Digital Luxury Services – Threats and Opportunities
(A2025-125781)

AUTHORS

Jonas Holmqvist, Kedge Business School; Jochen Wirtz, NUS Business School/National University of Singapore; Nina Michaelidou, Loughborough University; Ioannis Kostopoulos, Liverpool John Moores University; George Christodoulides, American University of Sharjah; Dean Creevey, Maynooth University

ABSTRACT

The last decade has seen a rapid development of digital tools in customer service, including service robots and AI. One industry in which the fast increase of digitalization is particularly delicate is the luxury industry, long characterized by its focus on traditions, craftsmanship, and a high degree of personalization. How can luxury services balance the benefits of digital tools while safeguarding the authenticity and prestige of their services? This special session addresses this complex issue through three studies into key aspects of digitalization in luxury services. Combined, the three papers shed light on how to navigate the potentials of digitalization and AI with the need to safeguard the prestige, exclusivity and uniqueness of the luxury brand in luxury fashion, hotels, and restaurants. Are Human Interactions Becoming a Luxury? Navigating the Digital Transformation in the Luxury Industry Alexia Glère, Jonas Holmqvist, and Jochen Wirtz The paper studies how a high degree of human contact in increasingly becoming a hallmark of luxury in the digital age. The findings identify how luxury brands can benefit from digitalization behind the scenes while simultaneously doing the opposite in the frontline interaction with customers, in which they even roll back digitalization to provide a highly personalized experience. This joint practitioner-research paper builds on inside managerial expertise from one of the world’s leading luxury brands for a framework of how luxury brands balance digital tools and human interactions in a way that provides the best potential for personalized customer service and safeguards the prestige of the brand. How Do Mobile Apps Enhance Luxury Experiences? Nina Michaelidou, Ioannis Kostopoulos, and Lina Nasr Studying the use of mobile apps in the luxury sector, the paper develops how luxury hotels can employ digitalization at different stages of the customer journey. The findings show that the apps help to streamline bookings and further facilitate dealing with VIP guests. By employing digital touchpoints, both before and during the guests’ stay, the luxury hotels can enhance the luxury service experience of its guests. For managers in the luxury service industry, the findings help managers by showing how luxury service providers best can use digital tools for customer engagement. ‘Luxe Authentic’: Investigating How Authenticity is Signaled by Luxury Service Brands on Social Media Dean Creevey, Joseph Coughlan, Christina O’Connor The paper addresses how social media can enhance rather than dilute the perceived authenticity of luxury brands. Through a study of Michelin-starred restaurants, the paper identifies six signals of authenticity: awards, consistency, environment, exclusivity, identity, and relationships. The findings show how luxury service providers can signal authenticity on social media in an implicit and intangible manner to aligning with the traditional discretion of luxury services. For managers, the paper identifies how to use social media for authenticity signalling to balance the tension between accessibility and exclusivity in the luxury industry. Discussant: Professor George Christodoulides, one of the most cited luxury researchers in the world, serves as discussant to summarize the session, provide insights into the interplay of luxury and digitalization and lead a discussion combining theoretical insights with practical implications for luxury managers.