The Rise of Fast Fashion: High Street vs Online Fashion Retailers
Yet another high street brand was in the news recently to announce profits slumps and the closure of a large number of stores across the UK. House of Fraser is the latest fashion retailer to take a hit, but at the same time many online fashion brands are reporting positive sales figures and profits.
In this blog, we explore the contrasting fortunes of established High Street fashion retailers and pureplay ecommerce fashion brands. We also outline some of the ways that fashion retailers can ensure they succeed both online and offline.
The High Street takes another hit
So, let's take a look at some numbers. House of Fraser recently announced that it had taken the decision to close 31 of its 59 stores across the UK, including its flagship London Oxford Street store. This was the result of a 6.3 percent drop in sales in 2017. It's always sad when a business announces that it's having to close stores and make job cuts, especially for a business that has been operating for 169 years! But this is the sign of the times.
The death of the High Street was predicted a fair few year ago, particularly in the wake of the growth of online ecommerce giants like Amazon. ASOS' growth has certainly hit some fashion retailers hard. However, it's not just the pureplay brands that are impacting the High Street, as the ecommerce stores of long-standing retailers are seeing a lot of success and unless brands focus on innovating their offline experience, it's inevitable that their physical stores will suffer.
Earlier this year, New Look reported that it could close up to 100 stores, and this is just one of a number of high-profile retailers reporting closures and plunging profits. However, many fast fashion brands and online fashion retailers are seeing an upward curve in sales.
Online fashion brands booming
Around the same time that House of Fraser, New Look and other High Street retailers were announcing dire results, online fashion retailers like Boohoo announced soaring sales in the first quarter of 2018, with an impressive 53% increase in the three months to 31st May!
Boohoo are just one example. ASOS reported a sales growth of 22% in 2018 up to the end of June, leaving the likes of M&S, Debenhams and House of Fraser looking enviously at the contrasting sales performance of fast fashion brands.
The likes of ASOS and Boohoo have also received praise recently for their promotion of plus-size models, inclusivity and unedited (non-airbrushed) images of women modelling their clothes. They are seeking to be more real and display relatable body shapes, shades and flaws – including not shying away from cellulite, stretch marks and even back rolls.
Changing retail and ecommerce trends in the fashion industry
So, is this trend just down to a shift in shopping behaviours, with less footfall in physical shops and a preference of consumers to do their shopping online, or is there more to it?
There are obviously lots of different factors that have led to the successful performance of these online fashion retailers, compared with some traditional High Street brands we've mentioned, such as the rise in mobile shopping, a generation of young consumers seeking more vibrant and cutting-edge products and experiences, and the ease and convenience of making purchases online. But that doesn't explain it all. A good online performance, even for some of the more traditional brands we mentioned, won't necessarily save their bricks and mortar stores.
It's more about the bigger picture. Putting customer needs first and truly understanding what modern shoppers want. ASOS and Boohoo understand their target audience and many of their strategies are consumer-led. Inclusivity is just one part of this. A key focus on personalisation and integration with social media channels is also important. By growing a loyal, engaged and interactive tribe on Instagram and Facebook, the route to purchase is more focused, compelling and tailored to the customers' needs.
ASOS has given consumers even more incentives to shop online, using handy sizing tools and features to ease the decision-making process and a generous returns policy that takes some of the fear factor out of buying clothes that may not fit when they try them on for the first time at home.
It all makes the online and mobile shopping experience quicker and more convenient. Especially during peak sales periods, such as the Black Friday and Cyber Monday weekend, where lots of great deals are available online without having to face the mayhem and queues at the High Street stores and shopping centres.
What can brands do to improve performance on the High Street?
This doesn't mean that every High Street fashion retailer is facing plummeting sales and store closures. In fact, we're seeing more and more pureplay brands open up physical stores, to cater for shoppers who want to try products on in-store before buying online later. There are plenty of ways to improve your retail strategy to ensure both your physical stores and ecommerce website performance thrives. The key is to take an omnichannel approach and harmonise the online and offline shopping experience.
Here are just a few of the ways you can improve your offline performance with customer-centric, innovative and omnichannel strategies:
Enhance your in-store customer experience by utilising new technologies: Consider technologies like VR and augmented reality to create really engaging in-store experience.
Make payment quicker and easier: Improve customer experience in-store with quick-pay and flexible payment options.
Step up your customer service: Make sure your customer service team and in-store staff can replicate the service and information available on your ecommerce store, whilst empowering staff with iPads, apps and other technology, so that browsing and buying in-store is as easy and helpful as online.
Exclusive in-store deals: What better way to get people through the door of your bricks and mortar stores than to offer exclusive or unmissable deals that can only be redeemed in-store? Whilst brands often offer sitewide deals and promotions, look after your physical stores with incentives for customers shopping the High Street, utilising geotargeting and store locators to help customers find their nearest store.
Events: This is something that fashion brands are usually good at, but in-store events (particularly around new product launches) are an effective way to not only incentivise shoppers to head to your stores, but it can boost awareness and help to create a buzz on social media channels – especially when leveraging influencers. Why not tie in products and promotions with added incentives, like make-up tutorials, trials or other fashion and beauty offerings.
Single customer view: This is where you can really harmonise your offline and online customer experience. Investing in a platform which offers a single customer view, means retailers and marketers are able to create more relevant and tailored experiences and communications with customers, as offline and online behaviours, preferences and purchase history are pooled together. This enables merchants to create more continuity for customers and enhance marketing campaigns with more granular targeting and personalisation.
Zara is a good example of a fashion retailer which has taken an omnichannel approach and achieved success both online and offline. Zara is one of the few established brick-and-mortar apparel companies to be thriving in today's competitive fast-fashion climate, reporting sales increases whilst the likes of H&M report large profit slums. The business has a unique strategy for competing with online fast-fashion brands, proving that brick-and-mortar retail can still thrive!
If the new generation of shoppers want to embrace the latest products and trends, with their thirst being driven by social media activity and influencers, fashion retailers need to evolve and innovate in-store and online. Zara has succeeded in keeping up with the expectations of consumers inspired by fast-fashion, with tactics such as:
- Regularly rotating and refreshing its store layout, shop window displays and mannequins
- Creating beautifully shot products and editorials, both online and offline, promoting urgency in consumers to visit stores regularly
- Using discounts sparingly and for limited periods, especially for new products, to uphold brand reputation and integrity, plus to ensure more regular purchases and visits rather than buying patterns based around peak periods
It's about perception too. Nivindya Sharma, Director of Retail Strategy and Insights at fashion forecaster WSGN, stated: "By bringing in regular but low volumes of products, Zara maintains regular levels of newness but creates perceived scarcity, creating demand for its newness." (Quote & image source: Business Insider)
So, it's not all doom and gloom for the High Street and traditional bricks & mortar fashion retail brands. Retailers just need to be more innovative and take an omnichannel approach to their strategy, to ensure both their online and offline stores thrive. This doesn't mean abandoning your principles or brand ethos, retailers must adapt and learn from fast fashion and the changing needs and behaviours of the modern shopper.
- How to Harmonise the Online and Offline Shopping Experience
- How to Create an Omnichannel Personalisation Strategy
- How to Win at Omnichannel Retail: Lessons from 5 Top Fashion Brands
If you want to learn more about omnichannel commerce, talk to one of our expert strategists and see how we help you to plan an effective omnichannel strategy!
Space 48 is a leading UK ecommerce consultancy and website development agency, based in Manchester. We specialise in Magento and Shopware platform development, UX and ecommerce strategy. If you have any questions about anything discussed in this blog or if you'd like to chat a project through with us, get in touch or book a free consultation with our ecommerce experts. Or why not explore our range of ecommerce audits and assessments to pinpoint key grow opportunities and areas to improve ecommerce performance?