Get more insights into EY’s detailed study.
360° acquisition strategy
80%see this as having high business value
Most (80%) respondents to the study agree on the high business value of driving a 360° acquisition strategy through omnichannel marketing but less than a third have the capabilities to deliver it. But mastering the digital ecosystem can be a complex task.
Discovery
Once exposed to and made aware of a brand through digital channels, the potential client enters the discovery phase of the brand universe. Immersion in a brand’s universe is, of course, facilitated by a physical experience: entering a store, leafing through a publication, visiting a manufacturer or talking to a watchmaker. So how do you reproduce or enhance this magic on digital channels?
Taking care of the website interface – as the major showcase for a watch brand – is key. One of our respondents summed it up: “The purpose of our website is not really to sell online, but to inspire the customer to visit our store. They come to us already informed, they show their phone to the salesperson and indicate which product they are looking for.” Investments in the catalog, the design and finally the brand universe must not be neglected, regardless of whether the brand has an e-commerce or a showcase site. As web platforms evolve, they tend to integrate new functionalities, contributing to a more fluid discovery of a brand’s universe and collections, so roadmaps need to be followed closely.
Advice
Once familiar with the brand, its universe, its collections and its models, the customer seeks more dedicated guidance on his or her choice in the form of personalized advice. Some brands are taking advantage of technologies to respond to the hyperconnectivity that has become embedded in the habits of “omniconsumers”. Against this background, the customer-advisor relationship needs to evolve and make use of each channel to offer personalized advice.
Omnichannel relationships
67%highly value personalized relationships across channels
Two-thirds of those surveyed see high value in unique and personalized 1:1 client relationships across all channels. At the same time, 80% of those questioned believe that while they essentially have the foundations in place already, they have not yet implemented the full capabilities to truly deliver an omnichannel customer experience.
Selection
Having received personalized advice – whether in a physical store or online – the next step in the customer’s journey is to select, try on and even personalize a watch. Although digital technology cannot replace the physical experience, particularly of how a watch “feels” on the wrist, it can be used as an extension to elevate the customer experience. Feedback from respondents across all price ranges on the trendy “virtual try-on” confirmed: while the reputation of augmented reality is well established among young people (Instagram filters, Snapchat) and in the world of beauty (trying on lipstick with your smartphone), it has yet to prove itself in the world of watchmaking.
The topic of selection tools goes hand in hand with the ability to configure and customize products. There are widely differing views on this matter, with 20% of respondents indicating a high business value and 27% indicating no value in online configuration and personalization services.
Purchase
Once the product has been chosen, it's time for the decisive step of acquisition. Here again, habits and customs have evolved in line with innovative models inspired by other industries. For example, the majority of respondents were in favor of offering new digital financing models, with 86% indicating that they saw medium to high business value.
New leasing models were less attractive however, with high refurbishment costs cited as a key barrier. Moreover, the concept may clash with the notion of a high-end watch, which is a collector’s item with a heritage and a legacy – not an interchangeable fashion accessory. Also in terms of exclusivity, brands with a high-end positioning are not aiming to enable accessibility for all.
Service
The customer journey does not end with the purchase; this is especially true in the watch industry where products require maintenance and repairs throughout their life. Digitalizing service makes it more fluid, faster and more transparent, which contributes to its optimization. A customer requesting a repair via the website can be offered a “pick-up” service at home or work, or request specially adapted and secured pre-stamped packaging with free-shipping. In short, those who prefer not to go to the store no longer have to. The result is maximum efficiency in the minimum amount of time and with the least possible disruption.
Digital post-sales services
87%see these as being of medium to high value
Our respondents confirm this: 87% of them see digital post-sales services as being of medium to high value. Digitalizing service also enables valuable data to be collected about the customer, the watch, the maintenance history and the details of the repairs performed. The data is valuable in itself, providing visibility to the customer on the status of the service and allowing a central record of maintenance and repairs. But it also provides information, e.g., about owners, especially those who bought an object on the secondary market and had not yet been identified by the brand.
Transfer
The last step in the customer journey, when the watch is passed on, has often been a blind spot for brands. However, they can respond to today’s challenges around this stage to benefit customers. Indeed, when transferring a watch, one priority is to guarantee the authenticity of the product. Digital approaches allow brands, distributors and retailers to take a stand on managing this issue. And it’s worth the investment. The second-hand market has been a popular trend for several years and has seen a rapid rise in recent years, helped by the arrival of young consumers. Millennials account for 32% of spending on the luxury market, expected to rise to 50% by 2025 according to Forbes magazine.
One of reasons companies are keen to support second-hand items is their desire to safeguard the value of their products by certifying those already in circulation, or even furnishing them with a new guarantee. Indeed, the exchange of certified products (authentic and in good condition) contributes to the value of existing watches, and therefore the image of a brand. Once again, this is not really a question of profitability – it’s a necessity.
Challenges and next steps
Digital trends are certainly on the radar of watchmakers across categories. The challenge for many, however, is how to evolve from a multi-channel model into an omnichannel model? In this respect, data is the main cog in the wheel. It’s what brings incremental value to the customer experience, far beyond the sum of the benefits gained at each step of the journey. Harnessing data appropriately will be an important task for watchmakers in their transition to omnichannel model.
Summary
Technology in watchmaking is – and will continue to be – first and foremost at the service of the most important stakeholder: the customers. Retail is all about customer-centricity, and the digital and physical customer experience are not opposing concepts. Viewed as complementing or extending each other, they make up a whole which keeps the customer at the center.
