NFTs as a CRM Tool in the Luxury Fashion Industry: A Study

The luxury industry’s clientele places the intangible value they derive, above all
else, from their experience with a brand. Scoring higher up on the hedonistic scale
as opposed to the utilitarian needs, luxury products are consumed for those
intangible values such as brand equity, esteem, recognition among peers,
exclusivity and impeccable service. This is precisely why brands in the luxury
industry strive to create experience for their customers and prospects. This often
involves a considerable amount of artistic and aesthetic aspects. The experiences
are often designed to be multisensory to evoke multiple senses of the viewer.
These experiences or experiential marketing as it is called in the marketing sphere
is an inseparable part of luxury industry. Illustrating this is a piece of data obtained
from a 2021 study of the global luxury market by Bain and Company. The report
states that the market remained 9% to 11% lower than 2019 levels owing to the
shortfall in experiences as a result of the Covid-19 pandemic.
If experiences are inseparable from marketing luxury products, then customer data
is inseparable from crafting personalized experiences and making sales. Customer
equity and customer lifetime value have become important points of discussion for
all brands alike. It is even more crucial for luxury brands to think about customer
equity because their clientele is typically small. This means that brands have to
retain their customers and build valuable relationships with them.