What lies in wait for global online Fashion

Transcription

1 What lies in wait for global online Fashion By Keeley Sweeney Fashion Buying and Merchandising Manchester Metropolitan University Can e-commerce conquer the world? ENT E C O M M E R C E Report focusing on the analysis of current e-commerce activities and the extent to which this could develop in the near future.

2 How will E-Commerce influence the future of fashion?.. The E-Commerce market encompasses the sale of physical goods via a digital online channel to profitably meet the needs of a private end user. As personal lifestyles develop and socioeconomic shifts see unemployment plummet, interest is beginning to shift to online fashion due to enhanced product accessibility and developing delivery channels whereby retailers such as Next and ASOS are able to offer same day delivery. Current E-Commerce Analysis Focusing specifically on the UK E-Commerce market, clothes and shoes sold online held a market value of $22,060 million in 2016, the largest revenue sector of total online sales. This value holds growth potential through increased portability, versatility and increased performance of smartphones and tablets that are currently driving online sales. E- Commerce users are expected to amount to 48.4 million by 2020, which equates to 74% of the total British population. Multi-channel retailers are beginning to focus on their online trading strategies identified as the key growth sector for fashion retail. Technology has been identified as the key driver in E/M/T-Commerce growth with traffic from smartphones up 8.3% since With 42% of smartphone owners acknowledging they use an IOS device, the dominance of global giant Apple becomes clear. As technology develops, so do opportunities behind fashion retail with their previous I- phone 6 launch deemed the most successful yet. However, it must be recognized that although mobile usage has had an increased impact on the world of E-Commerce with 1/3 of individuals purchasing online, 2/5 are uninterested in this venture. Barriers to online retail predominantly lie within the older demographic who hold uncertainties with Technology. Despite this, younger generations are beginning to encourage older relatives and friends to embrace technological innovations with Apple holding daily How To.. classes for the uncertain. The key to successful retail trading lies within the foundation built relationship between consumer and retailer. Retailers build trust through understanding their target demographics and providing product meeting primary needs. Once relationships are established, consumers become more willing to try new purchasing methods such as purchasing online. As individuals embrace new technology they become more accustomed to utilizing E-commerce channels. MR E- COMMERCE MR TECHNLOGY Imagery demonstrating how E-Commerce developments follow Technology.

3 CURRENT E-COMMERCE WINNERS v Collaborated with Twitter in 2014 with the #AmazonBasket tag. Users were able to comment on any tweet with an Amazon product and it would be automatically added to basket. As an online pure play, Amazon is a leading E-Commerce retailer specializing in online retail. Founded in 1994, Amazon began supplying books, music, DVD s and electrics before diversifying into the supply of clothing in 2014 with luxury beauty close behind. Recently, Amazon have began attempting online grocery retailing however there is often little profit to be made. Generated outstanding net sale value in 2015 of $107.1 billion. One of the fastest growing retail sites within the UK, offering fastfashion at affordable prices. Boohoo excel in their provision of celebrity and catwalk inspired pieces introducing 300 new styles daily. Exceptional capability of understanding the consumer and profitably meeting their needs through the turn around of fast fashion. Often endorsed by blogger collaborations that actively increase awareness amongst the young consumer group. * C U R R E N T I N N O V A T I O N S * v AMAZON PRIME AIR A future delivery service aiming to get parcels to customers within 30 minutes through utilizing small drones. v QR CODES Machine-readable barcodes that can be scanned using an app. Consumer then automatically directed to scanned barcode/product online. v NFC TAGS Near field communication used to implement digitally immersive experiences. Eg. Tag embedded into a flier, tap tag with phone and automatically directed to website or menu etc. v SAME DAY DELIVERY - Premium price but suitably meets consumer needs. Offered by Next/Asos and an important unique selling point with E-commerce transactions. v TOPSHOP LAUNCH MENTORSHIP PROGRAMME To find the next big thing in wearable technology.

4 T H E R E T A I L E C O M M E R C E C O N S U M E R THE TECHNOLOGY ENTHUSIAST EG. BROOKLYN BECKHAM TYPICAL AGE The technology enthusiast has grown up surrounded by technological innovations, which they have learnt to embrace. THE QUICK LEARNER EG. YOUNG PROFESSIONALS TYPICAL AGE The Quick Learner is likely to be beginning a family and finds it easy to adapt to new situations. They are keen to embrace new innovations and often learn through trial and error. THE ONLY USE IT IF YOU HAVE TO EG. RETIRED/MATURE PROFESSIONALS TYPICAL AGE 45+ It is likely this demographic have little knowledge about technology and potentially go about their daily lives without the need to engage with such innovations. In relation to future demographic changes, predictions suggest that the older demographic is set to grow. Technology giant Apple have already began reacting to this forecast through introducing lessons for the elderly to help them engage with modern innovations. This would be of benefit as it could maintain sales and credibility of the brand. In relation to E-Commerce, this development could widen appeal to online purchases with over ¼ of individuals acknowledging that they would like to begin purchasing online. Gradually individuals will upgrade to new technology and retailers will be able to tap into personal daily dead time to encourage purchases. Data collected collating E-commerce users in 2016 suggest 6.1 million 55+ use the online channel compared to 11.4 million year olds. This shows growth potential in utilizing E-commerce within the older demographic. FAST FASHION and E-Commerce Fast fashion relates to the rapid turnaround of stock from identifying catwalk or street-style trends to seeing product available in high street stores. Retailers are under more pressure than ever as consumers are beginning to demand constant turnaround of stock. Standard high fashion A/W, S/S season drops are becoming blurred as designers are hurrying to identify new trends and introduce fresh stock. Online pureplay Boohoo are believed to release up to 300 new products daily with the ability to identify a trend and introduce an own brand version in just two weeks. Similarly, mass-market retailer Zara holds the same capability through utilizing their vertically integrated supply-chain strategy to introduce new stock. E-Commerce and Social-media is impacting the fashion environment with celebrities and bloggers endorsing mass-market produce to drive demand. With constant technological innovations, fashion catwalk shows are frequently live-streamed online causing demand for new product to intensify. This is beginning to blur the line between high-fashion and massmarket as retailers are constantly seeking new manufacturing destinations to source such profitable product.

5 I N N O V A T I O N BREAK THE MOULD As innovation stands as the key differentiating factor between online pure plays, below are some suggested future E-Commerce innovations that could be implemented. I T S T I M E... T O B E I N S P I R E D... A N D EMBRACE THE UNTHINKABLE FRESH. INSPIRED. INNOVATION. CREATE. EMBRACE. NEWNESS CONCEPT NUMBER ONE Virtual Reality Glasses If you can t go to the shop.. E-Commerce will bring the shop to YOU!!!! TARGET CUSTOMER; v Young professionals experiencing time constraints due to increased work pressures. v Passionate fashion trend followers. v Individuals that invest in innovative technology. COLLABORATE males and females are beginning to seek innovative shopping channels that meet the needs of their dynamic lifestyles. With unemployment at a low, disposable income is evolving allowing individuals to trade up product architectures despite them having less time to shop. Unable to visit physical retail outlets, future e- commerce developments could see in-store shopping implemented through the use of virtual glasses. Inspired by current accessory trends, these virtual shades could be worn in various situations transferring from functional fashion glasses to provide a visual experience of retail shopping. The individual would be able to switch into virtual mode pressing a discreet button where they will be able to select a retailer and local store. They can then visualize themselves stepping into the current retail environment and selecting in-store items through analysis of eye movement technology. Selected items would then be delivered to the consumers selected location.

6 C O L O U R TRENDS POTENTIAL PROVIDER This idea could be implemented through a collaboration between technology giants and retail leaders. Zalando could potentially collaborate with Apple to achieve the successful development of the virtual reality glasses. Zalando could influence the physical aesthetics of the product whilst Apple perfects the technology behind the product. Apple have recently collaborated with Hermès on the strap of their Apple watch in order to appeal to a wider consumer demographic. Similarly, this innovation could be of interest to Apple to enable them to diversify into alternate product sectors whilst providing zalando with a substantial unique selling point to differentiate with competitors online. This E-Commerce based technology could successfully combine the in-store and online environment to streamline time constraints and maintain consumer satisfsctiion through introducing a new purchasing channel. Silhouette Trends It is important to utilize future trends to differentiate from the current virtual glasses providing a more discreet and fashion-forward innovation. This would also add value whilst implementing functionality for the wearer. WGSN analysed the opposite silhouettes as key trends for SS16 a key season due to the combined functionality of the product. Neutral shades and classic prints are timeless hues that will instill longevity in products and value for money.

7 } CONCEPT TWO Online Profiling The implementation of online personal profiles whereby individuals are able to upload personal information such as; v Height v Size v Style choices v Personal images v Budget This would help retailers gain broader knowledge on their consumer base so they can tailor online suggestions to meet the requirements of this individual. It could be possible to link this private account with Facebook and Mobile Phone Calendars whereby the retailer could suggest outfit choices for upcoming planned events through or app alerts. This aids interaction with the consumer streamlining their retail practice through personalized product offering. Online retailing activity can be monitored personal to each consumer in order to enhance this process. C R E A T E Y O U R P E R S O N A L P R O F I L E NAME* Keeley Sweeney AGE 20 Image 1 Upload Complete Image 2 Upload Complete Image 3 Upload Complete SIZE* HEIGHT BUDGET 8/ < 45 Image uploads will help establish products the consumer prioritises whilst helping to create a more personalized environment. FAVOURITE BRANDS* SYNC WITH CALENDAR ALDO, Ted Baker, Whistles, River Island Sync with calendar to receive personal style advice.

8 Regular updates relating to upcoming events in the consumers I-cloud or Facebook calendar. This will have been linked through their personal profile. Zalando We noticed you have an event coming up!.. You recently s ynced y our I- phone calendar t o Z alando and w e h ave some outfit s uggestions for your u pcoming event! To: Keeley Sweeney From: Zalando Re: Y our upcoming event: Andrews 50th Birthday! Hi Keeley! You recently synced your calendar with Zalando. We see you have an event coming up and have suggested some outfit inspiration below! Suggested items based on consumers private personal profile and analysis of previous purchases. Filters include favourite retailers, size and colours. C O N C E P T Strong and realistic opportunity to enhance seamless shopping channels for the consumer. Creating a personal profile is optional however could help the retailer encourage purchases and average basket size alongside engaging with the consumer through personalization. Encourages consumer to purchase new garments for upcoming events. N U M B E R T H R E E Based around streamlining the returns process to maintain sales transactions and eradicate expense. The difficulty of exchanging a product purchased online is a key barrier to re-purchasing and therefore must be eradicated. See below survey analysing the effect of complicated exchange processes. THE EXCHANGE BUTTON Does the online returns process effect the exchange process? No it doesn t bother me Yes I send it back and reorder Yes I send it back and don t reorder I don t know Enter your order number and select Exchange for new size to automatically release your exchange. EXCHANGE FOR NEW SIZE The unsuitable order will be collected on delivery increasing consumer satisfaction and brand loyalty.

9 CONCEPT NUMBER FOUR Virtual Fitting Rooms Everyone knows the key issue with online shopping is not being able to try on products for size, aesthetics and functionality. Through implementing an online service whereby the individual is able to create a virtual person that mirrors their size, height, weight and body mass in order to try items on when purchasing online. This could potentially reduce returns and the costly process that follows through implementing elements of personalization. C R E A T E Y O U R P E R S O N A L A C C O U N T Insert your details below to benefit from our online virtual fitting room service! Height* 5 5 Foot Size* Waist Measurement SIZE* 6 26 Inches 8/10 Image 1 Upload Complete Image 2 Upload Complete Image 3 Upload Complete Bust Measurement 34 Inches Hip Measurement 28 Inches S E L E C T Y O U R B O D Y S H A P E **Important: All information is confidential and used only to help provide you with the most tailored online shopping service. KEELEY Please wait while we create a virtual YOU based on the above

10 TRY IT OUT... Based on Menswear profile searching for shorts. TRY ON VIRTUALLY 360 Degree rotation to provide stronger outfit visions for the consumer. This simple innovation could easily be utilised by any online demographic as it is clear to use and beneficial in the purchasing process. The consumer is able to advance their online search through selecting their size and the TRY ON VIRTUALLY option. This would then translate into a virtual image of the individual based on their given size measurements and how the garment would look on their body shape. It is also possible to try on outfits online selecting more than one product to compliment the style choice. THE FUTURE It is highly likely the future of E-Commerce will revolve around the introduction of online innovations such as the above, to provide Etailers with competitive USP s to differentiate with competition. As Ecommerce market place booms, more retailers are beginning to shift online creating more competitive trading environments for retailers. Retailers must innovate to stay relevant with factors beginning to revolve around personalization, delivery methods and the ability to seamlessly link omni-channel retailing. Future online delivery needs to be quicker and more efficient with 68% of retailers offering next-day-delivery compared to 61% in This could be achieved through streamlining logistics utilizing reliable services and implementing collection services eg. Click and collect or collating collection points in high footfall locations. Establishing partnerships with national retailers can benefit online pure plays as they are able to reap benefits of the convenience of the real-world store whereby you can pop in on your way home.

11 Retailers such as Zalando must implement online innovations to stay current and maintain market share against global online giants. Potential opportunities could lie within markets outside the EU such as the USA who hold the largest value online market alongside Far-Eastern locations Japan and China. However, although the future of E-commerce portrays strong growth, intense research must be implemented to understand consumer requirements in new geographical locations. E-Commerce will influence the future growth of fast-fashion as new product and trend analysis becomes increasingly accessible. Social-media frequently visited by the younger demographic is beginning to create a perceived ideology of fashion whereby individuals may feel pressurized into purchasing the latest trends. As the online marketplace becomes more saturated, differentiation and constant innovation is key to success. From undertaking head office experience at Mulberry, it became clear E-Commerce is the future of fashion with retailers channeling capital into perfecting these channels to ensure in-store product reflects that of the web. Recent market analysis acknowledged in-store footfall declining as consumers begin to favour the accessibility and ease of purchasing online. The fundamental shift in the way people are shopping seems to be driving the sustained reduction in shopper numbers to both high streets and shopping centres, said Helen Dickinson, BRC director general. Out of town shopping locations are beginning to attract click and collect custom, which could present opportunities for Zalando to combine services with retailers such as Next, or Supermarket brands to increase accessibility. However, in-store environments are embracing E-Commerce opportunities utilizing I-Pads and virtual displays to enhance the in-store environment and drive footfall. As socio-grade changes see the older demographic grow, retailers must seamlessly target this individual through tailoring online offering. Zalando could implement larger sizing and more conservative brands such as Phase Eight and Monsoon to target this bracket. E-Commerce must be simple and clear in order to encourage engagement from the older individual through this channel. Future E-Commerce developments are likely to encourage a more technologically focused fashion retail environment whereby the shopping experience is centred around the consumer. Retailers must understand the customer, the market and competition to provide the most seamless experience towards their consumers. E-Commerce must differentiate to remain current through implementing personalization and encouraging engagement within the purchasing process. This could see individuals design their own garments online for retailers to produce and deliver or alternate shopping methods as shown in examples above. Overall, it is clear the growth and diversity of future E-Commerce presents an extensive array of opportunities for the fashion environment. It will drive growth, research of trends and enable the central focus of the consumer. Integrating E-Commerce with the retail environment is only becoming more common as technology seamlessly interlinks the omnichannel experience. However, as the marketplace becomes saturated pure plays must implement online innovations to remain competitive. E-COMMERCE IS THE FUTURE OF FASHION RETAIL