July 28, 2010

Luxury Goods Online: A Match That Was Never Meant To Be?

In our continual survey of the state of the Internet, we focus on a particular niche this week, viz. luxury goods. Well, this may raise a few eyebrows, and for a good reason too. To begin with, most would consider the niche to be practically non-existent. Or, at the best, one that is barely noticeable or worthy of a mention. And they couldn’t be further from the truth!

The Internet has a somewhat indiscriminate and non-exclusive character to it. After all, it belongs to just about everybody. When you are doing a business on the Web, you are practically selling to the world. The doors of your online store are open, whether you like it or not, to everybody.

Things are more convenient with a brick and mortar storefront. If you deal in exclusive goods meant for the rich and the famous, you can adopt measures, humane or otherwise, to keep away people you don’t want to waste time with. But on the Net, such walls don’t exist.

This is probably one of the biggest reasons why sellers of high-priced luxury goods have been shying away from the Internet. The fear that looms large in their hearts is the loss of exclusivity. Most luxury-goods firms are rather scornful of the Internet as a plaything for the plebs.

This is unfortunate, because the Internet can be an excellent means to boost their sales, as was discovered by Oscar de la Renta, an American fashion house that sold an $80,000 sable coat to an online customer from New Hampshire last spring.

Others are catching up, too. Prada, the famed Italian fashion house, has launched their first online store in 2007 and have been reported to be making brisk sales. The marketing pundits at Prada have predicted that within the next 5 years, some 40% of its revenues in America will come from the Internet.

It’s time to take a fresh look. If fashion houses can read the writing on the wall, it’s pointing towards just one direction – cyberspace. It’s where the real buzz is, and it’s about time they shoved their inhibitions aside to start taking advantage of it.

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