Selling Fashion Online

Online product testing - the secret to a winning season

Most merchants do conduct some types of pre-season product testing through their brick-and-mortar stores, It's often to gauge the consumer’s response to appetite for styles, designs, colors, prices and other variables. This gives direction to guide merchants in getting the collection right and to better plan and buy for the season. Ultimately, this would translate into higher sales and profitability while minimizing inventory risks.

The online retail store presents an opportune environment for product testing. Not only can results can be easily quantified and quickly tabulated — often in real-time — but, if you're like most large retailers, the online customer base you're sampling is much larger than the traffic through your largest brick-and-mortar store.

Unfortunately, the online channel is often underutilized for testing and development purposes. Often this is due to the independence or the separation of the product and e-commerce organizations and the fact that merchants are used to conducting product testing in brick-and-mortar stores only.

Merchants such as stevemadden.com and ninewest.com have been actively conducting online product testing through their pre-order program. The largest specialty online apparel retailer such as victoriassecret.com has been previewing some of their key collections much earlier. The lead time gained allows the merchant to better plan their buying and adjust their collections and assortment.

Winning multi-channel retailers understand the strategic value of e-commerce. They don’t just set up an online version of their brick-and-mortar stores. Instead, they utilize the e-commerce channel to unleash the overall growth potential of their brands. Online product testing is just one more example of this thinking.

Online product testing is particularly effective testing key items that would impact a significant percentage of the sales. Variables that merchants might consider testing include:

• Color
• Design
• Material
• Size
• Fit
• Name
• Price
• Image/Photo
• Description/Copy
• Feature color

Product testing involves many different business functions and, as a consequence, can disrupt your existing product development and e-commerce production process and timelines. With most of 2012 still before us — and well ahead of the big fall and holiday seasons — now is the perfect time to build a product-testing protocol within your organization. Establishing a testing protocol and defining key metrics are the most useful tools to ensure you can successfully impact your pre-season planning and buying as well as in-season optimization. 

 

Follow us on Twitter. 

Like us on Facebook. 

Follow us on Linkedin. 

10 key to success in selling fashion online in a multi-channel environment

The October retail revenue results reported last week indicates retail sales to slow into the holiday season. With so much economic uncertainties ahead, shoppers are expected to continue to tighten their spending. The financial crisis in the Euro zone could potentially drag this weak economy into another recession.  

In this tough economic times, consumer are reconsidering their priorities, values and buying habits. Merchants on the other hand, are re-approaching products and pricing to win the customers. Technology is also changing how supply chain is done and how consumers shop and buy. These key market trends will make the retail landscape in 2012 and beyond more complex and challenging than ever. 

And as you are finalizing your 2012 annual plan and reviewing your strategic plan to combat the difficult times ahead, here are the 10 key to success in selling fashion online in a multi-channel environment for you to consider: 

1. Define the branded dreams and fantasies.
2. Deliver a clear, consistent, end-to-end branded promises.
3. Be accessible.
4. Wow the customers with the most-wanted fashion and products.
5. Convince the customers to pay full price.
6. Know the customers so well to predict what they want.
7. Attract, develop and retain high value customers.
8. Build lasting relationship with the customers.
9. Provide the best-in-class customer service.
10. Incorporate a holistic integrated multi-channel perspective

Successful brands such as Nike and Victoria's Secret have one thing in common. They don't just sell you sneakers, bras and panties but they sell you the dreams and fantasies. In the multi-channel era, a winning brand is the one that is capable of transcending its brand's DNA in all aspects of execution and providing its customers with a branded, seamless multi-channel experience.

Now, let's hear from you. What are the key to success in selling fashion online in a multi-channel environment? Let's hear your thoughts in the comments section below. Thanks.   

 

Follow us on Twitter. 

Like us on Facebook.

Follow us on Linkedin. 

The 25 links your fashion retail Web site can’t do without

Last week, we had a conversion about how many e-commerce Web sites are still positioned as cash registers without fully taking into account customer intent and behaviour. Not every customer goes to a Web site just to purchase. Customers go to a Web site to perform different tasks. Among them:

• to make a purchase
• to browse
• to research an item
• to get fashion tips
• to plan for a future purchase
• to do comparison shopping
• to check order status
• to locate a store
• to see what’s new
• to see what’s on sale
• to contact customer service
• to find out more about a brand or a company
• And more

And for most retail websites, a majority of the clicks take place in the header and the footer areas and outside of the main feature area. These links are critical to serve the different needs of multi-channel customers. And, whichever the page a customer lands on, these persistent links are always prominently displayed on the header and footer.

We benchmarked some top 100 fashion retail Web sites in the US, Canada and UK and came up with the following top 25 must-have links on a fashion retail Web site.

1. Search
2. Shopping cart
3. My account
4. Order tracking/Status
5. Telephone number
6. Contact us
7. Guarantee
8. Wish list
9. Gift cards
10. Customer service
11. Sizing/Size chart
12. Style/Fashion tips
13. Return & exchange
14. Payment options
15. Shipping
16. Store locator/Find a store
17. Shop catalogue
18. Security/Privacy/Terms
19. About us
20. Connect with us
21. Career/Jobs
22. Investors
23. International
24. FAQ
25. Site map

Each unique business will have its own few unique links. Which other links are critical to be prominently displayed in the header and footer areas of a fashion retail Web site? Let’s hear your thoughts in the comment section below.

 

Follow us on Twitters.

Like us on Facebook.

Follow us on Linkedin.

The metrics you may be missing - beyond sales and conversions

At the dawn of the e-commerce age, Web sites were built mainly as cash registers to ring up sales. This is because cataloguers were among the first to enter this new retail space. Brands like Lands’ End, L.L.Bean, JCrew, and Victoria’s Secret were among the first to provide electronic versions of their print catalogues online. Therefore, they have shaped the industry standards about an e-commerce website. 

Today, a new breed of e-commerce players have joined the space and helped to redefine what a great e-commerce website can be about. Brands such as ASOS and Net-a-porter seem to get it right. Even though they are online pure plays, their sites take a multifaceted approach that delivers a rich shopping experience, taking product presentation, merchandising content and social shopping to the next level.

Yet, today, many e-commerce Web sites are still positioned as cash registers without fully taking into account the customer’s intent and behaviour. And as we know in reality, not every customer goes to a Web site just to purchase. Customers, including you and me, go to a Web site to perform different tasks. Among them:

• To make a purchase
• To browse
• To research an item
• To get fashion tips
• To plan for a future purchase
• To do comparison shopping
• To check the order status
• To locate a store
• To see what is new
• To see what is on sale
• To contact customer service
• To find out more about a brand or a company
• And more

It’s no surprise that conversions for most retailers remain mediocre.  

For customers, a Web site is just another touchpoint with your brand. Therefore, your Web site must play many roles beyond being a simple cash register. Retailers have to design, build and provide an e-commerce experience that is fully optimized to deliver all of the promises of a brand.

Vital to this larger success is for retailers to begin looking at the right metrics. Many retailers are still judging the success of their e-commerce investment simply by looking at online sales, conversions and profitability. These metrics are just too limited — and measuring your success in such narrow terms will undermine the potential of e-commerce as a key growth driver for your brand. Retailers need to evaluate performance in the light of the right metrics to drive the overall brand growth potential. These should include:

• Sales – sales, orders, items ordered, average order value, gross margin, average unit retail
• Traffic – visit, visitor, buyer, repeat customers, new customers
• Conversion – session, buyer/visitor
• Profits – gross profit, net profit
• Site experience – bounce rate, page view/session, product view/session
• Product performance – returns, average rating and review
• Customer behavior and performance - percentage of online visitor performing the various above-listed activities, ratio of customers served online to the total customer base served by the brand, number of customers driven to a brick-and-mortar store
• Multi-channel customer productivity - lifetime value of a customer by channel, lifetime value of a multi-channel customer

Only with these more nuanced metrics can the true value of an e-commerce site can be understood. This deeper understanding will guide companies to make better decisions about e-commerce investments along with all other strategic and tactical decisions.

What are the key metrics that you think brands should be looking at in evaluating the success of their e-commerce investments? What other metrics do you look at in evaluating your multi-channel e-commerce business? Please share your thoughts in our comments section.

 

Follow us on Twitter. 

Like us on Facebook.

Follow us on Linkedin. 

Virtual store - the new multi-channel retail format

As we all know, the retail environment remains a challenge. Anxiety about the economy has pummeled consumer confidence, while tighter lending standards have left many operators starved for credit. The result in many places has been malls with near-record vacancy rates.

Now, some retailers are taking advantage of the open retail space to set-up temporary pop-up stores.

Once the exclusive province of small-scale seasonal retailers offering Halloween costumes or Christmas decorations, the pop-up store has recently won the favor of big-name retailers as a venue for holding liquidation sales, sample sales, product launches, special events and more. Just recently, Toys `R` Us announced that it is opening 600 pop-up stores this fall to drive holiday sales.

While pop-up stores are generally used for the purposes mentioned above, they are also a great opportunity for visionary retailers to test and develop a new multi-channel retail format - the virtual store. In 2006, JC Penny created a temporary virtual store in New York City`s Times Square to showcase their brands, new products and e-commerce initiatives. 

This new retail format can work especially well for both multi-channel retailers and Internet pure-plays. It gives the multi-channel retailer an inexpensive alternative to the costly operating structure of its retail footprint. It gives the pure-play a brick-and-mortar presence to engage customers directly and to capture the market segment who are still resistant to transacting purchases online. Just last week, Piperlime.com, an online pure-play, announced the opening of its first ever pop-up store in New York City, giving the brand a real-world brick-and-mortar presence.

This is just the beginning. We believe the market will continue to see the arrival of virtual stores from some of the more visionary and progressive retailers. A virtual store can perform many of the following store functions - it is up to the retailer to seize the market opportunity to test and get it right for the brand and its customers.

• Sell the company`s entire product offering through its e-commerce channel.
• Serve as a showroom that allows customers to experience product more fully than would be possible online, allowing customers not only to see, but to closely inspect by touching, feeling and trying on the merchandise.
• Provide detailed product information supported by the company`s enterprise merchandising systems.
• Take in-store orders.
• Become a delivery point for store pick-up.
• Accept returns and manage exchanges.
• Provide after sale service such as product care and repair.
• Deliver a branded experience.
• Provide customer service.

_____

Like us on Facebook! Go to our homepage or Facebook Page and click Like now.

Key challenges in selling fashion online

To prevail in today's multi-channel environment, merchants must continually re-think cross-channel strategies, processes, technology and even the right skill sets for key people.

Here are some of the key challenges that face retailers when selling fashion online:

• Maintaining customer information across channels
• Optimizing the online catalog, rather than treating it as a subset of the brick-and-mortar assortment
• Providing a branded experience at touch points across channels
• Technology integration across channels
• Information architecture and information flow across channels
• Lack of multi-channel data intelligence and metric culture
• Lack of infrastructure (warehousing, fulfillment and shipping experties and capabilities) for doing direct business with customers
• A true multi-channel organization
• Cultural change and change management

Optimizing the merchandising assortment in the multi-channel environment

The brick-and-mortar store's limited shelf and floor space naturally define and limit the SKUs for a given store location. So... is the online retail space an infinite aisle for unlimited SKUs? How does the successful retailer expand the online assortment?

Most retailers quickly learn that a few key styles drive most of their sales. The immediate opportunity is definitely making the most of those key categories and key products by distorting to them. Second, there are the expanded key categories and products that merchants would not otherwise offer in their brick-and-mortar stores. With the lower online cost-structure, merchants are able to consider styles that would have ordinarily been dropped due to lower margins under the cost constraints of traditional brick-and-mortar retailing. Third, there are "long tail" products with broader breadth and depth that might not warrant typical volume and turnover, but can remain profitable online, satisfying a customer need and capturing customer loyalty.   

In addition to the above, successful multi-channel merchants also use the Web to get an early read on key product launches and appropriately adjust the buy, minimizing inventory risk. The Web is also an ideal, low-cost medium for merchants to liquidate inventory, avoiding or lowering the image risk that brick-and-mortar stores can suffer when their floor space is taken up with rack after rack of mark-downs. Innovative merchants are also offering online made-to-order products that both satisfy the customer's desire for personalized products while eliminating the need to carry inventory. A good example of this is the Lands’ End Custom program. 

The online channel provides merchant an opportunity to approach merchandising differently. Successful multi-channel merchants understand this and are making adjustments to their assortments to gain an edge on the competition.

The changing roles of brick-and-mortar store

The retail industry has never seen such revolutionary changes as those brought by e-commerce. Not only has e-commerce played a key role in influencing store sales, it has also changed the retail financial architecture across channels, operational set-up and more. Today, visionary retailers are positioning their brick-and-mortar stores with an eye on larger success in the multi-channel environment. In this emerging environment, brick-and-mortar stores will have new and different roles to play.

1. Sell not just the contents of a single retail location's shelves, but the company's entire product offering through in-store access to your e-commerce channel.
2. Serve as a showroom that allows customers to experience product more fully than would be possible online, allowing customers not only to see, but to closely inspect by touching, feeling and trying on the merchandise.
3. Provide detailed product information supported by the company's enterprise merchandising systems.
4. Take in-store orders.
5. Become a delivery point for store pick-up.
6. Become a fulfilment center for shipping to the customer.
7. Accept returns and manage exchanges.
8. Provide customer service by accessing the company's multi-channel customer relationship management (CRM) system.

Key strategic questions to answer in guiding multi-channel strategic planning

E-commerce is about more than simply having a transactional Web site. E-commerce enables merchants to optimize the entire company’s strategic planning. Some key strategic questions to consider in guiding multi-channel strategic planning:

1. How much of the business is conducted and influenced by the online channel?
2. How many customers interact with each of the channels and how do they use each of the channel?
3. What is sold by each of the channels and what are their respective cost structures?
4. What is the relative value of multiple channels to the company?
5. How can the company employ e-commerce to implement key functional strategies: product testing, assortments, availability and cadence, seasonal and product launches, fashion point-of-view, marketing campaigns, liquidations, brick-and-mortar store footprint, customer service and more.
6. What are the necessary e-commerce capabilities (technology, people, know-how, etc.) to realize your strategic objectives.