Lessons from the Field: Taking Your Fashion Business Online

Rick Watson is the VP Operations for Merchantry, an Amazon Webstore Solution Provider. Merchantry provides a cloud-based marketplace platform that empowers retailers to launch and expand their own online marketplaces.

Fashion brands are increasingly seeking online outlets for their products and for good reason: U.S. online sales of apparel and accessories are expected to top $73 billion by 2016 and constitute 20% of all retail eCommerce sales. And yet the traditional fashion business model is optimized for brick-and-mortar retail—wholesale, seasonal orders that are placed by retailers before any manufacturing commences. We recently interviewed Martin Zagorsek, Partner at design firm Arch & Loop, to get a behind-the-scenes understanding of the challenges fashion brands face when selling online. The key takeaway is that fashion brands need to commit resources in three areas: inventory, logistics and content development.

Inventory
Fashion brands typically operate without inventory—they produce what retailers have agreed to purchase and very little more. While selling through their own eCommerce site necessitates the manufacture and storage of inventory, the gross margins on direct sales will be much higher than selling through the wholesale channel because the fashion brand can keep the entire retail margin. Furthermore, selling directly can provide valuable insight into customer preferences and demographics that can be used to inform fabric selection and design for future seasons.

Logistics
Selling and shipping individual orders to individual customers requires storage and working space, branded packaging (boxes, tissue paper, invoices) and staff to package items, arrange shipping and handle customer service. With apparel returns running at 20-30% of all items purchased, customer service is no small task. Technology plays a primary role here in ensuring that all parties can access the same information about an order and in automating customer communications. Many fashion brands are turning to third-party logistics providers to overcome these challenges.

Content Development
From photography to product descriptions and attributes, the content-development requirements for eCommerce exceed what brands are accustomed to providing to their retail clients. According to Zagorsek, photography, though expensive, is the most critical content item. Fashion remains inherently visual. He recommends fashion brands hire professional photographers and invest as much as they can in the photography. They must keep it consistent—using the same background, same distance from screen, same angles and same lighting. The styling of the product for the photo shoot goes a long way in conveying luxuriousness, quality and, as a result, the implied price point to the customer. Copy, while less important, is also less expensive than photography and easier to produce. Videos are trendy right now but Zagorsek recommends smaller brands avoid producing videos because their return has simply not been proven to be worth the investment; they should instead harness their limited resources to produce great photography.

While fashion brands face challenges when they first take their business online, a smart allocation of resources to inventory, logistics and content development can help ensure success.

Image credit: Robert Neff, “Omar Chatriwala”  via Flickr Oct. 11th, 2011 in Jarash, JO. Creative Commons Attribution 2.0 Generic (CC BY 2.0)

3 Reasons Your eCommerce Strategy Might Be Stuck In Neutral

Rick Watson is the VP Operations for Merchantry, an Amazon Webstore Solution Provider. Merchantry provides a cloud-based marketplace platform that empowers retailers to launch and expand their own online marketplaces.

As an eCommerce retailer, you juggle all sorts of challenges each day:

• Complaining customers (where’s my stuff?)
• Escalating competition (where did they come from?)
• Lack of website activity (not enough traffic!)
• Performance challenges (too much traffic!)

Retailing has never been an easy business. Couple that with the pace of technology change and it has never been harder to be a top-tier eCommerce retailer.

But when you entered the business, it all seemed so easy; set up a store, load your products and start shipping. What happened?

Here are three reasons your current retail strategy might be stuck in neutral:

1. Your competition manages technology better than you.
That new social sharing widget on your site is not likely to be the one thing that makes or break your business, so while it’s a good thing to implement, keep looking at how to constantly improve your online offering. The battle is won over the long term and whoever can roll out the most interesting and useful enhancements (those that customers actually value) can keep them returning. This requires the integration of technology into your long-term strategic plan.

2. You’ve lost sight of your goals.
Lost in the shuffle of running your business is your raison d’être: why are you here? What are your business goals? Have you strayed from your mission?
Try this simple test: Look at the things you have personally done in the last two weeks, and all of the enhancements you have made to your business in the last six months. Do these directly support your business goals or not?

If they don’t, this could be a clue as to why you are moving sideways—customers may not perceive you are true to your own mission.

3. You need more expertise in key positions.
Sometimes the problem is not technology or processes, it’s people—a topic not often addressed when talking with eCommerce retailers about their key impediments. While smart but inexperienced people are energetic, they often don’t know what’s possible and can spin their wheels in the wrong direction.

A single experienced eCommerce hire can change the entire complexion of your business and make all your investments more efficient.

Ultimately, getting your eCommerce business back in gear can require taking a step back and looking at the larger questions—including the role of technology in your company, your long-term business goals, and the people that are entrusted with the company’s direction. By pulling yourself out of the day-to-day mechanics of your business, however briefly, you can tackle the larger challenges and set your business up for long-term success.

Image credit: Titanas, “Toyota Auris 2007” April 13, 207 via Flickr, Creative Commons Attribution 2.0 Generic (CC BY 2.0)

Social Commerce: Optimizing Your Social Presence

Shanley Wright is the Marketing Manager for ShopTab, a leading solution for Facebook Stores and social strategy that drives sales results. ShopTab is a Solution Provider for Amazon Webstore.

You have likely spent months or years optimizing your website to drive search traffic to your website. As eCommerce professionals we have been conditioned by the online industry and by SEO companies that to sell products we must optimize around this highly coveted search traffic. Previous posts in this blog showed how to gain both search traffic and client conversion value from something as simple as quality product descriptions. With all of this optimization focus, can we apply these principles to our social presence as well, and yield new clients and revenues?

With a focused effort on key aspects of your social activities, you likely can! When we talk about optimizing for social we are referring to your social channels such as Facebook, Twitter, Pinterest, LinkedIn and Google+ (among others). In this post we hope to provide some key insights into how optimizing your social profile can impact your overall results.

Picture yourself shopping in your favorite shopping mall. Once you’re inside one of your favorite stores, take a look around—it’s been optimized for your visual and emotional cues. Savvy retailers have their items displayed in specific locations with imagery that can invoke emotional responses and engagement. Brick and mortar retailers have usually optimized their stores to make sure you don’t leave without buying something. Our optimization efforts online often mimic this approach with driving targeted traffic and leveraging imagery, descriptions and engagement options to move us to make purchases.

On the other hand, think of the purchases you have made because of conversations you’ve had with friends, business associates, or people that you consider an expert. This person may have been raving about a book that changed their life. Based on this testimonial you’re more likely to buy that book. It wasn’t something you planned on purchasing, but you did. Thanks to the power of persuasion and social influences, you were moved to make an unintended purchase. That purchase reached a new audience that would have never been discovered by traditional marketing tactics. This happens every day, so how do you make that happen for you? You need to socially optimize!

Optimizing starts with the implementation of a social strategy. This strategy will be created to drive the right and consistent set of activities for maximized social success. It provides a high-level map for organizational clarity on your overall objectives, expected impact, and resources needed to execute. Once you have this in place you can engage in tactics, measure results, and move to deliver on your objectives.

One of many tactics to support your objectives could be to open a Facebook store. This provides a perfect situation for social conversations about your products, and can even integrate other popular social platforms like Twitter and Pinterest. Look for ways to ignite quality conversations across all of your platforms.

The information you put out in the social universe has to be meaningful and engage your fans so that they will share and engage with you. The social marks and conversations are often included in your search rankings as part of recent updates by major search engines. This can help drive more web traffic to your products and services. Many clients are finding that referral traffic to their websites has been growing from their social sites. Additionally, it provides the opportunity for you to become an authority or expert figure for your brand which can bring more clients to your site.

What does all this mean for you as a merchant? Likely your website does a great job of selling products to your clients when they are in the shopping mall. However, a considerable volume of sales can be influenced during social opportunities such as a discussion with a friend, a business dinner, a cocktail party, on the golf course, and now on social platforms. Without social optimizing you will miss those unique opportunities that can be so meaningful for your business. It may be time for you to tee-off on social selling!

Image credit: Brendan Landis, “Asian Clothing Store” January 2, 2003 via Flickr, Creative Commons Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0)

mCommerce: Top 3 Features to Consider in Mobile eCommerce

Asha Wadher is the president of atmosol, an Amazon Webstore Solution Provider. atmosol recently launched a unique mCommerce platform solution that integrates seamlessly with Amazon Webstore.

Mobile commerce is the fastest growing sales channel in eCommerce. In 2011, 41% of mobile device consumers purchased products with their mobile devices. Analysts predict that trend will continue, with shopping via mobile reaching $119 billion in 2015—representing about 8% of total eCommerce sales. We’re going to see the landscape change drastically in just a few years and mobile will be threatening to take over more of the market as new mobile and tablet devices are released every year.

Only 5% of the largest e-retailers offer mCommerce sites or iPhone-optimized sites. 85% of merchants, however, say that mobile commerce is a key focus of their retail store strategy in 2012, up from 68% in 2011. If these numbers don’t include you, they might include your worthy competitors.

The trend and statistics suggest the need for not only a user-friendly “desktop” online store but the increasing need for a mobile store. This is likely how your customers are already shopping, and they are likely expecting a seamless mobile-optimized experience from your online store.

So what should your mobile site have as part of best practices? Here are top 3 must-haves in a good mobile commerce solution:

1. The design and build of your mobile eCommerce store should be seamlessly optimized and compatible with the most popular mobile and tablet devices.  That means giving consideration to not only the devices themselves, but also the operating systems, screen sizes, and everything else. More importantly, consideration should be given to the layout of your Webstore in both landscape and portrait modes as users tend to flip between the two for ease of use and navigation.  Utilizing HTML 5 and responsive design is one way to accomplish this.
2. Captivate and engage your audience via your mobile commerce strategy.  Provide your consumers with ongoing coupons and promotions on your mobile webstore.  In-store coupons, QR tags linking to discount offers, scheduled promotions, rewards and loyalty programs are all crucial to keeping them engaged and coming back for more!
   
3. Comfort your audience by ensuring your mobile checkout process utilizes best in class encrypted and SSL-based checkout and payment gateway.  Consumers want to be “plugged in” whenever they can, and there are free unsecured internet access points offered almost everywhere you go today. While a customer’s internet connection may not be fully secured, ensuring that your checkout pipeline is mobile optimized and secure can reduce cart abandonments, speed up the checkout process, and reduce a potential hacker from scraping any confidential information. For example, Checkout by Amazon Mobile offers sellers the same A to Z Guarantees and security as Amazon.com itself.

These are just a few features you may want to think about when creating a mobile Webstore strategy.  With the advent of new coding languages and standards, coupled with increasingly innovative smartphone features, there is an infinite and untapped potential your Webstore has to offer your consumers. No matter how small or large of a retailer you are, your consumers either will be or are expecting a mobile experience from your Webstore. Going mobile may now be as important as going online!

Image credit: Jhaymesisviphotography, “Texting” December 12, 2011 via Flickr, Creative Commons Attribution-ShareAlike 2.0 Generic (CC BY 2.0)

Facebook for eCommerce: It’s About Customer Retention, Not Acquisition

Any social media pro can tell you that every business owner asks them the same question: “How can I get more Facebook fans?”

There are lots of answers. Post on your wall more often, or less often, or support your page with ads (hold on to that last thought). But from where I sit, many people running Facebook Pages are missing an easy answer:

The surest way to get more Facebook fans may be to get more customers.

It seems backward, right? Plenty of businesses are after more fans assuming they can turn them into new customers. What these enthusiastic business owners could be missing, though, is that Facebook is at its heart a retention and a loyalty platform—not an acquisition tool.

The harsh truth is that unless you’re Taylor Swift or MTV, it’s unlikely that huge numbers of people will find your Page. You’re another grain of sand on the vast beaches of Facebook—which now has between 35-40 million Pages—and unless you’re investing in ads there’s probably only one group that’s going to find your Page, and then care enough to Like it: Your customers. Your loyal, wonderful customers.

The numbers back it up, too. DDB’s 2010 social media survey found that, on average, 84% of a Page’s fans are existing customers. Trying to convert all your fans into customers might thus be a waste of your time (and theirs, too).

But that problem is just an opportunity to refocus your efforts. Instead of focusing on sales messages, try using Facebook the same way you run an email campaign. Post about new products. Get feedback from your most dedicated advocates about what features they’re looking for. Make your Facebook Page a focus group for everything about your brand, and you just might get more value than if you drum up a few thousand fans who never intend to buy from you.

The best candidates to buy from your store are likely those who have bought before—and even better are those who also decided they like you enough to, well, Like you. Using social media for retention lets you focus on generating repeat buys. For many businesses, a majority of sales (sometimes as much as 80%) come from repeat customers, and yet this group tends to be overlooked. It’s true in theory that repeat customers are cheaper to serve than new customers; it’s also true in real life.

In fact, your best bet for acquiring new customers via Facebook may be to post content that these loyal customers share with their friends—thus mobilizing your customers/fans as a team of brand advocates.

So before you go investing your whole marketing budget in Facebook ads to get new fans, consider reaching out to your customers first. Let them be the core of your Facebook fan base. Then decide if you have enough to offer to non-customers (good content from a blog, for example) to even try to get them on board. You might be happier talking to just your loyal, happy buyers and focusing on bringing them back to your store.

And while you’re at it, you should go Like Amazon Webstore on Facebook. We, uh, need more fans.

Image credit: Ed Yourdon, “Catching up on e-mail…” July 29, 2008 via Flickr, Creative Commons Attribution 2.0 Generic (CC BY 2.0)

Consumers Spending More Online in 2012? Depends Who You Ask

The up-and-down economy in recent years has affected different groups in different ways. That couldn’t be more clear than in a recent PriceGrabber survey (as reported by Internet Retailer), in which 28% of surveyed shoppers plan to spend less online this year, 21% plan to spend more, and 51% plan to spend the same amount.

The result is a pretty static bell curve of spending—the top quarter will spend more, the bottom quarter will spend less, and the middle will stay the same. It seems to reflect consumer uncertainty about the coming year; it also may include some negative halo effect as shoppers are still feeling the pinch from their holiday spending. The survey was conducted in January and February of this year, with 933 online shoppers.

The survey lends a few particular insights worth noting:

• It’s the discounts: The report indicates that those who plan to spend more online this year do so because they expect better discounts online. That’s a nugget worth storing away—while we all strive to deliver better experiences online, many shoppers are still simply seeking price advantages. 36% of respondents who said they’ll spend more in 2012 will do so because of discounts; 46% of all respondents plan to use daily deals more this year.
• It’s a gas: Gas prices are responsible for two different shifts. It was reported last year that rising gas prices are driving consumers to shop online to minimize extra driving, but the new survey suggests that spendy gas is also cutting into discretionary income. 40% of respondents that said they will spend less this year blame rising prices for gas, food, and other necessities.
• It’s all online: Regardless of whether spending goes up or not, the survey indicates that the average shopper will make 53% of their purchases online (more than half!) as opposed to 42% in physical stores. Surprisingly low is shopping from mobile devices, which accounts for only the remaining 5%.

The fact that the survey doesn’t point to a reliable future makes planning difficult for eCommerce store owners in the short-term, but doesn’t change the long-range outlook. Time Magazine suggests that when Internet prices are combined with free shipping, shoppers have even less reason to choose brick and mortar.

Ultimately, shopping continues to migrate online. And hopefully that’s not news to anyone.

Image credit: CarlosVanVegas, “Mexico City – Museum of Anthropology” April 8, 2011 via Flickr, Creative Commons Attribution 2.0 Generic (CC BY 2.0)