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Yoox CEO François-Henri Pinault
PPR—the luxury group that owns Alexander McQueen, Gucci, and Yves Saint Laurent, among other—is getting serious about e-commerce. The company released a statement yesterday saying that they are partnering with YOOX Group "to accelerate the e-commerce development of several PPR luxury brands."
E-commerce has traditionally been a difficult space for luxury brands to manage (swing by the Masion Martin Margiela website, which is powered by Yoox, if you need an example of this). Not only do virtual shops run contrary to the heavy lifestyle and customer-service focus many luxury houses were built upon, but it is also extremely difficult to explain to a customer why a dress is worth, say, $20,000 when you have little more than a thumbnail image and a few bullet-point descriptors to work with. That said, Net-a-Porter has managed to do it, and brands are beginning to believe that if they don't figure out the internet, they're going to be left behind.
According to the joint statement by Yoox and PPR, the PPR brands poised for an online makeover include Bottega Veneta, Yves Saint Laurent, Alexander McQueen, Balenciaga, and Sergio Rossi (interestingly, not Gucci).
PPR's CEO, François-Henri Pinault (he of Linda Evangelista-babymama-drama fame), gave an exclusive interview to Business of Fashion discussing the strategy behind the partnership. Pinault explains that, in his view at least, strong e-commerce isn't about bells and whistles. "I'm talking about basics, nothing revolutionary: easily finding a product; the checkout process has to be very efficient, on-time delivery," he said.
That's where Yoox Group comes in. The company describes itself as a "global Internet retailing partner for leading fashion and design brands." In addition to powering sites for luxury brands on an individual basis (like Margiela), the company also runs yoox.com, a sort of global luxury emporium. It's a site with the rare ability to manage the demands of international commerce (Yoox.com services about 100 countries from a single url), and The Corner—an innovative site that functions sort of like e-commerce's version of shop-in-shops—shows how well Yoox understands the importance of luxury branding.
"YOOX is the best player when it comes to e-commerce and logistics platforms in the world of luxury and technology," Pinnault told BoF. "By mid-next year, we will be able to sell online in 100 countries around the world. It's as simple as that, thanks to this partnership. YOOX will bring all the technological know-how, plus their e-commerce skills, and [the ability to] deliver worldwide, on time, at a very good level of service."
Sounds simple enough. But, again, very few luxury brands have been able to transition to a relatively seamless lifestyle and customer service experience on the web. Ralph Lauren comes to mind. Armani, a PPR luxury brand with multiple channels similar to Lauren's, has been less successful.
And Pinnault himself admits that while basics are important, there's more to the luxury experience than on-time delivery. "These first steps are the basics, so you have to be there very fast to make sure your shopping experience, globally, is on the right level. But that’s not enough? I think the best checkout process [online] would be Amazon.com, for sure. But, as a luxury brand, should we be compared with those guys? We cannot stop there. The vision has to be much beyond this in terms of re-creating the differentiation of a luxury brand online."
The interview is insightful and fascinating in terms of the future of online luxury retail, but still leaves much in the dark about the specifics of how all this is going to work. One major issue that wasn't really addressed in this particular article are the challenges of international e-commerce, for example. Even Amazon, who Pinnault cites as the model for checkout experience, has struggled with that.
This is a wildly ambitious announcement, and we are looking forward to seeing how it develops.
· François-Henri Pinault, Chairman and Chief Executive Officer, PPR [Business of Fashion]