Riding on the continued growth of the online shopping market, luxury brands are ramping up their e-commerce push. In the retail sector, an online presence is not only about showcasing products, or promoting brand awareness; it is about building a highly secure and convenient sales channel that can serve customers worldwide.
Thus, when John Hardy, a well-known luxury handmade jewelry brand in the US, decided to pursue an aggressive global expansion, an e-commerce platform became central to its strategy to capture the fast growing e-commerce and online shopping audience for luxury items. Starting off with the revamp of its US website in September 2011, it followed through with the launch of company websites in Australia, Canada in the same year and its global website in March 2012.
Janice Chan, e-commerce director, John Hardy USA Services Ltd., they have different goals for these e-commerce sites.
"For Canada, we wanted to provide a convenient platform for customers to purchase John Hardy’s pieces online in addition to availability through high end stores, like Holt Renfrew. For Australia, we wanted to penetrate the market by building our brand’s awareness online before establishing a retail presence. We have received frequent and positive shopping enquiries from these two regions," she said.
Though the proportion of online revenue remains small now compared to its retail business, she said the company expects this to grow rapidly in the coming years.
The key is to make the websites high accessible for product, brand and store information and to support the traditional retail business. This required a highly robust IT infrastructure and a reliable hosting partner.
In an email interview, Chan and Mark Randall, Interim Managing Director, Rackspace for Asia-Pacific, shared their insights on building John Hardy’s online presence and how it complements its in-store retail business.
Retail in Asia (RIA): How did you incorporate e-commerce with your physical stores? What are the challenges of integration you encountered and how were these solved?
Janice Chan (JC): We promote our e-commerce site’s URL through in-store and on print material, including catalogs and advertising. This also raises awareness among our traditional consumers who prefer these types of media. We do have a store locator online so that customers can easily locate stores nearby. Our online and offline teams do communicate very well therefore the whole integration has been very smooth.
RIA: What is a dedicated managed hosting solution? How does it benefit global retailers like John Hardy?
Mark Randall (MR): It’s essentially an ideal platform for e-commerce businesses because it combines two things – the security and compliance of having new data on dedicated hardware. That’s important for e-commerce because of data around transactions and payments need to be kept in a secure environment. At the same time it gives you the flexibility and availability of the cloud, which takes a way the pain of infrastructure management.
As a cloud provider, we are able to provide a very secure environment and we can replace a failed hardware within an hour. More importantly, we have a team that provides administration services round-the-clock. You don’t have to pay for those resources so they can concentrate on their business.
RIA: How do you make online transactions secure?
MR: A dedicated managed hosting solution provides security by using the technology options available or a security platform within the solution. More importantly, using 24×7 monitoring of security experts to make sure that customer data is safe.
RIA: For retailers that already have e-commerce websites and strategies in place, what should be their next IT steps?
MR: The first thing to consider is the business growth. One of the things they have to review is spending on systems availability. If your e-commerce revenue is large, then the cost of a downtime is also fairly large. If your operation is small, it’s probably OK to be down for an hour. It’s not recommended but fairly acceptable. But as your revenues grown bigger, and you have customers all over the world or in the Asia-Pacific region, it becomes very costly to have a downtown. They need to build more redundancy in their environment. That means having two of everything – content servers, backend servers, data servers acting as back-ups. This way, you can continue running with zero downtimes.
Moreover, they need to make sure that they are continuously scaling to meet customer and traffic growth and also scaling to address the risks of the system.
RIA: What are John Hardy’s plans in Asia? Why is the Asia market important for global retailers, especially for luxury brands? What can you offer to Asian shoppers?
JC: In this region, China is the fastest growing country for the online luxury market and is expected to outperform US by 2015. Hong Kong, with many frequent mainland Chinese visitors, is our group’s natural first step towards building our brand before entering the China market. Affluent customers in Asian countries are prepared to shop for high quality pieces, including jewelry with precious metals and stones.
We do offer one-of-a-kind very high-end jewelry pieces for wealthy customers looking for unique designs. Therefore, penetrating into Asian markets, especially mainland China will be one of the driving forces for the business growth of our global brand.
RIA: You will also be launching your website for Hong Kong shoppers very soon. How is this online site going to enhance your presence in territory and improve your relations with the local shoppers?
JC: John Hardy’s Hong Kong flagship store is in Central district’s The Landmark and we now have an exciting second store in Causeway Bay’s Lee Gardens. Our products are also offered at the prestigious department store – Lane Crawford. The launch of a Chinese language site will make it easier and more effective to communicate our brand story to local customers and potential customers from mainland China. Hong Kong people may not be receptive to online buying, like people from other Asian regions, however they do like to research online before shopping in stores.
Our Hong Kong site, which highlights our brand history and product information, will reinforce consumer confidence in the John Hardy brand. This will certainly support our retail business.
CEO Talking Shop is the Retail in Asia section devoted to interviews with brand CEOs and retail industry leaders.