A recent survey by leading executive search firm, DHR highlights that new skills are needed for the boards of top luxury brands . The lack of senior experience in ecommerce and emerging markets could be holding back profitability at top luxury brands.
The growing affluence of younger, more digitally savvy generations is driving the need for traditional luxury good suppliers to have an online, mobile presence to compete with sites such as Net a Porter.
The study of the world’s top 50 luxury goods businesses found that just five per cent of board members have experience in ecommerce, and only 16 per cent have experience working in emerging markets, leading to calls from DHR for more varied knowledge on boards. Other recent research has shown that the luxury sector’s traditional focus on bricks-and-mortar retail could be misguided. The profitability of luxury goods sold online was found to be higher than any other traditional sales channel by the Boston Consulting Group (BCG). Meanwhile McKinsey & Company forecast that the online share of worldwide luxury goods sales will be 18 per cent by 2025, which would make luxury e-commerce worth around €70bn (£60.71bn).