A guide to selling fashion around the world online - CheckOut 4 FASHION - Cross ...
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
CheckOut 4
FASHION
A guide to selling fashion
around the world online
The CheckOut2TheWorld alliance is brought to you by:
INFINITYBLUE
driving marketplace performance
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE CONTENTS Introduction ........................................................................................................ 3 Fashion by numbers ....................................................................................... 4 How do consumers buy online? ............................................................... 7 Being discovered in new markets ......................................................... 14 Getting your clothes to international customers ........................ 19 Looking after your international customers .................................. 21 Focus on China ................................................................................................ 25 Interview with Lei ......................................................................................... 27
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
INTRODUCTION
The opportunities available to retailers within
the fashion industry are enormous.
As the world becomes increasingly
connected, it also becomes easier and
cheaper to sell clothes, footwear and
accessories to consumers in new countries.
At the same time, as more people buy
products online, the more sophisticated,
streamlined and cost-effective the
associated logistics become, making it
faster and cheaper for sellers to reach their
customers, wherever they may be.
The first section of this whitepaper takes
an in-depth look at the statistics associated
with the fashion industry and the size of
the opportunity available to brands willing
to take advantage of both the digitalisation
and internationalisation of consumer culture.
The following sections address some of
the questions that a fashion retailer must
consider before selling their products online
to multiple countries. We examine the habits
of online consumers, the best way to market
your online products in new regions, the
different means of getting your products to
your customers, and how to look after your
international customers after purchase. The
information provided should give retailers
an idea of the various options available to
them and how to choose the best ones for
their business.
The final part of the whitepaper focuses on
China, which is quickly becoming the most
significant market for the fashion industry.
The world’s most populous country also
acts as an indicator of worldwide sales of
clothes, footwear and accessories in the
years to come.
3
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
FASHION BY
NUMBERS
The fashion industry, consisting of clothing (or apparel), footwear
and accessories (e.g. bags, watches, jewellery, eyewear, and
cosmetics and fragrances) was valued at an estimated $2.5 trillion
making up 3% of global GDP in 2017. 1 In the same year, clothing
and footwear accounted for 7.25% of total worldwide retail sales,
valued at $1.7 trillion.
8.0%
These
7.0%
numbers demonstrate the wealth Where will growth emerge?
of opportunity available for fashion
retailers,
6.0% with approximately 7 billion McKinsey predicts 3.5-4.5% growth in
customers using their products every global sales within the fashion industry
day.
5.0%
But which sectors and regions are in 2019 (down from 4.5-5.5% growth in
expected
4.0%
to grow fastest over the next 2018), with emerging markets in APAC,
few years, and how is the consumer Europe and Latin America forming the
landscape
3.0% changing within the industry? fastest growing regions.
A look at some specific numbers can
2.0%
provide some clues.
1.0%
0.0% Percentage sales growth in the
fashion
APAC Emerging Europe Emerging
industry Total
Latin America
worldwide
fashion
industry in 2019, North
MEA
by region
America APAC Mature Europe Mature
8%
8.0% Low estimate High estimate
7%
7.0%
1 obaninternational.com
6%
6.0%
5%
5.0%
4%
4.0%
3%
3.0%
2%
2.0%
1%
1.0%
0%
0.0%
APAC Emerging Europe Emerging Latin America Total fashion MEA North America APAC Mature Europe Mature
industry
Low estimate High estimate
1 The State of Fashion 2018, Link
2
1 Statista, Link obaninternational.com
3 The State of Fashion 2018, Link
4
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
In 2019, China is expected to overtake the US as the largest fashion market in the
world, with apparel sales reaching $335.5 billion.4 Growth is predicted to remain high
at an average of 7.5% until 2021.5
In the US, growth is expected to decelerate from 2.7% in 2017 to just 2.0% in 2021.6
Apparel sales in the US are forecast to reach $334.2 billion in 2019, according to
Statista’s Consumer Market Outlook, with growth averaging 2.2% over the next three
years.7 However, some experts suggest there has been a decline in apparel sales in
recent years, with some reports estimating a 2% decline between 2016 and 2017.8
Each of these reports measures slightly differing categories, but the overriding
conclusion is that growth in the world’s largest fashion market is slowing
dramatically.
Americans are also spending less on fashion. From 1977 to 2016 the percentage of
consumer expenditure on apparel and related services has fallen by half, from 6.2%
to 3.1%. The average US consumer now spends more on technology (3.4%) and
“experiences” such as eating out, travel and other leisure activities.9
The trend outlined above is indicative
of a more significant overall trend in The growing importance of
fashion spending.10 By 2025, McKinsey e-commerce
expects revenue from outside of E-commerce is a critical force for
Europe and North America will make growth in the fashion industry. In 2017,
up 55% of all fashion spending. With e-commerce accounted for $450.7
APAC, Latin American and African billion of global fashion sales.11 In 2019,
economies continuing to stabilise, and the amount is expected to grow by
greater individual engagement with the 14.1% year on year, reaching just under
internet, this trend is unlike to reverse $600 billion over the 12-month period.
any time soon.
4,5 Statista, Link
6,7 Statista, Link
8 NPD Group, Link
9 Bloomberg, Link
10 The State of Fashion 2018, Link
11 Statista, Link
5
$400,000.00 8.0%
in
$300,000.00 6.0%
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
$200,000.00 4.0%
$100,000.00 2.0%
$- E-commerce revenue growth in the fashion industry 0.0%
2017 2018 2019 2020 2021 2022 2023
Apparel Footwear Bags & Accessories %Growth
2 obaninternational.com
$900
$900,000.00 18.0%
$800
$800,000.00 16.0%
$700
$700,000.00 14.0%
$600
$600,000.00 12.0%
in millions$US
$US
$500
$500,000.00 10.0%
in billions
$400
$400,000.00 8.0%
$300
$300,000.00 6.0%
$200
$200,000.00 4.0%
$100
$100,000.00 2.0%
$-
$- 0.0%
2017 2018 2019 2020 2021 2022 2023
Apparel Footwear Bags & Accessories %Growth
2 obaninternational.com
Already the biggest slice of the In the US, 31% of cross-border online
e-commerce pie (29.4%), online purchases are those of clothing and
fashion sales are predicted to grow accessories, but consumers are still
at a compound annual growth rate concerned about increased delivery
(CAGR) of 8.7% (faster than the overall times and expensive returns.16
e-commerce market), resulting in a
market volume of $836 billion by 2023.12 In 2020, China is expected to become
the largest cross-border B2C market,
At the same time, the amount of with 200 million consumers receiving
money spent online across borders is goods from overseas, and the volume
estimated to top $1 trillion by 2020, of imported goods purchased online
equating to a 27.5% CAGR since 2014.13 reaching $245 billion (or 25% of all
A survey of consumers across 12 cross-border e-commerce revenue).17
countries revealed that 64% of online The main reasons for this include
buyers purchased from a foreign site in concerns about the quality of domestic
2018.14 As consumers search for better products and high-levels of counterfeit
prices, different brands or speciality products.18
products not currently available in
their home markets, and they become Forward thinking businesses such as
increasingly comfortable buying Alibaba’s foresee a merging of the
online from international websites, benefits of traditional shopping and
the opportunity for retailers to reach e-commerce, heralding a “new retail”
new customers around the globe in which the distinction between online
increases exponentially. By 2020, 45% and offline will become increasingly
of all online shoppers – more than 900 obscured.
million people – will purchase products
internationally.15
12 Statista, Link
13 McKinsey, Link
14 Pitney Bowes, Link
15, 17 Alizila, Link
16 Invesp, Link
18 eMarketer, Link
6
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
HOW DO
CONSUMERS
BUY ONLINE?
As technology continues to develop new methods for people to
consume content, the ways in which people purchase changes
accordingly.
A few of the resulting channels through which you can now
sell your items online include: your own website (desktop
and mobile), marketplaces, your own mobile app, various
social media platforms, smart devices and crowdfunding
campaigns.
Different markets do not only have different preferences
when it comes to channels, but they also have different
platforms and platform preferences within these channels.
For example, Amazon may seem ubiquitous in most of the
western world, and while the list of international sites and
countries that it now ships to is always growing, it is often not
the first choice for fashion consumers in all markets. In the US,
customers are au fait with using Amazon to buy clothes, but
in the UK it is not most customers first thought.
In 2017, Amazon was the 8th most popular destination for UK
fashion e-commerce sales, with companies such as Next, John
Lewis and Asos making far more sales.19 In the same year,
Amazon was the second largest apparel retailer in the US
(overall, not just e-commerce), and was expected to overtake
Walmart in 2018 according to a Morgan Stanley report.20
Other factors to consider are the most popular devices
within each market and the internet speeds available. In
large portions of Africa, people must rely upon slower
internet speeds and are more likely to make purchases on
smartphones than a desktop computer. As a result, a simple,
mobile-first webshop may be your most important channel in
these markets.
19 Statista, Link
20 CNBC, Link
7
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
E-commerce site financial affairs, is also a necessity.
As previously mentioned, in some
Making sales directly from your own markets, mobile devices are used most
e-commerce site presents several commonly for online purchases, and in
advantages. You have complete those countries your mobile site and
ownership of the platform and the user experience must be perfected.
versatility to adapt it as you please. Even in regions where purchases tend
Additionally, you are not required to to be made on a desktop browser,
pay any fees to a marketplace for the searching for and evaluating products
privilege of listing your goods on their may still occur on mobile devices and
platform. Further positives include mobile sites therefore are a priority.
complete control over your customer
data, and more control over your
shipping/return methods. There is also an increasing trend for
brands to create their own apps,
Conversely, adapting your website to allowing customers to install a mobile
ensure it drives sales in all your target shopping experience on their phone
markets will require significant time or tablet. Apps are very effective in
and effort. It is not just the cost of promoting brand loyalty, increasing
translations, but also guaranteeing repeat and regular custom, but can
the website is user-friendly, correctly also be very expensive to run, keep
localised and optimised to drive updated, and translate and localise to
sales. Deciding if the investment many countries.
is worthwhile may depend on the
importance of brand to your product.
If you benefit from having a one-on-
one conversation with your customers
directly through your website, it may
be an important sales channel. The
creation of partnerships in new markets
for warehousing, shipping, returns,
payments, customer service and
8
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Credit: Casimiro PT / Shutterstock.com
Marketplaces
Globally, almost 50% of online retail Customer research shows that customer
sales take place on marketplaces and choose marketplaces when they are
sales grew by 34% last year to $1.55 looking for a range of choice, ease of
trillion.21 The increasing dominance of comparing items and convenience
marketplaces is also evident in e.g. the of looking in a single place. They also
fact that online shoppers in the USA are benefit from only having to sign-up
more likely to start a search for a new once, fast checkouts and insurance
purchase on Amazon than Google.22 against items that do not match their
descriptions or fail to be delivered. This
What all marketplaces have in in contrast to other customers who
common is that the product or service prefer purchasing directly from brand
information is provided by multiple websites because they have strong
third parties, while the transactions are brand loyalty and trust, want to take
processed by the marketplace operator. advantage of loyalty programmes, and
Marketplaces usually charge a fixed fee are looking for the top end customer
and a percentage fee and many now experience that some brands offer.23
offer additional services like fulfilment
and financing. As such marketplaces There is no doubt that marketplaces
offer a fantastic eco-system of solutions somehow flatten the customer
for online retailers experience for each brand. Marketplaces
will always be more interested in
Some marketplaces have become promoting their brand than yours.
retailers in their own right, next to But those platforms are continuously
facilitating the sales of third parties. innovating, e.g. Amazon adding
Others like eBay are designed to work Brandshop, and Tmall setting up Luxury
on an auction basis and allow individuals pavilions. Other more fashion specialist
to sell used or unwanted items, as well platforms like Farfetch, Mr. Porter an
as enabling shops to sell new products. Zalando are now including social media
Amazon, Tmall, bol.com, Fruugo are and content as part of their positioning
generalists in the sense that they offer and marketing activities, both off and
a wide range of products . Others on platform – creating much improved
specialise in market segments like Mano appeal for both fahion-istas and fashion
Mano (DIY and home improvement), retailers.
or Farfetch, Mr. Porter and Zalando in
fashion.
21 Digital Commerce 360, Link
22 Infinity Blue webinar: ‘You can Export: Set-up and Sell Successfully on Global Marketplaces’, Link
23 Pitney Bowes, Link
9
A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Why should you consider using a marketplace?
• Access an additional route to market – the benefit of opening up a second or
third route to market will depend on many things, but in some countries
marketplaces represent over 85% of online B2C purchases
• Export with ease - when expanding into new countries, you will only need to
translate and localise the product copy for new marketplaces, without worrying too
much about the complexity of customer delivery and returns
• Protect your band - brand registry (or the non-Amazon equivalent on other
marketplaces) will ensure sellers that sell your products comply with your listing
and brand standards. You can do this even if you do not intend to sell yourself.
Tip: Note that research has shown that the average retailer underestimates the
importance of marketplaces for online buyers.24 So ignore marketplaces at your peril.
Which marketplaces should I choose?
Any discussion on specific marketplaces There are at least 250 dedicated
needs to start with Amazon and fashion marketplaces that are regularly
Alibaba, behemoths of online retailing. discussed, including Farfetch, Mr. Porter,
Amazon is dominant in the USA and Net-a-Porter, Asos, Zalando, Bonobos,
the EU (and barely touches China) The Iconic and Poshmark. They differ in
while TMall’s dominance in China is geography, audiences, brand protection,
even more substantial . TMall provides on-platform marketing and promotional
more opportunities for branding than possibilities, integration with social
Amazon. It is also much more focussed media, key opinion leaders etc.
on the overall e-commerce ecosystem
(including working closely with brick For more information on marketplaces,
and mortar retailers). For now, the including practical tips on how to
threat of Amazon and Tmall to fashion overcome challenges and make the
brands depends mostly on the type of most of opportunities, see our guide,
apparel in question. Amazon customers ‘You can export: Set-up and sell
for instance, when buying fashion successfully on Global Marketplaces’.26
largely buy underwear, socks, jeans and
workout clothes.
Both super-marketplaces are
experimenting with fashion and luxury
products. Tmall launched the Tmall
Luxury Pavilion, offering its shoppers
access to dozens of brands including
Burberry, Hugo Boss and La Mer.
Amazon is developing its own private
labels, offering a testing service
known as Amazon Wardrobe, which
allows users to have items delivered
to their homes in order to try them on
and either keep or return. Amazon is
also rumoured to be working on an
automated clothing factory that uses
personal preference data to create
personalised tailormade clothing.25
24 Pitney Bowes, Link
25 Quartz, Link
26 InfinityBlue, Link
10A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Bonanza is a seller-friendly marketplace. Therefore Farfetch positions itself as the “only truly global luxury
ASOS is a U.K-based marketplace, targets Originating in Germany, Zalando has made high street to high-end
there are no listing fees and no monthly store fees. digital marketplace”. Dedicated to lovers of fashion,
younger shoppers giving them the space fashion easily accessible by offering Europe’s largest selection of
Allowing sellers to make sales and build a brand by visitors can pick from an “unrivalled” range of products.
to be uniquely themselves and express clothing, accessories and shoes online.
developing relationships with their customers. They offer same-day delivery in 19 major global cities
themselves, selling over 30 sizes and home to + 24,6 million users including Milan, Berlin, London and Paris.
700 boutiques. + 200,000 items
> 50,000 brands > 995 luxury sellers
> 10 million items > 18 million users + 2,000 brands > 3,000 plus luxury brands
7 countries: Canada, UK, France, India, Germany, > 1,000 brands 13 countries: Germany, Netherlands, France, UK, Italy, Switzerland, > 2.6m marketplace users
Mexico, Spain 8 countries: UK, Australia, US, France, Sweden, Denmark, Finland, Norway, 11 countries: UK, Germany, Italy, Portugal, India, China,
Germany, Spain, Russia, Italy Belgium, Spain, Poland France, Russia, Japan, Brazil, UAE
Walmart started accepting online third-party sellers in XiaoHongShu (Little Red Book) is aimed at 18-to-
2016. Since then thousands have listed their products 35-year-old Chinese women buying luxury products
for free. Their aim is to help people save money and from overseas brands. Their app combines social
live better – anytime and anywhere online and on their media and e-commerce, driving sales through
mobile devices. customer recommendations, shopping tips and
fashion inspiration.
> 265 million users
> 11,200 brands > 70 million users
27 countries 1 country: China
Dafiti is one of the four top fashion markets in Latin
Ymatou is a C2C and M2C e-commerce marketplace
America, built on a unique value chain which is
and was one of the first cross-boarder e-commerce
ahead of the market based on warehousing, logistics,
marketplaces that allowed overseas franchises to sell
payments and customer service.
directly to Chinese consumers.
> 5 million users
> 1 million users
> 60 million visits per month
> 10,000 orders per day
4 countries: Argentina, Brazil, Chile, Colombia
1 country: China
Jumia is the largest marketplace in Africa, covering Superbalist is a niche, trendy and designer
marketplace, selling fashion and décor on their Zalora is one of Asia’s leading online fashion The Iconic targets younger women with
approximately 80 percent of the African internet
online, mobile, and award-winning app – telling destinations. They focus on giving millions of fashion the promise of allowing them to express
population, selling everything from fashion to food.
their story on their blog, The Way of Us, as well as consumers a great shopping experience with perfectly their true self. Their success is built on a
on social channels. fitting styles and trends. They have localised sites customer centric experience, technical
> 1.2 billion million users
offering top international and local fashion brands to innovations, unrivalled product ranges and
> 41,000 local and international brands
> 3 million users per month men and women. personalised inspirations.
14 Countries: Nigeria, Egypt, Morocco, Kenya, Ivory
> 300 local and international brands
Coast, South Africa, Tunisia, Algeria, Cameroon, Ghana, > 2 million users > 13 million visits per month
1 country: South Africa
Senegal, Tanzania, Uganda, Rwanda > 40 million visitors per month > 1,000 brands
7 countries: Indonesia, Philippines, Singapore, 2 countries: Australia, New Zealand
Zando is part of the Jumia group and is the biggest
on-line fashion marketplace in South Africa. Malaysia, Brunei, Taiwan, Hong Kong.
11A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Social e-commerce: See it, buy it standalone e-commerce app, on which
users would be able to buy products
The evolution of mobile and its growing from the brands and creators they
role in the lives of consumers offers us follow on Instagram.27 Snapchat have
some insight into the future of social partnered with Amazon to enable users
e-commerce. Is it possible that one to point their camera onto a product’s
day we will wake up to realise we are barcode and be directed to the product
spending a significant portion of our page on Amazon.
discretionary income through social
media purchases? Research from Business Insider tells
us that 72% of Instagram users have
Social and e-commerce have a purchased a product as a result of
complicated history. Facebook and seeing it on Instagram. However, this
Twitter have tried several features self-reported data is still not telling
that never took off, including a Twitter us whether users will purchase on the
Buy button that was gradually phased platforms themselves, or whether the
out. Some analysts complained at the platform is simply used for inspiration.
time that users go on social media “to No company has been too quick to
connect with friends, not to shop”, volunteer statistics on the volume
but as social media has become truly of sales they are seeing from these
mainstream and the use-case for social features.
media has grown dramatically in the
lives of consumers, it is time to consider: In China, social media and e-commerce
will social media become a crucial have been deeply integrated for a
channel for fashion purchases? longer time.
We know that the incentive for social While the mobile app ecosystem in the
media platforms to perfect this is West has been going through a period
significant, and no better testament to of unbundling (standalone apps splitting
this exists than the new enthusiasm in from their parent apps to offer narrower
rolling out shopping features across all features), the East has experienced a
social media giants. process of bundling, with apps such as
WeChat becoming the main entry point
In the last year, Instagram has launched to most online tasks. For several years,
shopping tags in feed, stories and Chinese and other WeChat users have
even its own channel in the ‘Discover’ paid, booked tables, hailed taxis, sent
tab. This enables users to tap on a files and scanned WeChat QR codes
product, learn more about it, and as from their phones. In other words, for
a last step visit the merchant’s site. In Asian users WeChat was not a way to
fact, The Verge has reported rumours “connect with friends”, but a way to use
that Instagram might be releasing a the internet to get things done.
Credit: Pixeljoy / Shutterstock.com
27 Business Insider, Link
12A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Angela Wang, from the BCG group Perhaps there is something about China
believes the entire social e-commerce that facilitates this more spontaneous
experience “is like you are exploring in shopping behaviour. This may be
an amusement park. It is chaotic, it is attributed to a larger percentage of
fun and it’s even a little bit addictive.” mobile users and bigger ratio of online
The whole purchase funnel and journey to offline purchases, the new middle
(e.g. seeing something on social media, class with an appetite for shopping
thinking about it, seeing it again on a or better integrations with payments
display ad, doing additional research via systems that decrease friction. But
search engines, and finally buying it on it can also be argued that China is
an e-commerce platform) has collapsed offering a peek into the future of online
into “see it, buy it”.28 purchasing in the West. It is easy to
see that major social media platforms
are attempting to create frictionless
purchase experiences. Additionally,
brands are using a combination of
personalisation and entertaining content
to try and increase the number of
people purchasing as a result of, and via,
social media platforms.
28 TED, Link
13A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
BEING
DISCOVERED IN
NEW MARKETS
Developing a reputation for your products in a new market is
easier said than done. How do you go from having no presence
to capturing the attention of all the customers seeking clothing,
footwear or accessories? The answer will depend massively upon
your products, target audience, budget and sales channels, as well
as the country that you are selling to.
The most obvious marketing
channels for those seeking to sell
products online are those native
to the internet. These channels
benefit from being flexible
regarding budgets. Additionally,
the amount of time and money
spent on each channel can usually
be increased or decreased quickly
and easily.
Another benefit of the major
digital marketing channels is
that it is easier to see what is
working and what is not and
adjust your methods accordingly.
Paid media (in all its forms) and
SEO produce vast amounts of
data which helps you to calculate
which areas are making the
best return on investment and
which channels are the most
profitable. By continually testing
new opportunities and refining
your adverts and website, you
can create the marketing mix that
works best for your product, and
evolve as new platforms, formats
and technologies emerge.
14A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Paid Media
There are numerous ways of promoting products online with paid advertising. They
offer the most cost-effective method for quickly enhancing your brand’s visibility
within a new market. The bread and butter of paid media advertising is pay per click
(PPC) advertisements, that show as promoted listings on the results pages of search
engine enquiries.
On top of this you can create image
or video-based adverts that show
as banners on other websites.
These can be particularly effective
for retargeting or remarketing,
when you want to get someone
who has visited your site to return
to a product page and continue
their customer journey. However,
they can also be used to increase
your brand presence by showing
your logo and brand imagery to
your target audiences.
Social media advertising has proven
to be particularly effective for
fashion retailers. The variety of
platforms and formats available
is vast and creating the most
effective campaign will usually
involve a series of experiments to
discover what works best. The rise
of Instagram, and the influencer,
(discussed below) has created
impressive results in some cases. A
social media presence and related
advertising can have a massive
impact, and fashion is the perfect
industry for highly visual image-
and-video-based content formats.
The most popular platforms
for paid media advertising vary
massively by country. Not only do
different search engines dominate,
but many countries have a variety
of social media platforms designed
for different purposes and with
different audiences. Putting in the
time to do your research and figure
out the best platforms and formats
for your products will pay off in
the long run. If you have a limited
budget, concentrating your efforts
on fewer platforms can help to
ensure a bigger impact while saving
you time in regards to developing
the associated creatives.
Credit: WDnet Creation / Shutterstock.com
15A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
SEO Marketplace marketing
If you are selling directly from your Being present on the most relevant
own e-commerce shop, then SEO is an marketplaces within your target markets
important factor in being discovered. is a great start when it comes to being
One of the key factors to address is the discovered by customers in a new
language used by a particular group, country. However, unless you are selling
when searching for a product. Once this a very niche product, you are probably
is identified, you can start producing going to find others are already selling
content that includes key phrases something similar, and they have
prominently and by consequence, already established a reputation on the
feature prominently in search results. platform. In that case you are going to
need to do something to make users
While Google dominates the western choose your product over competing
world of search, they are by no means sellers.
ubiquitous, and they are still banned in
what is soon to be the world’s largest Marketplaces will have their own
fashion market, China, where Baidu algorithms to help return the most
currently takes precedence. When relevant results for their users. Ensuring
creating multiple versions of your pages that your listings contain as much
for your new markets, keep in mind that information as possible about your
the algorithm behind the rankings may products, use the marketplace’s best
differ for the most dominant search practice guidelines for creating your
engine in that region. pages. Including product images is a
good way to ensure your product is
In addition, it is important to make sure featured in the correct results pages.
that the right version of your webpages
is served in the right region. There is Some marketplaces will also have their
no point spending lots of money on a own equivalent sponsored adverts or
beautifully translated, fully localised postings, allowing you to pay money to
Russian site if your servers are still appear higher up the search results for
sending them the UK version. There are certain keywords or displaying banner
a few things to consider here including ads for the goods you are selling on
how you will set up URLs for your their platform. If the marketplace is
international sites and what languages going to be your main (or only) route
your site is going to be available in, to market in a region, these sponsored
as well as which currencies you will listings may be worth considering.
accept. For fashion retailers, it is also
important to show the sizes of your
clothing, footwear or accessories in the
correct format for that country. Further
considerations are required for how you
will alter listings when items are out of
stock.
Many search engines also have a
shopping feed functionality. In these
cases, it is worth setting up an account
with the search engine to list your
products directly in their listings or
using other methods to ensure you
show up in these results, so that
shoppers can compare your products
directly on the search engine’s results
pages. Credit: Hadrian / Shutterstock.com
16A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Social media - the fashion influencer by the World Federation of Advertisers
(WFA), 65% of brands declared planning
The rise of influencers, especially those to increase their expenditure next year.
advocating for fashion, may be the final
piece of the puzzle that enables social This is particularly true for the fashion
media platforms to become mainstream and beauty segment, a sector which has
purchasing channels. enthusiastically jumped into influencer
programmes and activities. Revolve,
Initially, influencers began using trading a millennial-oriented designer retailer
their influence and consumer attention in the US, has hired a five-strong team
to advertise brands. More recently, and built proprietary technology for
this has begun to evolve, with more influencer tracking and monitoring.
influencers releasing their own fashion According to the company, 70% of sales
brands. The phenomenon is again come from influencer activity.
bigger in China, given the sweet spot of
mobile, social and payment. Andreessen Indeed, the power of influencer
Horowitz said last year that 5 of the relationships is clear not only with
top 10 womens apparel brands on promotion, but also in communication
Alibaba Group’s Taobao online shopping of product information. This was seen
platform were founded by influencers. recently with the brand Sunday Riley
and the consumer confusion and upset
However, the US is also seeing big around a formula change due to EU
inroads with these partnerships too. regulations. The brand asked influencer
Snapchat launched native commerce Caroline Hirons to convey the brand’s
features in 2018, available to top message and reasoning to her audience,
creators, with Kylie Jenner as the launch rather than the brand using the
partner promoting her cosmetics with a ‘conventional’ press.
simple swipe to buy functionality.29
In China, the power of celebrity
However, brands and influencers are still endorsements remains the most
working together. Even though many effective way for luxury brands to
marketers have not found the best way create online engagement with users,
to execute partnerships (given concerns according to the Gartner L2 report.
around fraud from fake followers and Over 95% of luxury fashion brands
false engagement, or past issues with included in the report said they relied
the ASA), the amount of time and effort on celebrities to engage with users
spent in making influencer programmes of China’s Twitter-like social media
is likely to increase. In a recent survey platform Sina Weibo.
29 Digiday, Link
17A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
However, the cost of working with such in activity.30 The platform, funded by
celebrities is incredibly high and many Alibaba, Tencent and K11 is becoming
brands felt that an influencer’s following the destination for marketing beauty
may not be the best fit for the brand. and fashion items. However, luxury
brands are yet to adopt the platform.
For example, the Chinese boyband Less than 3% of Redbook influencer
‘TFBoys’ was cited by the L2 Gartner posts include links to the commerce
report as the Chinese celebrities who sites of luxury brands. This is certainly
best generated outsized engagement an area of untapped potential for luxury
through brand partnerships. However, brands in China and one to harness now,
with the band’s fans largely coming before the masses descend.
from Generation-Z, the power of this
partnership does not necessarily Ultimately, brands should consider
transfer into sales. Indeed, when one whether the influencer is the best fit
member, Jackson Yee, partnered with for their target audience. Harnessing
Bottega, many fans spoke out about the the power of micro-influencers
price point of the products simply not for more engaged content over
being accessible to them. longer partnerships, while ensuring
transparency, should lead to more cost-
Outside of influencer marketing within effective marketing while maintaining
the Chinese platforms Weibo and consumer trust.
WeChat, the social commerce app
Redbook has also seen significant rise
30 Jing Daily, Link
18A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
GETTING YOUR
CLOTHES
TO YOUR
INTERNATIONAL
CUSTOMERS
In 2017, 74.4 billion parcels were delivered to online shoppers, that
almost 40 per annum for each online shopper on the planet.30
Warehousing, last mile delivery and reverse
logistics (i.e. returns) present significant Did you know?
challenges to any company - solution design,
• 85% of consumers prefer
cost control and process monitoring to name
free delivery over fast delivery
just three. In the fashion industry, returns
However, this drops to 65%
have a massive impact on profitability.
Almost half of e-commerce fashion shops amongst Millennials.34
report a return rate of between 25 and 50%,
• Same day delivery is now offered
the highest rates of any B2C e-commerce
by 51% of online retailers.35
sector. 32 23% of these returns derive from
the wish to try on different sizes.33 • 67% of European online
shoppers check the returns page
At the same time actual delivery time, the before making a purchase. Make
‘unwrap experience’ and return policies sure your returns policy is clear
and practices are an important part of
and not detrimental to your sales.36
the customer experience. Customers are
expecting more each year. Therefor keeping • 92% of shoppers that have
track of wishes as well as feasible solutions returned products to a company
is important for your conversion and loyalty have found the experience difficult
rates on the one hand and economics and
and as a result will not buy again.37
efficiency on the other.
31 PitneyBowes, Link
32 Whiteboard, Link
33 KPMG, Link
34 Salesupply, Link
35 Invesp, Link
36 E-commerce Europe Foundation 2016
37 E-commerce Europe Foundation
19A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Cross-border fulfilment
Cross-border fulfilment refers to
the integrated warehouse, delivery
and return solutions companies
put in place to service their
international clientele.
There are two basic models:
• cross-border shipment (sending
directly from your native
warehouses)
• cross-border fulfilment (sending
items from multiple warehouses
closer to your clients).
Working with international
depots reduces your delivery
times, as well as your cost of last
mile delivery. It may also reduce
the cost of customer service as
customers are less likely to inquire
about delivery.
However, cross-border fulfilment
normally requires that you hold
more stock, leading to higher
warehousing costs.38
As a rule of thumb, if you are
delivering 1000 or more units per
month to a country or region,
consider a local warehouse. At
these volumes the benefits will
start outweighing the extra costs.
For fashion retailers it will not
come as a surprise that there is
no ‘one size fits all’ solution. Some
smart A/B testing and financial
modelling will go a long way to
find the best choices for your
company.
Tip: A trusted and low-cost return solution through a free return or a local return
address really does make a difference, so much so that Amazon and other
marketplaces now make this mandatory.
Tip: Use one local return address for all your returns in one country, even if you
use different last mile delivery solutions or sales channels. It will reduce your overall
return costs and headaches.
38 Montapacking, Link
20A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
LOOKING
AFTER YOUR
INTERNATIONAL
CUSTOMERS
Providing excellent customer service is paramount for any fashion
retailer. The challenge of ensuring you meet the expectations of all
your patrons is intensified by your expansion into new markets.
How to turn customer service from cost to competitive weapon
The all-in cost of answering one customer call or responding to one e-mail might
be £5 or more, and many retailers deal with 1000 or more events per day. Still many
companies continue to make investments in better customer care. Why? Firstly, they
know that a happy customer is a loyal customer, and customer retention pays off big
time: a regular loyal customer spends about 3 times more than a repeat customer
and 10 times more than a first-time customer.39 Secondly, successful companies
know that bad customer care can be detrimental: while a happy customer will on
average tell 3 people about their experience, an unhappy customer will tell 10.40
39 The Balance Small Business, Link
40 CustomerThermometer, Link
21A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Developing your own customer service strategy
The best solution for customer care will be different for each organisation. It
will most likely also develop over time and with the scale and complexity of their
operations. In order to develop the optimal solution for your company there are
several key questions that will help you make the right decisions:
1. How should your customers be able to reach you?
Email and telephone are still the most important channels in the UK and Europe,
but as Millennials and Generation-Z become an increasingly important part of our
demographics, there is a clear and definite change towards social and chat.
Mail
1.7m
Telephone
96.3%
Average duration in minutes
2.7m
80.7%
3.6m
4m
4.4m
72.6%
70.5%
66.7%
3.8m 4.2m
2.4m
3.8m
58.7%
56.3%
54.3%
53.9%
46.1%
45.7%
43.7%
41.3%
33.3%
39.5%
27.4%
19.3%
3.7%
Nordics
United States
Italy
U.K
Belgium
France
Netherlands
Spain
Germany
COUNTRY
22A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
WHY DO PEOPLE CONTACT VIA SOCIAL MEDIA*3 10%
21%
Note about online
experience
34%
12% Note Compliment a
about offline service / product
experience 2%
45%
Product 2016 2017
57% issue
SOCIAL MEDIA AS CUSTOMER
Question
CONTACT CHANNEL
2. What software solution are you using to support your communication and
track customer information and enquiries?
As your company grows and customer expectations develop, the demand for
efficiency and quality will increase. Does your software allow you to keep track of
your conversations, does it allow for (part) automation, and will it support chat and
social?
3. When should your customers be able to reach you?
Most customers would like to be able to communicate with you after-hours and on
weekends. Can you support that? Should you? 37% of customers expect a service
response within an hour.41
4. What level of personalisation and automation fits your company?
Implementing auto-generated messages helps in efficiency but in many cases
reduces the customer experience. Consider what is right for your company.
5. How are you going to deal with detailed product enquiries as opposed to
general enquiries?
Would you have a well-trained and more expensive member of staff also deal with
simple enquiries?
6. How are you going to work to continuously improving your customer service
experience and reducing your cost of the service you provide? What is your path
to continuous improvement?
E.g. Do you capture the nature of enquiries and then use the resulting insights to
improve your FAQ section, website content (e.g. improved seizing tables), or pro-
active communication with the client? Do you have a clear idea what your customer
would like?
7. Would you consider outsourcing?
Outsourcing your customer service can have several decisive benefits including:
lower upfront investment and lower monthly fixed costs; access to the best
technology and new channels of communication; ease of scaling up and down.
41 Shopify, Link
23A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Cross-border customer service
Clothing, footwear and accessories are the most popular category for cross-border
purchases. To effectively support your sales plus achieve customer satisfaction in
other countries it will be important to adapt to the expectations of your overseas
customer. They are clear in what works for them and what does not:
88%
of retailers believe it
26%
of retailers see
is essential to answer customer experience
customer service queries as the most important
in the consumer’s local way to distinguish
language 42,43 themselves 44
74% 60% 57%
of consumers of companies say that of customers will
want customer customer service has been not order from
service in their own improved by multilingual a website that is
language 45 customer service 46 not in their own
Local customer service telephone numbers and email addresses as well as locally-
based and e-commerce-trained call centre teams create trust and appreciation.
They are, therefore important drivers of international success.
Providing excellent customer service for customers with different cultural
backgrounds and across time zones adds complexity and risk – some companies can
put this together themselves. For others the step to start exporting might be a good
time to start considering outsourcing.
42 Statista,Link
43 Thuiswinkel Waarborg, Link
44 Adobe, Link
45 Common Sense Advisory, Link
46 Lionbridge, Link
47 Deloitte The Netherlands 2017, Link
24A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
FOCUS ON CHINA
When we think of fashion, we probably imagine places like Milan,
Paris, London and New York, but to understand the evolution and
future of fashion, particularly through the lens of e-commerce, we
must primarily consider China.
China’s population of 1.4 billion boasts unique market, but more importantly
a fast-growing internet penetration of China is likely to influence the global
55%, combined with a booming new online shopping landscape for many
middle class and its position as the fifth years. The fast and furious adoption
highest consumer confidence index in of mobile shopping, mobile payments
the world. China is already the biggest and contextual commerce in China
market for online fashion spending and are offering insights into how fashion
almost a quarter of all fashion sales are e-commerce might progress elsewhere.
made online. (In the US only one eighth
of fashion sales occur online.)48 The Chinese out-rank any other country
in their reliance on their phones to
To see an example of this volume access the internet. According to data
in action, we need look no further from Global Web Index, over 80%
than Single’s Day, the world’s largest consider their smartphone the most
e-commerce event. Publicised by Alibaba important internet-enabled device,
as a discount shopping day thanks to compared to 43% of Americans and
star-studded promotional galas, it drove 28% of Germans.
£20 billion in revenue for the Chinese
platform in 2017, and £14 billion for This is not just an interesting
rival JD.com.49 Single’s Day is now in observation. The rate of mobile
the calendar of many Western fashion adoption and technology in general
brands, which comprise almost half of has dramatically accelerated the rate of
sales during the event. Take Nike for innovation in the country. In 2015, China
example, who became the first company devoted 2.05% of their GDP to research
to make 1 billion RMB (£111m) at this and development, more than the
year’s event.50 Netherlands and the UK (World Bank).
However, by focusing on volume and While many still consider Silicon Valley
projected revenue, we would potentially the pinnacle of technological innovation,
overlook a more important aspect of we need to bear in mind that as
the Chinese market: Chinese shopping many as 22 e-commerce unicorns are
behaviour. Understanding how they Chinese.51 You should no longer expect
are inspired, discover brands and make e-commerce innovation to only arise
purchases is essential information for from the US or Europe.
any retailer hoping to operate in this
48 Euromonitor
49 Forbes, Link
50 Azoya Group, Link
51 Hurun Research Institute, WalktheChat, Link
25A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
The Chinese mobile-first approach to fashion companies with many more
shopping online could also beChinese
impacting
vs American opportunities
Luxury Shopper for personalisation.
the
40 strength of platforms in this country.
At faster rates than Europeans and China is already a huge focus for luxury
Americans,
35 the Chinese are skipping fashion brands, as Chinese consumers
search engines for platforms when it are buying luxury fashion at higher
comes
30
to research and purchase. As rates. By 2025, Chinese consumers are
many as 61% will go straight to Tmall, expected to account for at least 45%
25
instead of Baidu, to search for apparel. of global luxury sales.53 Interestingly,
20 the demographic of the Chinese luxury
The Chinese are also the happiest users shopper is decidedly younger than its
to15 share their personal data in a value Western counterpart, which is having
exchange (38% of Chinese, vs 25% in a huge impact on the fashion houses
the
10 US and 12% in Germany).52 This ability to drive revenue.
provides technology start-ups and
5
0
16 to 24
Chinese
25 to 34
vs American
Chinese Luxury
vs American Luxury
35 to 44
Shopper
Shopper
45 to 54 55 to 64
40
Chinese Luxury Shopper American Luxury Shopper copy
35 %
Made a purchase from these brands last year (%)
3 50
obaninternational.com
30 %
45
25 %
40
20 %
35
1530
%
25
10 %
20
5%
15
0%
10 16 to 24 25 to 34 35 to 44 45 to 54 55 to 64
Chinese Luxury Shopper American Luxury Shopper copy
5
3 0 Made Made
China
a purchase from
a purchase fromthese brands
these brands
USA
last
last yearyear
(%) (%)
Germany
obaninternational.com
50
Chanel Dior Gucci Louis Vuitton
45 %
4 obaninternational.com
40 %
35 %
30 %
25 %
20 %
15 %
10 %
5%
0%
China USA Germany
Chanel Dior Gucci Louis Vuitton
52 Kleiner Perkins, Link
4 53 Bain, Link obaninternationa
26A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
INTERVIEW
WITH LEI
Oban interviewed one of its Chinese LIMEs (Local In-Market
Experts) to uncover his thoughts on the growing fashion
opportunities within his country.
Which Western fashion brands do you
think are doing well in China? What
can other brands learn from their
efforts?
“I would say Gucci is one of the fashion
brands that has grown the fastest in
China, with double-digit increases for
both web traffic and revenue in the first
quarter of 2018. It is apparent that Gucci
has recently changed its strategic focus
to seduce younger consumers, who are
eager to spend large portions of their engagement with the brand. On
disposable income on stand-out pieces. WeChat, those engaging with Gucci’s
programme can buy and send gift cards
Having said that, a big part of Gucci’s to their contacts and upload selfies a-la
success comes from their use of digital Snapchat.
marketing. Luxury brands have been
quick to realise how fundamental it is to Gucci has also succeeded in their
build a presence and reach consumers use of celebrities and influencers,
on WeChat and Instagram, and Gucci having signed actress Ni Ni as the new
has been no exception. spokesperson for the Asian series of
glasses, and signed singer Li Yuchun
Gucci launched one of the more as Gucci’s latest Asian ambassador
innovative ‘mini-programmes’ on for watches and jewellery. Brand
WeChat. Mini-programmes are ambassadors, celebrities and other
essentially apps within the WeChat app public figures have brought the distance
that enable further functionality and between luxury brands and customers
closer, allowing them to build an
emotional bridge with the younger
“LUXURY BRANDS HAVE generation.
BEEN QUICK TO REALISE
I do think other brands can learn a lot
HOW FUNDAMENTAL IT IS from Gucci. But they’re not the only
TO BUILD A PRESENCE AND company succeeding in China. Most
REACH CONSUMERS ON traditional luxury fashion brands are
making a fair effort and reaping the
WECHAT AND INSTAGRAM.” benefits.”
27A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
What do you think is important for Reports increasingly show most
a Western brand to get right, when Chinese fashion buyers are starting
selling in China online? their product search in Tmall. Does
this mean Baidu has a less significant
“There are three main areas in which role to play in the discovery of apparel
Western brands need to focus: brands?
Firstly, they must consistently create “Last year, the Tmall Double Eleven
a sense of freshness, introducing new opening, the mobile side of the
designs frequently. It is important transaction surpassed desktop,
to innovate and adapt to consumer accounting for nearly 70% of the total
trends. This is particularly important transaction. There is no denying that
for the younger demographic who are more and more buyers are using mobile
increasingly spending more on unique apps to search and purchase, due to
pieces that they can use to express its ease and convenience. However,
their individuality. By launching more traditional search engines such as Baidu
products, emphasising originality and still play an important role in the buying
creatively celebrating occasions such as cycle.
New Year with limited and rare releases,
they can captivate and excite the very Consumers will use search engines to
spontaneous Chinese fashion consumer. get more information about brands,
products, price, reviews, services,
Secondly, they need to embrace digital shopping experience, reputation, online
wholeheartedly. Fashion consumers channels, to compare and reflect, before
are increasingly using mobile, video, making any decision. Even though
online content and KOL (key opinion mobile apps are playing an increasingly
leaders) to get inspired and discover important role in driving sales, desktop
new collections. A key ingredient here and mobile search engines cannot
should be WeChat, which can take up as be ignored. They present a great
much as 50% of fashion brands’ digital opportunity to deepen the engagement
marketing spend. Successful brands are of the user and build brand equity.”
already investing a large part of their
marketing budget online, and this is a
trend that we think will continue. “THERE IS NO DENYING THAT
MORE AND MORE BUYERS
Lastly, they should strengthen
the experience in traditional retail ARE USING MOBILE APPS TO
environments, by integrating with SEARCH AND PURCHASE,
online interactions and providing DUE TO ITS EASE AND
immersive experiences. New stores are
getting bigger and bigger, dedicated to CONVENIENCE.”
providing consumers with a one-stop
experience for shopping, entertainment
and leisure. Stores are after all great
places for consumers to really get
to know a brand and experience the
product, so a balance between offline
and online is still necessary.” Credit: Freer / Shutterstock.com
28A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
Key Opinion Leaders in China – should we believe the hype? What would be your
advice for brands who are considering engaging influencers in your country?
“I think you can believe the hype. However, be careful and don’t be fooled
with their amazing following figures, and
Consider WeChat. The dominant don’t necessarily believe all the claims
position of WeChat in people’s lives from their agents. Do your own research
is beyond the reach of other social and make sure the KOL is not working
platforms, with one billion daily active with too many brands already as that
users. WeChat allows users to have decreases their authenticity.
more personal connections with the
people they care about and therefore One last piece of advice would be to
its users have a higher level of trust in its look for long-term collaborations. To
content. Since WeChat is the most used choose an influencer carefully that
social media platform, collaborating truly embodies the brand and can be
with KOLs to promote products is a very associated over time to create a long-
good way to increase brand exposure. term halo effect.”
29A GUIDE TO SELLING FASHION AROUND THE WORLD ONLINE
CONTACT US
CheckOut 2
THE WORLD
A cross-function alliance for international e-commerce launch, expansion
and growth in any market on the planet.
We work closely with our clients to help them plan, manage and deliver
against their global targets.
obaninternational.com
getintouch@obaninternational.com
+44 (0) 1273 613400
salesupply.co.uk
info@salesupply.co.uk
+44 (0) 1223 790 538
infinityblue-marketplaces.com
INFINITYBLUE
driving marketplace performance
info@infinityblue-marketplaces.com
+44 (0) 203 8680 358You can also read
