Deep Dives

Reinventing Luxury Retail

Walk into the Sephora store at Gare St. Lazare in Paris and a “smart” mirror will help you select and apply the make-up that is right for you and take note of your choices for future reference.

Think of it as a mirror into the future not just for cosmetics but for luxury retail. It is omni-channel, it is personalized and it is already coming to stores near you.

The MemoryMirror on display in the Sephora store was developed by memomi, a startup that first connected with LVMH, the owner of the Sephora brand, at VivaTechnology, a tech conference that connects startups with big corporates.

LVMH’s flagship brick and mortar deparment store is now represented online by 24 Sèvres, a boutique shopping website and mobile app named after the Paris street where Le Bon Marché is located.

The Paris-based luxury conglomerate has been particularly active in embracing new technology in the last year, building a multi-brand online shop called 24 Sèvres, named for the group’s flagship brick and mortar Le Bon Marché Paris department store, launching a $50 million venture fund dedicated to emerging luxury brands, and starting La Maison des Startups program at Paris-based incubator Station F. (memomi is one of 50 startups working within the 220-square meter LVMH space.)

It is part of a trend. “Luxury is finally getting its tech upgrade”, concludes a recent report on the sector from analyst firm CBInsights. For years, incumbents in the luxury industry refused to even sell products online, notes the report. But luxury-focused e-commerce startups like London-based FarFetch have changed the relationship between luxury consumers and brands by successfully building online retail businesses.

Meanwhile two of China’s biggest e-tailers — Alibaba and — are also getting into the luxury retail market, as the Chinese account for a third of luxury goods sales. Alibaba launched the Luxury Pavillon on TMall, a shopping site featuring Burberry, Guerlain and other brands. And, which already invested $389 million into Farfetch, has unveiled luxury site Toplife with fashions from Saint Laurent, Emporio Armani and others.

Against this backdrop LVMH Chief Digital Officer Ian Rogers, who was hired away from Apple in 2015, not only launched 24 Sèvres, the group’s first multi-brand luxury e-commerce play, but expanded the online presence of “Maisons” like Berluti, Givenchy, Louis Vuitton and Dior, set up an account for Celine on the Chinese social networking app WeChat to appeal to Chinese customers and approved the sale of nine LMVH brands on TMall.

Upgrading The In-Store Experience

Physical stores of LVMH brands are also cautiously beginning to embrace tech. That is important because luxury companies have historically used customer experience, and more particularly in-store experience, to distinguish themselves from mainstream brands. Although global luxury companies have finally moved online, stores are still where customers connect with the brand through private shopping sessions, personalized styling, and top-notch customer service, says the CBInsights report.

Retail and wholesale also remain luxury brands’ main distribution channels, generating 10 times more revenue than online shopping according to global consultancy Bain. Upgrading the in-store experience using newly available technologies is both an opportunity and a challenge for luxury brands which pride themselves on crafts and traditions.

Rogers cautions that retail customers crave white-glove service over digitalization.

« This is not about shiny objects, it has to really improve the expérience, » he says. « There are interactions between customer cell phones and associate cell phones that offer ways to reduce friction and enhance the experience that are simple and very useful. »

While Rogers believes that in-store technology is likely to be mainly behind the scènes, new technologies such as AR/VR are starting to be installed in luxury stores, including smart mirrors like the one developed by memomi. In addition to the makeup mirror memomi has developed a fashion mirror that allows shoppers to try on items virtually –changing colors and patterns instantly, adding accessories and other items to create the perfect look without having to physically try on anything.

Memomi was one of the startups pre-selected through the LVMH Innovation Award that is given at VivaTechnology each year. Award finalists (30 in 2018; 32 in 2017) are invited to showcase their technologies during the three days of the Paris tech conference.

“We had 500 plus startups apply last year and 800 plus apply this year,” says Isabelle Faggianelli, LVMH’s Director of Digital Transformation. “It’s an efficient way for both startups and Maisons to identify potential business partners. Smart ideas were generated during Viva Tech and many collaborations have been realized after the event.”

Among them is a collaboration with SmartPixels, a Paris-based startup which first connected with LVMH, Groupe Les Echos’ owner, at the first edition of VivaTechnology in 2016.

During VivaTechnology 2016 SmartPixels showcased animated bottles of LVMH champagne brand Moet Hennessy, an LVMH champagne brand and also digitally projected designs onto a Berluti Alessandro model shoe.

“Startups are helping us to bring more personalized and interactive customer experiences to brick and mortar stores,” says Faggionelli.

At the time same time, LMVH is looking to improve the online experience.

“Ecommerce is an important part of our business today,” she says. “It can generate even more sales than a physical store.”

Examples of how startups are helping LVMH enhance customers’ digital experience include its work with Smartzer, a 2017 LVMH Innovation Award finalist that specializes in making online videos interactive and shoppable, allowing brands to monetize video content on-site, in video ads and on social networks. And Louis Vuitton is working with startup, which is using its virtual advisor chatbot to give customers a personalized and real-time expérience for online discovery and shopping via Facebook Messenger.

“We look for solutions that can benefit our business and/or inspire our culture or accelerate our transformation,” says Faggianelli.

LVMH is interested in startups that can offer raw materials, product design, online and offline retail solutions, AR/VR or mixed reality tools, data and analytical systems, marketing and B2B solutions and forward-looking devices or services, she says.

It is an affirmation that technology is becoming more integral to luxury retail, both on-line and off, says Faggianelli: “At the end of the day, it’s not about e-commerce or the physical store, but providing an excellent digital experience across the different touch points of the customer.”

About the author

Jennifer L. Schenker

Jennifer L. Schenker, an award-winning journalist, has been covering the global tech industry from Europe since 1985, working full-time, at various points in her career for the Wall Street Journal Europe, Time Magazine, International Herald Tribune, Red Herring and BusinessWeek. She is currently the editor-in-chief of The Innovator, an English-language global publication about the digital transformation of business. Jennifer was voted one of the 50 most inspiring women in technology in Europe in 2015 and 2016 and was named by Forbes Magazine in 2018 as one of the 30 women leaders disrupting tech in France. She has been a World Economic Forum Tech Pioneers judge for 20 years. She lives in Paris and has dual U.S. and French citizenship.