Online store merger prods luxury goods makers toward Internet
By Astrid Wendlandt and Pascale Denis
PARIS (Reuters) - The merger of the world's two biggest online fashion stores, Net-a-Porter (NAP) and Yoox, sends a warning to luxury brands to embrace the Internet with more vim after years of resistance.
Top brands such as Prada and LVMH's Christian Dior still baulk at the idea of selling clothing online as well as through their plush boutiques.
"Considering the level of sophistication and image of our ready-to-wear, we feel the shopping experience has to remain immaculate and in-store," says Stefano Cantino, head of marketing and commercial development at Prada.
"You need the physical environment to try the product on and you need an exclusive service which you can only get in a boutique."
But as more people choose to buy through a website instead of going to Rue St Honore or New Bond Street, that position looks increasingly untenable. Brands whose goods are not available online risk losing customers to rivals.
Luxury executives understand the Internet will be vital for future sales, particularly to so-called Millennials -- web-savvy customers born between 1980 and 2000.
Yet top brands such as LVMH's Louis Vuitton, Hermes, Prada and Chanel have been slow to invest in e-commerce as other retail sectors have done in the last decade.
Some have focused as much on the shopping experience as on the products themselves, spending heavily on worldwide expansion and revamping stores with help from famous designers. Continued...