Why Fashion Brands Should Have Their Own eCommerce?

Introduction

With growing ecommerce in India, fashion and lifestyle category is evolving as biggest gainer. Globally fashion and lifestyle has emerged as leading e-Commerce category, so shall be in India. However, there is still slow participation of fashion brands into this new channel of commerce. One of the key concerns of brands remains choice of format for e-Commerce. With rapid growth of market places like myntra, flipkart, amazon, retailers are bound to think if they sell on marketplaces or create their own e-Commerce shop. But is it really a matter of choosing, or it is both that makes it a right e-Commerce strategy.

Further in the article we shall explore a comparative analysis on, if fashion retailers shall opt for selling on marketplaces or create their own e-Commerce shop.

Having said above, one fact is still quite clear that as online grows; consumers are changing how they buy and may be the answer to above question is in looking from the customer view.

Indian e-Commerce

This decade has been quite a ball for online commerce, with rise of some iconic e-Commerce market places we all know, myntra, jabong, flipkart, amazon, shopclues, etc. Also past few years has seen increased participation of retailers setting up their online shops, or take a serious step towards same like Shoppers Stop, Arvind brands. Table below show how

For fashion brands and labels to reach out to relevant customers through major marketplaces, exclusive fashion market places seem to be the ideal choice. These fashion marketplaces host both online only and offline and online brands. Below is a snapshot of fashion brands who are available online only, and the ones who cater through offline and online channels.

Omni-Channel Way

Selling on marketplaces and having web are integral part of omni-channel. Omni Channel theory encourages brands to enable themselves on all the channels where consumer can buy, however in an integrated and seamless way. The rationale behind this approach is that your consumers would need options of going to a market place and aggregating your purchase, while they would also enjoy shopping at your own website in best experience manner. Hence keeping consumers in forefront, Omni Channel approach guides a brand to enable itself on both marketplaces and own website.

As per the below consumer purchase journey, marketplaces play a key role in Awareness and Research, while Purchase, Fulfillment and Loyalty, they are more happy doing directly with brands.

Marketplaces are also common in offline world, like Shoppers Store and Shopping Malls.

Comparison:

Opportunities on selling through a Mono Brand e-Commerce:

• Exclusive branding experience. They are offering design language, ( design language, showcase, buying experience)
• ROI from marketing efforts: ROI from marketing can drive the traffic via marketplaces then having an own mono brand store. Online brands and offline starting online are showing tremendous increase in traffic as compared.

Custom Clothing : www.satyapaul.com , www.tailorman.com

Opportunities on selling through Marketplaces:

• Allows new opportunities for overseas sales — there has been noted online marketplace growth in the categories of fashion, home ware, pets and sporting goods
• Offer opportunities to establish new trading partnerships with traders and suppliers, either within your supply chain or across supply chains

Challenges on Mono Brand e-Commerce:

• B2C Supply Chain handling — Warehousing, Logistics — Forward and Reverse
• CapEx for tech and infra
• OpEx for skilled manpower, tech and operational infrastructure

Challenges on Marketplaces:

• % Commission sharing with Marketplace — Marketplaces can charge commission on every sale and fees can vary from site to site. Before selling your products on a marketplace, make sure you understand the marketplace’s pricing structure. Should have a look on pricing structure on different providers.

*Marketing fee varies a lot depending upon existing brand value, perception, number of years, repeat customers etc. Can be very low as well if it is a well known brand.

**This is a fixed amount so percentage may vary depending on ASP

• No Customer Ownership — The online stores may impose restrictive terms and conditions in terms of how you can communicate to customers.
• No Merchandising control — Branding, categorisation, product selection, etc
• Custom Photoshoot Freedom: Due to restrictions in policies, all product photographs have to be uniform across brands. Now, this doesn’t help the seller differentiate from others.
• Price Control: Minimum order plus Shipping date determines the final cost of the product. Such restrictions will end up discouraging customer to make purchases.
• Custom Packaging: The packing is completely controlled by the marketplace, and rightly so. But, the sellers will miss out on a golden opportunity to deliver a branding experience in packaging products to grab attention and establish the brand.

• Brand Dilution — Brand shares the shelf with other private labels, or brands from different segment.

Challenges of Setting up and Managing an e-Commerce Store

Opportunity posed by setting up an e-Commerce site and managing multi-channel sales creates a lot of challenges:

• Setting Up A Robust Online Infrastructure: To understand how to get the right kind of site up and running. And, mostly to manage the site with product additions and subtractions every season. This is bound to take a lot of resources to deliver the best online experience. Factors such as Product Cataloging and Photography, Offline and Online Store Integration, Order Processing, Payments, Taxes, and Logistical Aspects have to be addressed as well.
• Marketing and Customer Engagement Cost: Sellers will have to devise an effective and a comprehensive digital marketing plan to promote the site and engage visitors. This requires skilled manpower.
• B2C Operations: All the brands at present are tuned to supply in bulk to either their stores or marketplaces, they have less capability in handling warehousing, packaging, and logistics at each item level.

Opportunities through an Exclusive e-Commerce Store

• Reward Loyalty: Staying relevant to loyal customers through delivering the Omni-channel experience and building brand affiliation.

• Targeting Newer, Potential Customers: When making repeated purchases, we crave for exclusivity in products and shopping experiences. Through a flagship eCommerce store, the seller has the opportunity to attract and target potential customers, and retain them.
• More Control Over Design: Fashion products speak and echo current trends. So should the canvas you are selling your products through. An exclusive webstore is the right platform to match the uniqueness and dynamism of your fashion products, with an equally impressive and an engaging online store. The shopping experience will drive the brand experience. Also, you get to take care of vital technicalities such as SEO and other digital marketing aspects.

Communication of brand story is not possible on marketplaces and while it can be done on Brand ecommerce webstore using lookbooks, campaign shoots, behind the scenes videos etc.

• Fewer On-page Distractions: On your site, the visitor is a captive audience. No distractions from pop-up ads or cluttered shopping pages. Plan your design to make it user-friendly, not just eye-popping and heavy graphics and JavaScript.
• Customers Recognise The Shopping Experience: If your site is well planned, capable to deliver the ideal user experience, customers will take notice of the effort. This helps them visit your site more often and spread the word around. Let us put it this way, the quality of your site should match that of your creations to deliver the best consumer experience.

Every minute details of user experience can be controlled; font, name of the product, style notes, navigation, product images, up selling, cross selling etc. This cannot be achieved on marketplaces.

Other Considerations

Marketplaces such as Jabong, Myntra, etc. are additional channels to sell. But, they are not the ideal destination. Alarmingly these marketplaces have their brands and they provide maximum priority to their own labels.

Branding Perspective:

• Mono Brands & Marketplaces:

When mono brand e-Commerce tries to compare itself with a marketplaces, it’s not only making a mistake but wasting its precious time. Considering that a multibrand eshop has a wide stock of products this may be the main reason why Google is ‘giving’ it a better position over other monobrand eshops; it’s because every new released product counts as new web content and this is considered as valuable information by Google.

Another difference is the quantity of brands contained on each kind of e-Commerce: while monobrand appeals for traffic with a unique brand keyword, marketplaces engages the users by different brand searches.

If you manage a mono brand e commerce don’t pretend to compete with the ‘eshopping centers’ and start working on a good plan of attack:

• Growing a brand from a custom communication strategy
• Improving the brand positioning with SEM and display campaigns
• Trust on a good Community Manager
• Welcome your users back with a good and well managed search engine.

Once your customers find you appealing it is paramount to offer them the best user experience and make sure they will come back and back again.

In order to create a brand position strategy in marketplaces, you must first identify your brand’s uniqueness and determine what differentiates you from your competition.

Positioning:

• Marketplaces is effective at extending your visibility whether personally via social networks or the content you distribute via publishing platforms such as blogs and youtube, it can also amplify anything you do in the physical world i.e. people tweeting about your amazing key note presentation, or instagram photos of you at a networking event.
• Determine how your brand is currently positioning itself
• Identify your direct competitors
• Understand how each competitor is positioning their brand
• Compare your positioning to your competitors to identify your uniqueness
• Develop a distinct and value-based positioning idea
• Craft a brand positioning statement
• Test the efficacy of your brand positioning statement

Should build your own e-Commerce

Pros:

• More control over design, marketing and SEO
• Fewer on-page customer distractions
• Media and customers take you more seriously

Cons:

• You have to know what you’re doing if you’re not familiar with web design, making your own site can be a recipe for disaster. Not only will you want your site to just generally look nice, but it’s also crucial to avoid a number of usability pitfalls.

For example, you need to have an easy-to-use shopping cart, preferably from a trusted third-party platform that keeps on top of changing financial regulations, and an easy way to add things to your cart. You’ll want your site to load quickly and to be secure, and you’ll want a robust SEO strategy. As such, unless you’re a designer yourself, hiring one may be an important added expense.

• Increased marketing tasks
• Web competition

Key Considerations before You Start

As we have established earlier, there are quite a few challenges in setting up and managing your own eCommerce store. You may either choose to invest heavily on manpower and technology, or a prudent way to go about is to tie up with an END-TO-END eCommerce technology solutions partner who can manage, innovate and drive your site, while allowing you to channel your resources to produce great products.

Having a brand eCommerce webstore may not provide an immediate ROI, however investing today will be incredibly beneficial later, and is indispensable if you want to build a successful brand. Maintaining a fully functional eCommerce webstore is hard and it is prudent to find a right service partner to do it.