Luxury Retail and Digital Management, 2nd Edition

Chapter 12How the Internet Has Shattered the Traditional Sales Model

Victorious troups will first win and then go to battle, while defeated troops will first go to battle and then try winning.

–Sun Tzu¹

Shattered is perhaps not the word we should use because it means ‘crushed or smashed’, which, of course, is not the case. But it also means ‘to break (a record)’, and that corresponds more closely to what we are trying to say. With online selling, or e-commerce, the traditional system of selling through a store is passé. It was indeed unique, but it now has to coexist with another system, which also has its own advantages and specificities, especially regarding the manner in which it communicates with customers, provides service and transacts. One can no longer talk of a one-size-fits-all model of distribution for luxury products, but of an array of complementary methods of distribution that are evolving, and most of all, reinforcing themselves and becoming more complex.

In this chapter, we will describe how online sales (or e-commerce) are part of the whole picture, and why brands do not use a single distribution system or a single operator. Also, why all the stakeholders do not limit themselves to a single operating mode or a single intermediary, but multiply the number of intermediaries or stakeholders to, over the long term, keep open as many options as possible.

Is Selling Online Sufficient in Itself?

In 2006, the PPR-Kering group sold their Le Printemps department stores. ...