Twenty years after Net-a-Porter first launched, we look back at how the first multi-brand designer e-tailer transformed the fashion industry – and what might be next for luxury e-commerce
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This week, Net-a-Porter celebrates its 20th birthday, a milestone moment for a brand that completely transformed the luxury retail landscape when it first launched two decades ago. The revolutionary idea – of selling high-end fashion on the internet – might have been met with skepticism in the year 2000, but led the way for the fashion industry to alter itself dramatically once brands and consumers saw the advantages of the concept.
“Natalie Massenet is a true visionary and coming up with the idea for Net-a-Porter – and of course her impeccable execution of that idea – is, to my mind, without a doubt, the most instrumental reason for luxury fashion embracing technology and the evolution of how brands retailed,” Lucy Yeomans, founder of luxury fashion game Drest and former editor-in-chief of Net-a-Porter’s print publication Porter, tells us. “It was a privilege to observe the company’s growth into new sectors that, until then, had never been thought of as ‘right’ for the online luxury fashion space; this firmly cemented Natalie’s position as one of the world’s most pioneering female entrepreneurs.”
NET-A-PORTER INSTAGRAM
“Net-a-Porter has unlocked the apex between great quality and premium service at scale”
Laura Saunter, senior retail strategist at trend-forecasting company WGSN, explains that Net-a-Porter’s triumph came from prioritising the high-end service that consumers were used to finding in luxury department stores.
“In terms of its success, what Net-a-Porter has done well is unlock the apex between great quality and premium service at scale. Usually quality control of service is the first thing to dilute when anything scales, but they’ve maintained that, which is the key to being number one. The company has essentially closed the gap between content and commerce while offering the kind of white-gloves service that one would expect in a luxury store, but replicated online.”
REGAN CAMERON FOR HARPER'S BAZAAR UK
Over the 20 years since Net-a-Porter first launched, the luxury e-commerce market has boomed, with countless standalone e-tailers popping up and most luxury brands now embracing online shopping as not only a key revenue source, but as an opportunity to attract an entirely new set of customers.
“The luxury online shopping market has become much more diverse and has gained momentum over the past few years,” retail consultant Robert Burke says of the industry. “Online sales grew by double digits in 2019 and by 2025, e-commerce will account for 30 per cent of the luxury goods market [according to management consultancy firm Bain].” In fact, the market has now grown so much that many retail experts, including Burke, believe that it is overcrowded and consequently “more fragmented”.
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“Luxury brands and retailers, with the exception of a few, have understood and embraced the importance of having an e-commerce presence,” Heather Gramston, head of womenswear buying at Browns explains. “There is no doubt that the online market has become more saturated in recent years and as a result the customer has had more choice in deciding where to make their purchase. That’s why for us at Browns, the customer experience is everything and having a strong edit is paramount.”
“By 2025, e-commerce will account for 30 per cent of the luxury goods market”
Standing out in a crowded market can be tricky, which is why retailers need to find and use their voice, Yeomans argues.
“So many luxury e-commerce platforms have launched and so the space has become incredibly crowded – the need to stand out and stand for something is becoming integral to a brand’s success, and timely and authentic communication is paramount.”
COURTESY OF DREST
Indeed, with the wealth of information at any shoppers' fingertips afforded by the internet, coupled with this decade's renewed emphasis on sustainability and accountability, the luxury customer's standards are becoming increasingly high.
“The customer is now more educated than ever before because of these online players,” Burke adds. “They have become more conscious about spending money and online retailers must offer unique customer experiences to differentiate them from their competition. Having a clear point of view and not offering ‘everything to everyone’ has been the trend and important evolution of online fashion.”
Certainly, when speaking to retailers, it is clear that this unique customer experience is front of mind for them all.
“Multi-brand luxury e-commerce players significantly changed the retail landscape by offering a superior level of customer service,” Gramston says. “Since Browns relaunched in 2015, our strategy has been to extend our ‘coolest boutique in the world’ from our physical stores to our online channels, giving our customer the same experience as if they were shopping in store.”
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“Brands are developing an increasing awareness around the significance of having an online presence”
At Net-a-Porter, there's been an emphasis on convenience as well as service and curation; getting the product to the customer as quickly as possible, wherever they are, could mean the difference between someone shopping from their phone instead of popping to the shops. “Our focus, from day one, has been on offering a fantastic service and the best curation of product," a brand spokesperson tells us. "Service has been and will continue to be a focus for us. We have a multi-lingual customer care team who speak up to 22 languages; same-day delivery service in London, New York, Hong Kong - and in summers, to The Hamptons; and personal shoppers based in our key regions.”
At Matches, standing out has been about strong engagement with its customer.
“How we amplify our brand globally and keep our consumers inspired and engaged has been the biggest shift,” Jess Christie, chief brand and content officer says. “Our content became fully shoppable and we evolved our business continually to ensure that our customers could engage with us across all touch points, from the devices they shopped on to the services we offered – these include international teams and a global private shopping team offering virtual and private shopping appoints – our ‘Curated By’ programme with people of influence, our podcasts, our social media campaigns and our experiential retail space in Mayfair.”
Matches Fashion’s retail space, 5 Carlos Space; COURTESY OF MATCHES FASHION
Of course, much of this has been exasperated by the recent coronavirus pandemic, which has furthered the need for brands to have an online space as shops around the world were forced to shut their doors.
“Companies and brands are developing an ever-increasing awareness around the significance of having an online presence, which has been highlighted by the pandemic, when so many businesses needed to quickly pivot and adapt how they serviced their audience,” Celenie Sidel, womenswear buyer at Farfetch explained. “Businesses in the luxury e-commerce industry are working hard to digitally recreate the level of customer service and experience that has at times been perceived as something that can only be achieved in a bricks-and-mortar environment, acknowledging the importance of creating the most positive online experiences.”
This was certainly the case at Net-a-Porter, who said that the pandemic had “highlighted what [they] already knew was important – connection and authenticity with the customer”.
“It’s about rooting in people’s lives emotionally”
The experience even seems to have caused some high-end brands who have previously resisted the online model to acknowledge its potential. Chanel, for example, has tended to avoid e-commerce, selling fragrance, beauty and key jewellery products online but not any fashion, except for sunglasses.
“In the last few months, as our boutiques remained closed throughout the world, our teams have kept in touch with their clients,” a brand spokesperson shared with us. “We are convinced that the use of digital tools will become more widespread, as people might go less to the boutiques, because of health crises or political tensions that might arise.”
Chanel catwalk; PASCAL LE SEGRETAINGETTY IMAGES
Whether the fashion giant will choose to adopt a bigger e-commerce approach remains to be seen, but more generally, going forward for the industry, it seems that enhanced technology and increased personalisation of experiences will be crucial for retailers and brands who want to succeed.
“The future of e-commerce is really about platforms stepping up to their responsibility,” Saunter says. “Luxury e-commerce retailers need to take that quality service they’ve perfected and max it out with other areas of people’s lives – essentially becoming a tighter concierge service and having a more meaningful impact beyond the transaction. Retailers like Net-a-Porter and Matches are already thinking about what more they can do to provide women with added value. It’s about rooting in people’s lives emotionally, something we at WGSN have been talking about for years.”
A Matches Fashion supper club; COURTESY OF MATCHES FASHION
“Creating community through storytelling to establish a long-term relationship”
We saw this process amplified during the pandemic, Saunter adds, where luxury brands reached out to their consumer at home and attempted to build a community, for example through Bottega Veneta’s virtual residence, Fendi's Renaissance live performances, Alexander McQueen’s creator series and the Loewe en Casa project.
“This soft-sell strategy is great for staying top of mind, and creating community through storytelling to establish a long-term relationship that can be enhanced in the future.”
ALEXANDER MCQUEEN INSTAGRAM
Many luxury brands and retailers also used the opportunity to tap into new technologies, in order to bring a “high-touch human experience” to their consumers.
“Luxury is synonymous with impeccable customer service and retailers have had to recreate this online for top spenders, who expect the same level of attention and care as they would get in a high-end department store or boutique. To reach them, brands are looking to connect them with sales associates via virtual platforms such as Zoom, Skype and Facetime, recreating that same level of customer service, with a focus on personalisation.”
Net-a-Porter has seen a boom in the use of messaging apps for its loyal customers, with them overtaking email as the preferred channel of communication: “This is especially true for our high net-worth customers, for whom, 70 per cent of all luxury fashion shopping is done digitally. Our personal shoppers are on WhatsApp and WeChat sending hundreds of messages per day globally.”
This move towards the phone over the computer also signals how things are likely to move forward in the luxury e-commerce space.
“Most platforms are now app-first, which is another change,” Saunter explains. “There are increasing numbers of people shopping on the app over the desktop and that’s important because that’s where the loyal base lives. The desktop is for browsers but the apps are closer points towards conversion through the marketing funnel because app users are repeat buyers who already have their card details logged in and ready to go – they are regular users who are comfortable spending big on impulse, at the tap of a button.”
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For this to really take off at Net-a-Porter, it was, again, all about improving the customer experience and adding value.
“We changed the way people shop with the move from desktop to mobile, and our customer has been shopping on the go from their mobile device for some time now, with more than 50 per cent of all YNAP purchases made through mobile or app," emphasised the Net-a-Porter spokesperson. "This has affected the way our buyers considered product: products have to have more than just hanger potential, and via a much more editorialised way of buying – it’s all about the curation.”
Taking advantage of these new technologies that can enhance the unique experience for each customer is key, many think, for how online shopping will evolve in the coming years.
“During my time at Net-a-Porter, I saw how eager shoppers and readers were to see a certain product styled in multiple ways on various body types,” Yeomans says. “I’m aware that magazines and e-commerce platforms have limitations, often showing only one, two or possibly three ways of how a piece can be worn and likely photographed on just one model. Drest enables endless virtual styling experimentation with real-life products, in a uniquely sustainable way.”
A Gucci photoshoot challenge on Drest; COURTESY OF DREST
“The idea of ‘luxury’ has changed and taken on many guises”
Indeed, another way that this might manifest itself is through augmented reality, Saunter argues, something that is already kicking off in the beauty business.
“I expect we will see much higher adoption rates of brands using live video and live-streaming in the future as well as an evolution of online discovery through virtual boutiques and the use of AR-powered try-on tools, like Dior’s virtual beauty boutique, especially for service-led, high-touch categories like luxury beauty.”
An increasing importance on personalisation can also come into play with product consideration, where a new trend for uniqueness has emerged, and looks to be pivotal for the future.
“In the last decade, there has been a real shift in the perception of ‘luxury’ and what qualifies as luxury,” Sidel says. “This concept has found new meaning, and today the luxury customer looks more towards rarity or finding a unique product mix.”
“The idea of ‘luxury’ has changed and taken on many guises, likely driven by technological advancements and the vast differences in consumer behaviour from one country to another,” Yeomans adds. “Many argue that bespoke products are the new luxury - perhaps this is the reason why limited-edition drops and the desire for streetwear has risen exponentially.”
“Down the road, experiences and technology will be the key to success for luxury”
Showing off this rare product will also need to see advancement in the coming years, Saunter explains, especially in the more expensive categories that have struggled to boom online. Growth in luxury e-commerce has taken place because, over the years, consumers have become more and more comfortable parting with larger sums of money over the internet as they put further trust in the process.
“One of the biggest changes in luxury online shopping in the past 20 years has been customer confidence with how comfortable they are making purchases that firstly, they’re confident will fit and secondly, those which cost serious sums of money,” Saunter says. “From entry-level cosmetics which were familiar to buying significant – both financially and emotionally – items online, like wedding dresses.”
However, advancements still need to be made in some categories: “Many of the challenges that luxury e-tailers face surround watches and fine jewellery. How do they sell something that costs £20,000 over the internet when so much of the experience of the purchase is how the diamonds catch the light or the weight of a watch on your wrist as an indicator or assurance of quality? How do they replicate the boutique feel for online? That’s what they now need to crack.”
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Some experts believe that this will come together with a merging of online and offline, with consumers expecting high-quality personal experiences, both in stores and digitally.
“Down the road, experiences and technology will be the key to success for luxury,” Burke says. “This also includes physical retail and providing seamless experiences both online and offline. The smart companies will take the approach of personal shopping – each experience should be more personalised and targeted.”
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Ultimately, everything that has been behind the success of the online luxury fashion model will need to amplified and enhanced going forward. E-tailers will need to use the changes in the industry – an increased expectation of diversity, a more conscious and considered approach regarding the environment, and a desire for personalised, unique experiences and products – to find new methods and technologies to deliver this to their consumer.
With changes afoot happening fast and competition in the market at an all-time high, brands are being continually forced to innovate and adapt - meaning constant, exciting advances for customers to explore. As a result, the future of luxury e-commerce looks set to be just as ground-breaking as its 20-year evolution has been.