A selection of fashion retailers and IT insiders got together to discuss how they are capitalising on social media, in-store technology and customer data.
With high street conditions tough as cash-strapped consumers rein in their spending, fashion retailers are looking for innovative ways to boost business. This means focusing on newer channels such as social media, investing in the latest technology and encouraging its adoption among staff, deciphering the wealth of data captured and turning it into a meaningful sales tool, and also targeting international markets for growth.
These were the challenges identified at the Drapers roundtable discussion on innovation in fashion, in association with product lifecycle management and computer-aided design and manufacturing firm Lectra and m-commerce specialist Mobile Money Network (MMN), held at London’s Haymarket Hotel on October 2.
One of the key debates was around the true value of social media for fashion retail. The Drapers survey found that for more than half of respondents, the priority when it comes to social media is customer engagement and customer relationship management (CRM), with marketing and generating peer-to-peer recommendations also featuring prominently.
This message was broadly echoed by the attendees, who agreed that social media sites are more about starting a conversation with customers rather than as a direct sales channel. Hugh Raeburn, head of IT at Reiss, said that for the premium retailer the medium isn’t about making money. “For us, social media is for understanding the customer,” he said.
Nadine Sharara, head of ecommerce at shirt retailer Thomas Pink, agreed: “It’s about engagement and trying to understand what the conversation is all about. We don’t really use it to try to sell.”
Charlotte Ellis, head of strategic development at womenswear chain Karen Millen, agreed: “Invading that space isn’t right, and I don’t think it ever will be a direct sales channel because it really is about allowing the customer the opportunity to talk about your brand.” But she added, with a note of caution: “If [feedback is] negative, you have to listen and put it right.”
However, Nick White, marketing director at MMN, suggested there would be a point where customers may want to buy, but that potential sales are likely to fall through “because it’s such a poor, slow experience after that point”.
Lou Ashton, international manager at womenswear chain Monsoon, agreed there will always be some who want to shop directly via social media, but said the real business case comes from capitalising on the medium as a rich source of consumer data.
But qualifying the real value of social media by distilling that information is still some way off. “We’re not capturing it as well as we could do. At some point we’re going to have to quantify exactly what it’s giving us,” said Karl Doyle, director of kidswear at Marks & Spencer. Like many, M&S is investing in its social strategy and its social media team has doubled in the past year. But, according to Doyle: “We’re going to have to have some kind of IT investment to be able to capture information and digest it. I think it’s inevitable, [though] it’s just a question of timing.”
MMN’s White advised that in order to sell via social media platforms such as Facebook, retailers need to collaborate to offer a single “universal and simple experience”. He said:
“If you paddle your own canoe, you don’t get very far. However, if you can come together and offer a universal solution, you might find that you start to see greater sales conversion.
“I think social media will generate a lot of commerce. I know that I will buy from my friend’s recommendation more than from your advertising, and that’s crucial.”
In store, innovations such as iPads and kiosks are taking off as retailers open up their full inventories to improve sell-through rates. Ashton said that for Monsoon it’s about upping conversion: “The fact that somebody would leave your store just because you don’t have their size or a particular colour is frustrating. It’s a quick win if you can fill that gap.”
One of the upsides of click-and-collect, according to M&S’s Doyle, is that it drives in-store footfall. “The challenge is how do you increase dwell-time once they’re in that store? It can be turned into a big opportunity,” he said.
For some stores, such as premium retailer Jaeger’s two units in Canary Wharf, click-and-collect has revolutionised the way consumers shop. “They are our biggest multichannel stores. Everyone sits in their office, orders for delivery in store, and then pops out to collect in their lunchtime. We have product in there but they’re not interested,” said Jaeger marketing co-ordinator Millie Graham.
There was general agreement that the rise of smartphones will offer greater opportunities, such as sending welcome messages as a customer arrives in store, or special offers while the customer walks through the store.
MMN’s White advised ambient media marketing techniques, such as a hanger with a barcode on the rail or in the changing room in case a particular size is out of stock.
However, retailers also need to train staff to use this technology, a message echoed by 38% of respondents in Drapers’ survey.
Ipads and kiosks both feature in M&S’s newly opened Cheshire Oaks store, with kiosks proving particularly successful, but Doyle said some training was needed: “We’ve had to train quite a lot as you can imagine, [because] in M&S a lot of the store staff tend to be a little bit older. But they’ve embraced it as much as some of the younger ones.”
When Karen Millen rolled out iPads this year, there were concerns they would be lost or damaged, according to Ellis. However, staff’s fears were unfounded, and customers “loved” the technology and being able to order from the full inventory. She added: “In terms of back-of-house, it’s really enhanced our visual merchandising guidelines, being able to provide stores with an enhanced visual focus in terms of what the brand is trying to convey.”
Staff at Jaeger were similarly apprehensive, said Graham. “Our store staff were terrified of them, and we had to make a tutorial video. But they’ve been really successful and we’re going to roll them out.”
The issue of how sales are attributed is often a concern among staff. Doyle agreed M&S store staff had been suspicious of in-store technology, but that introducing a John Lewis postcode-style model, where sales are allocated to the store, has helped staff to “embrace” it.
Judy Gnaedig, director of strategic projects at Lectra, spoke of some of the key changes in the fashion industry, due to collaborative enterprise technology, known as product lifecycle management (PLM), which helps all participants working within the same business process to collaborate and share the same information in real time. Designers for example are able to have access to more of the product development activities, thus widening their skill set.
Francesca Herman, head of merchandising at lifestyle etailer Surfdome, agreed, claiming analytical skills are a must. She told the group: “There is a lot more analytics to do in the role now because of the amount of better reporting you can get out of the new systems.”
Lectra’s Littlewood said that while most brands and retailers are doing a good job of optimising their back-office systems and processes to respond to the ever-increasing traffic via ecommerce applications, there is limited connections to their product development systems.
The attendees agreed that information overload and ‘analysis paralysis’ is a real issue. M&S is going through a transition period, moving from 15 systems that don’t talk to each other to one system. Deciphering data will be the problem, said Doyle: “Before you know it you’re spending loads of time getting data and not enough time doing something about it.”
Monsoon’s Ashton advised adopting a “road map” point of view and tackling it one step at a time, rather than completely changing everything a retailer does straightaway.
Drapers’ survey also highlights the need to improve processes and communication within the product lifecycle. The survey found that 38% of respondents believe it could be improved every step of the way, while a further 24% say communication could be made better between designers and suppliers.
Such sentiments were echoed by M&S’s Doyle, who pointed to iPads’ ability to improve communication between designers and suppliers, allowing both parties to change a design at the same time. “Those sorts of things fundamentally speed the process. If we all want to be quicker, it’s about talking to each other and making decisions as quickly as we can.”
Littlewood said the challenge facing many organisations is that they now have more data to manage and share across the business. “Having the right information available to the right people at the right time is essential.
“Quick and easy searching, tracking and reporting is key, as this enables informed decision making and increased flexibility and responsiveness, as well as driving quality and time-reduction initiatives. All of this can only be delivered via a fully integrated PLM platform with a holistic approach to associated people and processes.
“Evidence shows that more and more European fashion companies are realising this, and are responding accordingly.”
Social media is also providing a rich source of instant feedback, said Thomas Pink’s Sharara: “The design team is getting direct feedback from customers on the collections. And that may have an impact on the design process as well.”
The morning finished with the hot topic of international expansion. Attendees agreed that brand consistency, especially online, is a must, as are local currency options, delivery and cultural references.
Reiss’s Raeburn said ecommerce has been a game-changer in terms of global expansion: “The bricks-and-mortar model was quite simple: you’d look at an international market and ask yourself, ‘How much do I know about it? A lot, a little, or not at all?’ If you knew a lot you’d do it yourself, if you knew a little you’d do a joint venture, if you knew nothing you’d do a franchise. Online has completely changed that.”
However, entering new markets means opening the floodgates and allowing a wealth of new data to come rushing in at a time when retailers are already struggling with the glut of data at their fingertips. The opportunities may be vast but serious challenges remain.