Figures, fashion and e-commerce

Figures, fashion and e-commerce

Monday, 11 march 2019 | Redacción CEU

The development and implementation of electronic commerce is one of the great transformations that the fashion business is experiencing. Omnichannel has become a need in the face of consumer demand for a different service. Customers increasingly trust digital channels to make their purchases: finding the best prices, accessing a huge amount of references, making purchases at any time of day, accessing free shipping services, returning  products if they are not interested in them, etc. For its part, the companies which are specialized in this industry are beginning to understand that if they do not adapt to the new scenario, they may run the risk of disappearing.

 

The eighth edition of the Barometer Vente-privee Group-Modaes.es of Fashion Companies in Spain has evaluated the health state of the industry from the opinions of 300 fashion firms. This report points at the online channel as the most important medium in the long term in this business. It is true that the previous editions of this study already reflected the growing interest of companies in digital media, but this is the first time that this distribution channel has been placed in first position. Specifically, 32% of firms place it there, followed by 28% companies who point to the multi-brand format and 19% who opt for stores. The percentage considerably departs from the 18% which was collected in 2017 and the 16% in 2016.

In turn, 86% of companies in the industry recognize having started a plan to adapt to omnichannel, and only 3% of them claim to have completed it. This figure only confirms that this type of processes is not temporary, but they must evolve over time and in relation to the context. The technological development is unstoppable and contributes to making it practically impossible to set an end date for this kind of actions.

Another striking fact is that, in 2012, only 65% of the companies which participated in the survey  confirmed having an online store. Now, the figure has practically encompassed all the participants. Likewise, more and more companies place the online division as the main reinforcement area, ahead of other key departments like product, finance or expansion. In turn, the commitment to e-commerce also seems to contribute to creating more job opportunities. 63% of these fashion companies plan to increase their staff to cover the needs in e-commerce.

 

Figures, fashion and e-commerce

A new customer profile

The growing interest of the business world and, in particular, of the fashion industry in electronic commerce is due, in large part, to the consolidation of a new type of customer: the digital consumer. That fact is evidenced by the recent publication of the IV Study of Confianza Online & Showroomprive on Spanish Confidence in Online Fashion Purchase. This report, which was elaborated according to the answers of an online questionnaire of 710 users during the month of October in 2018, comes to the conclusion that Spaniards have a higher level of confidence in electronic commerce.

75% of the participants in this study confess having bought more in 2018 than in the previous year. 38% of respondents say they make several purchases per month, and 35% only in several times per year. The majority of these buyers spend somewhere around 50 to 100 euros per purchase, and, precisely, fashion products are the most demanded. Clothing and footwear are at the top of the ranking. Customers point out that the advantages they find when buying this type of articles online are: free shipping, product quality and easy returns.

Another reason that explains why online commerce has intensified is the lower number of incidents. 73% of these customers say they have not had any problems when making their purchases online. However, 26% reveal that they have experienced some logistical, return or labeling problem.

As Cesar González, consultant in WMS at Hardis Group, explained a few weeks ago in the event on e-commerce and warehouse management which was organized by The CEU IAM Business School: <<Returns management constitutes an integral part of the logistical offer of e-commerce>>. Digital customers reproduce new behavior habits that must be reflected in new business models imperatively. A common practice among these new digital consumers is the deliberate purchase of different sizes of the same product to return the one that fits worse. Of course, this entails a considerable multiplication of returns. Companies must carefully define their strategies to obtain an adequate return regardless of returns.

Fashion is not the only industry that maintains a close relationship with e-commerce. In the USA, the online sale of books, music and videos already reaches the overwhelming figure of 50%, according to the data of eMarketer. This firm considers that, although the online sale of automotive products accounts for only 4.2%, personal care products for 9.6% and food for 2%, it may experience a strong change in trend in the future. Another analysis carried out by Kantar Worldpanel also points to the potential growth of e-commerce in the sale of food and consumer goods. This tendency is mainly explained by the commitment of Alibaba and Amazon to online supermarkets and the investment in online sales of large chains as Walmart.

The CEU IAM Business School offers a training which is aligned with the continuous changes that the business world is experiencing. Those professionals who wish to specialize in the online  communication and marketing of products and services through the use of different digital strategies can request information about our Master's Degree in Digital Marketing. If they prefer to deepen their knowledge of new business models, markets and new ways of interacting with customers, they can check our e-Commerce and Logistics Management Program.

 

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