Cartier made significant improvements to its digital platforms in 2018 to shoot past Tiffany to take the top spot in the annual Digital IQ Index report for watch and jewelry brands. Tiffany previously held the top position for five consecutive years. Meanwhile, Bulgari also showed marked improvement to rise to number three in the annual survey, conducted by Gartner L2, a business intelligence and research firm that benchmarks the digital performance of consumer brands.
The 2019 survey released Tuesday, titled “Digital IQ Index Watches & Jewelry Global,” measured the digital competence in 2018 of 83 watch and jewelry companies based on the digital presence and engagement of their websites and eCommerce platforms, digital marketing penetration, social media presence and mobile strategies. The companies are ranked in five categories: “Genius,” “Gifted,” “Average,” “Challenged” and “Feeble.” Cartier, Tiffany and Bulgari all earned the Genius ranking, achieving a minimum score of 140 points. It is the first time in the survey’s nine years that three companies shared this ranking. Cartier’s Digital IQ score improved by seven points, year-over-year, to reach 147 while Tiffany’s score remained unchanged at 144. Bulgari’s score moved from 134 in the 2018 survey to 141. It is the first LVMH brand to be named to the Genius category.
The ranking of watch and jewelry brands based on their Digital IQGartner L2
This is the first time the Digital IQ report included data from the United Kingdom, France and Germany (the three largest markets in the European Union) along with the United States, said Brian Lee, senior principal at Gartner L2, who added that the new market data did little to influence the overall results.
“Surprisingly, it was not as much change as I thought it would be,” Lee said. “Most brands stayed near where they’ve been.”
Cartier was bolstered by its “best-in-class digital marketing with improvements in on-site functionality,” Lee said. Meanwhile Bulgari’s rise to Genius was due to “significantly improved site experience” by “doing a lot to boost their fulfillment and omnichannel capabilities and having it fully integrated throughout their website and platforms.”
The report notes that the top digital brands also have the deepest pockets. “Genius brands are marked by large-scale budgets, allowing them to outspend competitors on search and display. This top-of-mind brand awareness also helps them excel on social media, and see large engagement and reach.”
Another thing Genius brands have in common is they “tend to focus on excellent product merchandising, alongside top-tier store locator and omnichannel functionality.”
Watch and jewelry brands have increased their use of Instagram StoriesGartner L2
This year, the number brands included in the report increased to 83, from 70 a year ago, but Lee said the gap between the leading digital brands and those that are lagging is becoming so great they may reduce the number of participants.
“The brands that are leading are leading by a lot while some small independent brands and high luxury brands continue to fall behind,” Lee said. “I think next year if this trend continues we may cut some of these laggard brands because there’s nothing really interesting at that end.”
While the Genius brands are enjoying strong digital growth, overall, watch and jewelry brands are lacking in many digital competencies, including some very basic ones in website design and functionality, eCommerce capabilities and basic search engine optimization and marketing strategies. Because of this eCommerce retailers, particularly in the resale and gray market categories, are winning the digital battles.
“Style over substance is an existing problem across index brands as many fail to offer a cohesive, user-friendly brand experience,” the report states. “This sector remains notoriously behind in offering features that have become table stakes for the consumer’s online journey.”
Search engine strategies is where e-retailers are excelling and where luxury brands are falling behind, the report says, even though it is the key driver of traffic to brand websites.
Among luxury holding companies, Richemont and LVMH are on top while Swatch Group and Kering lagGartner L2
Lee acknowledges that it’s difficult for brands to move resources and knowhow from their core business to the digital space. However, he says that basic SEO and SEM strategies can be done with minimal costs and manpower, and are highly effective in defending their space on search engines.
“We have seen many brands defend their own real estate in search and social,” Lee said. “It is possible and it requires a minimal budget, but a lot of brands simply aren’t willing to spend the money to defend their own brand real estate on basic search. E-mail still is relatively sporadic among watch brands. Many brands rely on a lot of investment in video ads. Very little on search and email where there are low hanging fruit for them to invest.”
One area where there is marked improvement is in social media (Facebook, Instagram and YouTube), particularly the use of Instagram and Instagram stories. According to the survey, 97% of all brands posted at least once on Instagram stories, an increase of 28%, with 37% using IGTV and 13% creating “shoppable stories.”
Many of the brands in the survey are owned by a handful of luxury conglomerates (Richemont, LVMH, Swatch Group and Kering). These holding companies are often trying to create overall digital strategies for their brands. Within this framework, it is Richemont and LVMH that are winning this battle while Swatch Group and Kering lag.
Rounding out the top 10 brands in terms of their Digital IQ are:
Pandora
Swarovski
Tag Heuer
Alex and Ani
David Yurman
Kendra Scott
Van Cleef & Arpels
They are among the 20 brands categorized as “Gifted.” The report describes these brands as having one area of underinvestment that prevents them from earning the Genius label. The Kendra Scott jewelry brand made its first appearance on the Digital IQ survey in this category. The Average and Challenged labels are made up of brands that have some areas of strength, “yet fail to connect the dots to create a truly cohesive digital experience.”
The Feeble category shrunk slightly from the prior year; however, there are many repeaters in this group. Generally, these brands have sites lacking basic functionality — frequently without eCommerce or user accounts and with poor social media presence. The bottom five in this group are: Fred Paris, Loren Stewart, Girard-Perregaux, Certina and at the bottom, De Grisogono.
The biggest digital IQ winners and losersGartner L2
In the report, the researchers at Gartner L2 provide three key recommendations:
* Focus on the basics by creating website that meet basic consumer needs and expectations through features that include geolocation, mobile-optimized check-out and live chat; and by integrating useful merchandising content for a cohesive customer experience.
* Invest in SEO and SEM Invest and website advertising.
3. Diversify social media marketing content across Facebook, Instagram and YouTube.
Gartner L2 produces Digital IQ reports for a number of industries and Lee says that when compared similar retail categories, like health and beauty, and fashion, watch and jewelry brands are well behind.
“Only 5% to 10 % of all hard luxury sales are online, compared with fashion at 15% to 20%,” he said. “It’s still very much an in store business.”