5 Things You Might Have Missed This Week
By Georgia Buchanan
1. Fashion in an Age of Technology: The London Perspective
Sissi Johnson; brand strategist, tech advisor, and FashTech inaugural Summit moderator, kicked off this week with an excellent article in The Huffington Post USA on why the world needs to be keeping an eye on London when it comes to all things fashion tech.
Citing our inaugural London Summit as the hub of a multitude of important current discussions within the industry, Sissi debates “How can the world of data & science inform the work of app-happy retailers and designers on the front line of fashion?”, “How can retailers keep up with our ever-diminishing attention span?” and “Can STEM make fashion more sustainable?”.
To read the full article, click here
2. Is Fashion Fit For The ‘Sharing Economy’?
With the likes of Uber and Airbnb spreading like wildfire across the globe, accessibility seems key to the future of consumption as we know it. With the rise of cost-aware millennials, and a population enticed by the convenience and value of a sharing economy, it’s easy to see how global investments in sharing start-ups totalled more than $12 billion in 2015; more than double the investments in social media start-ups, according to Deloitte.
Fashion in its most classic form does not easily fit this new phenomenon. “It’s quite common to have clothing that costs three figures or four figures” says Arun Sundararajan, a professor at NYU’s Stern School of Business, and yet we’ll wear it once and never again. Hardly cost-effective. In the US alone, over $8 billion worth of clothing sits in closets, unworn, according to a report by online thrift store ThredUp. But fashion hasn’t been blind to this rise in desire for convenience and accessibility, and over the last couple of years we have started to see dozens of fashion companies entering the sharing economy fray, adopting a number of different business models to tap in to the growing opportunity.
Fashion rental services are spreading across the globe, with the likes of Rent The Runway (5.5 million members) and Girl Meets Dress allowing customers to borrow items for a set time period, typically at the cost of 10-20% of an item’s retail value. “You’re able to experience a trend without feeling horrible that you’ve paid all this money for something you can wear once or twice,” says Trisha Gregory, co-founder and chief executive officer of Armarium, an app-based luxury fashion rental service. For stylish Generation Z consumers, this type of ‘shopping’ is hugely beneficial as they can be consistently on trend without breaking the bank. Whilst you used to be able to get away with wearing the same outfit over and over amongst different groups of people, Instagram’s meticulous documentation of our lives means this is no longer a possibility. So the solution? Rent a new outfit for every occasion.
However, there are difficulties facing these sharing fashion services that don’t affect brands like Uber and Airbnb. Whilst the latter two “connects users with a marketplace of third-party controlled goods, meaning consumers can monetise their own unused assets, a fashion rental company must take on the role of the owner - purchasing and holding all the stock they rent out” (Helena Pike, The Business of Fashion). Not only this but they have to maintain that stock; dry cleaning and repairing etc., all of which adds to time and cost incurred.
Not only are the logistics serving as a barrier to fashion rental taking off, it is also down to the problem of actually convincing people to share their clothes with other people, or say goodbye to a beautiful piece of clothing after just one wear. Whilst many people will see the practical values to a service such as Rent The Runway, many people would still just rather outright own the contents of their wardrobe. I think it’s safe to say that renting clothes is never going to overtake buying clothes. It’s just a question of whether or not there is enough of a market for it to co-exist successfully alongside the standard shopping experience.
3. Luxury Brands x Email Marketing
Fashion and Mash wrote a report this week on ContactLab’s somewhat surprising discovery that only 30% of luxury brands are using email marketing to its full potential, despite it being proven as one of the most cost-effective forms of digital marketing. Whilst some brands, such as Burberry, Cartier and Armani are leading the pack on the “Email Competitive Map”, the overall results are less than impressive, and show a serious opportunity gap for these big name brands to improve their overall digital performance.
One major finding? Too many brands are not exploiting data collection to achieve full segmentation. “Achieving customer segmentation will always be a challenge but there remains a lot of room for luxury brands to differentiate in their emails and create more personalised campaigns. Simply sending generic content and treating all customers as one does not build a relationship with customers. Customer shopping habits have changed and they expect an integration of different channels as part of the omnichannel experience” says Marco Pozzi, author of the research. Something as simple as addressing your recipients according to their gender or title can help to boost your customer engagement hugely, as shown by Dolce & Gabbana and Armani.
Another way to improve your open rate? Targeted emails. “With the modern customers having an overload of content and often bombarded with emails, brands need to ensure the emails they distribute are relevant and thus capturing the attention of the consumer,” said Pozzi. Always assume your recipient is time-poor and give them just the key points, laid out in an aesthetically pleasing and easy-to-navigate format.
Additional ideas to get your consumer hooked? Katie Gavaghan at Fashion and Mash suggests integrating cross-channel communication more, for example, asking for ZIP codes and postcodes in order to be able to use them in conjunction with store locators. She also lists ‘buy now’ buttons and links to shoppable apps as elements that should be introduced.
The impact of effective digital marketing, of which email marketing makes up a large part, can result in a 40% increase in revenue, hence why all brands need to be implementing a strategic email marketing strategy that caters to their user’s needs.
To read the full Fashion and Mash article, click here
4. Fynd’s Fify: A Conversational Commerce Bot for Fashionistas
You may have heard of the term ‘conversational commerce’ before. Coined by Uber’s Chris Messina in a 2015 piece published on Medium, it refers to the intersection of messaging apps and shopping. In a world where personalised communication and experience are of paramount importance to market and sell a product, this very recent term is becoming increasingly more relevant. Messina predicted that “2016 will be the year of conversational commerce” and he may be right.
This week conversational commerce has made the FashTech news as Shopsense, a Mumbai-based retail technology startup behind the online fashion shopping app Fynd, has launched Fify; the world’s first fashion shopping “botfriend”. Essentially, a conversational commerce bot for discovery and transaction.
Social media is God in today’s millennial generation. However, research shows that people are now downloading fewer apps and are instead spending more time on messenger services. Farooq Adam, co-founder of Fynd, says: “People are shifting time. This time will be monetised by pure Internet companies and in this case primarily by Facebook. Messaging is the new platform and bots are the apps. We want to be on this channel before anyone and use it to scale massively and efficiently.” (inc42.com)
We have seen other brands and publications flirt with the idea of chatbots. Vogue started a whatsapp group for their readers, but it was less of a chatbot and more like a string of scheduled mailers. There was no genuine interaction. Fify is described as “an intelligent fashion discovery and transaction bot, which will have its own memory and personality to resemble a human being. She would be like a 20-something stickler for all things in ‘Vogue’. Her mission is to make the world a beautiful place where everyone is well-dressed and looks their best. She comes alive at the mildest opportunity of discussing fashion, styling & shopping!”
The founders’ main aim is to make Fify a daily conversation bot for people wanting to discuss all things fashion. Trained with different conversation tones, from genuine and novice to flirty, and with the ability to respond with GIFs, Fify should be able to present a wholly convincing personable and human conversational manner. The app will integrate with nearby store inventories allowing users to discover and follow brands they love, order products and get it delivered within hours.
Fify’s development is based on an AI/Bot engine (something that we can understand a little better having listened to Martin Peniak’s brilliant presentation on AI at our FashTech Talk last week!), Platform (memory), Distribution and Mobile Web. The stronger the AI development becomes, the more Fify will continue to evolve. “Soon she will behave differently with different people. She will remember your tastes and preferences and be context aware of what is happening in your world”, says Farooq.
Could this be the future of marketing and e-commerce? Watch this space.
5. Older Retailers In An Age of Disruption
Retailers are struggling. There is a desperate need to innovate in this era of disruption, and yet a worrying amount of retail executives are apparently refusing to accept the problems facing them, says Kasey Lobaugh, Deloitte’s chief retail innovation officer. It’s time for retail executives to face up to the fact that the type of disruption they’re seeing today is something new, and that they need to find a way to up their game or else get left behind. Instead of competing solely with direct competitors, they are now also coming up against smaller retailers and the problems arising with the consumers’ changing idea of value. As we’ve said time and time again; it’s not always about new ‘stuff’ anymore, it’s about new experiences.
So how can these retailers make sure they can still compete? Get to know the consumer, and get creative. In the end, it all comes back to the consumer, and retailers should be looking to become shopper-centric in every aspect of their business. “The most important thing is involving the customer in the build process,” says Aaron Dane, retail experience and innovation manager from in-store product location software provider Point Inside. “What I really appreciate is being side-by-side with the real users as you’re building the software.” They do this by testing products on customers in the development stages. “A lot of times you will build experiences around touch panels or putting an object on something or picking something up,” Dane explained. “The difference between changing your natural behaviour of picking up a shoe or a garment or putting something on a platform makes a huge difference in usability. So when you talk to the consumer, you really want to observe their behaviour and observe their natural movement for usability but then also ask them what they expected to happen.”
The older retailers can learn from their younger competitors who have innovated based on their customers’ needs. “It’s not just about making the stores fun,” said David Page, senior vice president of brand strategy and research at Rent The Runway. “It’s about thinking about what people come to the stores for and what we need to deliver when [they] get there.”