1 Introduction

The introduction of the Internet has brought tremendous changes in market production and consumption and has empowered customers in unprecedented ways. As such, understanding customer behavior before, during, and after product consumption is vital for the existence of any business. As a consequence, Customer Engagement (CE) has been receiving considerable attention from many scholars, especially as companies can acquire both monetary benefits and more than mere customer transactions [1]. With the development of electronic commerce in recent years, the need for managing online CE activities has become more urgent.

However, the rising wave of digitalization does not seem to have transformed the luxury fashion industry to any great extent. As an unspoken rule, the Internet and the luxury industry have never been considered a good match: (1) while the Internet provides mass access and price transparency, luxury firms have traditionally competed on exclusivity, scarcity, and class; and (2) the personalized human interactions and attention and in-store service, which are at the core of a luxury experience, are considered impossible to replicate in an online environment [2]. Therefore, with few exceptions luxury firms [3], have been mostly reluctant in undertaking their operations online. This has put the industry in a more vulnerable position, especially in its reaction to the COVID-19 pandemic.

The luxury sector was the most impacted by the pandemic, with customers having little or completely no access to physical stores. In the early period of the pandemic, high-end brands suffered as much as 93% profit loss [4], many of them arriving on the verge of bankruptcy, or considered “almost dead” [5]. At the same time, the pandemic created new marketing opportunities and accelerated the digital transformation process for many businesses. Brands that switched to or enhanced their online sales activities in a timely manner witnessed a certain level of success. For example, much LVMH revenue came from online channels during the pandemic in 2021 [6], which reinforces the good start of 2022 [7]. This indicates the potential for the revival and transformation of the luxury fashion industry into an online or more hybrid one.

While online channels and online sales revenue have become a must for survival, not all luxury firms are willing to or know how to embrace this change, as online and luxury have been considered to be incompatible with each other [8]. However, the outbreak of the COVID-19 pandemic propelled online CE into an essential business activity, as digitalization became an indispensable part of survival, and triggering a global shift with lasting impact on consumer behavior [9]. The luxury industry needs to adapt quickly to this new reality to ensure future success, and move beyond a limited, transactional view of the internet toward one that takes advantage of the internet’s full range of abilities to increase CE. This paper seeks to answer the research question: “what are the determinants of online luxury CE activities and how can luxury firms effectively handle the flow of their online engagement activities in the post-pandemic scenario?” To answer the question, we analyze web content by using YouTube videos that contain experts’ perspectives on luxury fashion topics relating to the pandemic, following a hybrid thematic analysis to identify subthemes and their relevancy.

This article focuses on the luxury fashion industry, and builds upon the CE cycle model [10], with revisions for the online business environment and post-pandemic context. With this proposed revised CE model, the paper provides a guide for the luxury fashion industry to harness the strengths of the Internet to enhance CE, manage their clientele, and pave the way for post-pandemic success. We argue that rapid incorporation of innovative solutions, skillful adaptation of buyers’ characteristics from this era, and systematic resource allocation are ideal solutions for the luxury fashion firms in the post-pandemic scenario.

2 Theoretical background

2.1 The current state of luxury fashion industry

Based on the hierarchy of fashion [11] we narrow the scope of luxury fashion to the middle tier known as “ready-to-wear” designer brands such as Gucci or Prada, as they are making several digitalization efforts despite going against their conventional marketing strategies. Hereinafter we refer to them as luxury fashion.

Considered as one of the oldest businesses with a trillion-dollar market worth [12], the luxury fashion industry has never found itself in a bizarre situation like COVID-19. Within the pandemic period, while not going bankrupt as did some iconic fashion firms (e.g., Brooks Brothers and Century 21), many luxury fashion firms witnessed tremendous losses in revenue (e.g., Burberry and Salvatore Ferragamo sales fell for 48.4–46.6 percent respectively in the first half of 2020) [13]. This was to be expected as the entire industry was frozen during the strict quarantine period, which prevented in-store shopping. Online sales emerged as the mandatory channel for survival, but for luxury products there are many opposing opinions on this matter.

Many scholars believe that luxury products and online sales are mutually exclusive, as the role of physical stores is tremendous, including their ability to provide distinctive experiences with both external and internal layouts and the exceptional personalized in-store service [14]. Additionally, Okonkwo [15] believes that the uniqueness of luxury products cannot be made available to the mass community, and Hennigs et al. [16] state that collections presented online easily create opportunities for fakes. Consumers prefer to buy luxury fashion goods in brick-and-mortar stores due to the superior shopping experience provided [17]. Additionally, in metropolitan cities, 63% of customers prefer to touch and feel the product rather than buy it online [18]. There are also many other issues with Internet presence, including scarcity and desirability erosion [2], security concerns [19, 20], and luxury brands providing access to unnecessary information that can diminish perceptions of brand exclusivity [21], while also introducing democratization that some consumers resent by putting both loyal and non-loyal customers at the same level.

Nevertheless, there are several scholars and practitioners who condemn those pessimistic schools of thought. Even before the COVID-19 outbreak, luxury fashion firms acknowledged the imperativeness and inevitability of developing an online presence [3], [22]. For example, luxury brands like Burberry and Chanel have been digitizing for better audience connection [23]. Moreover, online sales of luxury goods has reached 8 per cent of total luxury sales, and is even predicted to rise to 25 per cent by 2025 [24]. As online sales are growing steadily, even luxury firms cannot ignore this fruitful platform, and the best practice is to mix different communication policies The Boston Consulting Group, [25].

COVID-19 may have brought dire consequences, but it opened paths for new marketing opportunities and channels Manthiou, [26]. With all the aforementioned arguments, shopping generally shifts to digital and accelerates along with the evolution of the pandemic, in which luxury fashion brands have had few options but to develop and represent themselves differently on the Internet. Kering is an example of a firm that quickly adapted its website to accommodate online transactions [27]. Although the image of these brands was negatively affected at the beginning of this transformation, subsequent figures demonstrate rejuvenation in different aspects, such as Kering returning to their pre-pandemic sales figures by early 2021 [28]. This shows a potential not only for industry survival, but also a chance for further development.

Many luxury fashion brands have chosen to digitize along with their traditional boutiques. However, the remaining concerns here can be how luxury brands should react if online channels become more dominant or the online presence sabotages a product’s scarcity; and thereafter, what marketing strategy should they stick to in the post-pandemic era when customer behaviors are heavily affected for a long period of online shopping. Regarding ideal activities that luxury brands can perform in this pandemic era, we found that the relationship between social media communication and consumers’ brand perceptions has been underestimated [29] as scholars and practitioners have not had a clear understanding of this matter (Schivinski & Dabrowski, 77). Therefore, maintaining and improving CE is quintessential within this digitalized era.

2.2 The online CE cycle model

The process of acquiring new customers and turning them into fans is extremely complicated and relates to not one but many aspects of a business. Multiple routes have been proposed by researchers to reach CE, including satisfaction [30] and interaction [31]. Prior studies–such as Alvarez-Milán et al., [32] or [33]–seek to make sense of CE routes using the concepts “antecedents” and “consequences”. However, many researchers agree that multiple factors can lead to CE, and by looking at several prior findings, these factors can be mutually influential. For example, a considerable factor like “commitment” can lead to “engagement” [10] and vice versa [34]. We argue that several notable factors leading to CE can be put on a circulation, which aligns with Sashi’s model (2012).

Sashi [10] synthesized various routes to engagement and turned CE into a sequence of steps known as the “CE cycle”. Sashi’s contribution to CE study is remarkable but cannot be totally updated with the current modern context, especially since the rapid digitalization movement of the COVID-19 pandemic. The model was revised to fit the online-dominant context [35], and this revision serves as the basis for this paper’s conceptual model. Details of the framework are further explained in the “Findings and Interpretation” section.

In this paper the online CE model acts as a means to re-create and adapt the online presence of luxury fashion brands to the new context. In other words, the proposed model can guide luxury brands to direct their resources to fit their engagement purpose and the targeted theme in the cycle. For example, improving the website’s user interface and user experience can benefit the customer experience, or improving engagement of customer community on social media can help the brand manage its advocates. Through the lens of the online CE model this paper employs and structures insights generated from qualitative analysis, following the conceptual framework for online CE in the luxury fashion industry.

3 Method

There have been several quantitative studies on CE that addressed how the pandemic can affect CE [36, 37]. However, we are looking at the ambiguity of the post-pandemic scenario that requires an investigation of potential issues for which “questions about experience, meaning and perspective” from a human standpoint should be addressed [38], p. 499). We therefore decided to conduct qualitative research. A qualitative approach can explore a vast and natural context of online luxury management whereby real-world problems can be explored [39], helping researchers in “understanding the meaning people assign to social phenomena” [40], p. 53) such as online shopping behaviors. Since our purpose is to look for answers to the ambiguous CE behaviors in the post-pandemic world, we gathered well-qualified perspectives from luxury fashion experts as the most important insights.

3.1 Data collection

The issue of the behavior of luxury fashion customers has raised a substantial number of debates around the globe, leading to numerous materials on the Internet. Therefore, we use web content as qualitative research data derived through YouTube. Web content research has been recognized as the method of studying information recorded in non-academic articles, which can be widely applied in management studies under the form of forum messages [41] or customer reviews [42]. This method helps researchers to concentrate on a specific timeline, while at the same time being able to provide better input and avoid biases [43]. YouTube also contains a large amount of relevant web content and comments. Since serving academic purposes can be considered as a “fair use” [44], YouTube can be considered as a valuable source of qualitative data [45].

The global situation caused by COVID-19 was very ambiguous during the pandemic, and many YouTube videos containing seminars, lectures, talk shows, interviews, etc. about the future of luxury fashion have been posted. These videos help us to access professionals in the field, with decent content quality that allows us to gain valuable insights through content exploration. After applying several filters, which are “include videos from the last 2 years” when COVID started, and “minimum video length is 20 min”, 400 videos were found under general keywords such as “luxury e-commerce” and “luxury covid”. We applied several inclusion and exclusion criteria and finalized the sample with 71 videos that we believe are the most relevant to the scope of the study. Details of the filtering process along with inclusion and exclusion criteria are in Fig. 1.

Fig. 1
figure 1

Video selection process with inclusion and exclusion criteria

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To gain multi-dimensional perspectives in the post-pandemic context, the research subjects chosen are well-qualified professionals who have years of experience in the luxury fashion industry (whom we refer to as “luxury experts”). The data set is comprised of insights from 96 luxury experts within 71 videos, including 35 experts from luxury fashion firms, 21 from luxury fashion retailers, 18 from luxury magazines, 12 from third party solution providers, and 10 are luxury fashion lecturers. In these 71 videos, to maintain participants’ anonymity, the experts are coded in the order of video analyzed, and the order of appearance within each video. For example, if there are two experts in the first video, depending on the order of appearance, their code would be 1A and 1B respectively. Selected quotes and videos are depicted in the Results section, and the sample characteristics of selected videos are indicated in Table 1 at the appendix.

Table 1 Sample characteristics
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3.2 Hybrid thematic analysis

By containing both deductive and inductive reasoning, “hybrid thematic analysis” [46, 47] was selected as an appropriate analytical method that is commonly used in management studies [48, 49]. The deductive method can be appropriate when having predetermined categories through a comprehensive overview of relevant literature [50], while being useful for findings consolidation obtained from a foundational model [51]. The deductive thematic analysis allows scholars to look for reasonable explanations that are supported by empirical data [52]. At the same time, inductive thematic analysis can benefit scholars in confirming the constructs and generate significant sub-themes [53]. Therefore, this type of analysis allows us to perform deductive thematic analysis on the existing themes of the revisited Sashi’s model (2012), and thereafter combine it with inductive coding of emerged sub-themes from luxury fashion experts.

Since a systematic quantification of qualitative data raises credibility of the study (Vaismoradi et al., [79]), we have also conducted a content analysis to measure the occurrences of themes and sub-themes that emerged during the analysis process.

One notable pattern was when the 50th video was reached, the opinions of different luxury fashion experts tended to show saturation as they began to share similar thoughts on certain aspects in luxury. With this insight, the predetermined themes are consolidated along with deductive thematic analysis and the sub-themes are constituted with inductive approach after transcribing video contents. All the themes, sub-themes, and the content analysis are illustrated in Fig. 2—the CE cycle conceptual model.

Fig. 2
figure 2

The CE cycle conceptual model of online luxury fashion

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4 Results

This research explores how luxury brands manage their online CE activities. Each sub-section contained in this section represents each theme from the predetermined framework, in which respective sub-themes are indicated along with the percentage of occurrences determined from the content analysis. Figure 2 presents findings through the lens of Sashi’s [10] CE cycle conceptual model, after iterating thematic codes and grouping similar concepts.

4.1 Theme: Connection (29%)

The model begins with “connection”, a simple and cost-effective method to help businesses reach CE [54]. Conventionally, a positive first impression is better ensured if both online and offline platforms are attractive, whether its original purpose is to increase sales or branding. However, the flow of building awareness is different online. By preparing certain essential initial touchpoints, businesses can help customers go seamlessly to the next CE stage throughout the cycle.

4.1.1 Sub-theme: era adaptation (41%)

One of the key risks for a luxury brand is to become mainstream, and luxury brands are therefore averse to being approachable by a mass audience. However, many experts believe the opposite in luxury online presence.

Scarcity is important, but the new generation is so much online now, so embrace them, optimize the brand everywhere you go. (29B, Business developer, Third party solution provider)

Others, such as 31A, add that now is not the time to worry about more online presence, as it is no longer the era of excluding people.

It becomes reasonable for luxury brands to exit the ivory tower and blend in the society for certain occasions–not too many times, but it is effective to build relationships and get impact since doing something here is better than doing nothing. (31A, Master unit leader, Luxury fashion retailer)

31A’s statement aligned with Kim et al. [55] when providing even a fractional addition of accessing luxury information can significantly motivate online luxury shopping. To reinforce this, 33A also believe in the compatibility between online luxury and the young customers of this era.

The Gen Z customers focus too much on their phone in store, even ignoring the warm smile of the sale associate. Digitalization is inevitable. (33A, Retail director, Third party solution provider)

4.1.2 Sub-theme: storytelling (24%)

Many respondents agree that the amount of online information can be overwhelming, and storytelling is the key to standing out. Let customer see the overall picture and create a good first impression.

Storytelling signifies how luxury has evolved by becoming digital. It is more powerful than fact, faster to connect to the soul of customers. (33B, Assistant professor of Marketing, University lecturer in luxury)

Others believe online storytelling needs to be carefully conducted, especially when things are deviating from conventional norms.

I agree that storytelling can be effective, but [there are] many made up stories now, luxury buyers may dig up the roots of the story. Never try to be what you are not. (33C, Brand Manager, Third party solution provider)

4.1.3 Sub-theme: sustainability (35%)

Sustainability is one of the trends that luxury fashion firms are following, such as focusing on less product and aiming for circular economy. This movement mainly arises from brands’ goodwill, yet their attempts can make brands become more appealing for customers from this era in the cognitive buying stage.

It matters to them, this generation. Allow them to see that they can shop [for] sustainability more transparently. (23A, Buying director, Luxury fashion firm)

By expressing the sustainability attempts such as showing customers exactly the sustainability aspects on websites (sustainability certificates or animal-testing free product guarantee), it can allow customers to know what they are spending on, and how their shopping activities can contribute to social wellbeing. Luxury brands’ expression of their social and environmental contributions has become beneficial for them to gain more support from their clients, according to 39A.

High income customers buy from brands [that] provide social values. LVHM rise 20% [in] revenue when they promise to help fight COVID. (39A, Head of luxury, Third party solution provider)

4.2 Theme: interaction (9%)

“Interaction” represents the direct activities with customers with the purpose of improving the understanding of customer needs, which subsequently informs necessary changes [10]. In the luxury sector, human interaction during this stage, whether face-to-face or online/digital, remains the crucial element that sets the industry apart [27]. Therefore, human touch is a major sub-theme in this stage.

4.2.1 Sub-theme: human touch (55%)

Luxury buyers always prefer to have human-assisted service and it is imperative to translate those human-based activities online.

True value of luxury is still human relationship, recreate it and move it online. There will be many more touchpoints to be mindful of, as we are moving from pure transactional brick-and-mortar stores to a much more relational and brand caring space. (30A, Account director, Third party solution provider)

By foreseeing this need, even before the pandemic, reputable brands such as Burberry have provided virtual stores or fitting rooms, and interestingly, young buyers are comfortable with those online interactions [56].

4.2.2 Sub-theme: education (45%)

Whether it is an offline or online store, once a customer spends significantly on a product, her/his concerns surrounding the product itself are inevitable. 51B comments on this matter as follows:

Some luxury customers would not buy anything without consulting. (51B, Global vice president, Luxury fashion retailer)

Personalization is also expressed when the sales personnel spend time serving one of their customers and do more than just close a transaction. As 40A says here, we take the side of our customers and convince them that buying a luxury product will create lasting value for them.

Educate customers, tell them to be mindful, treat their money as investment in clothes. Don’t just try to make a sale. (40A, Founder, Luxury fashion retailer)

Educating customers also emphasizes the brand’s identity, attracts customers who share the same values when shopping for the brand, and creates a set of customers that are attracted to the orientation of the brand itself.

4.3 Theme: experience (24%)

The original CE cycle model developed by Sashi [10] does not include “Experience” as an explicit theme, but the model introduced in this paper places Experience in a separate stage due to its important role in the online context, as any form of prior experience with the brand can increase the chance of online purchase [57]. Generally, many luxury experts believe luxury is a shift from material possession to luxury experiences when younger generations want instant access to luxury items and experiences rather than just owning them.

4.3.1 Sub-theme: innovative solution (63%)

As online customer experience can never be as realistic as offline, managing experience for luxury goods becomes the hardest part in the online CE cycle, especially since the critical experiences–including touch, feel, and smell–are eliminated [2]. However, online experiences could be improved with modern equipment, such as augmented reality (AR), virtual reality (VR), livestream commerce, electronic wallets, or virtual fitting room, which can stimulate senses and display a shopping atmosphere online (Blazquez, [80]). 23A believes the intriguing experiences generated from modern technology provide a direct impact on customers’ satisfaction.

The innovation was built to make shopping from home convenient, connecting this feeling to the self-satisfaction of buying it immediately. (23A, Buying director, Luxury fashion firm)

On the other hand, 6A’s perspective on modern technologies is aligned with Islam et al. [58], as innovative solutions could help customers spend more quality time online, which can strengthen customer attachment and set the initial foundation for a desirable customer experience.

The app is super interactive, we can try different items with AR, or customize our own sneakers. It’s really fun, customers spend more time, and somehow solve the issue. (6A, Marketing consultant, Third party solution provider)

4.3.2 Sub-theme: omnichannel (37%)

It is a long-term strategy for brands to create seamless experience, whereby customers can mingle between online and offline sales. 26A expresses her thoughts on this matter as follows:

You can try at store, go home, think again, wanna try again but don't want to commute, you open the app, get the identical experience. (26A, Global director of customer service, Luxury fashion retailer)

Additionally, 14A believes the amount of time spent online also benefits omnichannel efforts, when it can balance the transition between online and offline channels, as well as being able to create better effects on customer experiences.

As customers often spend much time in “brick and mortar” stores, the key here again is to create intriguing experiences for them to spend also much time with brands’ online interface. (14A, Finance editor, Fashion magazine)

By providing both functional and hedonic values while having unified experiences across different brands’ platforms (Bilgilhan et al., [76]), customers’ emotions are triggered in this stage, allowing them to proceed to the next stage of the model.

4.4 Theme: satisfaction (11%)

Customers’ “satisfaction” can be acquired when their experiences with the brand are processed in a way that allows them to successfully conduct a transaction. To fulfill this objective in the luxury industry, personalization for quick and responsive online service delivery is needed, while consistency and efficiency need to be maintained across channels [59]. The major concerns are presented in the following sub-themes.

4.4.1 Sub-theme: false decline (44%)

One of the most prominent issues that gets major attention is false decline, when an unusual-looking transaction is denied. While the deny is not related to any online technical issues and even makes online transactions more secure, it leaves customers feeling hesitant and insecure. As 20A states, this denial can substantially sabotage luxury fashion firms.

Even when some transactions look weird, they might be good. Although you try to settle things right, the damage remains. Chances for customer[s] to continue with online purchase, or even coming back are not good. (20A, Executive vice president, Luxury fashion retailer)

As also mentioned in the “safety” sub-theme, there are not many online transactions for luxury. Therefore, a manual review is necessary for any transaction, to bring about current and future productivity.

After any decline, we should conduct manual review, and update with AI learning for not making the same mistake again. (32A, Vice president, Luxury fashion retailer)

4.4.2 Sub-theme: safety (31%)

The online environment might be different from the traditional one, yet the key to satisfying customers is always “reducing customer effort and risk” during transactions [60].

Customers rely on us to be their watchdogs. As they feel more insecure online, ensure they are not at risk. (28A, Executive America Editor, Fashion magazine)

Following from the previous statement, 10A also stated that a little uncertainty during the closing transaction process will ruin all previous efforts, especially when customers are trying to assess if buying online is worth more than their conventional service personnel.

A minor mistake on the user interface will stop the purchase immediately and destroy all the earlier cognitive building efforts. (10A, Digital Merchandizing manager, Luxury fashion retailer)

This has been a transparent challenge for fashion brands when they must really try to please every single customer in this situation, especially when online luxury transactions are so few.

4.4.3 Sub-theme: sentiment (25%)

Hedonic features tend to be better than utilitarian in driving customer buying (Bilgilhan et al., 75), especially for highly sentimental products like luxury goods.

Luxury is all about emotions. It plays in the functional part, making it so unique. (33A, Retail director, Third party solution provider)

As luxury products can better meet the emotional needs of customers to ensure subsequent customer retention, brands can emphasize hedonic features on their online presences, such as service speed or receptiveness Busalim, [61]. 26A aligns with this thought that it is more appropriate to channel resources to more emotional features.

It gets emotional when customer[s] decide to finalize a transaction. Have some kind of sentiment analysis here, to come up [with] strategies depending on what [the] customer really feel[s] […] [about a] certain category. (26A, Global director of customer service, Luxury fashion retailer)

Another noteworthy point that can be useful for future field research is that hedonic features are suitable for shaping the attitude toward the ready-to-wear luxury segment Kim & Jang, [62], leading us to the retention stage.

4.5 Theme: retention (9%)

After customers have finished their transaction and start to evaluate their after-sales experiences in order to offer their loyalty to the brand or not, it is crucial to actively seek to establish a relationship with them, which is referred to as “Retention” Payne & Frow, [63]. Retention value can be boosted when hedonic and functional values are combined [64]. With the hedonic features emphasized in the previous stage, respondents describe functional features in Retention as the initial post-purchase effort.

4.5.1 Sub-theme: data usage (41%)

Luxury fashion customers not only buy the product but also have expectations about how they will be treated. Using published data as well as data from online transactions will greatly benefit current and prospective customers. According to 21B, customers expect transparency when their data are utilized by the luxury brands.

If using data here can help serving [the] customer better, don't hesitate to do so. Customers are willing to conform if they understand. Don't be afraid that this can harm our relationship. (21B, CEO, Luxury fashion firm)

4.5.2 Sub-theme: post-purchase quality (32%)

The number of customers from ready-to-wear luxury fashion is not as great as other affordable fashion segments, yet the quality from this ready-to-wear luxury segment is compelling. Performing well until finalizing the transaction is the first success but making customers happy after the purchase will make a bigger impact for their lifetime value. 21D expressed his opinion on how to channel resources at this period.

We make [a] trade-off here. Less conversion, but more personalized and direct company resources digitally to current customers …. Dedicate a sales associate team that [the] customer can freely contact directly. It’s more convenient and makes customers feel more important. (21D, Chief client and digital officer, Luxury fashion firm)

The fact that customers continue their purchase causes their expectations to grow. 33C believes:

When they buy luxury again, they expect not just the story, but also the service. Be extremely careful online. (33C, Brand manager, Third party solution provider)

4.5.3 Sub-theme: authenticity (27%)

A considerable influence on a customer’s purchase decision for a certain luxury product is its authenticity, and thus expressing authenticity publicly also helps with the initial retention effort. 28B remarks about the immediate action upon concluding a transaction as follows.

With authentication code, customer can track the life of the product on the Internet. Giving them information after purchase is the way to link with customer online. (28B, Chief operating officer, Luxury fashion firm)

35B emphasizes the role of authenticity by further asserting that maintaining authenticity creates trust for customers, while at the same time expressing authenticity constantly and publicly will always benefit both parties in the long run.

Authenticity build[s] trust, help[s] fight against available counterfeits and benefit[s] after sale. Make it appealing. (35B, Business & Financial expert, Fashion magazine)

Proper channeling of hedonic and functional values will upgrade those values, and over time customers who choose to stay will stick with the brand at a higher level, known as called commitment, which is discussed in the next stage.

4.6 Theme: commitment (4%)

As functional and hedonic values increase with the firm’s efforts, they can be transformed into calculative and affective “commitment”, respectively. In the luxury industry customers are more likely to pursue hedonic values [65]. Therefore, focused efforts to create and increase affective commitment at this stage can help strengthen customer behaviors toward advocacy [66]. There are several methods mentioned by luxury experts to benefit customer commitment, as follows.

4.6.1 Sub-theme: loyalty program (60%)

Many luxury buyers will not wish to commit to just one brand, because they want to express multiple identities [67]. Therefore, the differences in designing loyalty programs can make the brand more attractive than others in the same segment.

It’s not just about the points in the loyalty program. It’s how you show some creativity, like allowing [the] customer to exercise some good deeds such as donating their points to help fight COVID. (43A, Head of Digital Strategy, Luxury fashion retailer)

Conventional ways such as points accumulation or giving extra items based on customer volume always work, but a little creativity will make the benefits to customers much more interesting. As 43A mentioned above, the company creates conditions for customers to use the extra benefits received to help society, giving customers the feeling of being able to act for something greater. This also aligns with the sustainable trend that the customers from this era are much more focused on than earlier generations.

4.6.2 Sub-theme: exclusivity (40%)

For some very-important-clients (VIC), it would be exciting to give them something that not all customers receive, even if that exclusivity comes from very little things.

The exclusive access to contents only several customers have, can show customers that brands have special connection with them. (43B, Chief marketing officer, Third party solution provider)

However, not all customers will receive the same incentives, and with online transactions and transaction histories, brands can take advantage of this with modern technology to design an exclusivity distribution strategy accordingly.

With technology, we can measure the level of customer commitment with us statistically and give them the exclusivity they deserve, in either monetary or hedonic forms. (6A, Marketing consultant, Third party solution provider)

Making good use of available resources with a reasonable affective commitment allocation strategy will be the premise to create brand advocates–those who are paramount to the survival and development of luxury brands.

4.7 Theme: advocacy (9%)

Interactions with the brand after a successful online experience is what nourishes “advocacy” in customers (Bilgilhan et al., [76]). Once committed, customers are willing to take certain actions for the brand, thereby activating their tied motivation [68]. In this process they take a leap from the emotional-dominant stage to the behavioral one, in other words becoming advocates. In the online domain social media is more dominant (Schivinski & Dabrowski, 77) compared to before, when customer commitment was strengthened through communities [69]. Now social media have empowered customers in their advocacy role. This platform is more suitable for the development of C2C activities and allowing brands to exert only limited control over their communities.

4.7.1 Sub-theme: intimacy (53%)

It is noteworthy that customers can advocate multiple brands [67]. Therefore, it is important for a luxury brand to remain attractive and allow their current active advocates to be involved in intimate events in which they can have greater opportunity to perform their active role. 48A emphasizes the effectiveness of intimacy as follows:

Treat advocates like a member of a family. Invite them to eat in fancy restaurants or concerts. They have high amount of followers, and they can show off their private experience. (48A, Head of PR, Fashion magazine)

In addition, luxury brands can leverage on the characteristics of advocates’ followers to devise appropriate outreach strategies. It is not that having a lot of followers is a good thing, but as 50A said here, it is also based on other factors.

Be intimate with micro-influencer and non-influencer communities–low number of follower[s] but loyal ones–for better conversion. They lead people to be brand advocates. (50A, Southeast Asia VP, Luxury fashion firm)

4.7.2 Sub-theme: sharing facilitation (47%)

As we draw customers closer to intimate relationships, we expect them to share more about us in online communities. However, in luxury, there are passive advocates who choose to stay behind and observe, while there are active advocates who tend to publicly promote their favorite brands and express their opinion [70]. Brands should invest in the latter type. Interestingly, 47B said that at this point, young active advocates’ engagement with technology is considerable.

Affluent customers–those sons and daughters of millionaires or those [who] manage to earn money at a very young age–in this era tend to be more engaged to media and technology. This can influence marketing. They want to be first mover. (47B, Partner, Luxury fashion retailer)

As this generation spends a vast amount of time online, what brands need to do at this stage is just reap the rewards after offering exclusivity and intimacy.

People love to be involved in the marketing process of the brand they cherish. Give them intriguing content to encourage their sharing behavior. (44D, Co-founder, Third party solution provider)

In addition, as stated in previous stages, what luxury brands need to do at this point is not acquisition, but rather focus on retaining existing customers, especially their most important VICs. Not only do they provide substantial benefits throughout their consumption lifecycle, but they also offer additional value, as 45A said below.

Your VIC may not be the highest spender but refers a lot. That person hold[s] extended lifetime value. (45A, Senior director, Luxury fashion retailer)

4.8 Theme: engagement (5%)

Once the customers have developed both an emotional and relational affiliation with the brand, they have reached the “Engagement” stage. While this is traditionally viewed as the “final goal” of CE activities, the proposed model cycle suggests that this Engagement is the first success, and companies should prepare for new connections when the CE cycle reiterates.

4.8.1 Sub-theme: team structure (78%)

One of the things that experts talk about the most is the adjustment of the team structure within the enterprise. This customer-centric adjustment is based on the customers who have actually engaged, because of the huge benefits they bring along with the tremendous level of personalization they deserve. 44C refers to this as follows:

Restructure the team to prioritize fans, from traditionally organized e-commerce team to building out a matrix team that’s organized by fan type. (44C, Senior vice president, Luxury fashion firm)

The reason for this is based on engaged customers to prepare for new CE cycles, as the new rotation of CE to new customers will be better prepared with a narrower target customer in line with the business’ direction.

The team worked with current engaged customer[s to] identify patterns and create lookalike audience, which can increase conversion and save cost per acquisition in the future. (45D, Online account manager, Luxury fashion retailer)

In addition to the determination of keeping engaged customers continuing to engage, remodeling the team structure will help prospective acquisition activity, which is something businesses can focus on more at this stage.

4.8.2 Sub-theme: dis-engagers (22%)

The adverse consequences from luxury brands’ advocates can be remarkable, as when their expectations are seriously violated, they can perform anti-brand activities (So et al., [78]). With the knowledge they gained from the brand they used to cherish, the consequences can be substantial if they choose to deliberately sabotage the brand. 52A expresses his thought on this issue as follows:

The worst kind of customer is the one who used to be your fan. They have more than enough resources to sabotage you. (52A, Chief engagement officer, Third party solution provider)

However, 53A believes the situation is different now with more tolerance from the customer’s side. Therefore, it is essential to carry what has been provided in the previous stages of the CE cycle, while continuing to listen to the voice of the highly engaged customer.

They got more tolerant after the pandemic and on a new interface. Be sincere and don’t violate their core values. (53A, Chairman, Luxury fashion retailer)

5 Discussion

5.1 Summary of the analysis

This research asked the question “what are the determinants of online luxury CE activities and how can luxury firms effectively handle the flow of their online engagement activities in the post-pandemic scenario?”. By exploring the perspectives and opinions of well-qualified luxury fashion experts we managed to obtain valuable insights.

First, brands can start with “Connection” to build awareness, yet the concept of awareness is different online. A notable sub-theme generated in this stage is “Era adaptation”, in which luxury brands can consider increasing their online presence, since anything can be online today, and the current generation also spends a large amount of time on the Internet. In this context, a good and honest “Storytelling” is effective to reach the heart of the audience. Additionally, “Sustainability” attempts can be publicly stated to communicate with potential buyers, which is a matter of importance to this generation.

The on-stage activities with customers known as “Interaction” remain crucial, especially for the luxury industry. When going online the “Human Touch” aspect of interaction must be preserved in various online touchpoints, where “Education” can be provided if customers need consultation in any form.

Knowing what customers want during interaction, brands can ensure that the engagement process is solid when they can effectively handle the “Experience” of customers. In this stage, “Innovative Solutions” appears as a life-saving approach in which brands can provide an intriguing new way of online shopping. Under the new technology, “Omnichannel” experiences need to be ensured when customers can comfortably switch between offline and online channels.

Customer’s “Satisfaction” will emerge when their experiences meet their expectations. However, with online platforms, “Safety” has to be guaranteed as the online environment is riskier than offline; but when preventing potential fraud, luxury brands also have to be mindful about “False Decline” to avoid damaging past and future efforts. As customers are becoming more emotional up to this stage, certain “Sentiment” analyses could benefit luxury firms in the long run.

A completed transaction calls for an immediate “Retention” effort. At this stage, transparency in “Data Usage” can benefit both firms and customers. At the same time, the “post-purchase quality” needs to meet and exceed customers’ expectations, especially for current customers. Also, “Authenticity” can increase customer’s trust and willingness, allowing them to comfortably repurchase.

When customer purchases repeatedly meet both their functional and hedonic expectations, their “Commitment” to the brand becomes more transparent. Some creativity in “Loyalty Program” can makes customers from the young generation be happy, such as being included in firms’ sustainability efforts. In addition, some “Exclusivity” to certain VICs can facilitate their willingness to act on behalf of the brand.

The committed customers who decide to take action on behalf of brands can evolve to play the “Advocacy” role. Developing “Intimacy” with them has the potential of bringing tremendous future benefit, while “Sharing Facilitation” for active advocates in this young generation can attract a considerable number of potential buyers who align with brands’ orientation.

Luxury brands’ first success is when their advocates reach the “Engagement” stage after actively performing their advocacy role. At this stage, brands can consider remodeling their internal “Team Structure” to fit their engagers, while attracting a look-a-like audience when the CE cycle recirculates. However, luxury brands must always be aware of the “Dis-engagers”, as they can sabotage the brand drastically with the power they hold.

5.2 Theoretical contributions

By building on the model of Sashi [10], we have revisited and gathered opinions from many luxury experts to obtain important insights for the industry. The impact of COVID-19 raised numerous concerns from society, resulting in a considerable amount of video content from reputable experts who publicly shared their opinions regarding luxury fashion CE during the pandemic and thereafter. The method of this study is thematic analysis based on content exploration. Note that the sources of our data volunteer their opinions, are not guided in their opinions, are exempt from sample selection bias, are diverse, and represent many different geographical regions in the luxury fashion industry. They all express their perspectives on the post-pandemic scenario of the industry, and when transcribed and broken down to smaller elements, we can see them fit conveniently into the aspects from the predetermined model.

Additionally, when synthesized, a remarkable point of this study is how it aligns with prior studies about the three dimensions of CE–Cognitive, Emotional, and Behavioral–by many prestigious CE authors, such as [71, 72], and [73]. More specifically, at the cognitive stage there are “Connection”, “Interaction”, and “Experience”,at the emotional stage there are “Satisfaction”, “Retention”, and “Commitment”; and at the behavioral stage there are “Advocacy” and “Engagement”. Moreover, the flow of sub-themes generated from luxury fashion experts in each main theme of the CE cycle also reflect the components from prior CE dimensions studies. This confirms the relevance of the CE cycle model, how it can provide valuable input to academia, and leads to another important aspect that will be discussed in the managerial contributions section.

5.3 Managerial contributions

The combined insights from luxury fashion experts have provided the flow for better CE management online in the post-pandemic context, in which fashion firms can have a glimpse of what to expect in the upcoming era. The least important takeaway has to do with “intimacy”, in which the online environment cannot fully possess the similar intimate effects as face-to-face encounter. There are three top priorities including the reaffirmed role of innovative technology solutions, along with the highlighted special buying characteristics of this generation (e.g., long daily screentime, valuing online experience, inclination for sustainability). These priorities are depicted as follows.

Among the sub-themes, there are some that play more significant roles than the others. One important sub-theme can be “innovative solution”, which exists in numerous aspects of online CE and can be a lifeline for all online activities after the emergence of COVID-19. From the luxury experts’ perspectives, generally in this era customers tend to spend a lot of time on their phone and even more with the arrival of COVID, making innovative solutions a savior during that difficult time. Innovative technology solutions have sketched out a direction that modern luxury businesses need to pursue in the post-pandemic era if they do not wish to be left behind. Businesses also need to create a sense of security for customers in every single online touchpoint, such as providing truly supportive personnel when needed or assign an easy-to-track serial number for every product by which customers can check its authenticity at any time; while at the same time being able to optimize customer data to ensure after sale quality.

Another point worth mentioning is the special characteristics of the young generation that calls for “era adaptation”. The young buyers, also known as Generation Z, were born at a time when the internet was just becoming popular and grew up with modern technology invading every aspect of life. These young and wealthy clients are not as secretive as their parents, and more receptive to social media. Thus, with this generation luxury is not only about buying an expensive product, but also about the accompanying “experience” provided by the luxury firm. This becomes more important as Generation Z respects experience, and brick-and-mortar stores are no longer considered as the prerequisite for this generation. Based on the content from the videos, this generation’s perspective on experience comes down to certain concerns, including whether the technologies are enjoyable to interact with; buying in store or at home activities are seamless and manageable; how personal the experience can be; and for the brand, what actions are customers willing to publicly perform online. Additionally, for this generation, luxury marketing is no longer about just showing nobility and superiority. It also expresses the social and environmental responsibility of the luxury brand in front of a group of young, rich, tech-savvy, and ready-to-act customers.

On a final note, this paper managed to sketch a path that determines online CE resource allocation, based on the alignment of our conceptual framework and previous reputable CE studies on the three dimensions of CE (cognitive, emotional, and behavioral). Thus, luxury businesses can allocate their resources appropriately, such as in putting sentiment values into the emotional stage like “Satisfaction” or providing intriguing content to share in the behavioral stage like “Advocacy”. An important point noted by many luxury experts is that luxury brands should remain focused more on retention than acquisition, unless at the final stage of the CE cycle, when they can pursue acquisition more when developing a customer centric strategy.

5.4 Limitations and future research

One noticeable limitation of this study is the wide geographical scope of the data set, in which videos from India, China and North America are included. We agree that investigating a single geographical area can help us gain a deeper understanding of the local market and consumer behavior, but explorable public contents can be insufficient when narrowing the research scope. Currently, this study has demonstrated a big picture of how online CE behavior has changed for the luxury fashion industry after COVID-19, and this demands further investigation in a more specific region.

Furthermore, as the pandemic has shaken the world, causing consumer behavior to change rapidly, traditional concepts should also be revisited. The content exploration from luxury experts has opened new perspectives, thus challenging the concrete assessments of the luxury industry from prior scholars in the pre-pandemic era. For example, recent luxury experts believe that “preserving scarcity and accessibility” should be deprioritized, and it would be better if luxury firms can adopt a more accessible attitude towards consumers. In addition, based on customer memory, the sequence of product arrangement can affect luxury buyers’ experience [74], which can be meaningful when transitioned into an online context. Thus, a fruitful area of research is opened where scholars can focus on revisiting these phenomena.

6 Conclusion

This study provides a framework that outlines the best practices that a luxury brand can undertake online–a sector that has been neglected by the luxury industry until recently and only really obtained attention when the pandemic hit. The pandemic presents a new era in which luxury brands can no longer benefit as much from advantages offered by physical stores, and when customers have adapted to online shopping and developed new and unpredictable behavior patterns. However, this pandemic can be seen as an opportunity for luxury brands rather than a threat, as businesses can now accelerate and improve the online CE process, thus revealing new market segments and opportunities. As the world moves toward digital transformation, it is imperative for the luxury brands to prepare themselves for a new way to conduct their business, by increasing their online presence and improving the appeal of their online platforms through good management of online CE activities. By combining a theoretical framework with empirical data, we have established a new path for the luxury sector to improve the CE process for high-end luxury fashion firms and prepare them to seize post-pandemic opportunities. In conclusion, we hope our contribution is accurate in these uncertain times, and also hope that this study can open up other research opportunities for future researchers.