24S CEO Eric Goguey on how luxury means giving customers what they want
The high-end fashion e-tail site 24 Sèvres, owned by the LVMH group, was launched in June 2017 and was rechristened 24S last May. It has now grown in size, moving to new, more spacious offices in the Montparnasse area of Paris. In September, it added menswear to its product range, which already featured fashion accessories, jewellery and women’s ready-to-wear. Eric Goguey, CEO of 24S, had a frank conversation with FashionNetwork.com about the site’s current outlook.
FashionNetwork.com: When 24S was launched in June 2017, its goal was to become the French version of Net-A-Porter. What stage have you reached today?
Eric Goguey: We have a staff of 100 people and are operational in 100 countries worldwide. One of the biggest surprises after the launch was to realise that we also have a huge appeal outside France. International sales account for over 80% of the total.
FNW: Why did you change the site's name from 24 Sèvres to 24S?
EG: We didn’t anticipate we would enjoy so much international success. This year, we have opened up the site to Korea and Germany. It became clear to us that it was absolutely necessary to shorten the name, making it much more understandable for [non-French] customers. 24S is now operational in four languages: French, English, Korean and German. We will have to add many more in the future. We want to offer interesting shopping opportunities. This is luxury, it means giving customers what they want.
FNW: Why did you decide to add a Korean-language site?
EG: We realised that South Korea was becoming an increasingly important market, so we decided to offer Korean consumers a much more local experience, in their own language. We actually saw that some enthusiastic customers were making videos of the site and translating its pages into Korean, posting them on other forums. Once we introduced the Korean language site, sales in the country increased exponentially. The same happened in Germany.
FNW: Which is your leading market?
EG: The USA, followed by France, South Korea, Germany and the UK. The Middle East is still influenced by the language aspect. Some markets need a truly exclusive treatment, with a team dedicated to them. And not just technology-wise: they need fully humanised customer relationships. This is the kind of staff we are about to deploy, people who will take the time to go and meet these customers. All our staff is currently Paris-based, though they travel extensively.
In some countries, we aren’t yet operating in an efficient enough manner. We want to give those markets a better coverage, talking the language of local customers, and optimising product range and sizes based on each country’s demand. Every time we add a product, we want to offer top-notch quality in 100 countries worldwide. We therefore need to eliminate these barriers country by country.
FNW: What about China?
EG: We sell in China now. But it's a complicated market, where there are two major players. We need to have a bespoke strategy to make a break-through in this country. I’d rather we took our time and worked properly with China, adopting the right business model.
“There’s a fashion style that’s uniquely Parisian”
FNW: How many labels do you sell?
EG: Over 250, between men’s and women’s labels. We carry virtually all the LVMH brands, though they are a minority. Our approach is to select brands based on customer expectations, and also on our vision of aesthetics and shopping preferences. There’s a fashion style that’s uniquely Parisian, the kind of labels worn by Parisian women, and that you’d find at Le Bon Marché [department store].
FNW: Launching 24S wasn’t easy. You lagged behind some of your other competitors. Have you changed your strategy along the way?
EG: Our strategy hasn’t changed significantly since the site was launched. As a new business, we needed time to get started, find the first customers, win them over, gain a reputation, develop a brand image to generate the first sales, and get to know our customers and the countries where they live. Besides, we sell expensive items!
FNW: Which strategy did you implement?
EG: To begin with, we adopted an agile approach, starting out with one feature and a single product range, to gather data and then optimise the site based on customer behaviour. This enabled us to gain valuable time. After the introduction of our initial range, we tweaked the products according to sales performance.
We began by selling womenswear, which accounts for the largest share of the retail area at Le Bon Marché and is a key fashion category. Subsequently, and quite logically, we added menswear, since we had a number of male customers who visited 24S to buy gifts. We launched menswear in early September, and we are seeing that 45% of men’s products are bought by female customers, and the clientèle is quite young overall.
FNW: What is your customer profile?
EG: Our customers are young. They are between 25 and 30 years old, and very international, with a slightly different purchasing behaviour depending on the country. Asian customers prefer labels like Off-White, while in Europe, and France in particular, they lean towards more contemporary labels like A.P.C. or Isabel Marant.
FNW: In what ways are you different from your competitors?
EG: First of all, in terms of product range. We carry a variety of very high-end brands. We are the only site to feature Dior, Celine and Louis Vuitton, and this allows us to target the upper tier of the luxury segment. Not uniquely though, as from the start our approach has been more of a mix & match one.
FNW: You also underline that your service is “matchless” ...
EG: Our customers enjoy a unique experience as soon as the package is delivered. It all begins with customised packaging. We spent as much time building the site as defining this experience, setting our creative department the goal of sparking five seconds of joy and smiles when customers open their box. Every quarter, we work with a number of artists who put their vision of Paris into the box. And this is not all. Simply because it's e-commerce, it doesn’t mean there shouldn’t be a human touch in our relationship with customers. It's an extension of what they may experience in-store. Hence the importance of our customer service.
“We internalised customer service, which plays a key role”
FNW: How is it organised?
EG: We internalised customer service, which plays a key role. We only hire people who are passionate about fashion, and above all have genuine empathy and take their time with customers. In fact, every employee who joins us, when they arrive, systematically spends time in the customer service department. Every week, there’s a very detailed report with customer feed-back. Even if customers aren’t physically here, we do all we can to make them a live presence within the company.
FNW: And what about deliveries?
EG: Our delivery service is outsourced. We work with DHL. If you order a product in the morning, New York time, you receive it the following day. We deliver very, very quickly. Also, in Paris and the surrounding area, we offer a valet service allowing customers to pick a half-hour slot in which a courier in a suit will come and deliver the product at home, and will wait outside or downstairs while you try the product, so that they can pick it up immediately if it doesn’t suit you.
FNW: What other type of personnel do you have?
EG: Our specificity is that, right from the beginning, we put technology at the heart of the company. We internalised a large number of developer roles, hiring both men and women. We’re proud of the latter, because [female developers] are a rarity. We thought that, since we operate in the fashion industry, it was important to find developers who appreciate fashion.
FNW: What is the contribution of Ian Rogers, chief digital officer of LVMH since 2015, who was instrumental in setting up 24S?
EG: He's an entrepreneur. He has a super-sharp vision of strategy and of the digital world. He has had the chance to set up and dismantle a large number of companies.
FNW: From a visual point of view, your site looks rather traditional…
EG: Visuals are there to promote the products and the brands we commercialise. Because we sell luxury products, this doesn’t mean we must upset the way customers browse online. Customers have been used to buying on the internet since the end of the 1990s with Amazon, and to doing so in a specific way. All those who tried to go about it differently got stuck, because customers have no desire to re-learn how to shop online. Esoteric websites, they don't work. We sell products. We can make a difference with the product range, with brand and article selection, and also with merchandising. When you have thousands of products, deciding to push one instead of another is a genuine editorial choice.
FNW: Is this why 24S features little content besides the products?
EG: We will never turn into a magazine publisher. Our approach is to make the products we sell the stars. Our role is to let the products do the talking, to explain our choices and, at the most, why you need to associate one item to another. Above all, we are retailers. We are not here to write editorials. Especially since customers are more and more educated, and have an increasingly thorough understanding of the information presented to them.
FNW: Why do luxury goods customers prefer to buy online rather than in-store?
EG: They love going shopping, but luxury boutiques simply aren't ubiquitous. Then there’s a practical aspect: nowadays, time is the greatest luxury. There is a specific type of customer who no longer has any spare time. Once you’re offered a smooth service with 24/48-hour delivery, the possibility of having the products taken back if they don’t suit you, the opportunity of quick returns and of chatting online with the retailer, there is no reason for not buying online! Our responsibility is to make sure we don't waste our customers’ time, because they don’t have any.
FNW: Can you give us a few figures about your business?
EG: We do not provide figures. What I can tell you is that at the moment our growth rate is very vigorous, in line with expectations. And we are growing globally.
FNW: The next step?
EG: We will talk about it when it's time.
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