Luxury Retail: Looking beyond the slump
2020 has been a difficult year for many, and brick and mortar retailers are no exception. Luxury goods have been one of the hardest-hit segments—Q2 revenue dropped by 60% overall. Driven by a combination of temporary and long-term changes in consumer behavior, savvy luxury goods retailers are quickly adapting. Many are growing revenue and increasing consumer engagement by capitalizing on new strategies and channels.
While many luxury goods brands are accustomed to having a substantial amount of purchases happen in-store, travel restrictions have temporarily created a barrier to travelers purchasing luxury goods at brick and mortar storefronts. This has driven a boom in multilingual content meant to engage international shoppers online.
Given that online sales have traditionally accounted for roughly eight percent of luxury retail sales, some retailers aren’t making this kind of content a long-term priority. However, if we continue to dig further into trends in consumer behavior, engaging international audiences with authentic online content quickly jumps out as a priority.
Shifts in Consumer Journeys
While online sales of luxury goods have typically sat below ten percent, that figure is projected to grow to 19 percent by 2025. Perhaps more importantly, the role of digital touchpoints in luxury sales has grown exponentially, with 78 percent of luxury sales today being digitally influenced.
In other words, the majority of luxury consumers are engaging with multiple forms of digital content as they consider a purchase. This trend isn’t unique to luxury retail—the average person views 11.4 pieces of content before arriving at a purchase decision. If you’re a luxury retailer catering to an international audience, this makes translation and localization of a key part of your globalization strategy.
In contrast, consider the importance of localized digital content with a few stats relevant to growing international consumer audiences:
- Revenue has grown by 18 percent in countries outside of the top ten revenue-producing countries.
- Most luxury retailers support 10 languages of the top global consumers. However, on average global luxury considers are found in countries speaking 36 different languages.
- Given the shift in global demographics among consumers, consumers now rank brand history and heritage behind attributes like quality and customer service.
- With Gen X and Millennials quickly becoming the largest consumers of luxury goods, brands are increasingly leveraging social media to convey engaging brand stories to new audiences.
Tying these factors together, one can begin to see why getting ahead of the translation curve is becoming a key part of luxury brands’ success in foreign markets. Let’s take a closer look at how leading luxury brands are adapting.
Adapting to the New Normal
Given the crucial role language plays in connecting with consumers, luxury retailers are increasingly turning to localization and transcreation language services. Translation is becoming a part of their content creation process from the outset of expansions into new global markets.
At a glance, engaging a translation partner at the beginning of the content creation process may seem like a good way to quickly balloon costs and marketing expenses. However, the opposite is often true.
Companies with disjointed processes for managing translations often have disparate teams reaching out to multiple vendors for translations and multimedia localization. Many fail to leverage powerful tools, like translation memory. Others end up with inconsistent translations that miss the mark, damaging their brands’ reputations, perceived values, and abilities to resonate with new international consumers. The result? Translation-related expenses and budgets balloon by 30 to 40 percent as they attempt to expand.
At Protranslating, we help luxury retailers create a unified approach to translation. By making translation a part of globalization strategies from day one, we help companies achieve consistent, scalable results as they expand across foreign borders.
Ready to talk about how we can help your business? Contact us today to chat.