Without warning and with no explanation, Kering-owned Bottega Veneta closed down its Instagram, Facebook and Twitter accounts earlier this week. Its abrupt halt to social media promotion has left the luxury fashion world stunned.
With e-commerce doubling its share of the personal luxury goods market in 2020, from 12 % in 2019 to 23 %, and with its share expected to reach 30 % by 2025 when it will become the primary channel of distribution for luxury goods, social media has become an essential part of every luxury brand’s online strategy, until now.
People are speculating that it is just a marketing stunt to lay the groundwork for the release of its Spring/Summer 2021 collection, similar to the tactics that musicians use before releasing a new album.
It’s even more confusing since in October the company was looking for a new global social media manager to “develop an overarching global social media strategy from a communications-only tool to a full funnel marketing capability.” That announcement has been removed from the Kering website, but is still available in cache.
Having just completed an analysis of a luxury insiders’ survey among some 500 executives working in or supporting the luxury industry, I wasn’t so surprised. For the last three years running, that survey shows social media is grossly underperforming luxury companies’ expectations.
Social media over-promises, but under-delivers
In the latest survey, Instagram is the best performing social media channel for luxury goods and services companies, but best is a relative term.
Only 30 % of luxury companies using Instagram said it is “very effective.” Facebook’s “very effective” measure is about half that, or 16 %. Pinterest and YouTube are 9 % and 8 % respectively, and Twitter, Snapchat, WeChat and TikTok’s very effectiveness ratings are almost too small to measure. These social media channels have had consistently low ratings over the last three years.
“We have not found any marketing tool that produces leads qualified for our luxury products and service,” was among the comments in that survey. And another said, “So far nothing is working. Social media is seeing no actual move to act.”
With all the money, resources and effort that goes into social media, you’d expect it to perform better for luxury companies. These results are especially revealing when considering that a majority are only going to invest more in internet/digital, mobile and email marketing in 2021. Budgets for all others – direct mail, print, outdoor, radio and TV – are going to remain the same or be cut.
Advertising and marketing agencies that serve luxury brands are expecting a short fall this year. Fifty-one percent of the roughly 100 agency executives surveyed foresee a decline in billings. For them, internet/digital, mobile and email marketing will grow, while a majority expect clients’ investment in all other media to decline.
On the other hand, the advertising and marketing executives have a much different view of how well their social media strategies are performing.
Nearly two-thirds (63 %) say Instagram is ”very effective” for their clients and 40 % for Facebook. They also rate the other social media channels much more effective than company executives do. Twitter is the sole laggard, rated by only 10 % of agencies as “very effective” for clients.
The luxury companies’ and the agencies’ widely variant views of social media points to how differently each group measures effectiveness. For agencies, it’s traffic, likes and shares. For luxury companies, it’s sales that are generated from social media.
And this is why Bottega Veneta’s decision, under creative director Daniel Lee, to exit social media may be a bellwether for an emerging trend. It doesn’t work to attract the right people to a luxury brand.
Searching for a creative new strategy to attract luxury customers
Dubbed the “Quiet Radical” by British Vogue, Lee has been vocal about his disdain for all the noise on the internet. “I don’t think much of the digital presentations,” he said in an interview with Cultured Magazine. “They felt empty and took so much effort in such emotionally turbulent times, yet in the end, the concepts lacked depth.”
What’s worse, it hinders rather than aids the creative process. “Everyone seeing the same things is not healthy or productive. It doesn’t breed individuality.”
And he asked in that September interview, “How can we speak to our audience in a way that works for them because, ultimately, they are the most important in all of this?” He’s apparently answered that question now.
Creativity is fundamental to luxury. “In the luxury universe, the constant challenge is to transform creativity into profitability,” said Professor Maria Eugenia Girón, Luxury Brand Management executive programme, at IE Business School in Madrid.
And creativity is the underlying value for all Kering brands. “By placing creativity at the heart of its strategy, Kering enables its Houses to set new limits in terms of their creative expression while crafting tomorrow’s Luxury in a sustainable and responsible way,” the company says.
My suspicion is Lee will apply his amazing creativity to imagine a new, more effective way to use social media and other digital tools to achieve much greater things for the Bottega Veneta brand than it ever has before. The company didn’t respond to a request for comment.
GQ’s Rachel Tashjain speculated: “Perhaps the Bottega deletion is the ultimate act of stealth luxury – it will now be a brand that travels strictly by word of mouth. If only the fans of a brand are posting about it, perhaps it will move like a secret throughout the industry, with It items popping up organically, by dint of consumer taste (imagine that!), instead of beaming down like a mandate from the corporate account.”
That is exactly what the independent @newbottega Instagram account under the editorial direction of Laura Nycole does.
Social media is mass, not “class”
Isn’t authentic word of mouth what luxury brands want in order to deliver qualified leads? Social media is such a hodgepodge of divergent messages, from Granny’s chicken casserole, kids’ craft projects, pet pictures and political rants. Where does luxury fit into that world? It doesn’t. Social media is mass, not “class.”
What’s more, the people who can actually afford luxury brands like Bottega Veneta are not likely to pay much attention to the brand’s social media posts. They are too busy living their lives and they are over-marketed too as well.
They expect the luxury brands they do business with to understand them, to be respectful of them and to personalize every interaction. Bombarding them with irrelevant posts on social media is not how to do it.
We can expect Bottega Veneta to be the first of many luxury brands that will seriously reexamine their social media presence. It may well mean, like Bottega, they take a hiatus from it, too.
And it could result in a return to print media. Reading a copy of Vogue, Harper’s Bazaar or other fashion book on the train or at the lunch counter communicates something about the individual that being glued to one’s mobile phone doesn’t.
And whether one agrees with Anne Wintour, Samira Nasr or the other editors’ tastes, they all earned the right to present it, unlike what is found on social media.
The fashion books curate fashion for busy people with money to spend. Everyone in the fashion industry has been stressing the need for more curation in response to the industry’s woes, exacerbated but no caused by the pandemic.
By pulling out of social media, Bottega Veneta is simply curating its marketing messages in a way consistent with luxury branding. It is likely that other brands will follow its lead.