Luxury Brands in The Russian Internet

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Luxury Brands in The Russian Internet

  1. 1. Luxury brands in the Russian Internet November 2013
  2. 2. This work licensed for subsequent use under the following terms: For more information on the terms of the license please visit: http://creativecommons.org/licenses/by-nc-nd/3.0/
  3. 3. About Hermes
  4. 4. Hermes NexTec – e-commerce projects development for clients: platform, logistics, payments, digital marketing, client support services, etc. • Hermes NexTec countries of operation: the EU, USA, China, Brazil, Russia. – Launching e-commerce projects for global brands in the Russian Internet. • The unique e-commerce experience of Otto Group & Hermes.
  5. 5. Summary • • • • • • • Quantitative and qualitative aspects of 11 luxury brands presence in the Russian Internet (Runet) are considered in this research. The audience interest in luxury brands was studied on the basis of the search engine traffic analysis, including the brand product categories analysis. Geographic & seasonal particularities of this interest is also described. Price positioning of luxury brands is analyzed. The most expensive and the most reasonable brands are defined. Luxury brands references in e-media are counted as well as the gross brands popularity on the news-websites. The international experience is also taken into consideration (traffic sources, audience characteristics etc.).
  6. 6. Search Traffic: Key Findings • • • • • • • • • Yandex controls 60% of the Runet search traffic. Google - 25%. The more popular brand is the more search queries of its name are in Russian (60-75%). 45% brand search traffic are related with perfume & cosmetics. The most popular luxury brands (excl. perfume): Chanel, Louis Vuitton, Dolce Gabbana. The most popular topics in brand search traffic: new collections (25%), accessories (19%), website (17%), apparel (16%), e-shop/buy (14%). Search interest in luxury apparel has been stagnating in 2011-2013. The pronounced seasonality is noticed: March – max., June – min. 68% brand search traffic come from Moscow and 11% - from St. Petersburg. Brand search queries per 1000 inhabitants index: Moscow (1.0), Khanty-Mansiysk (0.7), Yekaterinburg (0.5).
  7. 7. Social Networks: Key Findings • • • • • • • • • • Daily audience: Vkontakte (22.5 mln) vs. Facebook (3.8 mln). None of 10 luxury brands considered has an official Vkontakte (VK) community. During a half-year period the unique Odnoklassniki audience decreased by 33%, FB – 43%. Year-over-year Facebook lost 18% of total audience in Russia. VK users state the brand names as their interests in profiles relatively rare. The most popular brand in VK (by interest stated in profiles) is Prada (46 thous persons). Stating brand names in VK profiles has no gender particularities. Gucci and Chanel are the leading brand names in VK communities titles. The largest VK communities are dedicated to perfume, apparel and accessories e-shops. The most popular brand-related VK communities of e-shops are not mono-branded.
  8. 8. Brand’s E-Shops: Key Findings • • • • • Russia has the largest online population in Europe, but none of 10 luxury brands considered has its own e-shop in Russia. 75% of TOP-50 luxury brands have their own online shops in USA. Chanel and Dior have no online shops anywhere across the globe. 60% of 10 luxury brands sites considered have the Russian versions… …50% ship orders to Russia among them, all of them are powered by Yoox.
  9. 9. International Experience: Key Findings • • • • • • • • • • • 5 the most visited luxury brands sites accumulate 75% of traffic. Search traffic is the most significant source of visitors for luxury brands sites (37%). Luxury brands rely more on search engine traffic than the average apparel site. Luxury brands also rely slightly less on paid search. There is a considerable share of traffic coming from other shopping sites (33%) Social networks provide 8%. Only 2% brand search traffic are provided by comparison shopping sites. Shoes & handbags are the most popular products driving search clicks for brands. Apparel is a less popular category. Dresses and shirts are the most clicked-on clothing terms for luxury brands. Visitors of the luxury brand sites are very close to average by their age and income.
  10. 10. Pricing Policy: Key Findings • • • • • • Dior and Valentino are the most expensive brands. Roberto Cavalli and Dolce Gabbana have the widest price spread. Some pieces of clothing are worth much more (fashion shows, celebrities etc.). Max. price spread: dresses, blazers, coats. Min. price spread: plants, shirts. Max Mara is the most reasonable luxury brand among 10 brands considered.
  11. 11. 11 Brands
  12. 12. Search Engines Traffic
  13. 13. Yandex Search Market Share 2011-2013 Source: Citi Research, Liveinternet
  14. 14. Brand Thematic Search Queries Samples* Note: *Total amount of search queries per month is given in brackets
  15. 15. Brand Queries & Purchase Funnel Gucci guilty Song from Dior ad Devil wears Prada Chanel №5 Mascara Dior Non-thematic brand queries Song of Verka Sedjuchka Dolce Gabbana Awareness Dior site Interest Desire Max Mara fall winter 2014 Dolce Gabbana online shop Buy Roberto Cavalli Action Buy Chanel suit Thematic brand queries
  16. 16. Brand Search Interest in the Russian Transcription Share of brand names in Russian in a total amount of search queries, %, Autumn 2013, Russia Source: Yandex, Hermes NexTec Russia
  17. 17. Perfume & Cosmetics Share in Brand Queries Share of «perfume & cosmetics» in a total amount of brand search queries, %, Autumn 2013, Russia Source: Yandex, Hermes NexTec Russia
  18. 18. Brand Popularity Sum of thematic search queries, Autumn 2013, Russia Source: Yandex, Hermes NexTec Russia
  19. 19. Thematic Search Interest in Brands Thematic search interest segmentation, %, Autumn 2013, Russia Website Clothes Footwear Accessories New Collections Shop/Buy Prices Original Moscow Source: Hermes NexTec Russia, Yandex
  20. 20. Brand Apparel Interest Seasonality & Dynamics Seasonality comparison, %, 2011-2013, Russia (11 brands, September 2011 = 100%) 10 brands (a total amount of «clothes <brand name>» search queries Source: Yandex, Hermes NexTec Russia
  21. 21. Russia’s Cities Share in Brand Search Interest TOP-8 Russian cities share in a total amount of search queries, %, Autumn 2013, Russia Source: Yandex, Hermes NexTec Russia
  22. 22. Comparative Interest in Brands in Russia’s Cities Proportion Index: ∑ TOP-20 commercial brand queries divided by city population (∑queries/1000 inhabitants), Autumn 2013, Russia Source: Hermes NexTec Russia, Yandex, government statistics data
  23. 23. Social Networks
  24. 24. Social Networks: Russia’s Particularities Social network audience overlapping, mln users • • • • Daily audience VK vs. FB (August 2013), users VK is the leading social network in Russia (+22% visits YoY). VK accumulates the audience from other popular social networks. During a half-year period the unique Odnoklassniki audience decreased by 33%. Facebook unique audience decreased by 43% over the same period. Year-over-year Facebook lost 18% of its total audience in Russia. Source: TNS Web Index (Aug 2013), ComScore MMX (May 2013)
  25. 25. Brand Interest Stated in VK User Profiles • Stating brand names in VK profiles has no gender particularities. Source: VK, Hermes NexTec Russia
  26. 26. VK Brand-Related Communities Brand names used in VK communities titles, October 2013, Russia • • • None of 10 luxury brands considered has an official Vkontakte community. The largest brand-related VK communities are dedicated to perfume, apparel and accessories e-shops. The most popular brand-related VK communities of e-shops are not single-branded. Source: VK, Hermes NexTec Russia
  27. 27. E-Media
  28. 28. Brand References in the Internet News Media Total amount of references, October 2013, Russia Source: Yandex.News, Hermes NexTec Russia
  29. 29. Brand News Segmentation Thematic segmentation of brand references in the Internet news media , %, October 2013, Russia Brand news Celebrities dress Reference in context With other brands in row Perfume & cosmetics Non-brand Source: Yandex.News, Hermes NexTec Russia
  30. 30. Brands’ E-Shops in the Runet
  31. 31. Russia & the Internet at a Glance Source: Citi Research, GroupM, AKAR, McKinsey
  32. 32. E-Shops of 10 Brands  Dior  Chanel  Prada  Versace  Louis Vuitton  Max Mara  Valentino  Roberto Cavalli  Dolce Gabbana  Gucci 80% of 10 luxury brands considered have their own online shops outside Russia. 75% of TOP-50 luxury brands have their own online shops in USA Source: Hermes NexTec Russia (PMDidital, Hitwise Research).
  33. 33. The Russian Language Site Versions & E-Shops in Russia None of 10 luxury brands Dior Chanel Chanel Prada Versace Louis Vuitton Max Mara Valentino Roberto Cavalli Dolce Gabbana Gucci considered has its own online shop in Russia. Source: Hermes NexTec Russia
  34. 34. RU-Language Site Versions & Shipping to Russia  Dior  Chanel  Louis Vuitton  Valentino  Roberto Cavalli  Dolce Gabbana 60% of 10 luxury brands sites considered have the Russian versions  Prada  Versace  Max Mara  Gucci …50% ship orders to Russia among them, all of them are powered by Yoox.  Dior  Chanel  Louis Vuitton  Valentino  Roberto Cavalli  Dolce Gabbana Source: Hermes NexTec Russia Powered by Yoox
  35. 35. Brands’ Sites & E-Shops in Russia Brand World E-store E-store in Russia Website RU-ver. E-store RU-ver. Shipping to Russia                                                   Source: Hermes NexTec Russia Powered by Yoox Yoox Yoox -
  36. 36. International Experience
  37. 37. Brand Sites Traffic (USA) • 5 the most visited luxury brands sites accumulate 75% of traffic (TOP-50 luxury brands sites traffic = 100%) Source: PMDidital, Hitwise
  38. 38. Paid/Organic Search Engine Traffic • • Luxury brands rely more on search engine traffic than the average Apparel and Accessories site. At the same time, luxury brands also rely slightly less on paid search. Source: PMDidital, Hitwise
  39. 39. Cases: Search Engine Brand Traffic • LouisVuitton.com owns 50% share of “louis vuitton” search clicks. 0% is paid. • Hermes, Ralph Lauren, Gucci, Chanel own 50-80% of brand search clicks. 50-65% are paid.
  40. 40. Traffic Sources • • • Search engines account for the largest share of traffic to luxury sites, well more than one-third of all visits. Shopping sites (mainly online retailers) are next in line after search engines, referring one-third of visits to luxury brand sites. This is indicative of the tendency of online shoppers to visit many different stores. Most traffic from other stores can be classified one of three ways: general apparel, department store, or another luxury brand. Source: PMDidital, Hitwise
  41. 41. Site Visitors’ Age (Luxury Brand Sites) • Online luxury brands attract younger visitors than apparel and accessories sites in general. 44% of luxury visitors are 18-34. Source: PMDidital, Hitwise
  42. 42. Site Visitors’ Household Income (Luxury Brand Sites) • Average household income of visitors to online luxury brands looks a lot like that of the broader Apparel and Accessories category though the higher income visitors make purchases more often. Source: PMDidital, Hitwise
  43. 43. Search Interest in Brand Products • • • Shoes and handbags remain the most popular products driving search clicks for luxury brands, followed by sunglasses and watches. As “handbags” drive less than 1% of clicks to general apparel and accessories sites, this product occupies a uniquely central focus for luxury brands. Dresses and shirts are the most clicked-on clothing terms for luxury brands. Source: PMDidital, Hitwise
  44. 44. Pricing Policy
  45. 45. Pricing Policy by Brands & Pieces of Clothing Brand prices comparison, $ Source: Hermes NexTec Russia
  46. 46. Price Matrix ($) Category Category 1000 - High price colour Source: Hermes NexTec Russia 200 - Low price colour
  47. 47. Thank you! Contacts: Internet Marketing Manager Oleg Zhukov Oleg.Zhukov@hermes-europe.de Phone: +7 (495) 775-86-87 ext.1176 https://www.hermesworld.com

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