Richemont One Step Closer To Group Brands Enjoying Online Sales

by Ariel Adams (RSS feed)
Apr 2nd 2010 at 10:01PM

I recall discussions with people in the luxury industry just months ago complaining about how the Internet will never replace the "in store" luxury buying experience. Claims of "we will never sell online" were uttered with regularity. While this was the mantra of many, the undeniable marketing power of the Internet is becoming more and more clear to luxury brand executives who can no longer ignore the allure of online sales (or the failures of in-store sales). When it comes down to it, price is not the only reason people buy online, it is convenience and sheer product availability. You can love a product and want to buy it, though you won't if you can't get it in your town. The Internet remedies all that. Plus, most luxury buyers go online to discover and research brands, so isn't it logical that they will want to purchase there as well?

All this seems pretty clear to the Richemont Group who recently announced the acquisition of NET-A-PORTER.com, an online luxury item retailer. I believe that the deal which involves the acquisition of a controlling volume of share is not 100% complete, but will more than likely lead to Richemont Group owning a controlling interesting in the NET-A-PORTER limited, the controlling company behind the site. NET-A-PORTER.com is UK run, and has been enjoying a healthy level of online luxury sales since its inception is 2000. While it has a silly-for-luxury name, the site clearly understands what it takes to sell luxury items online. The Richemont Groups owns a number of watch and jewelry brands, including IWC, Cartier, Panerai, Jaeger-LeCoultre, and more. At this time NET-A-PORTER.com does not sell watches.

I predict that Richemont was interested in NET-A-PORTER not only because of the site's success (and profits), but also to learn about successful practices for selling luxury goods online. The careful company has been planning an increase in online marketing for its brands, and at least online sales for some of them (e.g. Cartier). I personally predict that most of the Richemont Group brands will be "officially" available for sale online in the future - and that Richemont themselves will be the entity selling the good as opposed to the traditional network of third-party authorized dealers.

Ariel Adams publishes the luxury watch review site aBlogtoRead.com.

Tags: jewelry, NET-A-PORTER.com, online sales, Richemont Group, watch