Luxury Brands Grow Facebook Audience, But What About Sales?


James Lawson | January 08, 2013

James Lawson, director of Ledbury Research, explains that whilst the growth of Facebook likes and usage of the social media in general is clear, the impact is not.

Burberry’s Facebook audience has almost grown to 15 million fans

Ledbury Research has been regularly analysing the number of Facebook “likes” for a selection of leading luxury brands. Our analysis this year shows Burberry taking top spot again by absolute numbers, marking the 3rd consecutive year that the British brand has dominated Facebook.

It leads Louis Vuitton with 35% more “likes”, the latter which replaces Gucci in 2nd place. Dior maintains its position in 3rd place, while Chanel moves down 1 spot to take 5th place after Gucci.

Looking at growth rates, Prada emerged from last place to play catch up. It’s Facebook “likes” grew by over 2000% from virtually nothing in 2011 and 2010, pointing to the priority that the Italian brand has seemingly placed on its social media presence since its listing on the Hong Kong stock exchange last year.

Hugo Boss had the second highest growth of over 250%, followed by Tommy Hilfiger and Louis Vuitton which were up 162% and 142% respectively.

“ 73% of luxury brand marketers surveyed confirmed they will increase social media spend again in 2013 ”

Signs of slowing growth over time

These extremely positive growth rates hide the fact that growth has slowed for the majority of brands – only 3 out of the 16 brands we analysed had increases in Facebook “likes”. The median growth rate of Facebook “likes” was 80% in 2012, a 44% decrease from 143% in 2011.

The marked slowdown does not appear to be due to decreased investment in social media. A survey conducted by the research team of the Luxury Interactive conference with digital marketing executives of luxury brands found 78% of them reporting an increase in social media spend for 2012. 73% said they will increase social media
spend again in 2013, and 83% would choose Facebook if their company was forced to choose only one social media account to manage.

Hard to measure impact

As a result, the slowing growth is likely due to a maturation of this market—perhaps even approaching a saturation point. Either way, despite continued investments into social media, luxury brands have still not found the magic formula to successfully interact with existing fans, or attract new ones. Intrinsic to this is the fact that the direct impact of Facebook, or social media as a whole, is still unknown to them.

The chart shows Ledbury’s analysis of the relationship between Facebook “likes” and growth in sales. Though it is a relatively simple piece of analysis, it is clear that this relationship is non-existent.

Ralph Lauren’s Facebook “likes” rose 30% over the past year, whilst Tiffany’s grew 3x as much. At the same time, sales growth of both brands were broadly equal.

Until luxury brands fully grasp how to successfully use Facebook to communicate, they may struggle to attract more fans. This understanding would also help them turn their aspirational Facebook fans into actual customers, and perhaps then, we will begin to see a relationship in the chart.

Louis Vuitton on Facebook

To further investigate the way luxury brands are using social media on Luxury Society, we invite your to explore the related materials as follows:

- What Instagram Means for Luxury Brands
- Luxury Brands & Social Media: Opportunity or Trap?
- What Pinterest Means For Luxury Brands

Data | Social Media