The Future of Retail: What do fashion shoppers want?
In the past 20 years, the rise of social media and online shopping platforms has dramatically changed the fashion retail landscape. Whilst brand and retailers prepare for a very different future to our predecessors, here we outline some small to medium term strategies that will help them stay relevant to an increasingly elusive shopper.
An emphasis on providing an array of new, fresh items
Consumers have always cared about keeping up with the latest trends, but these days more than ever. Shoppers are attracted by retailers which stock a wide range of new on-trend items which give them the impression that their purchases are somewhat unique. Brands such as Zara are pioneers of this business plan. Though it may seem ruthless, figures attest to the success of Zara’s unspoken mantra of ‘If you don’t buy it now, you’ll never see it again’. The brand’s sales have increased 12% per year for the past 15 years. Their method consists of three main ingredients: short lead times to keep its range up to date with current trends, limited supply of items, and a constant flow of new styles available.
To replicate these profitable techniques, Australian brands would do well to use local manufacturers and reap the benefits, which home-grown fashion label Cue has done in its use of local NSW textile factories. Why local manufacturers? The appeal lies in the flexibility for quick repeats and short runs, which cannot be achieved when you choose to import. Not to mention the positive impact this will have on Australia’s textile industry.
Another way to achieve the fast turnaround of styles that consumers are after is to use digital printing. Unlike more traditional methods such as screen printing, digital systems provide flexibility as designs can be altered during the printing process without significantly slowing down production. This makes it an attractive option for brands.
Social media: an invaluable resource for understanding consumer choice
Something that you may find shocking to hear is that all the profit from fashion sales is driven by only the top 20% of fashion brands. The other 80% either break even or are in debt. The top brands (your competitors), rely heavily upon data and consumer insights, so in order to be successful we’d like to stress the importance of incorporating these into your business plan.
Data analytics is a fancy word for finding out: who is buying what, the age group, the gender, and the particular products that these different groups are after. Social media is a goldmine for gleaning this information! You can use tools such as ‘Linkfleunce Search’ and ‘Radarly’ to sift through the billions of social media conversations about fashion in order to find out important market about your brand’s customer base.
The next step is creating your own social media presence which allows you to receive comments and feedback from customers and to interact with them on a personal level. Once again, Zara’s example demonstrates that having a strong social media presence is a fantastic business technique. It allows instantaneous feedback on the styles that customers like and dislike which can then be filtered back to the design and production process.
Online Shopping Shape Up
If your brand includes an online shopping service, it is worth investing some time and resources in to making it a smooth and seamless shopping experience for customers.
A U.S. study found that the top reasons for U.S shoppers abandoning a purchase online are that the retailer does not have a decent returns policy (36%) and the checkout process took too long (31%). A flawed website functionality would also prohibit 61% of shoppers from repeat visit/purchase.
Creating the luxurious in store experience that customers still desire
Although it is true that customers are buying more and more online, it is not all gloom and doom for brick and mortar retailers and boutiques!
Almost half (46%) of Australian shoppers say that they like to touch and try items on before buying them, so they tend to buy more expensive items in store. In addition, almost a third of customers prefer to browse for a new purchase online before venturing out to buy it in store (29% in Australia). Though 55% think that shopping online is more convenient, 73% of consumers say that shopping in store offers an experience that cannot be replicated. This highlights the need for brands and retailers to appeal to that desire for a luxurious shopping experience.
Understanding the Gen Z generation of shoppers
The biggest online shoppers and Gen Z shoppers, aged 16-24, who buy clothing and accessories online on average 18 times per year. This generation is heavily influenced by social forces. But contrary to common conception, only 2% said that they would buy an item because a celebrity or influencer has worn it. Instead, 26% said that they are most likely to buy when they’ve seen something on social media and 25% would buy when an item is trending and likely to sell out, which feeds into the support the idea of delivering quick turnarounds of styles.
With less disposable income comes a higher demand among Gen Z for more flexible payment options. Many Gen Z admit to saving for several months before purchasing expensive items (35%) and 37% said they would like an option to pay in instalments. Millennials share the same consumer tendencies to Gen Z but to a lesser extent. Though appealing to today’s elusive fashion shopper may seem challenging at times, it is all about understanding and acting on the research and information at our fingertips.
We hope you’ve found these tips useful! Be sure to come to our Future of Retail Seminar Series on the 16th of September.