José de Cabo spends a lot of time on social media. But unlike most people who post on Twitter and Facebook to keep up with friends and family, Mr. de Cabo and his team of more than 140 people — primarily based in New York and London — have another goal. They scour the world’s most popular social media sites on behalf of luxury brands like Lancôme and Yves Saint Laurent, hunting for photos taken by individuals that feature the brands, say an image of a handbag or pair of shoes, that could be used in marketing campaigns.
By tapping into the digital world, Mr. de Cabo said, brands (which have final say over what photos are used and do not pay people for their online images) can foster closer relationships with their followers. They also can add extra credibility to marketing at a time when consumers are increasingly turned off by traditional advertising.
“There’s an army of fans out there for every brand, and they want to be part of your world,” said Mr. de Cabo, who started the company, called Olapic, with friends soon after completing an M.B.A. at Columbia University in 2010. The start-up says that its social media content can increase online sales by roughly 5 percent compared with traditional marketing photos.
“People are now wired in a different way,” Mr. de Cabo said. “They are used to seeing authenticity online. By embracing that, brands can build a stronger connection with consumers.”
Services like Olapic are the latest attempt by luxury brands — alongside traditional retailers — to stay relevant in a world where social media has given people greater power over how a company is perceived online.
Where once a brand could use its marketing campaigns to present a coherent message, the meteoric rise of social media — and its billions of daily digital discussions, many involving global luxury brands — has forced companies to reassess how they use, interact and respond to the likes of Instagram and Snapchat.
That includes finding new ways to engage with those brand followers, either through regular digital interactions on popular social media sites or offering online extras, like behind-the-scene looks at fashion shows or photo shoots, to reinforce their ties to a designer or fashion house. Brands also have turned to social media to extend their presence beyond the traditional customer base, partly to reach a new generation of consumers that have grown up online.
Yet just like in the offline world, some luxury brands have embraced social media and other digital activities with greater energy than others. Those are the findings of a recent report by L2, a company based in New York that tracks the digital impact of brands. The study, based primarily on U.S. consumer habits, compared the digital strategies of some of the world’s most well-known fashion houses, such as Chanel and Dior, ranking each company on their social media outreach, digital marketing, e-commerce and daily interactions on mobile platforms.
Some digitally savvy brands like Burberry, according to L2’s report, have incorporated social media and other online platforms directly into their wider marketing campaigns. These activities, says Maureen Mullen, L2’s head of research, have given companies a greater reach in the online world, associating Burberry’s regular posts on the likes of YouTube and Snapchat with people’s increasing desire to be connected to the next online trend.
“Seven years ago Burberry meant ‘British’ and ‘plaid,’ and now a core association of the brand is innovation,” Ms. Mullen said. “They’ve effectively changed the brand values through a lot of the things they’ve done in a digital capacity.” (Kate Spade is the only other company in L2’s “genius” category.)
But most luxury brands have yet to turn a growing digital presence into increased sales.
Online sales still represent just 6 percent of luxury companies’ total revenues, according to L2. And roughly 10 companies, including Ralph Lauren and Michael Kors, dominate this digital world, generating a combined 65 percent of all traffic to websites associated with the luxury industry.
Yet retailing experts say that how a company is viewed online — not just by its primary customers, but also by the wider online population — can have a significant impact on a brand’s overall reputation, particularly with digitally literate young shoppers.
“With social media, consumers are taking brands and reinventing them to fit their own tastes,” said Frederic Court, a London-based partner at Felix Capital, a venture firm that invests in fashion-related digital companies. “Brands need to find a new way to relate to their customers.”
This change has been particularly acute for luxury brands such as Louis Vuitton and Chanel. These companies — born decades before social media — have fostered an image of exclusivity as part of their marketing strategies, portraying a lifestyle that is often out of reach for most people.
In response to the digital free-for-all that is synonymous with the Internet, analysts say many companies have had to expand their brands’ online footprint, often teaming up with social media darlings and other celebrities to present a more populist image.
That includes Dior, which joined forces with the music star Rihanna, whose social media following is four times as large as that of the fashion label. Calvin Klein signed a deal with Justin Bieber, in part to tap into the Canadian singer’s avid following on Instagram and Twitter, where his audience is up to 15 times as large as that of the brand.
“Each brand needs to strike a balance between exclusivity and inclusiveness,” said James Lovejoy, an analyst at Brandwatch, a technology firm in New York that tracks discussions on social networks.
“When Rihanna wears Dior in an Instagram photo, the reach she gets might not be exactly Dior’s consumer base,” he added, “but she certainly attracts a wider audience.”
For Matt Jacobson, head of market development at Instagram, the photo-friendly online platform that has become the social network of choice for luxury brands and their followers, this ability to engage with a wider audience lies at the heart of how companies should use online platforms.
The British label Karen Millen, for instance, has crowdsourced photos from social media as part of its online store, showing how its customers — and the wider world — view the brand online. And Coach turned to user-generated images in a recent advertising campaign to highlight its range of footwear, including an interactive map showing where customers had taken their digital photos around the world.
These types of online interactions, Mr. Jacobson said, would happen irrespective of a brand’s participation. But by engaging with both core consumers and the broader digital audience, luxury brands have an opportunity to use the marketing potential offered by social media.
“The conversation is happening, with or without you,” he added. “You can’t choose to opt out. But you can choose not to participate.”
Rachel Felder contributed reporting.
[By Mark Scott] [Read More] [From The New York Times] [Image From Wmagazine]