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Chat & LIVE Commerce, the up and coming marketing trends for luxury brands

LINE for Business

Luxury goods are a growing market of immense value. Although the Covid-19 pandemic caused a hiccup to sales in 2020, the crisis seems to have no long-term effect on consumer tastes and spending. Many brands have recovered in the short term, in line with the expectations of McKinsey & Co that consumers would return to luxury goods at the full price quickly, with storefront sales estimated to grow 1-4% this year.


The key factor driving the recovery of luxury goods is the move to digital. The perception that these products could not be traded online has changed. Brands who previously encouraged customers to enjoy an offline experience are now changing their tune to be more compatible with consumer lifestyles. Meanwhile, the platform best meeting digital needs in Thailand is still LINE. It is not just for consumers, but also for businesses to communicate and build sales.



Upgrading Chat Commerce Strategy with MyCustomer


In the wake of the pandemic, luxury brands are increasingly seeing the potential of the digital world, after lockdowns and temporary store closures. Luxury brands have had to seek other channels to get close to customers, inevitably “online channels”.


McKinsey forecasts that 20% of luxury goods sales will be online by 2025, a total value of 87 billion USD. This is three times the 2016 figure, which underlines that luxury goods brands must build a foundation of strong connections with customers.


Just recently, luxury brands opening LINE OA accounts has increased by 60%, segmented into cosmetics 54%, fashion 35% and automotives 11%. There are currently 5,000 messages per day in Chat Commerce. This illustrates the transformed opportunities from personalized service in a store to a one-on-one chat service on LINE. Customers still feel they are important and worthy of the brand's attention (source: LINE)



The Chat Commerce trend goes together nicely with luxury branded products. Selling these products relies on talking to build the relationship, leading to an online purchase experience in which the "customer feels comfortable". LINE OA has the key feature of building a Circle of Trust for customers before they decide to buy, which also leads to repeat purchases.

LINE now has the tools to enhance the efficiency of Chat Commerce which are features in MyCustomer. On top of strengthening Chat Commerce, they enable Personalized Marketing to provide a more exclusive experience.



Broadcast feature


Before starting a chat, the brand must stimulate demand among customers by sending messages or content. In this feature, brands can choose to send messages as text, photo, video, tappable message and personalized message. Up to three speech balloon messages can be sent in one broadcast.


Suppose a brand is readying the launch of its latest perfume product. It can choose to make stimulating content on a countdown of three days before the launch. It can send this content in two speech balloons at a time. For instance, 3 days before the launch it can send a full advertising video; 2 days before the launch, a shorter video; 1 day before the launch, promotional images; and on the day of the launch, the brand can send enticing text with a tappable message using many different promotional images. They can attract with many different kinds of image to see each customer's reaction to each image, while not forgetting a link to close the sale.



Also, if a brand wants to make content more special it can choose to personalize messages by inserting the follower's profile picture and name in the image which is broadcast, to make the customer feel even more interested, to create further demand or conversations.


Broadcast can also help the brand to know its customers better. Once the brand has already sent various kinds of content and checked the performance, it can analyze who is interested in which category of product. For instance, Khun A likes bags, Khun B likes perfume or Khun C likes shoes, which can inform future marketing plans.



Chats feature


Personalization techniques to upgrade the chat experience are very simple. When chatting with the customer one-on-one, the brand can attach tags to segment customers, and attach many tags to each customer. This makes it easy to remember who likes what, what behavior they have, and what level of member they should be. It is even possible to add more detailed notes, so however much data is generated, none of it is ever missed.


Chats can query old data from previous chats, helping admins to give their attention to previous service. Or, they can recommend additional products matching the customers preferences from previous occasions. Chat Commerce strategies not just about building sales. They build deep connections with the brand and impress customers to develop long-term brand loyalty.



Audience feature



This is a channel to segment target groups, specify follower groups and create tags to define follower groups. The tags can be created from new, or data can be imported from the brand's database to give the brand all-round knowledge about their customers. Sometimes, customers' offline and online behaviors are not the same. Mapping offline data to online data gives a better picture. Brands get a 360° view of the customer, enabling the design of content, experiences or promotions to more accurately target each customer segment.



Rich Menu feature


A shortcut menu bar which can display in more than one style, after the brand has segmented its LINE OA followers with various tags, and has insight into the behavior of each segment. The brand can adjust the Rich Menu in a variety of ways suitable for the needs of each segment. Rich Menu can be distinguished into two categories, the Default Rich Menu and the Segmented Rich Menu.


• Default Rich Menu is the menu bar displayed to people in general

• Segmented Rich Menu is a shortcut menu bar with exclusive displays for  certain segments. Both Segments A and B may be interested in new collections and promotions, but Segment A is more interested in shoes, while Segment B is more interested in bags. The shortcut menu bar has similar buttons which display different images. Or, if customers in Segments A and B have different preferences, it is also possible to build Rich Menus on which the number of buttons, reactions and images are completely different.



Automation feature


Speed is also a factor affecting sales. If a customer drops into chat and has to wait to long for a reply, that is not good for the brand. It can even make customers lose interest in the product. This feature helps to keep customers engaged by giving them rapid answers, when LINE OA is set to automatic reply mode. (The brand can alternate automatic mode with one-on-one mode).


This feature can help admins work more flexibly and identify the most commonly used keywords to adjust communications. This could be welcoming message, news of a new collection, giving recommendations or designing a Rich Menu.


Survey feature 


LINE OA can enable Data Personalization, and the Survey feature is a superb tool for this. It helps the brand to know its customers in detail to fulfill their every desire. If a brand is already providing a Chat & Shop service, it can create a Personal Shopper campaign by conducting a Survey. Most crucially, the survey questionnaires are sent according to segments which the brand has already created, enabling the survey to penetrate the desired segment without impacting other segments.


Once the customer is fully known in every aspect, the brand can send personalized offers to customers. These could be Retargeting or creating a campaign to provide an experience which really understands them. In Product Recommendations, for instance, if the brand already knows what kind of product that customer prefers, it can send a newly launched product in this category immediately. With just this, Luxury OA can build a sustainable Luxury Relationship.



In-LINE LIVE Viewer brings luxury to the Chat


Another aspect of chat becoming equally popular is Live Commerce. Live events have grown, particularly during the Covid-19 situation, in the face of safety considerations or the temporary closure of shopfronts. The total value of sales through Live Commerce in the second quarter in Thailand grew 300%. Live events also increased 300% (source: Positioning). According to a report by Coresight Research, live streams had a value of 6 billion USD in 2021, and will almost quadruple in the next two years.




Live events have transformed the shopping experience for consumers. It is a form of online selling which is easy and convenient to access. It is bringing the storefront to the customer who does not need to travel anywhere. There is a dialogue between the customer and the brand. The products can be fully presented. The format of the live event can be adjusted for different campaigns as desired by the brand. For instance, it could be presenting a new collection, giving advice on product care, interviews with brand ambassadors, behind the scenes footage of the design process or even a fashion show. The brand can accomplish all of this with the In LINE Live-Viewer on LINE OA. Before the event starts, the brand can inform customers with broadcasts. If it is a big campaign requiring greater awareness of the event, the brand can advertise on LINE Ads Platform (LAP).


Most crucially, the brand can align itself to customer purchase decisions, from building awareness to closing the sale. If the brand has a MyShop, the customer doesn't even need to leave the application to make an instant purchase.


The country with the biggest growth of Live events is China, whose sales through Live Commerce reached 171 billion USD in 2020, with forecasts of 423 billion USD in 2022. The popular product categories are clothing and fashion with a 36% share, followed by health and beauty products at 8% (Source: McKinsey & Co)



These are all the reasons why many luxury brands have started to add live events to their marketing strategy. A clear and fascinating example from China is the cooperation between a luxury brand and Austin Li, better known as the "Lipstick King". Live sales of the Mini-Pouch bag topped 230 units in 10 seconds, without the brand offering any kind of special discount. There was only a souvenir gift set and interest-free card payment for 12 months (Source: China Marketing Insights)



Combining Chat Commerce and LIVE Commerce


LINE has become the most efficient platform which can do either of Chat or Live Commerce. Meanwhile, marketing through offline channels is no longer adequate for brands to access consumers for every Customer Journey. Brands seeking to achieve success must choose a platform which is most accessible to consumers, creates compelling content and offers new experiences to customers. LINE is no longer just a communications channel. It has become a key sales channel ensuring that no business sector is left behind.



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Source 1: McKinsey & Co say consumers are trending to buy luxury products again at the full price with sales expected to grow 1-4% in 2021

https://blog.edited.com/blog/resources/how-will-luxury-brands-survive-the-covid-19-crisis

Source 2: McKinsey forecasts that 20% of luxury product sales will be online by 2025, a total value of 74 billion EUR (converted to USD), more than triple the 20 billion EUR of 2016. Therefore, it is critical for brands to build a foundation from today

https://www.luxurydaily.com/defining-luxury-brands-post-covid-19-amazon-strategy/

Source 3: LINE OA of luxury brands grew 60% with up to 5,000 Chat Commerce messages per day

https://www.thumbsup.in.th/line-open-stat-covid

Source 4: Total value of sales through Live Commerce in the second quarter in Thailand grew 300%, with Live events increasing 300%

https://positioningmag.com/1340876

Source 5: Total value of sales through Live Commerce totaled 171 billion USD in 2020

https://www.mckinsey.com/business-functions/mckinsey-digital/our-insights/its-showtime-how-live-commerce-is-transforming-the-shopping-experience

Source 6: Bottega Venetta's Live Stream

https://chinamktginsights.com/bottega-venetta-and-salvatore-ferragamo-successful-luxury-live-streaming-case-studies/



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