In 2005, Alfred Dunhill’s then CEO, Simon Critchell, commissioned Nucleus to assess global e-commerce opportunities for the Dunhill brand against a background of Richmont board scepticism of e-commerce in the luxury sector.
We conducted a detailed review of Dunhill’s global distribution strategy and assessed their product range for suitability for e-commerce. This research included an online survey of customers predisposition to e-commerce, brand recognition in markets not served by retail distribution and channel conflicts and global pricing policy. From this research, we proved that there was huge latent demand for the Dunhill brand in markets where retail distribution was thin or non-existent – which e-commerce could cost-effectively satisfy.
We then created an e-commerce business plan based on our own model which proved compelling, even for those members of Richmont’s board who, at the time, didn’t believe e-commerce was suited to luxury brand marketing.
Following approval to proceed, we advised Dunhill on all aspects of e-commerce, including product ranging and fulfilment options, content architecture and website design and operations.
Online sales were an immediate success, exceeding even our most ambitious modelling. In markets like Korea, where no retail presence existed, e-commerce allowed customers to acquire the brand for the first time and in the US, where distribution was sparse, the brand became available to all. By 2010, Richmont had become strong advocates of e-commerce in the luxury sector, launching e-commerce websites for many of its brands and acquiring Net-a-Porter for £225m.