The case for mobile investment for luxury brands is looking ever more convincing.
The latest research from Deloitte has found that smartphone penetration in the UK is nearing 50% and tablet penetration 6%. In addition, mobile browsing is on the rise – in Q3 2011 ComScore found that 46% of mobile users had accessed a mobile site and 44% had used a mobile app. And these are figures for the population as a whole – affluents will be well ahead of these trends.
So it’s not surprising that Professor Scott Galloway and his colleagues at luxury thinktank L2, well known for rating luxury brands on their digital competence, have focused their latest study on the emerging field of mobile marketing.
In compiling their Mobile IQ report, L2 used a similar methodol0gy to their well known Digital IQ studies. Ratings were based on weighted scores for 4 different mobile marketing categories – mobile sites (40%), mobile apps (30%), mobile marketing (15%) and innovation and integration (15%). Those with a score of over 140 received ‘Genius’ status, 110-139 ‘Gifted’, 90-109 ‘Average’, 70-89 ’Challenged’ and less than 70 ‘Feeble.’
So how did the top 100 luxury brands measure up?
Well, only 4 out of the 100 - Sephora, Nordstrom, Macy’s and Net-a-Porter – were awarded ‘Genius’ status, as compared to 11 times as many who were rated as ‘Feeble’. Most of the problem was that luxury brands had yet to fully embrace mobile rather than a lack of competence in mobile strategy execution. However, Galloway and his team did level some specific criticisms at luxury brands and their approach to mobile marketing.
Mobile Sites
It appears that luxury brands have learnt their lesson from their slow response to the digital revolution – 2/3s of those in the survey had a mobile optimised site and 67% of those sites were m-commerce enabled.
However,the L2 study criticised most of the sites on offer for not offering a device agnostic experience – that is, not offering all of the functionality of the main site in their mobile site. Common features found to be omitted included videos, product reviews and user ratings.
Given the vastly different browsing experiences between iPad and smartphone, and the growing evidence of the iPad’s importance in ecommerce, it was surprising to find that the provision of iPad-specific experiences lagged badly. Only seven of the 100 brands in the study had an iPad-specific site. Of the remainder, 11% were directing iPad users to their main mobile site and 82% were sending them to their main site, where full functionality was missing in almost 1 in 5 cases because of the use of Adobe Flash.
Mobile Applications
70% of the top 100 brands had at least one mobile application, however most of the apps on the market were criticised for lacking utility and ’stickiness’. Less than 1/3 of all apps produced were commerce-enabled and features such as notifications, geolocation and
integration with the phone’s camera and gyroscope were rarely encountered.
In addition, just 16% of the sample had developed an experience for the unique features and functionality of the iPad. A more common practice was to replicate the same app across both smartphone and iPad.
Mobile Marketing
Although 78% of the brands in the study engaged in email marketing, only 24% had links to mobile-optimized versions of their email
content despite the fact that consumers are opening 23% of their emails on their mobile devices.
In addition, integration of mobile offerings was poor. Just 18% of brands with mobile sites were found to have links to their mobile properties and only 19% of the brands with mobile apps include download links to the corresponding app store.
In the paid mobile search field, luxury brands were found to be lagging too. In the US in October 2011, mobile accounted for approximately 15% of all clicks and 13% of all impressions on Google. During December, it is estimated that those figures rose to 25% and 20% respectively. Despite this, few luxury brands were observed to be taking proactive steps in this field. Of search returns rendered on a mobile device, only 13% of brands in the sample had links to any element of their mobile presence on the first page of Google results. Just over a third of the brands had store locators and/or maps returned in their results.
So which brands should luxury marketers be looking up to in this emerging field? LVMH’s Sephora secured top spot in the study and was praised for its long term and sustained investment in mobile, including a feature rich mobile site and distinct apps for the iPhone and iPad.
Other brands to earn praise for their mobile initiatives were Calvin Klein for the mobile element of the ‘CK One’ campaign, YSL for their ColorMirror virtual make up app and Salvatore Ferragamo for their iPad site.
It’s the contention of Professor Galloway and his team that mobile competence is inextricably linked to shareholder value and luxury brands that lag will suffer in the long term.
With more people forecast to access the internet wirelessly via a mobile device than from a wired connection within 3 years, and mobile commerce sales set to quintuple over the next 5 years, it’s hard to disagree.
Although this latest study from L2’s proves that most luxury brands have a long way to go before truly harnessing the power of mobile, our advice would be not to panic. We’d advise embarking on a course of structured low cost testing so that by 2013 you understand how mobile can work for you and how it might drive business.
