Target also leads the pack when it comes to paid search spending, a new report finds.
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Stuart Weitzman, whose shoes are typically priced for $250 to $500 online, uses the Crescendo tool from vendor SocialFlow to scan the content in consumers' posts across Facebook and generate keywords to use to target ad placements based on what's trending. For instance, if a lot of Mexican shoppers express interest in a fashion post about what Eva Longoria wore on the red carpet, the tool might suggest targeting consumers based on the keywords "Eva Longoria" along with a specific location, such as Mexico City, where Stuart Weitzman recently opened a bricks-and-mortar store.
"We believe that this tactic has been successful for Stuart Weitzman because the content is localized," Popatia says.
In Taiwan, a single Promoted Post generated more than 10,000 Likes for Stuart Weitzman and a 5.9% click-through rate. In Mexico, the retailer's Promoted Posts reached nearly 860,000 Facebook users and produced a 5.5% click-through rate. Most clicks were acquired for 5 cents a click or less, says Frank Speiser, SocialFlow co-founder and president.
Some luxury brands, including Burberry Ltd. and Tory Burch, have made strong use of social media, including blogs and Twitter. Burberry, for instance, has nearly 16 million Facebook Likes and more than 2 million followers. It ranks No. 6 in terms of Twitter followers in Internet Retailer's 2013 Social Media 300, which ranks retailers by the percentage of traffic to their web sites from social networks. Tory Burch, meanwhile, has a regularly updated blog that does double duty as a portal to the brand's presences on Facebook, Twitter, Instagram, Pinterest and Tumblr. Neiman Marcus Group Inc., meanwhile, this summer combined a sense of exclusivity with social media to launch a product, a red "Elle" handbag. The retailer offered the $595 product—a Rebecca Minkoff item promoted as an exclusive via Neiman's Cusp brand—for pre-sale through Aug. 12 on the Pinterest social network. Neiman Marcus has more than 65,000 Pinterest followers. On Pinterest, consumers "pin" products and images they like.
The campaign gained Neiman Marcus 3,000 new Pinterest followers in less than two weeks, the chain says. It wouldn't disclose » » sales figures, but says that during the handbag campaign on Pinterest, repinning of content directly from the main Neiman Marcus e-commerce site increased 35%. Overall pinning increased 20%.
"Although we have a relatively small following compared with our other accounts, we see Pinterest becoming a very important source of referral traffic," says Jean Scheidnes, the chain's social media managing editor. Approximately 0.13% of the chain's web traffic last year came from Pinterest, according to Social Media 300 data.
"Images are the most natural media for fashion, which is a visually stimulating business where we have endless image assets to leverage," Scheidnes says. "The Pinterest boards that our fans create put our products into an aesthetic context that is so much more compelling than a product shot, by itself, could ever be."
A personal, in-depth feel to web marketing also can bring gains. Indeed, "curate" and "curation" serve as vital buzzwords in luxury e-commerce. Denmark-based Waremakers Ltd., which launched earlier this year and sells such products as a 4,233 euro (US$5,612) Conway Stewart fountain pen and 595 euro (US$789) Travelteq leather laptop bag, provides an example of that trend.
The bag's product page has a link entitled "What's the Story?" through which shoppers can read nearly 350 words about how design and production required travel to a workshop in Tuscany, Italy, and how the product has a "handy slot for cigars should you find yourself returning from Cuba with a newfound addiction for Montecristos."
"The content has to give something to the customer: Captivating stories, solutions to problems or inspiration for the future," says CEO Anders Ojgaard, who was previously founder, CEO and editor of the Danish design and culture magazine Magasinet KBH. "If you don't offer this, you simply end up as yet another anonymous wallpaper of product shots."
The retailer also distributes its content through social media, connecting consumers with often unfamiliar brands, Ojgaard says. "These stories are often stories of people fighting to get their crafted products to the market and to survive the process," he says. "They are stories of struggle that we can all identify with."
Content takes patience, though. A one-off sale promoted through paid search typically will produce a spike in sales for a particular product—and draw the attention of more price-conscious shoppers—but Ojgaard says he wants deeper gains. "We want to build lasting relationships with customers, and once a customer has shopped with us once, he or she will know that our product descriptions are to be trusted," he says.
Those relationships will likely become more important for luxury brands selling pricey products to consumers who might not step into a store before purchasing. Robust mobile commerce programs, combined with features like shipping alerts that web shoppers are coming to expect, also promise to play major roles in luxury's online growth.