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NEW YORK — Burberry aside, American fashion brands have surpassed their European counterparts when it comes to fluency in the digital world.
Or so says New York University think tank Luxury Lab, or L2, which Tuesday released its third annual Digital IQ Index ranking fashion brands according to their online competence.
Burberry took the top spot in the survey, which used a 350-point data system to rate 49 brands in digital competency, spanning categories such as social media strategy, Web sites and e-commerce, mobile-commerce capabilities, digital marketing and usage of newer platforms such as Tumblr and Instagram. Each brand is categorized by a digital IQ class, which goes from genius, to gifted, to average, to challenged to feeble.
Ten of the top 15 brands hail from the U.S. — including Kate Spade, Coach, Tory Burch, Ralph Lauren, Michael Kors, Donna Karan, Diane von Furstenberg, Marc Jacobs, Calvin Klein and John Varvatos.
When asked why she thought European brands lagged behind with respect to digital innovation, L2’s director of research and advisory Maureen Mullen said that it’s a combination of expectations for private versus public companies, as well as less access to digital talent in countries such as France. She said that many of the brands nearing the top of the list, including Burberry and Coach, can spend up to a third of their earnings calls dedicated to digital innovation.
L2 attributes Burberry’s success in digital to a new global site launch earlier this year that received strong e-commerce ratings. In April, the company was also one of the first to launch a mobile commerce site (along with Tory Burch, which also launched m-commerce the same month, followed by Coach in June). Burberry came in first with respect to Facebook fans, YouTube uploaded views and Instagram followers. It came in second place for the most Twitter followers with 564,400 after Yves Saint Laurent, which has more than 603,000 followers.
Additionally, the study suggests that heritage might not be as pertinent in the digital world — as newcomer Kate Spade took the overall number-two spot. In fact, Chanel, Christian Dior, Yves Saint Laurent, Valentino and Fendi all clocked in with an “average” IQ, and Prada, Hermès, Salvatore Ferragamo, Versace, Balenciaga and Chloé were placed in the “challenged” category. Among those with “feeble” ratings were Tod’s, Givenchy and Manolo Blahnik. Louis Vuitton was the only French brand to nab a spot in the top 15.
Mullen said that digital innovation in France, as it relates to social media, is about 12 to 18 months behind, although areas such as mobile could arguably be ahead, in some instances.
She added that Hermès — another iconic brand — was one of the first to have an innovative Web site, but it hasn’t done much in the space since then. She noted that both Prada and Hermès by virtue of their sheer brand equity alone were rated “gifted” in L2’s first digital IQ study for fashion brands in 2009.
But Prada is absent from social media altogether.
Interestingly, Coach — which came in third place in the survey and received a “genius” rating as a fashion brand — didn’t fare as well in L2’s second annual Digital IQ Index ranking specialty retailers released in August. Although still labeled “gifted,” the company came in 22nd.
When placed among fellow retailers, Coach’s e-commerce orientation is not a point of competitive differentiation, according to Mullen. She said that while its retail and e-commerce orientation is very strong compared to other brands, it’s on par with other companies in the retail category because they have a “longer legacy selling online.”
She contended that fashion brands do lead the way in some aspects that are central to the industry and have made strides with newer platforms such as Tumblr and Instagram, but they’re still behind in some of the “not so sexy” areas like e-commerce tactics, search engine marketing and e-mail.