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21st century luxury fashion retailers' marketing strategies for customer

satisfaction: UK perspective

Article  in  International Journal of Business and Globalisation · January 2016

DOI: 10.1504/IJBG.2016.073630

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Int. J. Business and Globalisation, Vol. 16, No. 1, 2016 79

21st century luxury fashion retailers’ marketing

strategies for customer satisfaction: UK perspective

Daniella Ryding* and Gianpaolo Vignali

School of Materials,
University of Manchester,
M13 9PL, UK
Email: Daniella.ryding@manchester.ac.uk
Email: Gianpaolo.vignali@manchester.ac.uk
*Corresponding author

Myriam Caratù
University of Rome ‘La Sapienza’,
Piazzale Aldo Moro 5 00185, Rome, Italy
Email: myriamcaratu@gmail.com

Yen-Yin Wang
School of Materials,
University of Manchester,
M13 9PL, UK
Email: andytension@hotmail.com

Robin Carey
School of Business,
University of Central Lancashire,
Preston PR1 2HE, UK
Email: rcarey@uclan.ac.uk

Abstract: The purpose of this study is to examine contemporary customer

satisfaction drivers for the luxury apparel sector in three dimensions; product
quality, service quality and digital in-store interaction, and to reinforce their
importance for brand building and the overall multi-sensory experience. The
research design adopts a quantitative approach to establish the optimisation of
these effects on the customer. An internet-mediated questionnaire is used to
gather data for the UK market. The findings reveal that service quality
dominates customer satisfaction across the key dimensions, but also ranked
highly and in respective order are product craftsmanship and design, country of
origin and in-store digital entertainment.

Keywords: luxury; fashion; customer satisfaction; retailers; product quality;

service quality; digital; in-store interaction; marketing; engagement; UK.

Copyright © 2016 Inderscience Enterprises Ltd.

80 D. Ryding et al.

Reference to this paper should be made as follows: Ryding, D., Vignali, G.,
Caratu, M., Wang Y-Y. and Carey, R. (2016) ‘21st century luxury fashion
retailers’ marketing strategies for customer satisfaction: UK perspective’, Int. J.
Business and Globalisation, Vol. 16, No. 1, pp.79–103.

Biographical notes: Daniella Ryding joined the University of Manchester in

September 2013 and her PhD by publication was awarded in 2012. She is the
author of two marketing textbooks, made contributions to several others, and
has published in a number of business journals. Her international teaching
experience includes the delivery of marketing programs in both Europe and
Asia. She is the Program Director for BSc in Fashion Marketing in the School
of Materials, and teaches at both undergraduate and postgraduate level. She is a
Visiting Professor for the University of Vitez and supervises both MSc and
DBA students. Her research outputs are ongoing and her main research
interests focus on the use of cognitive neuroscience techniques to measure the
underlying mechanisms which impact on consumer responses to commercial
advertising, product branding packaging and store environments.
Gianpaolo Vignali is a graduate from UMIST with his first degree in
Mathematics. Later, adding a Master’s in Strategic Management his career first
started as a part-time Lecturer and researcher at Manchester Metropolitan
University before moving to full-time employment in the Department of Retail
at Leeds Metropolitan University. He then became the Program Leader for
Fashion Buying and Merchandising at Manchester Metropolitan University
until he achieved his PhD and moved to Manchester University working in the
School of Materials where he delivers on both undergraduate and post graduate
programs. He has written over 40 papers and books in the field of marketing
and management and presented at numerous international conferences. His
current research focuses on the case study technique in the service sector which
coincided with his PhD program of study.
Marion Caratu achieved her BA in Italian Studies and MA in Marketing and
Communication for Business at University of Rome La Sapienza. She
also attended an MFA in Creative Writing for Cinema and TV at the University
of Rome LUISS Guido Carli, specialising further in this field with a
Professional Program in Film Production at the UCLA. She studied as an
Erasmus student at the University of Tampere and afterwards she wrote her
thesis – which compared the British and Italian scenarios in the field of branded
entertainment – at the University of Manchester. She is a journalist and a
screenwriter.
Yen-Yin Wang received her MSc in International Fashion Retailing from The
University of Manchester, BA in Business Administration from The National
Taipei University and is currently working as a Welcome Desk Agent in
W Taipei Hotel. A strong advocate for luxury branding and customer
experience in fashion and hospitality, she devotes herself to hospitality field
with passion after receiving her MSc degree. Her professional interests focus
on novel marketing approaches to create better customer satisfaction and
further develop firm customer loyalty. Her MSc dissertation ‘New marketing
strategies for 21st century luxury fashion retailer: a focus on the in-store
experience’ involves the impact of product and service quality, in-store brand
and digital experience, physical appeals in store, and personal interaction to
luxury customer experience. In addition, she was rewarded the first place for
the academic year and honoured with Dean’s Prize for her thesis and poster
from the international CIRCLE conference.
 21st century luxury fashion retailers’ marketing strategies 81

Robin Carey is a Senior Lecturer and Course Leader in Business and Marketing
at Lancashire Business School (UCLan) and is also a Course Leader for
Advertising and Marketing Communications at VTC in Hong Kong. He gained
his first degree Business and Law from Coventry University, his MBA from the
University of Hull and more recently has added a number of post graduate
qualifications whilst teaching at UCLan including an Med. He has previously
worked in business and marketing related roles at BBC Worldwide, News
International (The Times, Sunday Times, The Sun), the Daily Express and
Daily Mail and General Trust. He is currently studying for his Doctorate in
Education with a specialist interest in teaching and learning with regard to
student from South East Asia in UK business schools.

This paper is a revised and expanded version of a paper entitled ‘21st century
luxury fashion retailers’ marketing strategies’ presented at 11th International
CIRCLE Conference, University of Manchester, 23–26 April 2014.

1 Introduction

The luxury fashion industry has witnessed evolution on many accounts: ‘old luxury’ has
been amended and enriched with tradition while ‘new luxury’ has developed through the
use of contemporary technology (Okonkwo, 2007). Luxury can be identified from either
a consumption perspective – which refers to its spiritual value of status obtaining a
unique customer engagement – or through a product perspective – which refers to its
premium quality, high price, exceptionality, and craftsmanship (Fionda and Moore,
2009). According to Mintel (2011), for instance, 60% of luxury shoppers purchase luxury
products for indulging themselves and for their social function. Premium quality and
manufactured craftsmanship goes only as the second motivation.
Today, the luxury industry is achieving a level of democratisation, which is
developing from the tailor-made garments to the industrially manufactured ready-to-wear
apparels (Kapferer, 2012). New luxury brands have thrived significantly in these two
decades due to globalisation, technology, and the internet, which have decreased the
entry barrier of luxury fashion market (Okonkwo, 2007) – even though, on the other
hand, the bespoke and customised services satisfy the affluent consumers for personal
specifications and modifications, especially for those who seek for the uniqueness and
distinctiveness (Mintel, 2011; Okonkwo, 2007).
As a result, the retail landscape is witnessing evolving formats, and luxury retailers
are adjusting their strategies as a whole to correspond to changes taking place within the
market in an attempt to compete effectively (Okonkwo, 2007): they are extending
product lines and creating distribution strategies to compete more effectively and benefit
from the mass market (Thomas, 2007). Equally, mass fashion brands attempt to
manipulate similar branding strategies to those of luxury retailers, upgrading their
products and brand impression with a more alluring strategic ‘luxury’ approach
(Okonkwo, 2007).
The future survival of luxury will be hinged on establishing the full emotional
engagement with brands, promoting real exclusivity, setting an aspirational dream for
people, creating a personal customised service, growing surge to be more sustainable in
the form of eco-fashion brands and promoting related campaigns.
82 D. Ryding et al.

Therefore, the research aim of this study is to critically examine the customer
satisfaction drivers for luxury fashion apparel meant for enhancing the service
experience, and specifically: product quality, service quality and digital interaction
in-store. This will be done via a research focusing on female consumers who have
experience of shopping in luxury physical stores, aged 18–34 years and located in the UK
area via three main objectives:
• The critical evaluation of theoretical frameworks underpinning customer satisfaction
for luxury fashion clothing retailers in the UK, with the emphasis on product and
service quality.
• The critical review of the environmental factors impacting luxury fashion clothing
sector, and in particular the luxury fashion consumer.
• The exploration of new marketing strategy adopted by luxury fashion retailers to
enhance the service experience, focusing on product quality and the use of digital
interaction in-store.

2 Research context

2.1 Macro analysis

Today, there is a shift in luxury core markets, which includes emerging countries in the
East, a development which averts the restricted concentration of luxury in the developed
markets of the West (Sherman, 2009): this trend, together with the global
communications and technological advancements, has brought luxury consumers to
become increasingly demanding. In addition, since global demographics are changing,
the market for luxury over the last five years has had to face a more international target of
luxury consumers whose number has enlarged three times up to 330 million, since 1995 –
and consultants assess it to rise constantly till reaching 500 million people in 2030
(Bloomberg, 2014): all this has given birth to that fast-changing environment already
mentioned.
Hence, some protagonists in this scenario have gone down to mass-fashion marketing
tactics to meet the customers, with the consequent creation of three levels of luxury
brands: absolute (such as Hermès, that addresses the exclusivity, the heritage and the top
elitism, which usually links to traditional manufacturers and originally market driving
retailers), aspirational (distinctive and noticeable brands as Louis Vuitton and Gucci) and
accessible ones, such as Coach and Hugo Boss, brands affordable for the middle class
consumers who look for reinforcing their status (Chevalier and Lu, 2010; Shukla, 2012).
So, given this sort of democratisation (Brun and Castelli, 2013) the future market is
going to be product-focused: customers will pay more attention on material, relevance,
and originality rather than perhaps tradition, hence, retailers will need to innovate
constantly. Recognising consumer needs and offering customised services will be the
crucial factors for success; additionally, ethical and moral issues will be greater
considered and valued in luxury apparel sector (Brown, 2014); finally, internet, social
media and digital marketing will grow rapidly and benefit luxury brands in certain ways
(Ventura, 2013).
 21st century luxury fashion retailers’ marketing strategies 83

In taking a closer look to the macro-trends occurring in the luxury market, researchers
estimate that the market revenue will grow 5% to 6% annually in 2015 (Bain and
Company, 2013), and there is a variety of reasons for that: firstly, consumers now already
tend to buy luxury products when travelling and discovering new countries such as Dubai
and Southeast Asia. Furthermore, the number of the middle classes is increasing due to
high earnings, accounting for ten times more than the real wealthy individuals:
consumers have more disposable income, especially in emerging countries which are
profitable locations for luxury retailers (Bain and Company, 2013).

2.2 Microanalysis
From this perspective, some other interesting trends can be observed: for what regards
suppliers, for instance, the luxury industry is now experiencing an obstacle of the
reducing number of high skilled workers, which results from the retirement of old
craftsmen and no willingness to learn from young workers (Bloomberg, 2013). Moreover,
some components of the products are outsourced, so the retailers may need to order a
great amount from one supplier at once and some special materials – such as exotic skins
– are increasingly facing a shortage, which can be seen in Chanel and Hermès (Reddy,
2009). Looking at the distributors instead, the top three popular retail channels for luxury
fashion shoppers are ranked as department stores (43%), outlet stores (39%) and
independent boutiques (39%); in particular, department stores are the favourite among
consumers under 35 years old and ABs (Mintel, 2010). On the contrary, for luxury
clothing going online accounts for the least percentage among all distributors.
In general, it is evident that there is a tendency of luxury retailers starting to
consolidate together, in order to achieve greater economic scale (Doran, 2013) which
would enable them to minimise risk while diversifying the brand portfolio and to obtain
more financing options and operating collaboration. This is also a tool to fight the
so-called ‘me-too phenomena’: fast fashion brands can easily copy trends and designs
from luxury brands within weeks after brand fashion shows and then offer similar
products with much more affordable price to consumers (Midby, 2014).
Finally, in regards to target consumers, there is some evidence to suggest that the
potential customer base is getting younger, particularly in Asia (although the main
resource of luxury consumption – according to Bain and Company, 2014 – still relies on
baby boomers, that manipulate the 90% of luxury global spending). This is even more
evident in the UK: according to Mintel (2011), there are about 66% of the population
who buy luxury brands, accounting for 80% 14–25 year old shoppers who buy luxury
goods, while half of them are luxury clothing buyers, who then become the strongest
demand in the designer/high-end clothing sector (as shown in Figure 1). The latters are
constantly keeping up with the latest fashion trends, which stand at a more important
position than price in their minds.
So, as mentioned in the micro-analysis, the traits of the new target (international,
young and digital), together with the trend of democratisation of the luxury, push the
companies to the tendency of ‘going younger’. It is not a case, in fact, that Burberry
utilises various digital strategies for enticing the young, and has used the face of Emma
Watson as testimonial, since she embodies perfectly the demographic consumer target
group (under 35s, full-time students, and specifically living in the London area).
84 D. Ryding et al.

Figure 1 Consumers wearing designer clothes (see online version for colours)

Source: From Mintel (2011)

Figure 2 Five types of luxury consumer profiles (see online version for colours)

Source: Adapted from Brun and Castelli (2013)

However, for truth’s sake, it must be said that – although the young luxury consumers are
emerging – consumers in the age of 13 to 33 years only contribute to 13% of global
luxury spending (Bain and Company, 2014): half of the global spending is made up by
 21st century luxury fashion retailers’ marketing strategies 85

about 15 million people, the true luxury consumers. The distinctive traits of these global
luxury consumers can be found, for instance, in Brun and Castelli’s (2013) model, shown
in Figure 2.

2.3 Fashion market performance and customer satisfaction theory

Before constructing a realistic and impeccable marketing strategy, it is essential for
retailers to identify and evaluate consumer satisfaction (Kotler et al., 2005), since it
stands at a central position in marketing, being it a predictor of consumption behaviour
that transforms to more profits and improves market share for firms (McQuitty et al.,
2000).
Bei and Chiao (2001) have written about perceived product quality and perceived
price fairness, demonstrating that these are as important as perceived service quality in
affecting consumer loyalty (while in the service industry of course the latter is even
considered the main and direct motivation to brand loyalty).

Figure 3 The ACSI model

Source: Source: Adapted from Hsu (2008)

These notions of perceived quality, price and service entail one key element in the
satisfaction concept, which is customer expectation. Expectation means that a product or
service that meets the customer’s requirement may determine the satisfaction
development (Angelova and Zekiri, 2011), which can vary and span through different
brands and product ranges (Huddleston et al., 2009). Expectation plays an important role,
especially in service firms, because they need to know what customers’ expectations truly
are in order to meet them. In the satisfaction theory, expectation it is regarded as an
anticipation in consumers’ mind about the process of transaction (Angelova and Zekiri,
2011), which leads eventually in engagement and retention, and it is broadly accepted
that customer retention enhances future revenue (Angelova and Zekiri, 2011). The
American Customer Satisfaction Index (ACSI) in 1994 has released, a national
measurement of customer satisfaction of the product and service quality. It consists of
86 D. Ryding et al.

three antecedents and two outcomes – as shown in Figure 3: perceived quality is

customers’ evaluation of the product or service from current experience, while perceived
value refers to the quality associated with price (Angelova and Zekiri, 2011). All these
three factors may have an impact on building customer satisfaction, which mainly
contributes to raise customer loyalty and diminish customer complaints (Hsu, 2008).
Given this frame, and also according to Vignali et al. (2008), the conceptual theory of
customer satisfaction hinges on customer perceived value, and value is affected mostly
by quality (Table 1).
Table 1 Satisfaction levels

Experience/ Customer’s Level of satisfaction

Consequence
performance experience
Real value of Better than expected Delight Will tell others and repeat
product/service purchase if possible (loyalty)
Expected Satisfaction Will tell others, but may
cross over to competition if
promised added benefit
Worse than Dissatisfaction Will cross over to
expected competition if at all possible
Source: Adapted from Vignali et al. (2008)
Therefore, there is a significant relationship between customer satisfaction and value, in
particular perceived value, as in the one derived from the sum of all the benefits and
sacrifices at the point of consumption (Sweeney et al., 1999). Researches have shown that
perceived quality had a profound impact on perceived value, and product value can be
highlighted by advancement of quality, durability, design, and reputation (Dodds et al.,
1991; Rangaswamy et al., 1993), even though Kerin et al. (1992) claimed that the
shopping experience has more influence in the in-store purchase than product quality and
price.

2.4 Luxury consumer and luxury context

As already mentioned (Vignali et al., 2008), satisfaction and expectations are tightly
connected in the customer experience, and the latter is also tied to the perceived value
that a customer has of a brand: empirical evidences have demonstrated that dissimilar
market segments perceive luxury brands differently due to the fact that luxury is quite
subjective (Phau and Prendergast, 2001); however, Wiedmann et al. (2009) have still
tried to classify some commonly shared luxury values derived from customer
expectations of the luxury value itself (Figure 4).
In general, it is commonly assumed that the whole brand experience applied online
and in-store, as well as personalised service, reinforces customer expectations to a new
level (Sena, 2014; Chevalier and Gutsatz, 2012): customers for one expect to be able to
personalise and customise their products, they expect from the brands to be recognised,
cared, treated as unique, and to build up a personal relationship with salespeople
(Chevalier and Gutsatz, 2012).
 21st century luxury fashion retailers’ marketing strategies 87

Figure 4 The four value dimensions of luxury

Source: Adapted from Wiedman et al. (2009)

Citing once again Vignali et al. (2008), the conceptual theory of customer satisfaction
hinges on customer perceived value, and value is affected mostly by quality: both product
quality and service quality. For what concerns the product quality, the parameters that
count the most are the ones related to the aesthetic dimension, which refers to design,
style, and colour contributing to beauty creation (De Barnier and Valette-Florence, 2013).
Close to it there are the materials used for the product: retailers will need therefore to
have high-quality materials and well-crafted products which, according to Ko et al.
(2010), will seize consumers’ inclinations and reassure them about their durability (as
well as about the reliability on the brand). Consumers’ inclinations and their purchasing
intentions, although, are also often driven by the country of origin (CoO) effect – which
refers to the brand features and the place of manufacture and construction (Godey et al.,
2012) – as well as the brand reputation and heritage: a long brand history or a distinct
personality of the brand’s founder, in fact, obtains a special position for the brand in the
marketplace (Ehbauer and Gresel, 2013), and can be also a translation tool to help luxury
brands to convey ideas (Lim et al., 2012).
The other domain of the product quality, for service firms, is service quality: here
interaction, a captivating mood and unique personalised service develop customer loyalty
and satisfaction, as well as attracting new customers (Atsmon et al., 2011; Wong et al.,
2014).
88 D. Ryding et al.

2.5 New marketing strategies

In conclusion, there is now evidence to state that the current new strategies for luxury
retailers are based on highlighting the most substantial five facets of marketing direction:
consumer experience, digital engagement, innovation, eco-fashion, and customer
emotional connection (Morley and McMahon, 2011; Kapferer, 2012; Wiedmann and
Hennigs, 2012). All these deliver the luxury experience through the retail environment,
which includes the physical store and social-web nature (Luxury Daily, 2013): for
instance, digital-enriched events and displays taking place in flagship stores impress
consumers by creating an amusing, entertaining, and digital-savvy environment (Luxury
Daily, 2013). Eco-fashion on luxury is another strategy in the new era, since people start
to care about the environment and consider about the sustainability of fashion: retailers
such as Stella McCartney and Vivienne Westwood have made their path towards to the
issue (Birch, 2011), while some luxury consumers also display wealth and status through
ethical and philanthropic purchases (Brun and Castelli, 2013). All the approaches
mentioned above of course require the creation of innovation, which is a beneficial and
crucial tool for tradition luxury brands in order to produce emotional aspiration responses
successfully, and in order to satisfy existing and potential customers (Morley and
McMahon, 2011). Finally, storytelling of the brand history and tradition is a must-have
instrument for luxury brands to stimulate emotional interactions with customers
(Kapferer and Bastien, 2009).

2.6 Case study – Burberry

All these strategies find their place in a very well known brand: Burberry. Today, in fact,
Burberry has become the pioneer of using digital technology and takes it as its
competitive advantage to lower the accessible level of luxury among massive top brands,
despite some researches have shown that the brand exclusivity and value would be ruined
if the brand kept no distance with the customers (Kapferer and Bastien, 2009; Walker,
2013). It is not a case that in 2011 Burberry has introduced the new concept of retail
theatre, an in-store digital event where the multi-sensory experience and the atmosphere
provided an exciting and unique opportunity to the customers (Alexander, 2010): digital
rain shower in store, easy and time saving checkout process, RFID technology (Bergin,
2012; Cartner-Morley, 2012) were just some of the tools used. The firm emphasises on
blurring the boundaries of digital and physical world; customers are now able to
experience the digital innovation in real stores (Davis, 2014): by utilising the advantage
of its tradition, Burberry can boost consumers’ emotional arousal and in the meantime
evoke the trench coat legacy from people’s mind (Forbes, 2013).

3 Methodology

In the very beginning, the research explores the prospective drivers triggering luxury
customer satisfaction; next, it assesses and analyses how these factors inspire luxury
customers’ satisfaction and purchase behaviour; lastly, it analyses the significance scale
of each factor to see how it can be exploited to satisfy customers and further trigger
purchase intention.
 21st century luxury fashion retailers’ marketing strategies 89

In this study, a positivistic paradigm has been adopted as research philosophy, which
implies that researchers take the phenomena as the beginning rather than taking the
personal perception, intuition, or inference. Specifically, the two assumptions under the
traditional positivistic philosophical are:
1 the world is unbiased and external
2 if knowledge is based on exploring the exterior facts, it has a remarkable effect on
business research.
As for the research approach, here a deductive one has been adopted through relevant
hypotheses and numerical data in order to support the concept obtained from earlier
studies statistically (Ghauri and Grønhaug, 2010).
As a consequence, also a quantitative method has been applied for the data collection
(both primary data and secondary data): the more appropriate method to this study, given
its aim to test the hypotheses about customer satisfaction generated from previous
literatures. In fact, the quantitative data have been employed to create both hypotheses
and the result, which has been tested accuracy statistically and dependably (deductively).
The data collection method herein is constituted mainly by a survey: an
internet-mediated questionnaire that has been designed and manipulated to gather valid
data (Chiu et al., 2009; Saunders et al., 2012). Due to the reason that the questionnaire is
web-based, a sample whose size is approximately 100–150 people has been collected
through a survey pattern made of social media (such as Facebook) or through e-mail
system, reaching thus students in the University of Manchester.
The research audience on which this study focuses is geographically based on luxury
consumers within the UK, due to the fact that the country has been defined highly
associated with the fashion industry thanks to its cultural identity correlation, and the
market has experienced a steady year-on-year growth in these years, with a 4.8% increase
from 2012 to 2013. Moreover, the audience is focused on female, 18–34s consumers in
the UK area who have experience of shopping in luxury physical stores: this, since
women tend to perceive sensory attractions better than their counterparts, they are more
likely to show positive reactions to an appealing retail environment and they tend to
transform the value derived from the phenomenal in-store experience to the products
offered by a specific brand (Borges et al., 2013).
In addition, it is not easy to acquire the list of the whole population as a sampling
frame, so the systematic sampling has resulted to be the most appropriate method, since
in it the sample picked can symbolise the whole population with no bias and it can also
be scattered in a particular geographical area – no matter the size of it; therefore, this
technique has resulted suitable for online or telephone surveys. Finally, in the systematic
sampling, there is no need to obtain the sampling frame to select samples (Saunders et al.,
2012).
Eventually, the research has operated SPSS software to analyse data through T-test
(which enables researchers to compare the mean scores of a particular variable between
two different groups), correlation and Chi-square test statistical approaches. Correlation
has been presented using Spearman’s Rho correlation analysis to observe the
relationships between variables (Pallant, 2010), while Chi-square test has been used to
show frequencies between variables and further to see any significant result (Pallant,
2010).
90 D. Ryding et al.

4 Data analysis

4.1 Validity
Herein, the construct validity method is exploited to measure whether the research is
valid and rational; for example, concerning customer satisfactions in luxury fashion
industry, an expected notion that premium quality of luxury products can positively
impact on customer satisfaction. Subsequently, the relationship between product quality
driver and customer satisfaction could be examined to demonstrate the deduction through
the data analysis.

4.2 Demographic analysis

The survey questionnaire consists of 30 questions, and the participants are female,
18~35 aged customers who are luxury shopping experienced, fashion sensitive,
comparatively young, and digital influenced. The choice relies on two factors: female
customers are particularly emphasised in order to produce valuable results (d’Astous,
2000) and moreover young generations perform a great percentage of online shoppers
thanks to the internet. Therefore, in this survey, of the 102 questionnaires that were
obtained, eight of them are considered invalid as they have been conducted by male
respondents (the recovery rate is 92%).

4.3 Frequency examination

According to the 94 valid questionnaires, there are just about the same numbers of
participants in the 18–24s and 25–34s age groups, constituting 46 people in each category
(49%). This is a benefit for the analysis and results in a rather reliable outcome. In
addition, for customer satisfaction variable, there are 14 respondents (15%) strongly
satisfied with their shopping experience in physical luxury stores, and the greatest
frequency (66%) falls into the ‘agree’ category, indicating that the experience was
satisfying. Overall, participants of this research have a tendency to a satisfying
experience shopping in luxury physical store, with percentage of over 80% of people who
are happy with their luxury shopping experience (which is substantially valuable to the
analysis).

4.4 Reliability
Stability and internal reliability (Bryman and Bell, 2007) are utilised in this research,
which takes advantage of the Cronbach’s alpha test – that concerns the customer
satisfaction driver questions in the survey and involves 25 items (Q6A-Q20B) correlated
of a scale from 1 to 5. The Cronbach’s alpha value is 0.851: favourable result in proving
the reliability scale.

4.5 Correlation analysis

It investigates the relationship between the variable of the customer satisfaction (based on
question 8 of the survey questionnaire) and the satisfaction drivers – product quality
(Question 10~Question 14), service quality (Q15~Q17), and in-store experience variables
 21st century luxury fashion retailers’ marketing strategies 91

(Q18~Q20). The quantitative results of each of these correlations are presented later on in
the hypothesis testing section.

4.6 T-test
It is used to analyse the emphasis of the study on the digital experience of the customer.
Four questions (19A/19B/19C/19D) have been included in the questionnaire for the
T-test analysis, as shown in Table 2. Here is the research question: ‘Is there a statistical
significant difference of digital in-store experience driving customer satisfaction between
luxury consumers under and over 25 years old?’
Table 2 T-test for digital in-store experience in two age groups

Std. Std. error

Group statistics Age N Mean
deviation mean
19a I feel entertaining by the huge screens 18–24 46 2.22 0.987 0.146
playing catwalk fashion shows in 25–34 46 2.15 1.032 0.152
stores while shopping.
19b I find it interesting and useful when 18–24 46 2.04 0.942 0.139
picking up an item and the near mirror 25–34 46 1.57 0.807 0.119
will show the look on catwalk as well
as the manufacturing detail.
19c The audio-visual content displays in 18–24 46 2.13 0.778 0.115
physical stores positively stimulate 25–34 46 1.72 0.621 0.091
my senses and emotionally engage me
into the brand.
19d Mobile checkout devices make the 18–24 46 2.17 0.877 0.129
shopping process more convenient 25–34 46 1.63 0.711 0.105
and timesaving (e.g., using pad).

Also, an independent samples T-test was conducted to analyse data and compare the
scores between the two age groups (Table 3). As it is shown in this last table, there is
exactly the same number of respondents aged between 18–24 and 25–34, calling for
46 people each. It can be told if there is any statistical significant difference between the
two groups by checking the value in the sig. (2-tailed) column, which is 0.757, 0.010,
0.006 and 0.002 for question 19A, 19B, 19C and 19D. Except the value for question 19A
is above 0.05, all of them are less than 0.05, which indicates a significant difference in
the mean scores on digital in-store experience for the two age groups.
By examining further, it can be calculated the effect size to attain an indication of the
scale of the discrepancy by manipulating the formula of Eta squared in the following:
t2
Eta squared =
t 2 + (N1 + N2 − 2)

Therefore, they can be applied the values in Table 3 to the formula, for instance, in terms
of question:
2.6152
19B, the Eta squared = = 0.07
2.615 + (46 + 46 − 2)
2
 92

Table 3

Levene’s test for

T-test for equality of means
equality of variances
95% confidence interval
D. Ryding et al.

Sig. Mean Std. error of the difference

F Sig. t df
(2-tailed) difference difference
Lower Upper
19a: I feel entertaining by the huge Equal variances 0.333 0.566 0.310 90 0.757 0.065 0.211 –0.353 0.484
screens playing catwalk fashion shows in assumed
stores while shopping. Equal variances 0.310 89,820 0.757 0.065 0.211 –0.353 0.484
not assumed
19b: I find it interesting and useful when Equal variances 0.091 0.764 2,615 90 0.010 0.478 0.183 0.115 0.842
picking up an item and the near mirror assumed
will show the look on catwalk as well as Equal variances 2,615 87,934 0.010 0.478 0.183 0.115 0.842
the manufacturing detail. not assumed
19c: The audio-visual content displays in Equal variances 0.027 0.870 2,816 90 0.006 0.413 0.147 0.122 0.704
physical stores positively stimulate my assumed
senses and emotionally engage me into Equal variances 2,816 85,771 0.006 0.413 0.147 0.121 0.705
the brand not assumed
19d: Mobile checkout devices make the Equal variances 0.576 0.450 3,266 90 0.002 0.543 0.166 0.213 0.874
shopping process more convenient and assumed
time-saving (e.g., using pad) Equal variances 3,266 86,287 0.002 0.543 0.166 0.231 0.874
not assumed
T-test for digital in-store experience in two age groups – independent samples
 Table 4
Correlations
19b. I find it
19a. I feel 19c: The audio-visual 19d: Mobile
8. I usually feel interesting and useful
entertaining by content displays in checkout devices
satisfied with the when picking up an
the huge physical stores make the
shopping item and the near
screens playing positively stimulate shopping process
experience in mirror will show the
catwalk fashion my senses and more convenient
physical luxury look on catwalk as
shows in stores emotionally engage and time-saving
stores well as the
while shopping me into the brand (e.g., using pad)
manufacturing detail
Spearman’s 8. I usually feel satisfied with the Correlation coefficient 1,000 0.058 0.248* 0.321** 0.129
Rho shopping experience in physical Sig. (2-tailed) 0.577 0.016 0.002 0.214
luxury stores.
N 94 94 94 94 94
19a. I feel entertaining by the huge Correlation coefficient 0.058 1,000 0.551** 0.568** 0.329**
screens playing catwalk fashion Sig. (2-tailed) 0.577 0.000 0.000 0.001
shows in stores while shopping.
N 94 94 94 94 94
19b. I find it interesting and useful Correlation coefficient 0.248* 0.551** 1,000 0.535** 0.486**
when picking up an item and the Sig. (2-tailed) 0.016 0.000 0.000 0.000
near mirror will show the look on
catwalk as well as the N 94 94 94 94 94
manufacturing detail.
19c: The audio-visual content Correlation coefficient 0.321** 0.568** 0.535** 1,000 0.427**
displays in physical stores Sig. (2-tailed) 0.002 0.000 0.000 0.000
positively stimulate my senses and
emotionally engage me into the N 94 94 94 94 94
21st century luxury fashion retailers’ marketing strategies

brand.
19d: Mobile checkout devices Correlation coefficient 0.129 0.329** 0.486** 0.427** 1,000
make the shopping process more Sig. (2-tailed) 0.214 0.001 0.000 0.000
convenient and time-saving (e.g.,
using pad). N 94 94 94 94 94

Notes: *Correlation is significant at the 0.05 level (2-tailed).

**Correlation is significant at the 0.01 level (2-tailed).
Correlation analysis between digital experience and customer satisfaction variables
93
94 D. Ryding et al.

As for question 19C and 19D, the Eta squared is 0.08 and 0.105, indicating a moderate
effect on digital experience between groups, in other words, there is 7%, 8% and 10.5%
of the variance in the construct by age.
As far as it concerns the implications of this data and with regard to other two
constructs in the luxury in-store experience (physical appeals and personal interaction),
the results are illustrated further on in the section of the hypothesis testing, while an
example of correlation analysis between digital experience and customer satisfaction
variables is drawn in the Table 4.

4.7 Chi-square test

Based on the results of correlation, this study compares the observed frequencies or
percentages of those significant variables encouraging customer satisfaction. Research
questions:
1 Is there an association between customer satisfaction and product quality (focusing
on aesthetic/design and CoO)? What is the proportion of satisfied luxury customers
emphasising on product quality?
2 Is there an association between customer satisfaction and service quality? What is
the proportion of satisfied luxury customers emphasising on service quality?
3 Is there an association between customer satisfaction and in-store brand experience
(focusing on digital experience and personal interaction)? What is the proportion of
satisfied luxury customers emphasising on in-store brand experience?
Keeping the digital experience variable as a symptomatic model of this research
methodology, an example of the data collected is shown in the Tables 5 and 6.
Table 5 Chi-square tests of customer satisfaction and digital experience variable

Chi-square tests Value df Asymp. sig. (2-sided)

Pearson Chi-square 14.860 9 0.095
Likelihood ratio 18.286 9 0.032
Linear-by-linear association 4.823 1 0.028
N of valid cases 94

According to the Chi-square tests table (see Table 5), the asymp. sig. (2-sided) column in
the Pearson Chi-Square value for customer satisfaction and in-store digital experience
variable (in-store brand experience) is 0.095 (the smallest value among the four
questions), which is larger than 0.05, showing that the result is not significant.
Nevertheless, in the cross-tabulation table (see Table 6), the overall percentage of
customers who get inspired and entertained emotionally by the digital technology
applied in store and are satisfied with their luxury shopping experience, is 100%
(34.8% + 65.2%), and for customers who ranked second (agree), the percentage is 74.2%
(8.1% + 66.1%). The proportion of the two variables is considerable, implying an
association in between. Moreover, it can be also asserted an effect size between the two
variables by inspecting the Cramer’s V value in the symmetric measure table (see
Table 7), which is 0.23 (> 0.17) for digital experience and customer satisfaction
variables, considered as a medium effect. The frequency of the association between the
two variables is presented in a chart form (see Figure 5).
 Table 6

Crosstab
19c: The audio-visual content displays in physical stores positively
stimulate my senses and emotionally engage me into the brand Total
Strongly agree Agree No opinion Disagree
8. I usually feel Strongly Count 8 5 0 1 14
satisfied with the agree % within 8. I usually feel satisfied with the 57.1% 35.7% 0.0% 7.1% 100.0%
shopping experience shopping experience in physical luxury stores
in physical luxury
stores % within 19c: The audio-visual content 34.8% 8.1% 0.0% 16.7% 14.9%
displays in physical stores positively stimulate
my senses and emotionally engage me into the
brand
% of total 8.5% 5.3% 0.0% 1.1% 14.9%
Agree Count 15 41 2 4 62
% within 8. I usually feel satisfied with the 24.2% 66.1% 3.2% 6.5% 100.0%
shopping experience in physical luxury stores
% within 19c: The audio-visual content 65.2% 66.1% 66.7% 66.7% 66.0%
Customer satisfaction * digital experience cross tabulation

displays in physical stores positively stimulate

my senses and emotionally engage me into the
21st century luxury fashion retailers’ marketing strategies

brand
% of total 16.0% 43.6% 2.1% 4.3% 66.0%
95
96 D. Ryding et al.

Table 7 Customer satisfaction * digital experience symmetric measures

Symmetric measures
Value Approx. sig.
Nominal by nominal Phi 0.398 0.095
Cramer’s V 0.230 0.095
N of valid cases 94

Figure 5 Customer satisfaction * digital experience frequency bar chart (see online version
for colours)

5 Findings and discussion

At this stage of the research, therefore, there is strong enough evidence to outline a frame
of the hypothesis most of which, when tested, are supported to be positive both by the
literature and by the rho values of the correlation analysis and Chi-square test.
Hypothesis 1 The product quality has a significant positive influence on customer
satisfaction in the luxury apparel context.
Test: There are two factors within product quality attribute that have significant result on
motivating customer satisfaction: aesthetic/design and CoO construct. The literature
suggests that the aesthetic generally have the first overwhelming impact and encourages
customers to touch and feel the real product in person (De Barnier and Valette-Florence,
2013); while for the CoO factor, Godey et al. (2012) claim that a product manufactured in
the same country where the brand originates has a higher perception in the consumers’
 21st century luxury fashion retailers’ marketing strategies 97

eye. This helps to explain, in the data, the significance of 7.3% and 11.2% of these two
factors (rho value of 0.27 and 0.335 individually).
Hypothesis 2 The service quality has a significant positive impact on customer
satisfaction in the luxury apparel context.
Test: researches have shown that employees’ ability to deliver service trustworthily and
recognise customers requirements with great product knowledge have noticeable impact
on customer satisfaction (Islam et al., 2011), as presented statistically in the analysis. All
the service quality attribute designed in the survey, in fact, have met significant outcome
on creating customer satisfaction: customised service, reliability and problem solving
construct, which have the rho value of 0.366, 0.374 and 0.395, respectively (13%, 14%
and 16% significance on customer satisfaction). In addition, proportions obtained from
Chi-square test can also illustrate the importance of constructs that consumers who
especially appreciate value and high-end services in luxury physical stores, mostly
satisfied with their shopping experience in store, with percentages of 93%, 94% and 91%
in average.
Hypothesis 3 The in-store brand experience has significant positive link with customer
satisfaction in the luxury apparel context.
Test: the literature here suggests that the experiential consumption influences consumer
emotions significantly (Tynan et al., 2010): Lin and Liang (2011) stated that as long as
customers receive positive and pleasing feelings during the interaction, satisfaction
begins to grow. In other words, luxury retailers today, in order to stand out, are devoted
to brand engagement (Walley et al., 2013; Roper et al., 2013; Bain and Company, 2013a).
This is consistent with the data analysis, from which comes out that there are two factors
significantly encouraging customer satisfaction within the in-store brand experience:
in-store digital experience and personal interaction, which have the rho value of 0.321
and 0.284 individually (10% and 8% significance on customer satisfaction). In addition,
proportions obtained from Chi-square test can also illustrate the frequency of constructs
that consumers who get inspired and impressed by the digital appliances in store and
special interrelationship with sales assistants, mostly satisfied with their shopping
experience in store (with percentages of 87.1% and 86% in average).
Hypothesis 4 The physical appeal such as design and décor in physical stores has
significant positive impact on customer satisfaction in the luxury apparel
context.
Test: although previous researches have revealed that store environment can actually
stimulate customer satisfaction due to its significant impact on customers’ shopping
experience (Berry and Parasuraman, 2004), the concept is not consistent with the statistic
result obtained in this research. In fact, based on the two questions in the survey
(Q18A/Q18B), which has comparably low rho value of 0.181 and 0.096 individually,
there is not much significance within physical appeals’ construct remarkably encouraging
customer satisfaction. Therefore, the hypothesis is not supported.
Hypothesis 5 The digital brand experience exploited in the physical store has a
significant positive effect on customer satisfaction, more significantly on
young shoppers than mature customers.
98 D. Ryding et al.

Test: there are two questions within in-store digital experience factor significantly
motivating customer satisfaction with the rho value of 0.248 and 0.321 individually (6%
and 10% significance on customer satisfaction): these are about creating a multi senses
digital environment to emotionally engage customers into the brand. In addition,
proportions obtained from Chi-square test can also explain the frequency of consumers
who get inspired and impressed by the digital appliances in store, satisfied with their
shopping experience in store, with percentages of 87.1% in average. Linking back to the
literature, Wiedmann and Hennigs (2012) concluded that the more sensory the service
and experience the customers obtain, the more impressed and fascinated they are. In
addition, by the use of SPSS T-test analysis, it has been confirmed that there is a notable
discrepancy between the age group of under and over 25s in terms of their perception in
digital technology applied in luxury physical stores: just as same as shown in literature,
young shoppers are more likely to be swayed by these innovative high-tech entertaining
appliances comparing to older ones (Mintel, 2011; Wu et al., 2013; Davidson and
Martellozzo, 2013; Hsu et al., 2013). Therefore, the hypothesis results to be supported.
Hypothesis 6 The personal interaction with employees in physical stores has a
significant positive relationship with customer satisfaction in the luxury
apparel context.

Figure 6 The conceptual framework (see online version for colours)

Product Purchase
quality H1 intentions

H2
Service
Customer
quality
satisfaction
H3

In-store H4
experience Customer
loyalty
H5
Physical
appeal
H6

Digital

Personal
interaction

Test: grounded on the correlation analysis and Chi-square test in the prior chapter, there
is a significant relationship between personal interaction and customer satisfaction, with
the rho value of 0.284 (8% significance on customer satisfaction), while the frequency of
 21st century luxury fashion retailers’ marketing strategies 99

consumers who acquire unique interrelationship with sales assistants mostly satisfied
with their shopping experience in store, has percentages of 88.9% and 83.55%
(Q20A/Q20B) in average. Therefore, the hypothesis is supported to be positive.
The results perfectly demonstrates the ideas in the literature, which suggested that
luxury customers value a genuine help, while service enhances gratification in them
(Ehbauer and Gresel, 2013; Wong et al., 2014; Morley and McMahon, 2011).
All hypotheses, if connected together, create the conceptual framework (shown in
Figure 6) on which the primary research of this study is based.

6 Conclusions and implications

The aims and objectives of this research are set on the examination of customer
satisfaction drivers for luxury fashion apparel emphasising on three dimensions: product
quality, service quality and in-store brand experience. All three factors were tested and
further proved having impact on building satisfaction in customers with different levels.
The most significant catalyst to arouse customer satisfaction in physical store has resulted
to be service quality, which is constituted by three elements: customised service,
reliability and problem solving. Then, within the product quality factor, aesthetic/design
and CoO noticeably surpassed other variables, performing a significant result. Customers
also feel impressed and influenced by the use of multisensory entertainment, even
though, comparing to old times, there is no empirical indication that the in-store brand
experience is overtaking the position of product quality in luxury customers’ minds in
this century under observation in this research.
As far as it concerns the managerial implications of this study’s findings, it could be
stated with a little confidence that luxury retailers’ pivot in their strategies should be the
customer satisfaction: other than that, they should create a positive experience, arousing
customers’ affection emotionally and managing it effectively through in-store digital
technology. This will contribute to a positive impression of the brand as well as its image
and spirit, generating thus, eventually, satisfaction and loyalty in return. In addition, a
warm and genuine personal interaction brings trust, hedonistic value and confidence in
customers: the in-store brand experience aims at the creation of hedonic value in
customers through engaging them into the brand overwhelmingly. Furthermore, the
research also tested the discrepancy of the perceptions in digital entertainment in store in
two age groups: so it is cautious for luxury retailers to identify their position and target
customers when applying digital marketing in store, because the young generation is
thought to be digital-favourable rather than the mature generation based on the research
outcome.

7 Limitations and further research

The samples collected in this research have focused on a limited range (female
customers, aged 18–35 years old) and are also restricted to a geographically limited area
(UK): this does not allow generalising the outcomes among other targets and countries.
Therefore, further research could be carried out on testing the same variables not only on
100 D. Ryding et al.

both genders but also in other countries, so as to strengthen the generalisation of our
result.
The results also reveal that the young shoppers get easier swayed by the use of digital
tactics than older shoppers; however, it is still unknown if this stimulation and impact of
innovative technology satisfies and pleases shoppers due to its freshness and novelty
reason. It would be noteworthy for luxury retailers to know how customers who
frequently visit the store react to the digital appliances, comparing to those who firstly
visit the store, in order to understand if shoppers would still feel excited and interesting
after couples of visits. An observation could be further conducted in real store
environments so as to identify customers’ actual reactions to the variables and discover
any other variables influencing in-store experience.

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