Luxury: indictment against digital transformation experts who forget the human

Luxury: indictment against digital transformation experts who forget the human


Digital transformation in the luxury sector is too important to be left to technical experts. This is an indictment against poorly conducted digital transformations in the luxury sector published by the Luxury Institute, a company which indicates that it has advised 1,100 luxury brands for 18 years. The Luxury Institute interviewed a panel of executives and former executives of luxury or high-end brands on issues related to digital transformation. Avoiding technical teams where people have no empathy with customers or salespeople Among the issues raised, the Luxury Institute is concerned about technical teams that include people who have no empathy with customers or salespeople in shop and define them as "subjects" instead of humans. This lack of empathy undermines the design of customer experiences and journeys. For the Luxury Institute, this goes so far as to affect how data is collected, circumventing privacy laws or operating barely within legal boundaries, while trampling ethical lines. Therefore, this places the brand in legal danger and destroys consumer confidence. It also results in a brand developing biased, soulless, often manipulative algorithms. This is the case, for example, when prices are overcharged for well-off, or less well-off, price-insensitive customers.

The brand managers consulted by the Luxury Institute consider that too many digital transformation projects are entrusted to technicians, internal or external, focused on technologies, platforms, software, data and processes. These experts must not be allowed to hijack culture, or the experiences and journeys of the customer and store associates into standalone projects that are efficient in theory but ineffective, soulless and disconnected and create dysfunctional experiences. These leaders are critical of the technical focus of many brands that have to catch up in e-commerce, face disconnected channels, and are unable to determine which tasks should be automated and which should be optimized with human interaction. In addition, the fact that the same solutions are offered to all brands destroys the creativity and uniqueness of a brand's DNA, especially in the high-end and luxury product and service categories. Brands identified as leaders are Sephora, Gucci, Amazon, Nike or Tesla Faced with this situation, the panel of executives or ex-executives of brands questioned by the Luxury Institute nevertheless cites Sephora, Gucci, Amazon, Nike and Tesla as being leaders in terms of transformation that stand out from their competition. This is a one-time assessment because transformation is a journey that has no end. More established brands such as Hermès, Chanel and Rolls-Royce are also mentioned as moving quickly and successfully in their digital transformation in order to remain relevant to their customers. For the entire luxury industry, the level is rated "poor", with a rating of 5 to 6 on a scale of 1 to 10 (worst to best). However, executives consulted by the Luxury Institute believe that the luxury industry will win out in the end as it has since the beginning of mankind. They believe that most iconic brands will drive their digital transformation safely if not easily. This journey is there to serve the human beings who are valuable members and constituents of a sustainable industry. The Luxury Institute draws attention to the fact that in this transformation of a brand, the top managers of the company must be sufficiently competent in the principles of digital transformation. Leaders cannot delegate digital transformation to consultants or technology companies and then wait for success to happen. Leaders must create the humanistic context for digital evolution. Only truly customer-centric brands that see their employees and customers as human beings, not chess pieces, will succeed. Skills are needed in communication, empathy and emotional intelligence. The difficulty can be the state of mind or the fact that the company is organized in silos According to the panel interviewed by the Luxury Institute, the degree of difficulty of the digital transformation s evaluate item by item. In some cases, transforming the mindset of the business is the hardest part; other times it's digitization. For example, if the business is organized in silos, with disconnected channels with different goals and rewards, it cannot align behind the design of a seamless customer experience. However, even if a team is customer-centric, with the right mindset and the right creativity, they cannot achieve a digital transformation project without access to rich and relevant data that is compliant with regulations and ethics. How data is accessed becomes critical to the brand, in terms of risk and reputation considering privacy laws and consumer concerns. This can no longer be delegated to third parties. The brand must take control of data acquisition, which has become the lifeblood of any business. Panelists interviewed by the Luxury Institute point to common mistakes made by luxury brands in their digital transformation efforts . Many brands mistakenly define digital transformation in luxury as a human replacement project. Instead, brands should view transformation as “enhancing” humans. The panel is concerned that some brands are allowing technology to erode or replace the rich and powerful human relationships they have cultivated over time. The creation of desire is key This same panel warns that the creation of desire is precious, that the choice of products and services, and the “joyful emotional intelligence” of the ambassadors of luxury brands must prevail. Technology will always provide a better solution for specific tasks in the business model, but the richness of human connections that defines the luxury industry must not be broken, or this industry becomes another soulless product category defined by price. Digital transformation is all about brand imagination and creativity that creates much greater emotional and economic value for customers and store associates through improved communications, interactions, experiences and journeys. Digital transformation is fueled by the optimization of human and digital resources. It is, at its best, about building, empowering and improving internal and external human relationships. Digital transformation is not something that is imposed on employees and customers. It's not manipulative, coercive or abusive. It requires education, inspiration, collaboration and constant enrichment. Second, digital transformation is not a project or a process. Technology, data and business analytics are part of the toolkit, but not the end goal. Transformation has elements of revolutionary change, as well as endless agile evolution. The transformation stabilizes for some parts of the organization for a while, but it never stops. It may be necessary to control it with projects and processes, while having the ability to see the big picture, including client goals and strategies, as well as the smallest tactical details, simultaneously. Build seamless, frictionless execution Finally, digital transformation requires a change in organizational structure because it involves seamless, frictionless execution, not self-interested, disconnected, or dysfunctional activities. It is necessary to organize around customers or customer segments, beyond products, functions and channels. Domain expertise is the main resource for the organization. Good experts must organize, reorganize and unite around customer-centric goals. This requires agile teams whose members are accountable to each other for measurable inputs and results, and then accountable to the 'organization. Over time, executing the different steps, with precision, will evolve the business model successfully, without fear or confusion.

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Luxe : réquisitoire contre les experts de la transformation digitale qui oublient l’humain