Technology mobilized mainly for customer engagement in luxury

It is a realistic portrait drawn by Bain & Company in his new study “Luxuries and Technology, New Age” which measures the adoption of new technologies in the French luxury sector. This research was conducted by surveying houses that are members of the Comité Colbert about their level of adoption of 16 technologies.

Relatively low level of technology adoption

Between May and June 2022, 39 member homes of the Colbert Committee responded out of 75 homes that were contacted. The study also reproduces interviews with heads of houses, consortia and technology partners and various documentary research and experiences of Bain & Company. The study shows that the level of adoption of new technologies in French luxury is still relatively low.

Luxury is just at the beginning of technological adoption. There must be a cultural revolution within luxury houses, in terms of talent, organization, work methods and digital platforms. We need joining forces and openness to technological progress in other sectors. The main obstacle is the feeling that use cases are considered of little relevance. The houses also face a shortage of skills on the field.

” Adoption of new technologies in luxury is still in its infancy” says Mathilde Haemmerlé, partner in charge of luxury at Bain & Company Paris. ” They can play a central role in the profound transformation of the sector in customer service, operational excellence and sustainable development” she continues. “The areas of application that need to be explored are still numerous and promising. Joining forces across the sector will be a powerful accelerator she advises.

Only three technologies have an adoption rate above 30%

Only three technologies, RFID, 3D printing and 3D imaging have an adoption rate above 30% of luxury homes surveyed. In contrast, luxury is becoming a pioneer in adopting technologies such as the metaverse and NFT. Half of luxury houses are testing these two technologies or plan to do so within three years.

The pace of adoption is accelerating. Luxury houses are currently testing an average of 3 additional technologies or plan to do so in the next three years. The most advanced houses test up to 7 technologies. These test phases apply to almost all technologies, especially those that are emerging or the most avant-garde, such as NFT, metaverse, blockchain, holography, gloves and haptic displays that allow you to grasp objects from a distance, helmets for neural detection analysis emotion and body scanning scanners.

To date, Houses mainly invest in technologies that target customer engagement in a concrete way and that enrich the relationship with clients, so that it is also practical, seamless, hyper-personalized and experiential. The challenge is to make the experience consistent across all distribution channels. These stages include visualization technologies with 3D images and virtual or augmented reality, which are already widely accepted.

Invest in 3D digitization of products

The study points out that it will be necessary to invest in 3D digitization of products in order to implement augmented reality. The goal is to personalize and enrich the experience of selling at a distance, across channels and immersion in the universe of brands. The practical side must allow for easy exchange with the seller, easy access to their product selection and the benefit of virtual fitting, whether it’s fashion or beauty.

The level of adoption is lower for technologies that serve operational excellence. RFID is one of the most accepted technologies. Blockchain, for its part, concentrates experiments, with 39% of houses in the test phase. Blockchain enables end-to-end product traceability. Artificial intelligence follows. It aims to optimize inventory allocation, supply chain fluidity and the structure of the collections being sold. 29% of houses are in the test phase, and 19% have adopted it. More than half of the houses use it for predictive demand management, and some for managing the creative process.

In terms of operational excellence, the challenges are precision, predictability and automation. The main concern is that the product is available for sale in real time, and if there is only one copy in the store, whether it is reserved or not. In terms of quality, automated optical inspection, for example, is currently accepted by only 16% of the sector, but is being tested or planned to be tested in the next three years by 33% of the industry.

Experiments are multiplied with new materials

Finally, technology is not yet seen as a catalyst for reducing the carbon footprint of luxury companies. However, experiments are multiplying at different stages of the value chain with new materials and environmentally responsible production processes. There is also the use of artificial intelligence integrated into sales forecasts for the most accurate production, creation of virtual twins of operations, etc.

The study concludes with the fact that large luxury groups have an important driving role in the progress of the industry as a whole and in training the smallest houses for technological challenges. During the study, sixteen technologies were selected and sent for the opinion of Luxury Houses are. These are biotechnologies, molecular recycling, 3D printing, artificial intelligence and machine learning for process optimization, artificial intelligence and machine learning for customer engagement. , augmented reality and virtual reality, automated optical inspection, digital scanner, 3D imaging, holography, neural analysis, gloves and haptic displays, radio frequency or RFID identification, blockchain, metaverse and NFTs.

The Colbert Committee was founded in 1954. It brings together 92 French luxury houses, 17 cultural institutions and 6 European luxury houses. It represents 14 professions: crystal, leather and leather goods, design and decoration, publishing, faience and porcelain, gastronomy, haute couture and fashion, jewelry and watchmaking, music, goldsmithing, palaces, perfumes and cosmetics, heritage and museums, wines and alcoholic beverages . The Colbert Board wants to promote, sustainably develop, transfer French knowledge and experience and creation in order to instill dreams and contribute to the international influence of luxury and the French art of living.

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