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Why mobile is an untapped opportunity for luxury brands

By
July 2, 2013

Peter Matthews is founder/CEO of Nucleus

Peter Matthews is founder/CEO of Nucleus

By Peter Matthews

Technology-inspired transformation is driving dramatic and rapid changes in consumer behavior amid the birth of the mobile era. No sector reflects this more acutely than brands targeting the luxury consumer.

Where, only a year ago, 80 percent of all Web site traffic to luxury sites was from laptop and desktop computers, this has shrunk to less than 65 percent today. By this time next year, the majority of Web site visitors will be using tablets and smartphones to browse and buy online.

What is more, the luxury consumers’ favorite devices – Apple’s iPhones and iPads – currently account for nearly 90 percent of all Web browsing.

Yes, Android “ships” more devices, but its users do not seem to browse the Web or indulge in mobile commerce the same way that Apple owners do.

This lower-usage may be down to inferior browsers and less than perfect Android usability, or maybe it is down to Android users using their phones as phones, for gaming and social media. This may change, but not anytime very soon.

Why is this important?

With Amazon selling $4 billion of goods to mobile users in 2012, and eBay claiming mobile commerce sales of $13 billion (forecasting $20 billion for 2013), the writing is on the wall for luxury brands whose audience is one of the most wedded to their smartphones.

These are just some of the startling facts that define the mobile era, observed through six waves of independent research conducted by us since summer 2011.

So what are luxury brands doing about this?
Not nearly enough.

All too often the mobile user experience does not meet brand expectations.

Few luxury brands deliver a compelling smartphone proposition. All too often, it is a negative experience.

Consumers want to browse, buy or book when it suits them, on whatever device is most convenient at that moment in time.

A bad brand experience – or even a slow brand experience – means that the customer’s need remains unfulfilled and defecting to a competitor is a likely result.

So luxury brands with poor mobile experiences are not only disappointing their own loyal customers. They are inadvertently directing them to their competitors. And they might even be paying for these clicks through their pay-per-click campaign.

There are opportunities galore for those prepared to invest now and make a viral mobile name for themselves and huge, avoidable risks for the laggards.

We have already seen massive shifts to mobile bookings in the world of luxury hotels – especially for city stays – where no hotel group can now afford to be without a smartphone-friendly Web site.

Smartphone-friendly does not just mean getting everyone to book or buy online.

A smartphone is still a phone, so any business that wants to drive calls can do so easily by hot-linking the number to a call center or reservations desk.

Google AdWords supports this with online call tracking, and the conversion rates are surprisingly high.

Being at the leading-edge of mobile creates competitive advantage, since it is a smaller battleground than ubiquitous PC PPC.

Being a phone also means the level of personal interaction is higher.

In a study commissioned by Nokia, smartphone users check their devices an average 150 times a day. Other studies point to extensive home use, while watching TV or in bed.

Already more local searches are made on mobile devices, where maps and phone numbers are key.

How to get in on the birth of the mobile era
So how do you go about creating a world-class, smartphone-friendly luxury Web site?

Well, that depends where you are today and whether your digital strategy is fit-for-purpose for the mobile era.

Creating a digital platform, conceived for a mobile-first world, is ultimately the way to go. This means you can bring your luxury brand to life using responsive design to ensure every device is served with the right templates and content, delivering an always-optimized brand experience to the user.

This takes planning, time and investment.

If your current Web site is OK for PCs, perhaps you can create an interim, separate, mobile site or add some responsive functionality to your existing site.

Either way, be prepared for a challenging world to design for where screen sizes vary hugely, formats swap with every tilt, images cropped for one screen size do not look good in another and proliferating operating systems and browser combinations create a tortuous testing challenge.

And that is all before we consider the prospect of connected TV and 60-inch high-definition screens.

THE MOBILE ERA brings with it many complexities, but mastering this new reality will determine the future success or failure of many brands.

To create an immersive brand experience, while managing risk requires – like everything in luxury – creative talent fused with experience, plus technical expertise, all coming together to create beautiful experiences that the consumer will adore.

Luxury brands were late for the world of ecommerce. There’s no excuse for being late for the arrival of the mobile era.

Peter Matthews is founder/CEO of Nucleus, Surrey, England. Reach him at pmatthews@nucleus.co.uk.

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