Luxury brands face a moment of reckoning. Since many customers have been wooed over the years with the maxim that a life without luxury is not worth living, their expectations have also risen exponentially. The shift to a digital landscape has increased the need for differentiation at various touchpoints and accelerated the drive to ensure that customers get sophisticated experiences, beyond the products or services offered.
Given that the approach to luxury brand customers (a high-value, low-volume landscape) as compared to mass customers (a high-volume, low-value approach) is different, the various ingredients for luxury customer experiences are as follows:
Customer centricity in luxury CX
1. Minimization of customer effort
Since luxury customers are typically short on time, the onus is on brands to minimize the effort needed from the customer. One of the most common examples here is the customer relationship manager, a function many banks provide to their high-net-worth customers. The ubiquitous approach of going to different departments for different products is turned on its head to that of a one-stop shop. A dedicated relationship manager caters to a luxury customer’s entire set of needs.
2. Fractional ownership
As luxury customer experience evolves, and the sharing economy comes into play, asset light customers are likely to emerge. These individuals are not interested in full ownership of a luxury asset, but are focused on renting it for a short period. In this context, firms must have processes to ensure top-notch customer experiences span seamlessly from one customer to another.
3. Emotional luxury
The shift in customer priorities from asset possession to experience implies the need to create the feeling of luxury in the mind of the customer. In that context, the onus is on firms to ensure the customer ‘feels’ luxurious at every touchpoint in the lifecycle. Customers need to ‘feel’ appreciated, respected and valuable especially during the moments that matter most in buying journeys.
4. Curated products
Luxury customers expect a holistic solution, be it the core product of the firm or a selection of products across the ecosystem. Firms who can orchestrate this to provide a seamless experience to customers are likely to emerge on top.
5. Stores as destinations
When a moment in a customer experience exceeds expectations, that touch point is memorable. A case in point here is demonstrated by a bank which converted some of its branches (which customers used to visit for “mundane” banking activities) into dedicated relaxation centers for its ultra-high net worth individuals. These individuals could visit the branch, pick up jewelry from the locker, have a bath, change into clothes of their choice, attend a social event, and reverse the process (return jewelry to the locker etc) before returning home. The whole hassle of carrying expensive jewelry and clothes was eliminated, as well as the worry of finding a place to relax and change.
6. Behind-the-scenes
Behind-the-scenes access can work wonders to create exclusive experiences. Often, it is a real ‘wow’ moment for customers when they get to meet the bright minds that have created their experiences, like meeting the celebrity chef who prepared the wonderful meal the customer just had.
7. Data-driven personalization
While data-driven personalization is common today, the devil lies in the details. Complete personalization at every touch point and interaction is what matters. Going beyond meeting basic expectations by anticipating customer needs through predictive analytics can be a powerful tool in creating a premium personalized experience.
8. Meaningful conversations
An often-overlooked aspect of luxury customer experience is the human angle. While firms often invest in processes and features to create luxury experiences, when customers seek empathy and compassion beyond the confines of the transaction at hand, organizations need to ensure they have the resources in place to meet that need. A meaningful conversation, without any constraints such as resolution time caps, creates an amazing bond between the firm and the customer.
9. No generic engagement
The underlying theme of luxury customer experience is exclusivity. After all, we are talking about customers who contribute to a significant share of the revenue pie for a business. In this context, much as it sounds logical, firms need to avoid the temptation to indulge in mass, generic communication with these customers. Exclusivity all the way – at the beginning, during the journey and at the point of renewal or repeat purchase.
10. Shift from standard processes to experience flexibility
The most exclusive customers expect instant gratification. No place for the usual rigmarole in terms of standard operating procedures. The CX associates dealing with this set of customers need to be completely empowered and trained to deal with the assumption that every transaction is an exception.
Essentially, for experiences to be delivered at a premium level, brands must strive to boost the comfort and leisure of customers. As Coco Chanel said: “luxury must be comfortable. Otherwise, it is not luxury.”