Buying diamonds in lockdown? WhatsApp can be your best friend

Luxury shops are connecting with shoppers online to provide VIP service remotely

A pedestrian uses a smartphone beside women's clothing and handbag in the window display of a Louis Vuitton luxury goods store in Paris, France, on April 14, 2021. Bloomberg

As Italy entered a new coronavirus lockdown and shut shops in March, Genoa-based jeweller Gismondi 1754 turned to messaging service WhatsApp to sell a 300,000-euro diamond ring to a wealthy Swiss client.

At the same time, sales assistants at luxury puffer jacket brand Moncler were arranging gourmet dinner deliveries to customers homes so they could dine in style while watching a video streaming of the brand's latest collection.

The pandemic has forced luxury goods companies to use social media, video and virtual showrooms to woo their wealthy customers in Europe and keep them shopping at a time when tourists, especially from China, have been absent for more than a year.

Retailers reopened in Britain and most of Italy on Monday, but they remain shut in France and access is restricted in Germany, where in Berlin, for example, a negative Covid test is required to go into most shops.

Senior executives in the industry said this trend of selling outside the traditional store network, while not replacing the need for physical shops, is here to stay.

"We are learning that we can also have a high level of service with a low level of physical contact," Moncler's boss Remo Ruffini told Reuters. "Distant sales are a new frontier, something in the middle between e-commerce and a traditional store."

Analysts say that lockdowns and "staycationing" mean that wealthy Europeans have money to spend that they are not using to splurge on fancy hotels or Michelin-starred restaurants.

Designer brands are keen to capture some of that cash.

High-end labels such as Hermes, which used to be more reticent to sell online, have had to fully embrace e-commerce. Online revenue for the industry has doubled to about 20 per cent of sales in the past year alone, based on analyst estimates. Boston Consulting Group expects that percentage to rise to 25 per cent by 2023.

Luxury labels have also invested in transforming store assistants into personal shoppers who pamper their VICs – very important clients – by sending them products at home and keeping in touch regularly. Most brands now stream products on social media and show customers specific product videos.

Before the pandemic, Gismondi would not have sold a 300,000-euro, 10-carat diamond ring without showing it to the client in person.

"I was on the phone chatting with the lady who is buying it, and it came up that this was the dream of a lifetime for her," Massimo Gismondi, chief executive of the jewellery group, said.

"If there is something I like they send it home. They know my size and if in doubt they send more than one size. I buy what I like and I send back the rest."

From that moment, an exchange started with the woman via WhatsApp and video-calls to find the perfect design for the ring that would be delivered to her home.

"People are craving for leisure, for returning to savour life and spending," Mr Gismondi told Reuters.

French luxury group LVMH's star label Louis Vuitton in addition to online sales has started taking its shops to wealthy clients' doorsteps in the US.

The "LV by Appointment" campaign essentially brings a tailor-made shop on wheels to the customer, curated with a personalised selection of pieces – from leather goods to watches and perfumes – for those who opt for the service.

LVMH, the first to report results for the first quarter, set a very bullish tone for the industry. Revenue bounced back strongly, with its fashion and leather goods division surging 52 per cent – double analysts' forecasts. Sales in Europe remained in negative territory, but the 9 per cent decline was a major improvement from the minus 24 per cent seen in the fourth quarter.

Luxury brands have had a strong recovery in China since shops began to reopen there last spring. But in Europe and the US finding new ways to connect with customers has helped them to mitigate last year's sales declines.

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  Métamorphose du Cygne Clip: white gold and diamonds with vibrant sapphires, garnets, black spinels and onyx

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  Papillon Secret Watch with manual-winding mechanical movement: a 14.57-carat emerald-cut Colombian emerald with white gold, diamonds, emeralds, black spinels, onyx, and mother-of-pearl

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  Labyrinthe Ring: a 13-carat cushion-cut yellow diamond with onyx, white gold, yellow gold, diamonds

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  Message des Hirondelles Necklace: 52 fancy-cut mauve Madagascar sapphires, making up 142.10 carats, are set with diamonds, sapphires, coral and red enamel

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  Amour Retrouvé Earrings: transformable earrings in white gold, pink gold, diamonds and pink sapphires

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  Clip Sous son Aile: the various stones - rubies, pink and yellow sapphires, spessartite garnets, black spinels, coral, onyx, grey mother-of-pearl and diamonds - come together in Van Cleef's Traditional Mystery setting

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  Fleur Bleue Ring: a cushion-cut 5.13-carat Burma sapphire surrounded by diamonds, emeralds and tourmalines

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  Believe in Luck Between the Finger Ring: a cushion-cut 3.07-carat Mozambique ruby forms the centre of the flower, while its petals and the bee are crafted from diamonds, rubies, coloured sapphires and spessartite garnets

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  Bracelet Dentelle Secrète: diamonds, rubies, onyx and white mother-of-pearl, put together using Van Cleef's intricate gouaché design

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  Secret des Amoureux Clip: a pear-shaped orangy-pink sapphire of 2.74 carats from Sri Lanka is paired with a pear-shaped violet sapphire of 1.36 carats, a heart-shaped rubellite of 12.04 carats, with diamonds and sapphires.

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  Colombe Mystérieuse Clip: a message secreted away with Traditional Mystery Set rubies, plus white, red and pink gold, diamonds and emeralds

Analysts say that improving sales in those two regions should also help revenue this year. Sales in Europe and the US accounted for 60 per cent of the total in 2019 and should come in at just under 50 per cent by 2025, consultancy Bain said.

Francois-Henri Pinault, chief executive of Gucci owner Kering, said in February that the group's revenue from "distant sales" – or sales outside its global store network – had risen sharply last year. The group had trained 400 sales assistants in 16 countries for this purpose, he said.

One source at an Italian luxury fashion label said typically a brand's marketing department will provide a list of clients to contact based on what they have bought over the previous year.

The sales assistants then phone customers, show them the latest arrivals via video chat and send them clothes or shoes to try on.

"You create a strong relationship between the salespeople and the customer," Prada chief executive Patrizio Bertelli told Reuters.

"We have gone from the shop assistant that simply shows you a product to someone who also does a bit of marketing, knows customers, their taste and their habits, reaches out to them and sends them stuff home."

A leather handbag and sneakers in the window display of a Louis Vuitton luxury goods store. Bloomberg

A Milan-based PR executive who spends on average 40,000 euros ($47,552) a year in Prada's stores said that since last year, Prada has regularly sent her videos about its clothes.

"If there is something I like, they send it home. They know my size and if in doubt, they send more than one size. I buy what I like and I send back the rest," she said.

Over the past year, cashmere sweater label Brunello Cucinelli has been organising video calls with 30 to 40 customers at once to keep them engaged.

"It allows us to have a dialogue with a number of people which, if we had to arrange a physical appointment, would take us perhaps three to four years," the brand's co-chief executive Luca Lisandroni told Reuters.

He also said that brands should not become too insistent in trying to sell their wares.

"Some people like being contacted and stimulated, others don't want to be solicited too much," he said.