Céline fans will be glad to know that the Paris-based brand is finally preparing to launch e-commerce. The LVMH Moët Hennessy Louis Vuitton-owned house, one of the final ones to hold out in its efforts to sell online, has announced the appointment of new CEO Séverine Merle. Beginning on April 1, she will replace Marco Gobbetti who left for Burberry in this summer – along with the impending launch of an e-commerce platform by the end of the year.
Despite being one of the most influential (and highly copied) fashion brands on the market, under the direction of Phoebe Philo, Céline has maintained a low profile in terms of its retail footprint and distribution chain. Moreover, it has traditionally eschewed most digital channels, making it one of the new brands lacking a social media presence and a website without e-commerce capabilities ... until recently, that is. The brand launched an official Instagram account this week.
With the desirability created by Philo beginning in 2008, Céline’s sales are up and so, to meet demand, it has slowly moved to expand its retail network. In September 2014, the brand opened its second brick-and-mortar store in New York – in Soho – the other New York location being uptown on Madison Avenue. This second New York store brought the total number of Céline stores in the U.S. to five (other locations include Bal Harbor, Las Vegas, and Beverly Hills). It has since opened its store count to twelve with brand-owned stores opening in Boca Raton, Chicago, Costa Mesa, Dallas, Guam, Honolulu, and Houston.
Gobbetti started rolling out a number of store openings during his tenure with the brand, telling WWD in 2014: "We're ready to roll out a little bit now. But it's very targeted," he stressed. "We are not really multiplying our presence in cities, but we want to open some relevant stores in the important cities while keeping the distribution fairly tight."
Rolling out a number of standalone stores in some of its most prominent cities in the U.S., in particular, Gobbetti said at the time: "I think we have a lot of opportunity in the Western side of the world. It's a very controlled growth, but substantial." Such growth also comes in the form of shop-in-shop stores, with select Saks Fifth Avenue and Neiman Marcus locations in the U.S. playing home to brand-operated outposts.
The Move Online
Along with such brick-and-mortar growth comes the brands impending online initiative. To date, Céline joins only a small handful of other brands, such as Chanel, Goyard, and Hermès (in terms of its most desirable bags), that do not offer handbags for sale online. “Fashion is about clothing, and clothing you need to see, to feel, to understand,” Bruno Pavlovsky, Chanel’s president of global fashion, said several years ago.
As for why Céline has opted out of selling online for so long, Gobbetti said in 2014 that the brand prefers to engage with customers directly “in the way they like to be engaged,” which he said is in stores. Philo, herself, said: "I very much like the idea that shoppers experience a Céline product in a Céline store." She elaborated a bit a few years ago, saying that the brand’s fabrics and designs should be experienced in real life, especially as the brand utilizes "the best fabrics in the world."
In this way, LVMH’s online strategy is particularly interesting, largely because it is so inconsistent. As Reuters noted last year, “Some [of the Paris-based conglomerate’s] labels, such as Louis Vuitton and Fendi, have made great strides along with cosmetics retailer Sephora, but Céline stands out as an apparent laggard.”
While online sales have become the fashion industry's most important and promising engine of growth, analysts estimate that LVMH's total online sales are less than 5%. And even if luxury purchases are not made online, the presence of an e-commerce strategy is essential, as more than 60% of luxury goods purchases, online or in-store, depend on what customers see on the web.
According to Chris Morton, chief executive of Lyst.com, a multi-brand online luxury retailer in which LVMH chairman Bernard Arnault’s family investment company has a small stake: "A luxury brand that avoids the internet is effectively refusing to engage with its customers where they are increasingly spending time and money. It is not listening to what its customers want, which is dangerous in any consumer-facing industry."
With this in mind, "the question is no longer whether luxury brands should enter the digital world, but how," said Nathalie Remy, partner at consultancy McKinsey. It seems that even Céline is not immune to such considerations.