|Brands held by public companies have a sigificant advantage online, arguably as a result of the emphasis placed on innovation, L2 says. Public comapnies not affilated with a larger organization demonstrated the biggest Digital IQ gains.|
The world has largely turned to digital mediums for their consumer information, to purchase products and to share their thoughts about these products and brands with others. Most industries have learned how to harness the power of the Internet, social media and wireless mediums to build their brand image and increase sales. But according to one study, the luxury jewelry and watch industries are lagging far behind nearly all others in using these digital platforms to gain a presence in an area where consumers continue to turn.
Nearly two-third of the jewelry and watch brands surveyed were classified as “Challenged” or “Feeble,” based on the findings of the Digital IQ Index: Watches & Jewelry. Only two brands, Tiffany & Co. and Swarovski, achieved “Genius” and “Gifted” classifications, (respectively).
“Gray market concerns, counterfeit fears, limited pricing transparency, and retailer conflict all present obstacles for organizations in this category to build and sell their brands online,” the survey by L2, a membership-based consultancy that bills itself as a “think tank for digital innovation.” “However, with 67 percent of consumers in the EU and half of those in the U.S. indicating that they research luxury goods online before making a purchase, do watches and jewelry brands really have a choice?”
The top ten brands in the study are:
1. Tiffany & Co.
4. David Yurman
7. TAG Heuer
9. Montblanc (tied)
9. Pandora (tied)
Other key findings in the study of 35 jewelry and watch brands:
* Just 29 percent of brands in the Index boast e-commerce capabilities. In a category where third-party distribution is not going away anytime soon, the missed opportunity online to drive customers to offline retail is even more disappointing.
* All but three brands in the Index maintain a presence on Facebook, with communities averaging more than 200,000 fans. Mobile site adoption is up from just seven percent in 2010 to 39 percent this year. In addition, brands are beginning to abandon flash-heavy sites that are difficult to navigate in favor of more streamlined experiences that are more searchable, shareable and product-centric.
* With a YouTube channel launch and updates to its iPad, Cartier is one of this year’s biggest winners; however, the brand still only notches an Average IQ classification. The biggest disappointment is industry heavyweight Rolex, which has fallen from Gifted in 2009 to Feeble this year. Iconic brands are falling behind.
* Less than half of brands included in the study are purchasing their own brand keywords, and thus fail to appear in the top-three paid ads of their search pages. Instead, e-tailers, flash-sale sites, and discounters are seizing this valuable search engine real estate. Google is another “door to the store.” By not addressing paid ads, brands are essentially displaying discounted merchandise in the windows of their largest retail locations.
“The Watches & Jewelry industry is running out of time online,” says Scott Galloway, L2 founder. “Although these brands are beginning to invest in social media and mobile, transaction-orientation and digital marketing competence such as search, email, and retargeting lag other industries.”
For the survey, L2 used a four-tier ranking methodology: Website functionality, content and brand translation accounts for 35 percent; digital marketing, 25 percent; social media, 25 percent; and mobile, 15 percent.