How Digital is Transforming Luxury: The New Affluent Consumers

Digital Transformation: Stories of Origin and Transition.
GE NESIS

Florine Eppe Beauloye, Editor in Chief
Welcome to the first issue of
the Luxe Digital Digest. This
publication is for you, the believ-
ers, game changers, leaders who
dare and care to think innovatively.
Luxe Digital is born from a vision:
providing a platform to inspire, empower
and drive positive change. A simple,
stylish yet substantial luxury media, Luxe
Digital redefines luxury for the modern
age.
At Luxe Digital, we made the conscious
decision to publish original content
that is both informed and opinionated.
Crafted by a team of professional copy-
writers, academics and luxury insiders,
Luxe Digital is a distilled collection of
fresh perspectives, reflective insights
and thought-provoking digital explora-
tions that have the power to shape the
future of businesses.
So what can you expect? Through our
sections, we deep dive into topics that
matter (reports), highlight digital and
luxury trends you should take notice
of (trending), share stories of inspiring
thought leaders (opinions), translate
digital jargon in plain English (speak-
easy) and showcase the best of the best
in various classifications (ranking).
Each issue explores a specific theme that
serves as the editorial focus.
In Issue One - Genesis, we compiled
stories of origin and transition. A digi-
tal-first outlook on luxury marketing.
Transforming luxury print magazines
for digital. Taking back control of the
customer acquisition in luxury hospi-
tality. The emergence of new luxury
hubs in China. The growing thirst for
conscious consumption in beauty and
fashion. Seeding thoughts on influencer
marketing, wealth management and
much more.
In February, we will put the spotlight on
the future of retail, blending the online
and offline experience.
In the spirit of community, our monthly
magazine cover will feature the work of
talented designers and artists from our
select creative circle.
…And this is only the beginning! The
beginning of an enriching and rewarding
journey of digital innovation and empow-
erment.
Thank you for connecting with Luxe
Digital.
Florine Eppe Beauloye
Editor in Chief
Letter from the Editor

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Contents
Artists, Trendsetters, and Entrepreneurs:
When Influencers Become Professional
Luxury Content Creators 6
Transforming Luxury Magazines for
Digital with Michael von Schlippe 8
How Luxury Skin Care Uses Digital to
Drive The Beauty Industry Growth 12
The Next Wave of Philanthropic Luxury
Retail 18
CRM at the Heart of the Luxury Retail
Evolution with Pontus Persson 20
The Debated Popularity of Influencer
Marketing for Luxury Brands 23
Redefining Luxury Affinity Marketing
with Irene Ho 29
Digital Transformation in Hospitality: A
Guide for Luxury Hotels 32
Luxury Brands Review their Strategy for
China’s Tier 2 and 3 Cities 38
A Digital-First Outlook on Luxury
Marketing with Simon Beauloye 44
What Wealth Managers Can Learn from
Luxury Digital Marketing for the High-
Net-Worth Millennials 47

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526
32
Contents
Storytelling and Showrooms: How
Generation Z is Transforming the Future
of Luxury Retail 52
6 Steps To Opening a Fine Dining
Restaurant: The Best Pre-Launch
Marketing Strategy 54
Florine Eppe Beauloye on Sitting in the
Digital Front Row of Luxury 61
Contact Luxe Digital 65
In Our Next Issue… 66
Endnotes 67

Luxe Digital 6
As Instagram has grown
exponentially the past
few years, now capturing
700 million active global us-
ers monthly, so has the pow-
er of digital luxury influencers.
Much of what has been written
about the influencer marketing
trend has been from the perspec-
tive of luxury brands and how to
establish effective partnerships
with influencers. However, for
luxury brands to truly under-
stand the potential of influencer
collaborations, it is worth taking
a look at the “profession” of
being an influencer and the
myriad of possibilities that they
are exploring. As you’ll soon
learn, influencers have become
quite the chameleons within
the world of luxury, embracing
diverse opportunities and roles,
as well as redefining the bound-
aries of traditional definitions of
influencer marketing.
Artist influencers
use luxury brands to
further their artistic
mission
At first glance, it’s easy to
mistake influencers as
the next “celebrity endorse-
ment” that can flaunt and
showcase luxury brands to
their online community. How-
ever, the digital influencer of
today has become the source
of original content creation,
and not just for the benefit of
the luxury brand. To explain,
many Instagram influencers
that are considered micro or
mid-tier influencers (follow-
ers of 10K to high six digits)
are established creatives in
their field of expertise. Lux-
ury brand partnerships for
these influencers are not
a source of income, but in-
stead, an outlet for artistic
expression and collaboration.
This is a trend that resonates
with many talented creative
entrepreneurs, like Pari Ehsan
(204K Instagram followers).
Founder and creative director
of Pari Dust, her mission (in her
words) is to “explore new ways
to combine the elements of our
visual world, offering windows
into contemporary art, fashion,
and the built environment
through [a] unique lens.” It would
be incredibly narrow to peg her
as an influencer in the traditional
sense, even though she has
worked in artistic collaborations
with luxury brands like Chanel.
Creative talents like Pari Ehsan
are blurring the line between
luxury brand influencer and
artist/designer.
From the perspective of creatives
that happen to be digital influ-
encers, luxury brands are not just
seen as business opportunities,
but rather a dynamic and unique
medium for artistic expression
and collaboration.
The possibility of being a
channel for creativity is an inter-
esting perspective to consider
for luxury brands, and provides a
bit of insight into the opportunity
Artists, Trendsetters, and Entrepreneurs: When Influencers Become
Professional Luxury Content Creators

Luxe Digital 7
that exists for genuine, artistical-
ly-driven collaborations.
Trendsetter influencers
break down the exclu-
sive world of high-end
fashion
The world of high-fash-
ion is an infamously ex-
clusive, members-only crowd.
However, recently, influencers
have broken down this daunt-
ing wall and been invited to
walk the runway themselves.
Fashion influencers haven’t had an
easy go at being accepted into the
world of luxury fashion. High-end
magazines have dished out their
fair share of criticism, labeling influ-
encers as “wannabes” desperate
for attention. Similar to the senti-
ments of Vogue’s creative digital
director, Sally Singer just last year,
digital influencers were decidedly
too plebeian for high fashion: “Note
to bloggers who change head-
to-toe paid-to-wear outfits every
hour: please stop. Find another
business. You are heralding the
death of style.”
The fact that the likes of Rebecca
Minkoff and Dolce Gabbana are
inviting fashion influencers onto
the catwalk speak volumes to the
transformation of the luxury fashion
industry and the clout that digital
fashion influencers carry nowa-
days. Influencers have evolved
from being seen as imitators and
outsiders of high-end fashion to
being at the source of inspiration
and trend-setting.
For high-end fashion brands to
remain relevant in the industry, it
is essential to carefully consider
strategic partnerships and poten-
tial ways in which to include digital
influencers as part of an overall
brand strategy.
Entrepreneur influenc-
ers launch their own
luxury brands
More and more Instagram
influencers are foregoing
potential luxury brand partner-
ships and instead, using their
captive audience to launch
their own luxury brands. When
it comes to top-tier influencers
who are in essence already a
“brand” in and of themselves,
this doesn’t come as much of
a surprise. However, many
mid-tier influencers like @innika
(71.3K follower) or @dazedbu-
tamazed (24.3K followers) are
using this opportunity to create
their own luxury brands as well.
Both Instagram influencers have
e-commerce driven brands that
command a luxury price-point.
Innika, a stylist and mom, started
her own fashion line, aptly called
Innika Choo, and sells hand-
sewn, embroidered linen frocks
at upwards of $450 USD per
garment. Jes (@dazedandamazed)
started her own curated collection
of custom woven, hand-dyed, flax
seed linen bedding for kids and
adults, with each set netting out
around $320 USD. For both Insta-
gram entrepreneurs, their social
media account was the primary
platform to drive sales, followed by
a brand website. Success has been
undeniable with quickly sold out
mini collections and features in the
likes of Elle magazine.
Not only are mid-tier influencers,
like Innika and Jes, entrepreneurs
utilizing their existing Instagram
fan-base to launch a luxury busi-
ness, but they are also a part of
a bigger re-definition of what
“luxury” means. The popularity of a
luxury fashion or lifestyle brand is
no longer purely based on estab-
lished brand names and a sense
of explicit opulence. Instead, the
luxury mindset seems to have
grown more inclusive of craftsman-
ship, detail, quality of materials,
and ethical production.
The autonomy that mid-tier influ-
encers currently have to create
their own brands based on their
aesthetics and passion is some-
thing that luxury brands need to
note. Collaborations are becoming
more sophisticated, with both
parties assessing each other’s
style and brand to determine if it
is a good fit. On the other hand,
if luxury brands can find budding
influencers with a similar ethos,
there is an opportunity to co-create
and perhaps even collaborate on
the launch of a passion project.
This would blur the lines between
influencer and brand even more,
as they become business partners
with a stake in brand sales.
The world of influencers is one of
possibility. And although it involves
navigating through a fair bit of grey
space, the potential alliance of
influencers and luxury brands can
prove to be fruitful for both parties.
Words by Tian Chang. Photography by Pari Dust.

Luxe Digital 8
Transforming Luxury
Magazines for Digi-
tal with Michael von
Schlippe
Michael von Schlippe is
one of those gentlemen
who look effortlessly elegant
and charismatic upon meet-
ing them. To say he is a true
living embodiment of its lux-
ury magazines’ values is an
understatement. Simon Beau-
loye sat down with Michael to
discuss how digital is trans-
forming the business of high-
end luxury media publishing.
Michael is the founder and
co-owner of Indochine Media
Ventures (IMV), a media company
that focuses on digital publishing,
luxury print publishing, and events
for high-net-worth individuals and
affluent Millennials across South-
east Asia.
IMV’s portfolio of brands includes
Robb Report, Esquire, Luxury
Guide, and Buro 24/7. The media
group also publishes Barcode, a
magazine for the young urban
readers in Ho Chi Minh, STAIL.my,
and My Pope.
Michael is originally from Munich,
Germany, but his career rapidly
led him to Moscow, Russia, to
work with renowned publishers
such as Gruner+Jahr, Condé Nast,
and Independent Media Sanoma
Magazines. Michael was in charge
of growing prestigious titles
including Vogue, GQ, Harper’s
Bazaar, Esquire, Robb Report,
National Geographic, GEO, and
Architectural Digest.
Michael has been based in Asia
since 2009 to establish and
successfully expand IMV across
the region. A few years later, IMV
is more than ever a key player in
Asia’s luxury media landscape.
Luxe Digital: Hello Michael, it’s
great to see you again. Thank you
for taking the time to discuss with
Luxe Digital.
Michael: Hi Simon, it’s good to see
you too!
Luxe Digital: I would like to start
our conversation by giving some
context to our readers about the
business of luxury publishing. Can
you please give us a general intro-
duction to what you do?
Michael: Well, I used to say that I
was in the business of publishing,
butthat’snothowIseeitnowadays.
We’ve now become storytellers.
When I started in luxury
publishing, only the editorial
aspect of the business focused
on storytelling. Today, the
marketing and sales teams
need to be able to incorporate
elements of storytelling in their
own approach if they want to
be successful. As a high-end
media company, we need to
communicate compelling and
exciting stories to both our
readers and our advertisers.
Our media sales team, in partic-
ular, has seen a dramatic shift
over the past few years. They
used to go to luxury adver-
tisers with their pitch deck to
negotiate the budget and ad
placements in our magazines.

Luxe Digital 9
But this doesn’t work anymore.
Digital and the growth of online
publishing has radically trans-
formed our operations.
Luxe Digital: How did the
digital transformation of luxury
publishing start and how did you
approach it to take advantage of
its opportunities?
Michael: For us, it really only
started in 2014. I vividly remember
the moment when our long-term
partners and luxury advertisers
told us that print media wasn’t
their priority anymore.
Digital obviously didn’t start all
of a sudden in 2014, but prior to
that year, luxury brands in Asia
were only mildly interested. Their
headquarters in Europe might have
started to leverage digital around
2010, but luxury advertisers in Asia
felt that traditional print media was
still the best investment to reach
their audience.
2014 was another story alto-
gether. Sales for high-end brands
fell sharply across the region, due
in part to a drop in tourism from
China. This had a significant impact
on how luxury advertisers decided
to allocate their budget.
My sales team told me at the end
of 2014 that most of our adver-
tisers were cutting budgets for
magazines. Luxury advertising
budgets were being cut across TV,
print, cinema, and outdoor for all
industries. The only area that was
seeing an increase was digital. The
increase in digital luxury adver-
tising budget did not equal the
reduction in print, but it was the
only media buying growth that we
saw.
Robb Report, our largest publi-
cation at the time, wasn’t ready
to provide a compelling digital
solution to our luxury advertisers,
so we decided to look somewhere
else for growth. We had a Robb
Report website for years running in
parallel to our print version of the
luxury magazine, but in retrospect,
we didn’t do enough to treat it as a
media in its own right.
I think it’s one of the original sins
of legacy publishers. Print was our
priority, and we would just repub-
lish most of the content online
as an afterthought. That model
not only didn’t work, but it also
damaged the confidence in heri-
tage publishers’ ability to generate
high traffic to their websites. As
a result, it undermined the luxury
advertisers’ trust in publishers to
understand the digital world and
to know how to engage their audi-
ence.
So we needed a digital-first media
that understood how to engage its
affluent readers online. We wanted
something more interactive, where
our readers could engage with our
content in a measurable way. I thus
started looking at adding a new
brand to our portfolio. That’s when
I stumbled up Buro 24/7.
Buro 24/7 was launched in 2011
by Miroslava Duma. Mira and I
used to work together in Moscow,
so I just picked up the phone and
offered her to expand the Buro
24/7 brand to Asia. That was in
December 2014. Two months later,
in February 2015, we had agreed
on the details of the Asian expan-
sion with IMV. By May of that year,
we had the Singapore version of
Buro 24/7 online with the Malay-
sian version coming up shortly
after.
Interestingly enough, I remember
talking to Richard Nilsson from
Lifestyle Asia at the time. His story
was the complete opposite to
ours. They started Lifestyle Asia
as a digital-only luxury publication
and initially struggled to find large
advertising budget from brands.
But towards 2014, they saw a real
turn around in advertisers budget
allocation to digital and their busi-
ness started to grow consistently
from there on.
“We are now able to
target ultra-high-net-
worth readers with
our print edition and
broaden our reach
online to a younger
affluent audience.”

Luxe Digital 10
Luxe Digital: So while the digital
transformation in luxury adver-
tising in Asia might have come
late, things moved very fast once
it started. How did things go from
there for IMV?
Michael: Absolutely! The shift to
digital was sudden and significant.
But we took the right decision by
launching Buro 24/7 in Asia and
the brand rapidly became well-
known among the younger Asian
affluents. The team now publishes
over 20 stories per day across
our Singapore publications alone.
We’re delighted to have engaged
and vocal followers on social media,
and traffic to the website continues
to be on an upward trajectory.
The acquisition also brought new
talents to our team and we were
rapidly able to apply the newly
acquired digital knowledge to
Robb Report. By the end of 2015,
we launched a completely rede-
signed version of the Robb Report
website to make a statement to
our readers and advertisers that
we were radically changing our
operating model online. We started
publishing exclusive digital content
and invested more resources
to understand who our readers
where.
What we saw over the following
months really surprised us. The
audience of the print version of
Robb Report has always had a
median age of 45 years and 85%
male (which is very high consid-
ering most male magazines have at
least 35% of female readers). The
online audience of Robb Report
however was a very different story.
Our online readers are 10 years
younger and almost 50% female.
“Digital opened up new
opportunities. We are
now able to work with
influencers and celebri-
ties on social media to
reach audiences that we
wouldn’t have been able
to connect with before.”
Luxe Digital: Were you concerned
about diluting the Robb Report’s
brand identity by broadening its
audience online?
Michael: Not really. We have defi-
nitely made our brand and content
available to an audience who is
more aspirational than the affluent
readers of the print edition, but
it follows a certain trend in the
broader luxury industry. All the
high-end luxury brands are now
talking about the Millennials and
Generation Z consumers. It’s a
natural evolution for us to follow as
well.
We are now able to target ultra-
high-net-worth readers with our
print edition and broaden our
reach online to a younger affluent
audience. It provides a compel-
ling solution to luxury advertisers
looking for a 360 integrated
marketing campaign.
This is also why the majority of the
content that we publish online now
is native and original. For example,
Robb Report features a digital
concierge section with a wealth
advisor and a wine selection
section that is exclusive to digital.
Luxe Digital: If you think more
holistically about the business,
how has digital influenced the
way luxury media companies
operate?
Michael: Digital is clearly opening
up new opportunities. We are now
able to work with influencers and
celebrities on social media to reach
audiences that we wouldn’t have
been able to connect with before.
With digital, we also have access
to more data to understand who
our readers are. We use Content
Insights, for example, to analyse
how our readers consume content
online, what works, and when. This
provides our editorial team with
invaluable information to decide
what to prioritise. Some of the
content that we used to write on
high-end mechanical watches, for
instance, have changed as a result.

Luxe Digital 11
We now focus on high-end watch
trends instead of the technical
aspects of the mechanical compli-
cation movements.
There is also a human component
to the digital transformation of our
business. Our operating cadence
used to be centered around a
monthly publishing timeline. With
the addition of the Buro 24/7 team,
we’re now publishing over 15
stories per day.
I’m delighted to see how well and
naturally the various teams have
come together. It’s very satisfying
to see knowledge being shared
from both sides of the spectrum to
help our publications improve.
Luxe Digital: Looking back, what
would you identify as the keys for
any business to make a successful
digital transformation?
Michael: I believe that the nature of
luxury is and will remain primarily
an offline, tactile experience. That
said, digital is a critical technical
component that all companies
need to get right. There is a high
level of expectations from affluent
consumers for the digital expe-
rience that luxury brands should
offer. Online experiences need to
be seamless and well-designed
with perfectly tuned features. You’ll
rapidly lose your audience if you
don’t get this right.

Luxe Digital 12
The Opportunity
• The high-end beauty and skin
care market is one of the fastest
growing luxury industry. Euro-
monitor International estimates
a 6% growth for the year, with
the premium skin care segment
outperforming its mass market
counterpart for a third year in
a row.
• Affluent consumers have an
appetite for skin care knowl-
edge and are receptive to
learning about and engaging
with luxury brands online.
• High-end skin care brands
have an opportunity to build
digital appeal and credibility by
tapping into global consumer
demand for entertaining and
educational content.
The Problem
• Beauty and skin care remain
industries that are driven by
fast-disappearing fads.
• Aside from uncovering robust
trends, the digital-driven
discovery of new skin care
products and the information
is borderless. This necessi-
tates that digital marketers be
attuned to the ebb and fall of
global trends, which makes
forecasting trickier than ever.
• Thewayluxuryskincarebrands
engage with consumers online
are changing as conscious
consumption and scientific
expertise become priorities.
• Power players like Unilever
have made moves into the
high-end skin care category
with the acquisition of boutique
brands, heralding an increas-
ingly competitive landscape.
The Solution
• Harness a multi-faceted
digital strategy that embraces
conscious luxury and natural
organic skin care by show-
casing transparency and
authenticity.
• Luxury skin care brands need
to build credibility amongst
well-informed consumers by
demonstrating unparalleled
expertise around the science
behind their products.
• Carefully vetted collaborations
with online beauty influencers
and luxury online retailers
become potential components
to a well-rounded global digital
strategy.
• Exercise a global mindset when
it comes to beauty trends and
potential audiences. Search
data is an invaluable resource
to determine specific, global
long-term trends in the luxury
skin care category.
How Luxury Skin Care Uses Digital to Drive The Beauty Industry
Growth

Luxe Digital 13
Skin care remains the key
revenue driver in the beauty
industry with global sales ex-
pected to exceed $130 billion
by 2019. The high-end beauty
and skin care category is grow-
ing; however, in order for luxury
skin care brands to capitalize on
the growing industry, marketers
need to keep abreast of robust,
global skin care trends as well as
changing consumer demands.
The following report identifies
longer-term sustaining skin care
growth drivers and their broader
implications, clarifies the fast-
changing relationship between
consumers and brands, as well
as illuminates the mindset and
approach digital marketers need to
adopt in order to gain ground in the
coming years.
Luxury skin care evolves
from an obligation to an
experience
The high-end beauty and
skin care industry is large-
ly driven by fast disappearing
fads. The ability to harness ris-
ing, robust trends and under-
stand the bigger implications
driving them is vital for brand
growth. Search data is a reliable
source of information that pro-
vides insight into healthy trends
by directly looking at consumer
interests and considerations.
That said, according to Think
With Google’s 2017 search
trends report, a noteworthy
shift in the category points to
the evolution of luxury skin care
from a fundamental obliga-
tion to a sensorial experience.1
Two of the specific trends driving
a more playful, experimental
approach to high-end skin care is
the growing prevalence of masks
and Korean skin care.
“Masks” is deemed by Think With
Google’s 2017 search trends report
as a “sustained riser” — a trend
that has seen steady growth over
the past years in the industry and is
considered a “safe bet”. According
to the report, masks have been
prominent in Japan over the past
year and has recently taken off in
both the U.S. and France.
Based on global search data,
“Korean skin care” has also seen
sustained, rising popularity glob-
ally. Elevating skin care from a
one-step obligation to a multi-sen-
sory experience, the tenets of
Korean approach involves an
arsenal of varying luxury skin care
products that comprise a 7 to 10
step regimen. Lauded by the beauty
industry as a game-changer, this
involved routine has helped trans-
form a previously underplayed
step into a thriving category that
consumers are willing to spend
time and money on.
As both Korean skin care and
masks make for online educa-
tional and entertaining content, it
comes as no surprise that beauty
influencers have embraced the
trend and consumers have become
avid viewers. With a proliferation
of social media how-tos on both
masks and Korean skin care, it’s
clear that digital and social activa-
tion has been integral in growing
this global phenomenon. Youtube
videos have gained traction,
particularly for Korean skin care
as influencers create longer-form
content demonstrating the steps of
this complicated routine and which
luxury products consumers can
use at each step. The video demos
— which emphasise not only the
steps but also the experimentation
and exploration of various prod-
ucts — have been met with much
success. For instance, digital
influencer Rachel Nguyen, whose
normal videos rack up views in the
low six digits, saw almost 1 million
views on a video dedicated to the
10 step routine.
Both robust trends point to a bigger
shift in the skin care category, and
as high-end skin care brands look
to acquire modern luxury
consumers, marketers need to
approach the category with a new
focus. There is a growing desire
amongst global consumers for skin
care to be an experience in and of
itself. Highlighting the sensorial
experience online and on key social
media platforms, like Instagram
and Youtube, should be a point of
focus for luxury skin care brands.
Skin care, and beauty for that
matter, has been predominantly
a “try before you buy” industry,
influencer marketing becomes
a desirable way for potential
consumers to explore and vicari-
ously test out skin care products
from the convenience of their

Luxe Digital 14
mobile phones. In parallel, affluent
consumers are also actively seeking
tutorials from trusted digital influ-
encers. Thus, engaging in influencer
collaborations to produce orig-
inal, entertaining content centred
around globally relevant trends
has become an essential strategy
for skin care digital marketing.
However, influencer marketing isn’t
without its pitfalls, and luxury skin
care marketers need to be cautious
about selecting the right partner-
ships that will build on existing
brand equity and not detract from
it. Read our deep dive into the pros
and cons of influencer marketing to
avoid pitfalls.
Conscious-consump-
tion luxury organic skin
care growth
More so than ever, consum-
ers are interested in, and
have access to digital resourc-
es, to become fully conscious of
the circumstances in which their
purchases are made. Conscious
consumption has not only im-
pacted fashion and food indus-
tries, but also the luxury skin
care category. Whether it’s from
a growing distrust of brands, a
heightened awareness regard-
ing the use of harmful chemicals
in skin care or an increased con-
cern with being environmentally
conscious, modern consumers
want to understand the ori-
gins, process, ingredients and
impact of the luxury skin care
products they’re investing in.
For luxury skin care, this desire has
manifested in the overwhelming
popularity of all-natural organic
products. In fact, a study by Nielson
reported that 46% of consumers
are willing to pay more for organic
skin care products.2
The luxury
organic and natural ingredients
beauty market has seen 24%
growth over a four-year period, and
is projected to reach $13.2 billion in
2018.3
Search data also supports
the industry’s robust performance.
According to the same Think With
Google trends report, “organic” is
trending as a skin care search term
globally and is expected to be a
“sustained riser”. The paragon of
natural skin care, “vegan” skin care,
has also seen 83% growth year
over year in the U.S and is starting
to rise in France.
Luxury skin care marketers need
to understand that this movement
towards “clean” skin care and
organic consumption necessi-
tates more than just vague claims.
Although all-natural ingredients
and organic beauty products
are specific trending elements of
luxury skin care, the overarching
theme is one around transparency
and substantiation. It is without a
doubt that the burden of proof falls
upon brands, and skin care brands
that are thriving are the ones that
embrace an unprecedented level of
transparency into the entire manu-
facturing process.
Perhaps that’s precisely why the
luxury skin care and beauty brand
Tata Harper has become a best-
seller on Sephora and a cult favorite
as deemed by the “Queen of Beauty
Bloggers,” Caroline Hirons and the
likes of popular beauty blogs such
as Into The Gloss.
Named after its founder, the luxury
brand produces, formulates and
manufactures products on Harp-
er’s 1,200-acre farm in Vermont.
Third-party certifications (cruel-
ty-free, all natural ingredients,
100% vegetarian, etc) are proudly
displayed on the brand website,
but Tata Harper goes the extra mile
to establish transparency. From its
Open Lab and Traceability Program
to introductions of each member of
the manufacturing team, the brand
aptly embraces the tagline “Next
Generation Beauty” and caters to
the level of conscious consumption
that modern consumers are looking
for.
In order to practice conscious
consumption, high-end organic
skin care brands need to take
the initiative to share more about
their practices, their process and
to prove that their stated purpose
is matched by reality. There are
undoubtedly benefits for luxury
organic skin care brands to adopt
the type of radical transparency
that connects consumers with the
production and manufacturing
process. Not only does it add

Luxe Digital 15
brand authenticity, but it could
also tangibly justify charging at a
premium.
Indeed, luxury organic skin care
seems to be going through a revo-
lution — one that is characterised
by transparency in labelling, clean
ingredients and an environmental-
ly-conscious ethos. With the power
of search behind them, consumers
have the desire and the means to
understand what goes into their
luxury skin care products. Expect-
edly, this has weighty implications
for organic skin care marketers and
asks for a cultivation of digital-led
transparency and substantiation.
Luxury skin care sci-
ence and expertise are
a must to appeal to the
digital skintellectuals
Not only are affluent con-
sumers educating them-
selves on the origins and pro-
cesses of all-natural skin care,
but those who prefer a sci-
ence-driven approach are ac-
tively searching online to find
out the exact science behind
their luxury skin care products.
From lactic-acid toners to reti-
noid treatments, luxury skin care
consumers are turning to trusted
online sources to make informed
choices, learn about the latest
science, and find products with key
active ingredients to target their
particular skin care concerns. As
hyper-educated consumers are
becoming the norm, experts in the
industry have coined an appro-
priate name to describe those
with a pseudo-academic pursuit
for scientific skin care knowledge:
“skintellectuals”.4
For these digital affluent shop-
pers, even packaging is a point of
scientific concern. For instance,
skintellectuals understand that
storing a volatile formula in a
jar rather than an airtight pump
exposes it to oxidation damage. It
is evident that affluent consumers
are raising the bar when it comes
to high-end skin care not only
in terms of conscious consump-
tion but also scientific innovation.
They’re demanding brands show-
case a new standard of expertise
and knowledge.
In response, digital-first skin care
brands like NIOD (a high-end line
from parent company Deciem)
have gone to great lengths to
establish scientific credibility. And
they do this by employing a multi-
pronged digital strategy. From an
information-rich brand website
to Instagram posts boasting of
beauty awards, NIOD practices a
no holds barred approach when it
comes to disclosing the “why” of
their products.
The company strives to live up
to its tagline, “Skincare for the
Hyper-Educated,” and perhaps the
most exhaustive deep dives are
showcased in the brand’s email
marketing efforts. For instance,
for the second-edition launch of a
popular serum, NIOD sent out an
introduction email to its subscribers
on the new formulation. This is the
opening paragraph:
Say a premature hello (launching
in late May) to MMHC2, the next
generation of NIOD’s best-selling
Multi-Molecular Hyaluronic
Complex. This updated edition
introduces two new forms of hyal-
uronic compounds, including a
first-ever use of direct hyaluronic
acid not in sodium salt form, for
a combined total of 15 forms of
hyaluronic compounds, hyal-
uronic precursors and a hyaluronic
support technology in a peptide-
charged delivery system.
Even more so, the conversation
with NIOD isn’t just one-sided. The
brand is open for dialogue and
encourages curious shoppers to
send any product or skin care ques-
tions to their team of “monkeys”
— a playful term NIOD uses to refer
to themselves.
According to a recent study, by
ATKearney on Beauty and E-com-
merce, consumers are seeking
more value-add from brands.5
A
reported 48% of users say that
the messages they receive from
high-end beauty brands are
generic. In this respect, brands
like NIOD are in the vanguard
of knowledge-driven content.
Speaking to online audiences as
a skin care expert and engaging
in an educational, informative
exchange establishes both authen-
ticity and credibility. Although
some may question whether this
may to be a case of information
overload, NIOD’s approach seems
to be working. Recently, The Estée
Lauder Cos. Inc. became a Deciem
(NIOD’s parent company) investor.6
There are several digital implica-
tions for luxury skin care brands.
First and foremost, consumers’
appetite for educational content is

Luxe Digital 16
voracious. Luxury skin care brands
based in science need to commu-
nicate their solutions effectively.
Consumers have become self-ed-
ucated skin care experts in their
own right, and high-end skin care
brands that feel they can charge
a premium price point without
demonstrating their own exper-
tise will not successfully reach this
discerning audience.
Even more so, the majority of skin
care education happens online.
There are clear opportunities to
participate in original content
creation, quality partnerships
and targeted digital activations.
Luxury skin care brands can also
approach digital strategy through
the lens of “online learning.” What
type of content, channels and
collaborations could provide inter-
ested consumers with a mini crash
course on the science behind the
product? Those that fail to engage
and establish credibility in the
digital sphere — through 360 acti-
vation of owned, earned and paid
channels — will struggle to gain
traction in the luxury playing field.
Affluent consumers who want
the latest innovation in skin care
solutions don’t just want to hear
about the end result, they need to
understand the science behind the
claims as well.
Luxury online skin care
retailers become ever
more important for in-
die brands
Trends aside, the luxury
skin care market is also ex-
periencing market shifts driven
by a few key acquisitions. One
of these companies is Unile-
ver, a company that historically
hasn’t been a strong player in
the luxury category. It formal-
ly entered the high-end skin
care market in 2015 with four
key acquisitions – REN, Kate
Somerville, Dermalogica and
Murad.7
This marks a point of
departure from the status quo,
as the prestige skin care cat-
egory has thus far been large-
ly dominated by indie brands
like Tata Harper and NIOD.
As long standing power players,
like Unilever, enter the luxury
market, they will have the existing
infrastructure to rapidly increase
synergy, reach, and credibility by
building a portfolio of high-end
skin care brands. In response, indie
brands should be prepared to face
increased competition. This outlook
on the luxury skin care market is
echoed by Carrie Melange, the VP
of marketing research firm Kline:
“In 2015, the trend towards
acquiring successful up-and-
coming, innovative brands
continues. some of the most
notable headlines in the beauty
industry in recent months are
about who is being acquired by
whom. More importantly, these
acquisitions feature a new gener-
ation of competition for the leading
companies — indie brands.”
For boutique luxury skin care
brands faced with increased
competition from companies with
extensive scale, partnerships with
high-end online retailers is one
way to strengthen both credibility
and reach. To explain, e-com-
merce is evolving in almost every
category, and the luxury skin care
industry is no exception to the
rule. As affluent consumers turn
their attention to trusted online
sources for self-education, shop-
ping online for prestige skin care
is also becoming more common-
place. Traditionally, high-end skin
care brands have been conser-
vative on distribution in an effort
to assert control over pricing and
brand image. However, in reaction
to evolving consumer behaviour,
many skin care brands have turned
to luxury online retailers who have
built a level of trust and credibility
amongst shoppers. Many digital-
ly-savvy high-end online retailers
have actively highlighted their
own vetting standards and pushed
“expert credibility” to the forefront
of their communications strategy.
For instance, Violet Grey adheres to
a high standard for their carefully
curated products. As explained on
their website, “The VIOLET CODE is
a testing process and set of stan-
dards by which our community of
top makeup artists, hair stylists,
estheticians, dermatologists, and
celebrity influencers distinguish the
finest beauty products in the world
from the tens of thousands on the
market. The result is a curation
that is truly the best in beauty from
those who know best. All products
approved by the VIOLET CODE.”
Cult Beauty is another example of
a dedicated high-end UK e-com-
merce site that appeals to luxury
skin care brands as a potential
distribution partner and affluent
consumers looking to shop online.
Alexia Inge, the founder of luxury
skin care retailer Cult Beauty, said

Luxe Digital 17
in a recent interview, “We always
have a full ingredients list for every
product on the site, even if we have
to manually copy it out from the side
of the bottle.” The thorough effort
to cater to affluent consumers’
demands makes high-end online
retailer partnerships beneficial for
luxury skin care brands.
The growing prevalence of pres-
tige skin care collaborations with
online retailers is more than just
a passing trend. According to
Anne Zybowski, vice president of
retail insights at Kantar Retail, it’s
luxury that’s driving digital sales
in the drug and beauty industry.
“Luxury, in general, has been a big
piece that has led in terms of online
growth, particularly when you start
talking about upscale skin care and
cosmetics.” Fueled by changing
consumer behaviour, the relation-
ship between luxury brands and
e-commerce continues to evolve.
As competition heats up with power
players entering the luxury skin
care category, digital marketers
should carefully consider symbiotic
relationships with high-end online
distributors that enhance the
brand’s credibility and reach.
The globalisation of
luxury skin care
The prevalence for consumers to
discover skin care brands online
coupled with the rising popularity
of global shipping for luxury online
retailers enable trends to rapidly
cross borders and become interna-
tional phenomenon.
Think With Google’s skin care
report for 2017 not only high-
lighted specific search trends to
take note of, but it also acutely
pointed out the influence and
transfer of trends across countries.
For instance, masks and Korean
skin care, discussed at the onset
of this report, were country-spe-
cific trends that caught on with
the rest of the world. Interestingly,
both trends originated in Asia and
elucidate the potential for Asian
trends to take hold in Western
markets. In this respect, digital
media, especially social media, has
truly flattened the world when it
comes to the beauty and skin care
industry.
In order to stay ahead of the curve,
digital marketers need to have
global awareness and a border-
less approach to forecasting. This
is especially true for luxury brands
vying for the attention of Millennials
who lean towards a more multicul-
tural and multinational approach
to beauty and skin care. As Karen
Grant, global beauty industry
analyst for The NDP Group points
out, “The impact of the Internet has
further changed the way brands
engage with and reach consumers.
In this environment, major brands
are looking… to resonate with
younger consumers, who are not
only fresh to the market, but more
multinational and multicultural.8
”
As discussed previously, in order
to discern fading fads from robust
trends, search data is a reliable tool
to keep abreast of sustained, rising
global trends.
Besides global beauty trends,
luxury digital marketers should
also be aware of global audiences.
Under the right context, boutique
high-end skin care brands have the
potential to capture international
appeal and global sales. If aligned
with overall business growth objec-
tives, luxury marketers should not
only be attuned to global trends,
but also consider if and how they
should leverage digital and content
strategy to capture relevant
international audiences.
The way luxury skin care brands
engage with customers has
evolved beyond just skin deep. As
skin care becomes an almost-ac-
ademic pursuit for many affluent
consumers, brands must rise to
the occasion. The key drivers for
global consumers revolve around
sensorial experience, conscious
consumption and a growing thirst
for skin care science. Luxury skin
care marketers will need to engage
in a comprehensive digital and
content strategy that showcase
not only transparency, but also
authentic, infallible expertise
around their product.
From a market standpoint,
increased competition from the
likes of Unilever creates opportuni-
ties for indie brands to collaborate
with luxury online retailers in order
to increase credibility and distri-
bution. Looking at advantageous
alliances, understanding global
trends and their broader impli-
cations along with a borderless
mindset are needed guardrails to
position luxury skin care brands for
success in the future.
Words by Tian Chang. Photography by Candice
Lake.

Luxe Digital 18
Millennials and digital.
These two words have a
host of implications and mean-
ings for luxury brands today.
However, perhaps the most
humanitarian of those impli-
cations is the rise of success-
ful philanthropic high-end and
avant-garde e-commerce.
Millennials are the next power
purchasers. According to Forbes,
those between the ages of 17 and
34 collectively are expected to
spend more than $200 billion annu-
ally in 2018 and $10 trillion in their
lifetimes. They are also a different
type of high-end consumer that
care about authenticity and are
seeking to engage with high-end
brands that align with not only
their aesthetics but also with their
values. Research has shown, for
example, that 87% of Americans
will purchase a product because
a company advocated for an issue
they cared about.
Being socially and environmentally
responsible is a core brand purpose
built into many new philanthropic
luxury e-commerce retailers today.
One such retailer is Olivela. The
brand sells new luxury products
from high-end fashion brands that
have opted for this opportunity to
give back. Salvatore Ferragamo,
Valentino, Marc Jacobs, Dolce
Gabbana, and Jimmy Choo are
amongst their providers. The best
part is that in partnering with the
GOOD+ Foundation, Malala Fund,
VH1 Save the Music, and Too
Young To Wed, Olivela donates a
portion of the proceeds to causes
that matter and families in need. To
communicate the tangible impact
of a purchase made, the retailer
equates the sale of an item to
an actual benefit. Deemed “The
Olivela Effect”, potential customers
will see, for instance, that buying
one Salvatore Ferragamo bag
will provide 26 days of children’s
essentials for families in the U.S.
Founder and philanthropist Stacy
Boyd met with each of the poten-
tial luxury brands to see how they
could potentially partner and work
together.
MAAARI is a recently-founded
boutique luxury brand based in
the U.S. that sees social respon-
sibility driving its business model.
Founded by 3 American women in
honour of their mothers who were
born and raised in the Philippines,
MAAARI solely partners with local
Filipino artisans and designers
in order to create a meaningful
marketplace around modernising
age-old artistry. The unique nature
of leveraging digital platforms to
showcase a traditional way of
life is especially poignant here.
The website provides a realistic
The Next Wave of Philanthropic Luxury Retail

Luxe Digital 19
glimpse of the lives of the makers,
delves into the heritage behind
each product made, and tells of
inspired collaborations and tradi-
tions. From handcrafted textiles,
jewellery and homewares, the
philanthropic high-end boutique
brings a sense of deep-rooted
heritage and embraces luxury in its
most meaningful form of reimag-
ined, modern artisanal design and
quality craftsmanship.
Considered a veteran amongst our
list, online retailer Reformation, a
certified B Corp, is a luxury boutique
clothing brand that is making
sustainability fashionable. Created
in 2008 by Yael Aflalo, Reformation
creates limited-edition collections
made from sustainable fabrics,
vintage garments and incorporates
“better practices” in their supply
chain in an effort to reduce the envi-
ronmental impact of fashion. The
Reformation website has detailed
information on the impact of their
garments and an overview of the
harmful environmental practices
that fuel the fashion industry. With
#jointhereformation as their official
hashtag, the brand communicates
a distinct environmentally-con-
scious ethos that aligns with the
values of many modern women
today. According to the LA Times,
Reformation raised $12 million
in a single venture capital round
since its launch, earned over $25
million in revenues in 2014 and
was expected to double or triple
that number in 2015. Its brand
devotees include Taylor Swift,
Karlie Kloss, Rihanna, Sophia Bush,
Lauren Bush and Rosie Hunting-
ton-Whiteley.
With Millennial consumers looking
to identify and connect with a
luxury brand’s values, there is a
rising trend of philanthropic luxury
retail. Large high-end companies
take notice. In the historically exclu-
sive, aesthetically-driven world of
fashion, more and more luxury and
boutique brands are beginning to
seek opportunities to make a real-
world impact whether it be socially
or environmentally.
Words by Tian Chang.

Luxe Digital 20
CRM at the Heart
of the Luxury Retail
Evolution with Pontus
Persson
Leaders who rise through
the ranks to reach a de-
cision-making position are
oftentimes the most effec-
tive. This is certainly the
case with Pontus Persson.
Pontus was born in Sweden and
moved to France with his parents
at the age of 3. After a Bachelor’s
degree in International Business
Management, Pontus pursued
his Master’s degree in Sydney,
Australia. This is also where his
professional career started as he
became a part-time store assistant
in retail while finishing his degree.
Those first steps took him from
Sydney to Singapore and now
Dubai, with Ralph Lauren and
Bulgari. In his current role, Pontus
is leading the development and
implementation of Bulgari’s CRM
activities across the Middle East.
His responsibilities are at the heart
of the luxury retail industry’s digital
transformation. Simon Beauloye
sat down with Pontus Persson for
a fascinating conversation on the
evolution of luxury retail and the
critical role that customer data
management plays in it.
Luxe Digital: Hi Pontus, great
talking to you again. Thank you
for taking the time to share your
views on the luxury retail’s digital
transformation with Luxe Digital.
Pontus: It’s great to talk to you too,
Simon. Thank you for the opportu-
nity.
Luxe Digital: Let’s start with your
journey over the past few years.
Your career has taken you from
Ralph Lauren in Sydney to Ralph
Lauren in Singapore and now
Bulgari in Dubai. Can you tell us
more about how your role has
changed over that period?
Pontus: My career really started on
the sales-front of retail, for almost 5
years with Ralph Lauren in Sydney
and Singapore. Sales was my main
role and “raison d’être”. My interest
from the start has always been
about the people – both my clients
and coworkers – and the relation-
ship we had with each others.
In early 2014, my responsibilities at
Ralph Lauren started to shift a little
from pure retail sales to include
client relationship management.
While maintaining a strong bond
with the boutiques and the sales
team, I started to focus on the
development and nurturing of our
special clients and the teams who
liaised with them.
Ralph Lauren had four luxury
boutiques in Southeast Asia, and I
was responsible for building a rela-
tionship with our VIP clients. Those
clients could be regular clients
or one-time large spenders. As a
result, I had to coach the various
retail sales team on the ground,
manage special VIP events, gifting
for special occasions, and more
broadly relationship building.
That’s when my interest in lever-
aging Customer Relationship
Management processes and soft-
wares (CRM) really started.
I could see at the time the impor-
tance of having a strong knowledge
and understanding of our clients
and the importance of catering to
our clients’ needs in a personalised
way. Shortly thereafter, a CRM
Specialist role was created with
Ralph Lauren in Singapore and I
fully transitioned from retail oper-
ations to a CRM role based in our
regional headquarters.
Luxe Digital: How do you define
CRM for luxury retail and what
role does it play in VIP clients
relationships.
Pontus: A CRM is first and fore-
most a tool for companies to gather
information about their customers
in order to understand their clients
better and, ultimately, to cater to
those clients in a more personalised
way – and of course to generate
revenue.
With the change in today’s luxury
landscape, especially in the clients’

Luxe Digital 21
behaviours, I believe CRM has
become a crucial tool which should
be used and applied at all levels of
a retail company: from sales floor
to top management.
When I took on that role with Ralph
Lauren in Asia Pacific, the broader
luxury industry realised that our
clients were evolving. Luxury
customers were traveling more.
They had more options to compare
and more information to learn
about a product before making a
purchase. The luxury industry had
to adapt and personalise its inter-
actions in order to stay relevant
and top-of-mind.
That is exactly, in my opinion, why
a proper CRM is so critical for every
luxury brand today.
Luxe Digital: What role did digital
play in your decision to focus on
CRM for retail and how does it
impact your marketing outreach?
Pontus: Digital tools are crucial to
stay up-to-speed with the current
world. However, I must say, the
retail industry has never really
been at the forefront of the digital
transformation, and the luxury
industry within the retail industry,
even less so. But we are catching
up and adapting faster than I origi-
nally thought we would.
Digital is an enabler that increases
efficiency of CRM platform for
high end retail. A luxury marketer
can’t focus solely on digital tools
however. While some of today’s
digital systems allow for a
two-way communication with the
end consumer, most of them allow
mostly a one-way outreach. While
this two-way communication may
be more personal and relevant for
the customer, it isn’t enough for a
luxury brand to rely on.
Relationship is the most important
aspect of a proper CRM. And no
healthy relationship is a one-way
affair. Only a human interaction
can provide the necessary interac-
tion and emotional connection with
clients that luxury brands require.
Digital tools and CRM systems are
thus essential, but they remain
merely tools. Humans using these
tools need to remain in front of their
customers to build lasting relation-
ships.
Luxe Digital: What are some of the
most significant challenges that
you’re facing when implementing
CRM systems to transform Ralph
Lauren and Bulgari?
Pontus: “Transform” is a strong
word. “Evolve” is more appropriate.
Change has always been a chal-
lenge for any human being. Digital
tools, including CRM, represent
that change for most people in the
luxury retail industry.
The implementation of the CRM
platforms at Ralph Lauren in Asia
represented an important change
for a lot of people. First and fore-
most the management had to
understand the importance of CRM
and the benefits that the company
could gain from it. Ultimately,
implementing a CRM represents an
extra step and a little extra work
from the retail sales teams. Without
their participation, no data or infor-
mation could be collected. This
highlights again how critical the
human factor is. The same remains
relevant today in my current role
with Bulgari.
Because of my previous experi-
ence as a sales person myself, I
am uniquely positioned to explain
the importance of the extra work
required by a CRM system to a
retail team, in a language that
makes sense to them. Being able
to rapidly show the outcome of
their work, with repurchase rates
and revenue increases, is also key
to secure quick buy-ins from the
teams.
Luxe Digital: Looking back, what
do you identify as being the most
important lesson or learning

Luxe Digital 22
opportunity for luxury brands
attempting a retail evolution with
a CRM system?
Pontus: Adaptation has been by
far, the biggest lesson for me, and
still is today one of the greatest
opportunities with a significant
potential.
When moving from a boutique-
based role to an office-based
role, I had to adapt my approach
towards my previous boutique
colleagues. When liaising with
teams from Singapore, Malaysia,
Thailand or Vietnam, I had to adapt
my approach and delivery in front
of them. Most importantly, when
moving from Singapore, Southeast
Asia, to Dubai, Middle East, need-
less to say, I had to adapt a lot of
things.
All this while staying relevant and
up-to-date with all the new tech-
nologies and the different ways
each region uses those technolo-
gies.
Adaptation, on a larger human
scale, is a very important factor,
especially in today’s extremely
fast-moving world.
Luxe Digital: How do you envision
the future of the luxury industry?
What part will digital play in
creating a luxury experience?
Pontus: I am of the opinion that
brick-and-mortar retail will never
disappear, and should not disap-
pear. If you take away the boutiques
from the luxury retail equation you
remove one of the most important
aspects of a luxury experience, and
that is the human.
I believe that an experience is
stronger when it’s shared with
someone. This is just as true for a
luxury experience. You could walk
in the most luxurious boutique in
the world with the most high-end
products there is, if the service is
bad, your experience is bad. Full
stop!
Digital tools, remain tools, and
should be treated as such. Granted,
they bring the brands closer to the
clients. Granted they allow us to
know more and understand our
clients. And granted they allow
to personalise our campaigns to
target specific clients. But they
cannot replace the human factor.
I find this to be particularly true in
the high-end world of luxury that
Bulgari and other jewelers repre-
sent. For example, a client would
never buy a million-dollar set
online. Yes, she or he could have
its interest awaken after seeing it
online and take the final purchase
decision in a retail boutique. But
if that boutique experience with
the retail team is negative, the
customer will not buy the product.
To invest in our people is the key for
any company. And to stay digitally
relevant in today’s world, is also the
key for any company. However, one
does not rule out the other – they
should be working hand-in-hand.

Luxe Digital 23
The Opportunity
• Social media influencers can
provide luxury brands with
an authentic and engaging
story for their high-net-worth
consumers, compensating the
decline of traditional digital
advertising channels.
• Influencers can take care of
the content production and
distribution, leveraging their
significant online following
base to drive reach.
The Problem
• Influencer-led or co-created
content requires luxury brands
to loosen up their creative
control.
• Although promising, influencer
high-end marketing is a grey
market with many pitfalls.
Selecting the right type of part-
nerships, avoiding inflated user
base and engagement rates,
and measuring a meaningful
ROI remain problematic.
The Solution
• Identify the right mid-tier or
even micro influencers who
can create authentic content
for your luxury brand.
• Ensure alignment internally,
with clear objectives and KPIs,
before engaging with an influ-
encer.
• Set up a strategic framework
that will enable your luxury
brand team to think holistically
about your marketing strategy.
An influencer campaign
needs to be part of a broader
approach, where each channel
can supplement and amplify
each other.
The Debated Popularity of Influencer Marketing for Luxury Brands
Initially considered just an
experimental advertising
channel, especially for high-
end and luxury brands, influ-
encer marketing is now worth
$1 billion dollars annually and
is the fastest growing form
of digital advertising. 84% of
brands will integrate an ele-
ment of influencer marketing
as part of their plans this year.9
In this report, we will explore
the current state of influencer
marketing, the opportunities for
luxury brands to leverage influ-
encers’ authenticity and create
unique content, as well as the
potential pitfalls that surround
choosing the right influencers.
We’ll also discuss the challenges
of measuring the true ROI of influ-
encers campaigns and the various
KPIs that luxury brands should pay
attention to.

Luxe Digital 24
The State of Influencer
Marketing For Luxury
Brands in 2018
Luxury brands have histori-
callyapproachedsocialme-
dia with caution. At first glance,
it seems counter-intuitive for a
brand built around exclusivity
to invest in platforms that are
all about accessibility. However,
times are changing. Consumers
have never been as sceptical
towards advertising as they are
today. Luxury is no longer about
shrouding the brand in mys-
tery, but more about authen-
ticity, quality, and personality.10
Where fashion editorials and
high-end magazines used to domi-
nate and drive consumer opinion,
the new voice of truth comes from
digital influencers. A recent study
shows that 92% of consumers trust
an influencer’s opinion more than
an advertisement or traditional
celebrity endorsement.11
Even
more so, technology has kept up
with consumer sentiment, and with
the advent of ad blocking technol-
ogies, consumers no longer have to
accept intrusive digital advertise-
ments as a fact of life.
Social media influencers offer an
engaged online audience. They
can lend luxury brands a voice of
authenticity and have the potential
to produce original brand materials.
In many ways, influencer marketing
addresses several challenges
that luxury brands are now facing
online. Current trends seem to
reflect this positive sentiment, with
73% of global high-end brands
engaging in influencer marketing in
2017.12
However, adoption of influencer
marketing as a part of a luxury
brand’s overall digital strategy has
been relatively slow compared
to non-luxury brands. Out of 300
luxury brands polled, half say that
they have only been active in influ-
encer marketing for a year or less.
And 59% of those same luxury
brands spend less than 10% of
their total digital marketing budget
on influencers.
The continued hesitancy of luxury
marketers to invest in influencer
marketing comes as no surprise as
the influencer marketing industry
is anything but clear-cut.
Research And Vetting
Of Digital Influencers
Is Crucial For Luxury
Brands
The budget needed to en-
gage with influencers is
often a grey area that can vary
drastically from one influencer
to another, and luxury brands
are often at the risk of over-
paying. A thorough look at the
influencer’s background and
fit is the first step to ensur-
ing a successful partnership.
The influencer marketing industry
has reached a state of maturity
now, with a handful of influencers
enjoying millions of followings.
Top-tier Instagram celebrities —
those who have accumulated over
one million of followers — can
charge more than $5,000 USD per
post.
While the number of followers is
still an important factor to consider
for luxury brands, reach should
not be the deciding factor. In
fact, high-profile influencers with
immense reach not only tend to
have inflated rates, but many have
worked with too many conflicting
brands to still be seen as truly
authentic to their audience.
Furthermore, according to the New
York Times, marketers should be
particularly cautious about judging
an influencer by the number of
followers.13
The demand for influ-
encer marketing has spurred
the proliferation of bot-enabled
marketing tools that help gain
followers and likes for Instagram
users. It’s a tactic that, in essence,
cheats the game and helps create
the illusion of a sizeable online
community in order to attract
potential marketers. Artificial likes,

Luxe Digital 25
the purchasing of followers and
even the creation of fake accounts
make approaching influencers
purely based on the size of their
community a risky game at best.
As a result, influencer marketing
experts at mOOnshot digital
recommend their luxury clients to
work with mid-tier influencer —
followers in the 6 digits — over
top-tier influencers. Mid-tier influ-
encers are more dedicated to their
community, passionate about
what they do and offer a high
level of perceived authenticity to
consumers. Engaging ten influ-
encers with a combined reach of
1,000,000 followers rather than
only one influencer with 1,000,000
followers will result in more trac-
tion, engagement, conversions,
clicks and a more authentic narra-
tive.14
Whether luxury brands engage
with top-tier or mid-tier influencers,
it is critical to thoroughly vet poten-
tial partnerships and consider the
following:
• Is the influencer aligned with
your brand positioning?
• Does the influencer have the
right demographic of followers
that are potential customers for
your brand?
• Has the the influencer worked
with competitors in the past?
Is the content produced by the
influencer a match for your brand
in terms of visual and tonal quality?
Last, consider how the partnership
with the digital influencer fits into
an overall strategy, as it should
not be treated as a one-off collab-
oration and should amplify other
channels in the marketing mix.
A fatal mistake for luxury marketers
would be to forego the necessary
research and instead, reach for a
top-tier Instagram celebrity that
is in conflict with the ethos and
narrative of the brand itself.
Influencer-Led Content
Creation, The Next Step
For High-End Brands?
While luxury brands are
used to producing
branded content featuring ce-
lebrities that showcase their
product, influencer marketing
leans much more towards influ-
encer-led content creation and
distribution. In fact, one of the
main benefits of working with
influencers is having quality and
originalcontentasabrandasset.
Many luxury brands still feel uneasy
and cite that one of their main strug-
gles with influencer partnerships
is controlling the narrative. Luxury
marketers need to remember that
influencers are influential because
of their perceived authenticity.
And collaborations will involve
creating content that is inspired
by the influencer’s look and feel.
Consequently, loosening the reins
on creative freedom makes picking
the right influencers to work with
all the more vital.
When the partnership is carefully
selected, granting a degree of
artistic license to the influencer has
resulted in a positive experience for
luxury brands: For those that have
explored content collaborations,
73% say that influencer produced
content is “effective” or “highly
effective” for their brand.
More sophisticated luxury brands
are even exploring collaborations
with micro influencers (10,000 to
low six digit followers). The appeal
of micro-influencers is that they are
artists and creators themselves
who have carved out a specific
niche — whether it be in art, music,
fashion or beauty — and often
have access to sub-segments that
are less obvious. A partnership
between a budding influencer
with access to a niche audience
and a luxury brand with a distinct
and unique sense of style has the
potential to result in extremely
fruitful collaborations and highly
original content. When an influ-
encer and a luxury brand can
grow together and form a trusting
relationship, oftentimes, there is no
payment transaction involved.

Luxe Digital 26
For instance,
Influencer Pari Ehsan (204K
followers) has a long-term relation-
ship with Chanel, one in which no
payment is involved. She explains:
“When the Chanel couture collec-
tion comes to New York during
Fashion Week for press preview,
I’ve established a relationship with
them and they allow me to concep-
tualise a creative shoot around the
couture pieces of that season. The
relationship came about through
meeting with them initially, working
with them once, showing them my
level of creation, and from that
point, it’s been an ongoing thing
that we do together.”
Luxury brands should think about
how brand assets generated from
the collaboration can be re-pur-
posed for other channels and
marketing efforts. If brands allow
(carefully chosen) influencers
creative freedom, the authenticity
of their work will be beneficial in
elevating brand authenticity and
should be distributed strategically
amongst all relevant brand chan-
nels.
Collaborating with an influencer
should be seen as an invest-
ment in quality content. As luxury
marketers can no longer depend
on “exclusivity” to communicate
luxury, execution and originality
will be vital in retaining a sense of
prestige. The more trusting rela-
tionships that luxury brands can
build with creatively-driven influ-
encers, the better the chances are
for truly original content.
How Luxury Brands
Should Determine The
ROI of Influencer Mar-
keting
Perhaps the biggest strug-
gle for luxury brands has
been determining the return on
investment (ROI) of influencer
marketing campaigns. This is
becoming particularly critical as
marketers look to increase their
budgets for luxury influencer
campaigns in the year to come.
Industry experts are the first to
admit that there is currently no
clear-cut way to measure the ROI
of an influencer campaign. The
metrics that are being used are
what marketers consider as “soft”
ROI, standard social and online
measurements such as growth of
a platform, web traffic generated,
and content shares. These data
points are limiting when it comes
to determining the actual impact
of a particular influencer or proving
revenue-based return.
Jimmy Choo’s influencer
marketing ROI
Jimmy Choo can attest to the
tricky nature of determining the
ROI of influencer marketing: The
luxury footwear brand is known
for investing heavily in influencer
trips. This year, the brand took
seven top-tier influencers with a
combined global reach of 6.5 million
to India. However, when it comes to
the ROI, things are foggy, at best.
As Vogue reports, “a representa-
tive there says these trips are an
important part of the brand’s social
media strategy, with the objective
of creating aspirational and unique
content for Jimmy Choo’s audience,
but regrettably there is nothing
solid to prove a link between this
kind of marketing and consumer
sales, although they think there is a
correlation.”15
From a different perspective, the
true value of influencer marketing
lies in priorities that are inherently
not conducive to hard metrics such
as building a strong brand narra-
tive, creating high-quality content,
and generating aspiration.
As the influencer marketing
industry continues to grow, so will
the ability to measure its ROI in
more concrete terms. At this point
of the game, it is up to the luxury
marketers to assess what the
brand’s strategic priorities are and
if the more intangible benefits of
influencer marketing is enough to
overcome a weak link to the actual
ROI.

Luxe Digital 27
Luxury Brands To Prior-
itise Instagram For In-
fluencer Marketing
For luxury brands that
have decided to dive into
the world of influencer mar-
keting, measurable ROI or
not, Instagram is the cho-
sen platform for engagement.
Within the the world of luxury,
Instagram is by far the dominant
channel. A report on New York
Fashion week found that out of the
13 million total interactions that
occurred on social media during
NYFW fall 2016, an overwhelming
97% of them took place on Insta-
gram with only 2% on Facebook
and 1% on Twitter.
Chanel’s #newchanel5
campaign
Luxury brands are taking advan-
tage of this powerful marriage
between influencers and Insta-
gram. To illustrate, fashion house
Chanel leveraged this trend for
the launch of its new No. 5 L’Eau
perfume. The luxury brand invited
high profile guests and carefully
selected influencers to the South of
France to visit its production facility.
The chosen mix of top and mid-tier
influencers documented their
journey and used two brand-cre-
ated hashtags, #newchanel5
and #chanelgrasse, to aggregate
content during the trip. This exclu-
sive (and yet accessible) behind the
scenes look garnered high engage-
ment on Instagram. Creating a
social media ripple effect, the
influencers’ followers were in turn
inspired to create their own content
around the new perfume. The
branded hashtag, #newchanel5,
resulted in over 1,600 pieces of
influencer and user-generated
content. The two hashtags in total
received almost one million likes in
the first month of the campaign.
Again, social media metrics are
not traditionally defining markers
of the actual impact or ROI that
campaigns have. However, within
the measurement limitations of
influencer marketing, this Insta-
gram-fueled collaboration is
deemed as a successful one in
terms of generating engagement
and awareness.
Influencer Marketing on
Instagram Projected to
Grow to 2.38 Billion By
2019
Influencer marketing isn’t going
anywhere but up. The opportunity
is immense for luxury brands to
find an authentic way to reach new
global audiences. With anticipated
increased budgets in influencer
marketing, luxury brands need
to remember that high-quality
content is the main factor to
consider, not necessarily reach.
The key to retaining prestige and a
sense of luxury within the context
of social media will depend on the
ability of luxury brands to select
the right mix of partnerships in
order to create new, intriguing and
authentic content.
Words by Tian Chang. Photography by Candice
Lake.

Luxe Digital 29
Redefining Luxury
Affinity Marketing
with Irene Ho
Irene Ho is not your typical
luxury professionals. A char-
teredcertifiedaccountantturned
business connector of luxury
brands and high-net-worth in-
dividuals, Irene is as comfort-
able juggling numbers as she
is socialising at luxury events.
Irene launched the Singapore’s
chapter of The Luxury Network
in 2013 and has since grown
her affinity marketing network to
almost 60 premium and luxury
brands. Some of her members
include One 15 Luxury Yachting,
AIG, De Dietrich, Caratell, Etihad
Airways, Kwanpen, mOOnshot
digital, Peroni, Runway Moda,
Singapore Polo Club, Singapore
Yacht Show, Small Luxury Hotels of
the World, The St. Regis Singapore
and Vision Advisory – to name a
few.
Born and raised in Singapore, Irene
is involved with the local creative
community. In 2017, she organ-
ised her first fashion show to offer
emerging designers a platform to
showcase their creations. Together
with her business partner, Ray
Perera, she is also building up
Runway Moda, a new online
platform that showcases fashion
collections through runway-videos.
In 2017, Irene was named Head of
Mission for the Diplomatic Council
in Singapore, an organisation that
enjoys a UN consultative status.
This opportunity opens the door
for her extensive high-net-worth
network to connect with interna-
tional diplomats and foster foreign
investments.
Luxe Digital: Hello Irene. Affinity
Marketing is at an interesting
cross-road between events and
digital, tell us about the most
significant changes that you’ve
observed since launching The
Luxury Network in Singapore?
Irene: Companies in the luxury
sector are increasingly embracing
social media to engage with their
affluent consumers online. It is no
longer about whether we do social
media but a question of how well
we do it to drive awareness for
your brand and convert it to sales.
I also noticed that savvy high-end
brands don’t believe anymore in
paying bloggers to promote their
products or services. They moved
away from basic social media
vanity metrics that do not equate
to tangible retail sales.
Luxury brands are increasingly
recognising the power of niche
influencers. For example, I have
recently been approached by a
designer brand to associate my
social profile to their high-end
products because they like what I
do and the values I embody. They
know that I have a loyal following
on my social media accounts and
a group of contacts that trust my
opinions and suggestions. They
saw an alignment between their
brand and myself.
“Humans are ‘social
animals’, digital plat-
forms are levers of
growth but will never
replace in-person
interactions.”
Luxe Digital: How do you ensure
that offline affinity marketing
remains relevant for luxury busi-
nesses when they increasingly
invest their budget on digital?
Irene: I don’t expect UHNWIs to
stop buying private jets to travel for
their meetings just because Skype
calls or Whatsapp are available.
In my experience, nothing beats a
face-to-face conversation. Brands
will still need to meet up in person
to brainstorm ideas. Fruitful collab-
orations still require live discussions
to clearly understand each other’s
objectives. This is especially rele-
vant in the world of luxury and
high-net-worth individuals where
time is precious.
It will always be important for
luxury businesses to host events
which could include other luxury
brand partners. For example, when
launching a new luxury product,
events can help a high-end
brand introduce it to their affluent
customers, leverage this offline
moment to strengthen their rela-
tionship with their audience. Luxury
is all about providing customers

Luxe Digital 30
with an experience and this is best
conveyed in person, through our
senses of taste, smell and touch.
You can’t have an online affinity
marketing collaboration without
an offline meeting to discuss the
partnership. This is particularly
true in the luxury sector where
people want to meet you before
their decide to collaborate with
you. Luxury brands embody the
finest in their industry and are the
best in what they do. In that regard,
you need to build trust and rapport
with each other. And that could not
happen without spending some
quality time together.
Humans are ‘social animals’, digital
platforms are levers of growth but
will never replace in-person inter-
actions.
Luxe Digital: In that context,
how does digital marketing help
you create opportunities for The
Luxury Network? And how are
your members responding to it?
Irene: With the appointment of
our new Global CEO, H.E Fares
Ghattas, in October 2016, we intro-
duce a bi-monthly magazine. It
provides our readers and members
with updates on what is happening
within our global community.
Members can advertise their
products and services, promote
their events or highlight their key
personnel on a complimentary
basis. This is a great way to create
valuable content and drive traffic to
our website while creating aware-
ness for our members and The
Luxury Network.
Members who are proactive took
advantage of this resource without
fail for every issue. One of our
members is the CEO of a company
that provides professional services.
I suggested to him that we feature
an interview of him and how
members would benefit from his
services. Shy by nature, he was
very reluctant at first but eventually
agreed to it. He recently thanked
me because his interview was the
best performing campaign on his
company’s social media accounts.
He was so impressed by the design
and quality of our magazine, that
he decided to create a “coffee table
book” about his company and
services.
Luxe Digital: Tell us more about
the digital challenges that you
understand most of your clients
are having?
Irene: Interactions with the
members of the Luxury Network are
primarily about offline networking,
so I’m not particularly involved with
the digital marketing challenges
that their companies might be
facing.
I am much more familiar with the
online challenges that emerging
luxury brands are experiencing
through my other activities,
however. For them, it’s mostly a
question of brand awareness and
being able to grow an engaged
audience on social media. An audi-
ence that can then convert into
actual sales.
One of the reasons why Runway
Moda was created, for example,
is to solve the digital challenges
faced by designers in the Fashion
Industry.
The platform offers multi-faceted
tools that provide a turnkey solution
in monetising video-based media.
It also serves as a marketplace for
both brands and consumers alike.
Additionally, through a specially
crafted analytical dashboard, users
can track video impressions and
gain micro insights into high-end
product sales by regions.
Luxe Digital: You are very active
online through your social media.
What made you decide to invest
more time on your profile and how
is it impacting your business?
Irene: I am active on my personal
social media accounts indeed. It’s a
great platform for me to show my
personality, what I do, and what I
believe in.
I don’t post stories related to my
family, but everything that I share
shows the real me. So I would even
sometimes post things I am angry
or disappointed with.
I do share my achievements as
well, such as my interview with the

Luxe Digital 31
Straits Times or Bangkok Post, my
participation as an Honorary Judge
for the Luxury Lifestyle Awards and
MPAS Awards. I also talk about the
events and organisations that I
support and my volunteering work.
As I provide professional services,
it is important for me to build trust
and rapport with my members.
I need to be able to know and
understand their underlying inter-
ests to ensure that these interests
are met to achieve a win-win situ-
ation. Only then can a partnership
happen between different brands.
Trust can be built when members
get to know the real me. Social
media helps me disseminate such
information about myself to a wider
affluent audience.
Social media also helps to keep my
members informed about what I
have been doing including other
members’ partnerships. We often
discuss these when we meet face
to face later.
Last year, for example, I met a
prospect who wasn’t sure that he
should invest in a membership with
The Luxury Network. He found the
upfront payment of US$15,000
to be a significant investment. He
went home and briefly mentioned
it to his 20 years old son. His son
Googled me and looked through
my Instagram account, then
recommended his dad to join my
network. He signed with me for a
membership and has since been a
satisfied member.
I have many other similar stories
of opportunities that arose thanks
to my investment in building my
personal brand on social media.
The investment in time and energy
is thus justified.
“Luxury brands that
adopt a sound digital
marketing strategy
will be able to reach
their HNWIs customers
more effectively.”
Luxe Digital: What are some
interesting luxury trends that
you’ve observed as noteworthy
for high-end brands to be aware
of?
Irene: A few of my luxury members
emphasize that sales during events
are not as important to them as
building brand equity and long-
term relationship with their affluent
customers in Asia.
I think luxury brands understand
that promoting their products takes
time and should be done with tact,
not through hard selling.
That is also one of the reasons why
my business partner Ray Perera
and I built Runway Moda. Tradi-
tional fashion show events do not
provide an avenue for designers to
collect orders or sell their pieces off
the runway. Some fashion show
organisers do provide pop up stores
so that attendees can browse the
pieces and buy the products after
the show.
Runway Moda has live streaming
capacities where viewers from
any location watching the live
fashion show can click on items of
interest and buy or pre-order them
immediately on the video of the
runway. With our technology, we
want to revolutionise how people
make purchases by shortening the
buying process.
I believe the trends would be for
luxury brands to better utilise digital
analytics to collect meaningful data
and incorporate machine learning
to track buyers’ behaviour. This will
enable brands to create or suggest
complementary products that their
affluent consumers would want.
Luxe Digital: How do you envision
the future of marketing to high-
net-worth individuals (HNWIs)?
Irene: The rise of digital has altered
how we live and the speed at which
we engage with one another. 93%
of buying decisions are influenced
by social media for example.
HNWIs are a demographic that
enthusiastically adopts new tech-
nologies because they believe in
utilising any resource available to
them in order to identify the right
decisions quickly, achieve good
results and ultimately attain their
lifestyle goals.
Luxury brands that adopt a sound
digital marketing strategy will
be able to reach their HNWIs
customers more effectively. This
is especially important for brands
targeting affluent Millennials and
Generation Z HNWIs who have
grown up in the digital age. For
example, by monitoring their
customers online behaviour, luxury
brands can customise their offering
to optimise engagement and create
highly personalised value for their
HNWIs customers and thereby
increasing customer loyalty.

Luxe Digital 32
The Opportunity
• The high-end hospitality
industry continues to grow
exponentially, with an esti-
mated US$528B of direct
spending on worldwide hotel
reservations in 2017, and is
projected to grow by over 50%
by 2026.
• Digital brings scalable means
at very low cost to all players,
accelerating the industry
shifts between OTAs and hotel
groups, but also between the
winners and the losers of the
digital transformation.
The Problem
• The ability to adapt and evolve
digital strategy has become
essential in increasing online
profits, especially as OTAs
are now the fastest growing
yet least profitable revenue
stream for luxury hotels. Mean-
while, affluent travellers have
been empowered with choice.
Expectations are changing
when it comes to showcasing
authenticity, digital user
experience and the seamless
integration of mobile into every
step of the traveller’s journey.
The Solution
• In order to remain competitive,
luxury hoteliers must be flexible
and forward thinking in their
digital approach. Hotel groups
need to take back control of
their clients acquisition flow by
forming new partnership and
alliances to benefit from large
customer data, articulating
an authentic brand through
content marketing, leveraging
user generated content, and
creatively optimising their
online reservation process,
particularly for mobile devices.
Digital Transformation in Hospitality: A Guide for Luxury Hotels
More than 1.18 billion
people traveled interna-
tionally last year, and Asia-Pa-
cific cities collectively claimed
almost 25% of those arrivals.
This year, growth rates are ex-
pected to be 5% to 6%16
and
the total spending on travel and
tourism should grow by over
50% over the period from 2015
to 2026, according to the World
Travel Tourism Council.17
The upward volume in travel
comes with an intensification
of digitally-powered custom-
er engagement and decision
making. Digital has become a
borderless fact of life for luxury
hotels in Asia and around the
world, but most are still strug-
gling with turning their custom-
ers online habits into a profit.
With this article, we’ll dive into the
rising importance of direct online
bookings for luxury hotels. We’ll
see in particular how best to create
differentiated digital experiences
and remain relevant in an ever-in-
creasingly competitive industry.

Luxe Digital 33
The Importance of
Luxury Hotels Brand
Sites and Direct Online
Bookings
It has become clear with-
in the last few years that
the relationship between ho-
tels and online travel agencies
(OTAs) may not be mutually
beneficial. While the contribu-
tion of OTAs to hotel sales have
continued to increase, making
up 12% of all reservations last
year, the OTAs commissions
have substantially increased
in parallel, from 4% in 2010 to
15% on average in 2018, going
up to 30% in some instances.18
OTAs are effectively the most costly
booking channel for luxury hotels.
But OTAs also offer high-end
hotels a significant exposure to
their affluent audience. From a
hotel customer behavior point of
view, the OTA model seems to be
preferred, especially for millennials
who are used to aggregate sites.19
Recently, however, there has been
noticeable push back from luxury
hotels as significant efforts have
been made to drive direct book-
ings on their own hotel brand sites.
Most notoriously, Hilton launched
a campaign aptly called “Stop
Clicking Around,” alluding to the
well-known statistic that global
travelers browse an average of 38
websites before actually booking.20
The battle between OTAs and
hotels is expected to come to a
head in the next few years. In
the meantime, as many digital
marketers scramble to increase
direct online bookings, and thus
profitability, the question of how
luxury hotels can differentiate
themselves and remain competi-
tive is more important than ever.
Luxury Hotels Are Cre-
ating Opportunities
Through Global Net-
works and Strategic
Partnerships
Increased competition has
spurred the formation of new
alliances. Last year saw a few
bold moves from the biggest
players in the hotel industry.
Marriott announced it would
acquire Starwood Hotels and
Resorts Worldwide for $14.4
billion, while AccorHotels pur-
chased Fairmont Raffles Hotels
for approximately $2.9 billion.21
Newly formed networks signify the
start of global partnerships that
come hand-in-hand with opportu-
nities to revamp outdated digital
capabilities, consolidate reser-
vation systems, expand global
customer databases for CRM,
as well as enrich hotels’ loyalty
programs.
The ability to engage, acquire and
retain hotel guests by utilising data
on customer’s unique preferences
may be one of the most signifi-
cant advantages that hotels have
over OTAs. Aggregate insights
combined with real-time travel
trends will help luxury hotels better
define customer segments, create
targeted digital campaigns, and
propose differentiated offerings
that meet, perhaps even exceed,
guest expectations for personali-
sation at every touchpoint.22
Boutique hotels can also benefit
fromthissameapproachinthinking.
Symbiotic partnerships with luxury
hotel groups, but also high-end
businesses (retailers, restaurants,
transportation services) along
every touchpoint of the guest’s
journey will be essential in gaining
access to valuable customer data
that, in turn, will shape communi-
cations, offerings and services.
Opportune alliances that enable
consolidation, aggregation and
management of valuable customer
data will be a powerful tool in the
battle with OTAs.
Establishing Authen-
ticity for Luxury Hotels
Through Digital Story-
telling
The need to stand out and
connect with travellers
through authentic and digi-
tal storytelling has never been
direr for high-end hotels. Now
more than ever, besides factual
data and price points, travel-
lers are looking for inspiration
when booking luxury holidays
online. In fact, 65% of leisure
and 69% of business travel-
lers from the U.S. search online
before they decide both where

Luxe Digital 34
and how they want to travel.23
Not surprisingly, affluent travellers
today are expecting value-rich
content that speaks to a hotel’s
backstory, everything from its
design to the people, the local
community to the uniqueness of
the experience. The notion of luxury
is no longer as simple as hitting a
thread count number. Ironically, it’s
come down to the showcasing of
personalisation — purpose, crafts-
manship, community, even artistry
— through a mass medium.
The high-end hotel brand website
is oftentimes a customer’s first
impression of a hotel and it is an
essential platform in which to
appeal, engage and communicate
a unique experience. Only then can
a brand hope for conversions.
As savvy as today’s affluent trav-
ellers are, any sign of generic,
gimmicky or bland content on a
hotel’s website is likely to pull the
property out of the running. Addi-
tionally, as travel and hospitality
providers become more digitally
sophisticated, the competition is
shifting to highlight bespoke expe-
riences upon arrival. Content that
offers a digital sneak-peak into
potential activities is fast becoming
a go-to differentiator for luxury
hotels.
An example of a luxury hotel
engaging in authentic digital
storytelling is Marriott. The brand
published a “city guides” series
featuring local destinations
alongside its own properties. A
collaborative effort with photogra-
phers and travel writers, Marriott
was able to position its prop-
erties at the centre of culture,
community and a host of exciting
experiences. The brand also
cements its authenticity by encour-
aging user-generated content
(UGC) from social media followers,
showcasing the best of the best
on a microsite called “Travel Bril-
liantly”.
Pitfalls to watch out for:
As important as it is to bring
the brand to life, it is even more
important to be truthful to the expe-
rience. The bigger the gap between
expectation and reality, the more
disappointment a customer expe-
riences.24
Particularly for high-end
and boutique hotels. Keep in mind
that the more platforms there are
that encourage travellers to share
the good, the bad and the unheard
of, the more pressure there is for
luxury hotels to walk the walk.
High-End Hotels User
Generated Content For
The Win
As we briefly illustrated with
Marriott, user-generated
content (UGC) is poised to be-
come a cornerstone in a luxury
hotel’s content arsenal. Content
created outside the hotel brand
by OTA reviews, digital influenc-
ers and guests are increasingly
swaying travellers’ opinions and
decision making. With UGC,
there is an opportunity to lever-
age the momentum of an exist-
ing customer trend, while show-
casing authenticity directly from
the perspective of hotel guests.
“Social media has
become instrumental for
luxury hotels not just as
a way to connect and
nurture relationships
with customers but
also as a way to get
deep insights – through
systematic listening –
into what customers
are into, what cultural
experience they expect
and the stories they
may want to hear
when traveling.”
David Dubois, Associate Professor at
INSEAD in Paris
Perhaps most importantly, the
integration of UGC (photos, videos,
reviews) on the hotel’s brand site,
as well as within social media
channels is effective in driving both
brand engagement and online

Luxe Digital 35
bookings. To explain, statistics
show that overall brand engage-
ment increases by 28% when
customers are exposed to a mix of
both brand content and UGC.[9]
Specifically, in the world of social
media, luxury hotel brands that
feature UGC in their Instagram
posts see six times more interac-
tions per post.25
When it comes to high-end hotel
brand sites, studies show that
when potential guests interact with
UGC, the conversion rate increases
by 9.6%. The strategic usage of
UGC is undoubtedly beneficial. Not
only does it increase engagement
and conversions by telling the story
through the guests themselves, but
it also helps keep customer acquisi-
tion costs low. Embracing UGC also
has the added benefit of providing
luxury hotels with valuable data
and insights into their customers.
“Social media has become instru-
mental for luxury hotels” explains
David Dubois, Associate Professor
at INSEAD in Paris, “not just as a
way to connect and nurture rela-
tionships with customers but also
as a way to get deep insights –
through systematic listening – into
what customers are into, what
cultural experience they expect
and the stories they may want to
hear when traveling.”
However, despite obvious benefits,
hotels have been slower than antic-
ipated in integrating UGC within
their online channels. According
to L2, a New York-based consul-
tancy, an overwhelming 60% of
luxury hotel brands do not use
UGC on branded pages or sites,
and 86% of high-end hotels do
not have UGC on their site landing
pages. As the global hotel industry
works to improve engagement and
conversions on their own chan-
nels, UGC will become even more
important as an authentic source
of information, affirmation and
inspiration for travelers.
In order to keep up with the pace
of digital transformation in this
disruption-prone industry, luxury
hotel marketers need to pick up the
pace or risk being left behind.
Rethinking The High-
End Hotels Reservation
Process
On one hand, there’s com-
pelling content, and on the
other hand, there’s convenience
and usability. An intuitive user
experience is, and will remain,
essential to generating direct
bookings for luxury hotels. Al-
though a prominent and omni-
present Book Now button has
become widely adopted, ease of
booking still remains inconsis-
tent amongst hotels websites.
This has noticeable implications. A
staggering 81% of potential guests
booking travel online abandon their
reservation. And 13% of these
potential guests point to the hotel
booking process as their main pain
point.[6] That comes as no surprise
when affluent travelers hold
hotels to the 2-clicks-to-purchase
transaction standards they’re used
to when dealing with beauty or
luxury fashion e-commerce sites,
for instance.
However, as of today, there is still
a significant portion of luxury hotel
sites that require 4 or more clicks
and multiple page loads before a
successful booking. Expectedly,
extraneous clicks and pop-ups
detract from the user experience,
and only increases the likelihood of
user abandonment. More so than
ever, streamlining and innovating
at every step of the conversion
funnel is key for luxury hotels to
remain competitive
Relais Châteaux Boutique
hotels and gourmet restaurants
have demonstrated innovation
throughout their conversion funnel.
The property incorporates func-
tionality that users have become
accustomed to in their booking
process. An example of this is the
concept of the “basket”. To explain,
Relais Châteaux attempt to
prevent booking abandonment by
letting guests add rooms to their
“basket”, favourite and share prop-
erties (similar to Airbnb) and access
the last set of properties viewed.
All of these features are not only
aligned with digital behavioural
trends, but also reduce the amount

Luxe Digital 36
of time a potential customer has
to spend restarting their search on
the brand site.
Additional food for
thought:
To generate more direct sales,
luxury hotels certainly need to
rethink the booking conversion
funnel, but they can also innovate
around creating another stream of
e-commerce revenue altogether.
For instance, a regional trend in
Asia Pacific has emerged around
high-end hotels and homeware.
Coupled with the rising expres-
sion of “luxury” through thoughtful
design and local craftsmanship
(think hand-dyed indigo robes),
luxury and boutique hotels are
becoming shoppable. The Banyan
Tree, for instance, sells its toiletries
and accessories. Micro-Luxe in
Melbourne blurs the lines between
the virtual and physical hotel expe-
rience further by allowing guests to
purchase everything in the room —
from the bed linen to the furniture
and artwork.
It’s time to get creative. The blur-
ring between retail and hospitality,
physical and virtual all allow diver-
sified streams of revenue and new
opportunities to drive conversion.
The Unstoppable Power
of Mobile for Affluent
Travelers
Astellar mobile-optimised
website has become an
inescapable mandate for luxury
hotels. According to eMarketer,
travel bookings made on mo-
bile grew 26.7% year-over-year
from 2016 to 2017, across all
markets. Furthermore, eMarket-
er estimates that transactions
booked via mobile will grow
to almost 70% of total digital
travel sales by 2019.Figure 1
With this in mind, mobile expe-
riences offered by luxury hotels
are not exempt from usability
standards that are common-
place in other e-commerce driv-
en industries. The ever-picky
user has little to no patience for
anything else: Out of 83% of
leisure travellers that encoun-
tered a travel site that was not
mobile optimised, more than
60% left the site immediately.26
Anotherimportantfactortoconsider
when evaluating the prominence of
mobile usage is device switching
behaviour, as discussed by author
Florine Eppe Beauloye in her book
“Shine – Digital Craftsmanship for
Modern Luxury Brands. Research
has revealed that 46% of travelers
who perform search via a mobile
device move to a different device to
book, thus making the full impact of
mobile on decision making difficult
to capture.27
Device switching behaviour
constrains the share of mobile
sales captured by the industry
and minimises the true impact on
the customer booking experience.
Perhaps the statistical underesti-
mation of this powerful platform is
reflected in the fact that although
over 90% of high-end hotel brands
offer a mobile optimised website,
there is a considerable drop off in
functionality when compared to the
desktop version of the hotel site.
However, we predict the mobile
experience for hotel brand sites in
2018 will catch up to, and perhaps
even surpass, that of the desktop
experience.
Digitally sophisticated high-end
hotels are already beginning to
utilise the possibilities of mobile. A
prime example is Virgin’s hotel app
“Lucy.” The app truly lives up to its
branding “Makes Things Happen,”
enabling guests to perform a
myriad of tasks including order
room service, book spa appoint-
ments, control room temperature
and even text with hotel staff
and guests.28
In many ways, the

Luxe Digital 37
integration and innovation of mobile is the next wave of transformation that holds serious implications should
hotel brands fall behind this unstoppable force.
Digital Has Become A Fact Of Life In Luxury Hospitality
The high-end hospitality industry has been fraught with transformations in the past few
years, demanding that luxury hotels adapt and evolve their digital strategy and im-
plementation at every customer touch point. The emergence of review websites, the con-
tinued tug of war with OTAs and fierce competitors, has only empowered the affluent trav-
eller with choice. In order to remain competitive, luxury hoteliers must be flexible and
forward thinking in their approach to content, user experience, and multi-channel presence.
Words by Tian Chang.

How Digital is Transforming Luxury: The New Affluent Consumers

How Digital is Transforming Luxury: The New Affluent Consumers

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