The internet has revolutionised the way businesses operate and consumers buy. In 2014, online sales were reportedly up 17% and offline retail sales down by 11%.
With this trend unlikely to change, the internet is a crowded place and staying innovative is paramount. So brands are mixing and experimenting with offline offerings, integrating showrooms, storefront and web.
However, there are aspects to consider for online fashion businesses wanting to take the plunge into the offline market.
Diversifying into offline creates opportunities for more consumer engagement and building stronger brand loyalty. However, becoming an omnichannel business means ensuring that the in-store and online consumer experiences seamlessly translate to a unified message.
Pop-ups are a great way to dip a toe into the offline experience. The short-term leases minimise the risk, and the flexibility to relocate offers brand exposure to new customers without a capital intensive expansion.
However, communities require different inventories, styles and store formats and integral to the investment should be a strategy to grow online sales.
Brands are mixing and experimenting with offline offerings, integrating showrooms, storefront and web
In store, brands are able – through analytics technology – to gather hugely valuable customer data. Technology also aids that unique consumer experience, and brands have started to use tools such as augmented reality and 3D printing.
Financially, businesses should seek advice on negotiating lease terms, premiums and budget for capital works, factoring these costs into cash flow forecasts. The business should keep detailed records of the fit-out work to maximise a capital allowance claim.
Other costs to factor into the cash flow are systems to manage inventory, gearing up on sales staff, staff training – especially if the team has never had to deal with consumers face to face – and what technology to invest in, including payment systems.
In gearing up for an offline move, a company should have clear metrics on sales conversion to cover the upfront investment that is required in setting up their offering.
Once up and running, performance should be closely measured against the budget. An agile strategy shoulc be deployed to drive sales if performance does not meet expectations.
Whether through a pop-up or a more permanent store concept, businesses that can successfully unify their online and offline offerings will reap significant rewards.