Following weeks of rumors, LVMH, the largest luxury group in the world, have officially announced their biggest foray into online shopping in nearly a decade. Spearheaded by Chief Digital Officer Ian Rogers, the move is the first step as part of a new initiative, with the aim of capturing a significant chunk of the luxury ecommerce marketplace. The former CEO of Beats Music--and then head of iTunes following their $3 billion takeover--Rogers has been quietly leading the project since his appointment 18 months ago, and recently announced the site with a flurry of press, confusing many journalists who quietly wondered, "why?"

Named 24 Sévres, the new site is technically not a branded LVMH e-commerce platform. Rather, is is a complete overhaul of the pre-existing Le Bon Marché website, the online store for the storied LVMH-owned luxury department store in Paris, located on 24 Rue de Sévre--hence the name. While the current Le Bon Marché online store is limited to the EU, the new platform will ship to over 75 countries and offer some 150 brands. Of these, 30 are LVMH subsidiaries while the rest will be brought on as either wholesale clients or on consignment.

This is not the first time LVMH has attempted to enter the highly competitive luxury online marketplace. Back in 2000, they launched the under performing ELuxury, a site stocked with luxury handbags and accessories. At that infant stage of online shopping, however, the idea of buying a $2,000 handbag on the internet was simply not tenable, and the site shut down in 2009 after years of mediocre sales. For this new venture, however, the timing is not the issue, but rather the competition.

Currently, three players vie for the title of most successful online luxury marketplace--Yoox Net-a-Porter, Farfetch, and matchesfashion, and from the current stock list over at Le Bon Marché, ostensibly 24 Sévres will not be drastically different. Rodgers has expressed that while their competitors are more editorially driven, 24 Sévres will focus on "digital merchandising," offering an audience less and less interested in words with moving images and illustration to create a more enjoyable shopping experience. On the corporate level, the massive success of Sephora's online store--also owned by LVMH--has served as indicator that digital retail is an area of huge potential growth, with CEO Bernard Arnault and son Alexandre willing to bet "a modest undisclosed sum" on Rogers to pursue the project as he sees fit.

The move drew immediate comparisons to Condé Nast's demolition and subsequent re-launch of Similarly geared as a visually motivated e-commerce platform, the site has failed to attract any significant sales and is largely seen as a multi-million dollar flop, an attempt for a struggling company to monetize on their pre-existing viewership. Unlike Condé Nast, however, LVMH has the distinct advantage of owning 20% of the brands featured on 24 Sévres, helping cushion the blow of an expensive multi-channel platform.

Initially focusing on women's wear, when the site launches the second week of June, it will feature exclusives from 68 brands, offer free online consultations with Parisian stylists, and expedited worldwide shipping--something all three main competitors offer in some capacity. The highlight of the launch is unarguably the availability of both Dior and Louis Vuitton, the first time either will be available on any multi-brand online channel.

While the move is a curious one, it is desperately needed. LVMH's main competitor Kering Group is already heavily invested in online sales, with both its star-performers Gucci and Saint Laurent offering their entire line-up of product on their respective e-stores, a huge factor for their massive growth. With Dior and Louis Vuitton entering the online marketplace--and possibly Céline--especially considering the purchases will be VAT free outside the EU, this could potentially be a huge boon for LVMH. That being said, was a massive multi-brand retailer the right move considering the monumental costs and mediocre margins wholesalers deal with? Would have investing in individualized online shops for each LVMH brand been a significant reduction in cost with possibly very similar gains, and much more limited competition?

While the pre-existing Le Bon Marché clientele will no doubt head to 24 Sévres, their plethora of options seems to tip the odds in the shopper rather than the websites favor. LVMH always plays long ball--they have invested over $200 million in Berluti and the company still operates at a loss--and regardless of immediate success you can expect the new e-commerce platform to be around for some time. Whether or not it does drastically shift the online marketplace, however, only time will tell. With Roger's resume, there is (some) hope.

Tags: ian-rogers, lvmh