Welcome to RETHINK Luxury, a new four-part, forward-looking series on the luxury industry at-large.

On today’s episode, we take a deeper look at connected experiences and the digital tools that are transforming the luxury retail industry into a place where shoppers can touch, sense, smell and dream bigger and bolder than ever before.

Joining us today are guests Ludovic Baussan, Sandrine Crener, Marie Driscoll, Shannon Ryan, Ron Thurston, and Line Tousignant. 

– – – – – –

Hosted by Julia Raymond
Written and produced by Gabriella Bock
Edited by Trenton Waller
Marketing and social media by Natalie Arana

 

TRANSCRIPTION

Julia Raymond Hare:

Hello, and welcome to RETHINK Luxury. I’m your host Julia Raymond Hare and you’re listening to the 4th episode of our special luxury series. Each episode dives into a different topic within luxury retail, and today we’ll be taking a deeper look at connected experiences and the digital tools that are transforming the luxury retail industry into a place where shoppers can touch, sense, smell and dream bigger and bolder than ever before. 

Up first, we’ll hear from Valtech’s Shannon Ryan and Line Tousignant as they bring us up to speed on connected experiences and the role it’s already playing in today’s modern luxury market.

 

Shannon Ryan:

Hello, Rethink Retail listeners. My name is Shannon Ryan, I’m the EVP North America for Valtech.I’m primarily responsible for helping set and guide the overall strategic direction of the teams here in North America.

 

Shannon Ryan:

The future of luxury looks really exciting. I think as we continue to mature in our understanding of how technology can enhance the customer experience as luxury brands continue to be more risk tolerant of changing that experience, I think we see a great horizon for the world of luxury.

 

Line Tousignant:

Research shows us that the luxury shopper is no longer focused on exclusivity and product quality. And actually, it tells us that this trend is really growing. Luxury shoppers like brands based on values that are beyond the products. Of course, quality, craftsmanship remain important, but consumers now want to know if a brand’s values align with theirs. And we see this really becoming very important. More than ever the brands are part of the customer identity. They buy it, they wear it, or they drive it. They want to and they can associate with it. They want to have this connection.

 

Shannon Ryan: 

Connected experiences are a set of applications, experiences, and even just thinking around this merging that we’re seeing of the physical-digital world. We started off seeing it in the world of retail, but more and more, we’re seeing it everywhere, be it at a movie theater, airports, the workplace, or even in education. This combination of the physical and the digital coming together to form one seamless experience is really quite exciting.

 

Shannon Ryan:

The world of luxury has really embraced this idea of connected experience and that’s a rather obvious answer because luxury has always been about trying to provide, sort of unique experience to the customer and for the work, for example, that Valtech has done with MAC cosmetics, with our new MAC store in Queens, I think there are some great examples there of how the store interacts with the customer.

 

Shannon Ryan:

Historically, used to always be about how you could interact with the store, how you could connect to the Wi-Fi, or you could do things. Now we’ve sort of turned that around a little bit and the store interacts with you. It knows where you are. It knows what you’ve looked at based on your preferences, and can save that all to one consistent profile and I think that’s really exciting and it opens up a lot of different opportunities.

 

Julia Raymond Hare:

You just heard from Valtech’s Shannon Ryan and Line Tousignant. Next, we’ll hear two women with their fingers on the pulse of luxury: Harvard Business School’s Sandrine Crener and Coresight Research’s Marie Driscoll. First, let’s hear what Sandrine had to say about COVID-19 and its role in accelerating the adoption of digital technology in luxury. 

 

Sandrine Crener:

My name is Sandrine Crener and I work at HBS. I’m a Program Director for executive education at the business school and I also teach a class on luxury marketing at Harvard Extension School.

 

Sandrine Crener:

COVID has altered consumer behaviors in many ways and the good news is like the luxury industry is covering and even a little bit faster than anyone anticipated

 

Sandrine Crener:

Just to cite the obvious, luxury brands have been lagging behind them in terms of e-commerce over the past year and they will probably continue to still lag behind but the growth has been really, really impressive.

 

Sandrine Crener:

On the demand side what we observe is the pandemic has really accelerated the trend toward an increased focus on health and wellness. So this translates to an increased interest in food and nutrition and fitness. We’ve seen the increase of interest in peloton bikes and smart mirrors but also well being and meditation apps. So with the first closures of stores, restaurants, movie theaters, sports and concert arena, I mean it’s another limitation on tourism and travel. People are just obliged to refocus on their homes, which has become the place where you live, where you work, you exercise, you entertain and I think this shift has multiple consequences. First, obviously the explosion of e-commerce the accelerating usage of kind of this omnichannel retail, changes the way and where we eat, with whom we eat, the multiplication of takeout and delivery options.

 

Sandrine Crener:

Staying at home is also impacting, I think, the way we dress. Consumers have been buying more casual wear, loungewear but this is once again a trend that is just I think accelerating compared to before. It’s not like formal wear will disappear in the future, but there is this trend of consumers that are looking for more comfort and more relaxed clothing. Then again, people need to entertain themselves. So we saw consumers turn to streaming services, to video games and so these are some of the trends that we seen in the behavior or the purchasing patterns of consumers.

 

Julia Raymond Hare:

You just heard from Harvard Business School’s Sandrine Crener about the impact the COVID-19 pandemic has had on the digitization of luxury.  Joining us next is Coresight Research’s Marie Driscoll. Let’s hear her take on connected experiences in luxury and why unique ones matter now more than ever. 

 

Marie Driscoll:

Many modern luxury companies have acknowledged that while their store fleet is important, the consumer is going digital. And that’s where they have to go to.

 

Marie Driscoll:
We have the ability to think about recreating our industries to look differently. More digital focus, less physical retail, safer physical retail. 

 

Marie Driscoll:

Luxury brands have the unique ability to tell stories. It’s where you can actually, on a sensory level, live the brand, right? They always would say that the Ralph Lauren flagship right here on Madison Avenue is like Disneyland for adults. It’s like, you go in and you enter the world of Ralph Lauren. If you love Ralph Lauren, you couldn’t be in a better place. You go from apparel and jewelry and handbags to home and books. It’s just in a mansion, right? Nike is a temple to the brand of Nike. 

 

Marie Driscoll

But even the most differentiated experience is boring after five times. Even the best experience at Disneyland is old after you’ve done it four or five times, right? One of the problems with retail for the last 20 years is that they weren’t changing. They were one wall after another look the same, the product looked the same. The product looked the same, basically as what you had last year and also with what your competition had, right? It’s one of the reasons why there’s too much apparel.Too much stuff that isn’t differentiated, right?

 

Marie Driscoll:

You’ve got to twist it. And by twisting it, you evolve it to be more current and more a part of the culture today. Just look at Louis Vuitton and all the collaborations that they’ve done with Jeff Koons and with Virgil Abloh and with Marc Jacobs. I mean, they’re limited in time. It could have been a few years. It could have been half a year. It could have been a season, but it’s a reason, it brings new interest and liveliness to the brand. A new expression of the brand. It just looks at the brand from another facet and ergo enhances it. Yet, the true DNA of Louis Vuitton isn’t… It continues to represent what the brand stands for, which is travel and luxury, and a certain lifestyle. It will continue to evolve by incorporating pieces of the world into it.

 

Julia Raymond Hare:
Up next, we’ll hear from Ludovic Baussan. Ludovic co-founded 2nd Avenue, a design agency that helps brands and retailers transform their physical and digital experiences. Let’s hear what Ludovic had to say about the ways the COVID-19 pandemic has impacted the way his agency thinks about design and his predictions for the future of luxury. 

 

Ludovic Baussan:

Hi. I’m Ludovic Baussan. I’m the Head of Strategy and Co-Founder of a retail design agency called 2nd Avenue.

 

Ludovic Baussan:

I think there are challenges that luxury brands will be facing, or are even facing today, as they begin to blend those physical and digital presences. Maybe the biggest one is I think is to keep the brand experience human. There are so many digital tools and innovations available, and it can be so tempting just to use them without making sure that they actually bring real added value to the consumer. And this is where human-centered design can really help. It’s about focusing on empathy, understanding what users value and the experience they crave, and only from there, trying to identify if there is a technology that can serve that purpose.

 

Ludovic Baussan:

Generally speaking, consumer expectations evolve a lot but I think that in 2020, we might have seen really strong shifts in those expectations. And in order to ensure that brands understand precisely consumer demands and provide an upgraded customer experience, brands can use human-centered design to rethink the innovation process. So that it’s more based on co-creation and on the involvement of the end users.

 

Ludovic Baussan:

There’s a second aspect that is also linked to how this methodology can help the luxury brands is that more and more customers are intellectualizing their relationship with consumerism. And especially now that the health, economic and even the social prices have impacted their daily life I mean, more than any other years before.

 

Ludovic Baussan:

Has the COVID-19 pandemic impacted the way we approach design? Yes, it did. It did in many different ways. Historically, we designed retail experiences, but we really have been focusing our work into physical spaces. And even though those physical spaces include a lot of digital experiences, it was really about the place in the brick and mortar. So yes, it impacted it a lot because the brick and mortar retail industry has been impacted. So, we had to change the type of experiences and the type of concepts that we create.

 

Ludovic Baussan:

The way consumers perceive a brand and its offer has been shaped over the years by the mechanism of the digital world. I mean, particularly for Gen Z, of course, but it has been really accelerated by the pandemic. And the digital world brings a real proximity in the relation with the brand. So today consumers that expect in-store experiences that will make the history of the brands tangible, but also to find places that are no longer, those temples that are dedicated to the glory of the brands, but spaces that speak to them. Spaces where they feel home, spaces where they can engage and they can interact.

 

Ludovic Baussan:

They can engage and they can interact. And I think beyond that, it has also been an opportunity for us to kind of challenge the service that we offer. We create those retail experiences, but how can we offer maybe new services? New modes of engagement means also new users and more users, and also higher expectations from those users, but again, focused on digital channels more than brick and mortar and physical spaces.

 

Ludovic Baussan:

So what we’re doing now is we’re trying to work into bringing the physical retail experiences into virtual environments, and we’re doing this through the creation of virtual stores.

 

Ludovic Baussan:

I think what’s the most interesting for brands today is that the virtual offers us the opportunity to create experiences and to tell the story of a brand beyond the physical constraints. So what we are doing is we’re creating in 3D environments and places that maybe could not exist in real because we don’t have any structural or architectural or even construction constraints. So we’re creating worlds like you would create a video game, for example, and we can then have a visitor from a browser, wherever, if it’s from a phone or from the computer, navigate into the space by moving from point to point and interacting with the space through different touchpoints.

 

Ludovic Baussan:

And those touchpoints could be to discover the product. It could be to view video branded content. And of course, the interesting part is once you have discovered a product, a brand or any new category, is to be able to convert this into a purchase by linking directly the virtual space with the e-commerce website of the brand.

 

Ludovic Baussan:

2020 is transforming the luxury sector. I think luxury brands in 2021 will be more down to earth, more accessible, closer to their customers. They will be less about status and more about relationships. They will tend to try to reestablish a dialogue instead of just selling status and prestige. And I think that’s great, because we’re also, it kind of flows naturally with the trend we’re seeing that redefines what luxury is, and the values that are behind luxury.

 

Ludovic Baussan:

And I think the overall situation, economically, socially, that we’re living this year, is accelerating this shift in the definition of luxury. So I would say, luxury brands are going to be more cool. They’re going to be more, in some way, maybe the price will still be here, but the perception on it will be less intimidating.

 

Julia Raymond Hare:

You just heard from retail design expert Ludovic Baussan who shared his vision of the future of luxury retail design. And he said luxury will be cool and less intimidating – that brings us to our last guest today: Ron Thurston. Not only is Ron a vice president at a pretty cool luxury brand, he’s also the author of the recently published book Retail Pride. I’m currently reading it and I’d recommend it to anyone involved in the industry. Ron shares many endearing and personal stories about his journey in retail and why it’s a career to celebrate. 

 

Ron Thurston:

Hi, my name’s Ron Thurston. I’m the Vice President of Stores at Intermix, a division of GAP INC.

 

Ron Thurston 

Intermix was founded 27 years ago, exactly this month in October, by two brothers who really thought about the idea that the customer on any given day is looking for a variety of different brands. A variety of different end uses in her closet, and loves this kind of curated local idea in the mix. So the Intermix was born here in New York City, and it continued this journey of discovering emerging brands, mixing the highest end of luxury to our own private label brands with shoes and accessories, different end uses. What’s most unique about Intermix today is the way that we presented in stores.

 

Ron Thurston:

So, rather than say, a department store where you’re shopping by brand or shop in shops, we mix it all together, and you would walk in and you would see maybe it’s a trend story, to what’s new for the season. It’s coming up on fall, what’s important for fall? But within that environment, you would see blazers, and denim, and T-shirts, and knits, and dresses, and shoes all mixed together from different brands to really think about your closet and house shoe shops. Then, our expertise is in styling. How do you take all of those pieces? Mix them together, use pieces you already own. Let us show you how to make this work.

 

Ron Thurston:

We’ve had great success. We’re really the only one that does it in this really unique way, of mixing all the brands together, and has a wide appeal for a large different client base.

 

Ron Thurston:

When I’ve spent time with some of our top clients and I say, “I know you love Intermix, but where else do you shop?” Her answer often is, “Everything I need, I get in Intermix.” With maybe the exception of luxury handbags, some luxury shoes, here or there, intimate apparel. Some things that we just don’t go deep into. But really everything she needs from casual at home, Zoom tops,  dresses, events in her life, she buys at Intermix. So, if I think about today’s environment, there’s actually a demand for visiting the least number of stores possible to achieve my goals of shopping for whatever I might need that day.

 

Ron Thurston:

So, I really propose that if you’re going to work in the fashion business, the intent is that you have to be a great stylist. You have to be able to assess a customer’s needs, understand trends, understand what’s right for a hundred different people, and how that style works into her wardrobe, her spend, whatever that means.

 

Ron Thurston:

So, I really think the word luxury, when I think about Intermix and I think about the industry, luxury has become about service, and experience, and about time, and energy, and safety, and words like that, for me, that don’t necessarily apply to price point. So, we really take that to heart and say, a luxury experience can really be a $200 sale, but you’ve had such a memorable time reconnecting with the team in the store, reconnecting with maybe your favorite sales team. It really brought this idea together of, luxury is experience not about price, and not about the big sale, and not about something that she maybe couldn’t or dream of affording.

 

Ron Thurston:

It’s really, this is what I need today. This is the experience I want to have, and maybe I want to do that virtually. So, I actually think luxury could be a virtual experience. It could be curbside, it could be consignment. It could be a private shopping appointment in the store before it opens to the public, if she has a safety concern. I think of luxury in all of those terms of, what can it be? What should it be? But what’s right for that particular client on that particular day? What does luxury really mean for her? Ask great questions, be curious, dig into how she is experiencing the world and make sure that she leaves feeling just that much better before she came in.

 

Julia Raymond Hare:

That was Ron Thurston, Vice President of Stores at Intermix, a brand that has worked hard to embody that cool, casual and more inclusive vibe that both Sandrine and Ludovic both revealed are redefining demands in luxury. I’m going to let Ron close out the show today, but first, I want to thank all of our listeners for tuning in to this series and also give an extra special thanks to the incredible guests who joined us over the last several months. It’s been an exciting journey and we look forward to seeing what’s in-store for luxury in 2021. Alright, take it away, Ron: 

 

Ron Thurston:

The customer expects that they can go to your website, they can go to your Instagram account, they can go to a physical store, they can interact with the brand however they choose. 

 

Ron Thurston:

So, I think from an experience standpoint, every brand needs to say, “I want to be accessible online and shoppable, and I want to be understood in social media. I want to have great physical stores.” Because no matter what channel the customer chooses to shop in, it’s an important touchpoint of your brand marketing aesthetic, and just the future of what you want to present to the world.

 

RETHINK Retail Luxury was brought to you by RETHINK Retail in collaboration with Valtech. Hosted by Julia Raymond Hare, Written and Produced by Gabriella Bock, Edited by Trenton Waller, Social Media and Marketing by Natalie Arana.

[2251]
[2251]
[12]
[12]
[10]
[10]
[11]
[11]
[14]
[14]
[16]
[16]
[17]
[17]
[18]
[18]
[19]
[19]
[15]
[15]
[13]
[13]
[21]
[21]