INSIGHTS: Data the most under-used luxury asset

Photo: Maison Meta - AI generated

The luxury industry has long mastered emotion, but often overlooks the power of precision which lies in data.

As privacy laws evolve and digital behaviour changes, first-party data is no longer optional. It is the foundation of long-term brand equity, relevance, and client intimacy. Capturing this golden information is critical. Leveraging it with intent and relevance is future-proofing!

Fast-Moving-Consumer-Goods giants analyse every click, every data point. Luxury brands often still relies on instinct, exclusivity and legacy to convert and drive the business forward. While this has proven to be a successful recipe for centuries, consumers expectations are calling for a reset.

Why is data still so under-used in luxury?

Large luxury brands and conglomerates started to consider data integration as a necessity about 8 years ago and AI was already starting to take off. Catching up became critical, client-centric strategies became the name of the game and increasing client knowledge a strategic focus. However, behind this necessary shift few challenges came about and still remain major hurdles to most luxury players today to fully unleash the power of their first-party data:

Internal expertise, undeniably! The industry had to pause, rewind, lay the foundation of data integration properly while catching up with the rest of the data-savvy retail players. Speed, efficiency and relevance require highly competent teams internally which most brands do not have or only recently on-boarded. Let's face it, even the most reputable luxury brand does not sit very high on the priority list of data scientists who would rather join a tech or e-commerce giant. So the internal data professionalisation has been a slow burn and dedicated data knowledge centres within the brands only recently emerged. External agencies are hired to fill in the gap, accelerate and drive innovation, however internal skills are still necessary to steer the vision and brand alignment.

Fragmented CRM and data platforms across regions. Most players still operate today on multiple systems across the business and across all locations which prevents a unified view of customers' profiles and journey. Global data platforms such as Salesforce in integration with clienteling, transaction, and communication systems are the key. It is one thing to collect data every day and another to have the systems and processes in place to leverage this gold mine fully.

Reluctance to link client data to storytelling as a result of disjointed systems and communications.

Over-reliance on retail intuition and the "good old" processes to drive the business forward. A mind-set shift still needs to happen across the industry as data does not mean robotic practices, in fact it only enhances the human connections.

Photo: Maison Meta - AI generated

Every touchpoint generates data, from boutique visits and e-commerce browsers to client events and partnerships. Yet too often, it stays siloed.

Missed personalisation,

Missed loyalty growth,

Missed conversion opportunities from lead acquisition,

Missed business development decisions ...

Forward-thinking Maisons

Already leverage a unified and global CRM ecosystem to interact with clients with the same precision and intent across all channels (online / offline / wholesale) and all regions.

The same Maisons understand the power of client knowledge and turn retail insights into business strategies keeping a client-focus approach.

They utilise predictive models to anticipate intent, to optimise the online journey as well as to plan the next launch, opening or campaign accordingly.

They also build digital experiences that feel personal and convert at a higher rate.

While the luxury industry has a lot to learn from big retail players and digital innovations, we can already identify those embracing the movement and those struggling to make space for it.

The precision once reserved for products must now apply to understanding luxury clients. Data and predictive analysis does not replace emotion. It amplifies it, with understanding, value and precision.

Let's continue to drive data integration forward to future-proof the luxury industry today and win tomorrow!