E-commerce for fashion brands: Global expansion, zero investment

E-commerce has clearly transformed the potential global reach for fashion brands. But simply making this season’s stock available online in a new market is not going to deliver much incremental value. Brands need to build up awareness in a totally new market, determine whether the bricks-and-mortar expansion should preempt or occur in tandem with the e-commerce offer, and quickly ascertain key market differences and synergies to inform strategy.

From the multi-million pound investment in marketing and stores, to the time it takes to build brand value in each new geography and the challenges of responding to different customer experience expectations, traditional expansion strategies lack both the agility and responsiveness required in a fast changing global marketplace. There has to be a better way to rapidly maximise the global opportunity while minimising both cost and risk.

Strategic expansion

Given the increasing volatility of the global economy, prioritising international expansion has become challenging for fashion brands. Agility and speed of response are becoming key requirements in a market that can be transformed virtually overnight by a celebrity endorsement on social media. In theory, the rise of the global digital consumer has transformed the ease with which brands can reach new target markets, but in practice, the challenge of raising brand awareness and building a market remains.

This model of global expansion takes time and demands a huge investment. Traditional marketing campaigns take months, even years, to build strong brand awareness in a country that has previously had no exposure, especially where marketers have had no opportunity or insight to refine the messaging.

Customer expectation

The differences in each market also create significant operational challenges. How can a brand identify not only the most valuable target audience but also determine how best to reach that audience in an unfamiliar environment? Furthermore, having found the customers, how can the brand gain insight into the different expectations in each market – from the way in which products are presented to the quality of customer experience, including fulfilment?

For any brand, the chance to forge a strong relationship with leading retailers within each geography can transform that speed of expansion. Leveraging the retailer’s customer base and market insight enables a brand to gain immediate access to the key customer base which, by default, is already drawn to the retailer’s e-commerce presence.

Global logistics

Growing numbers of brands are now exploring the evolution in global logistics, which now makes both national and international product distribution both low cost and rapid. Rather than investing in local marketing and brand awareness, brands can become part of a real-time network of retailers that supplements the traditional wholesale model.

A brand has the chance to make a significant noise in a new market from day one, by enabling the retailer to extend the range on offer without the need to invest in additional stock up front. Suddenly, instead of just the handful of products preselected by the retailer, a brand can also offer a far bigger subset of the overall range. Furthermore, access to real-time sales information across the entire retail network enables the brand to continually refine the offer to reflect the expectations of this new customer group.

This approach also fast-tracks a brand’s understanding of local market expectations and idiosyncrasies. A fundamental part of this process is a brand’s commitment to both present products and fulfil orders from its own warehouse in line with the retailer’s policy – a process that ensures the brand understands and meets local expectations immediately.

E-commerce: the future for fashion

In the increasingly fast moving world of fashion retail, speed and agility are becoming key. By building on the traditional wholesale approach to retail with real-time fulfilment, brands can enter – and leave – new markets in a matter of weeks, not months or years. Critically, taking a product-led rather than marketing-led approach enables a brand to leverage retailer’s local expertise and market presence without the constraint of limited range.

The brand can now combine fast-track access to new markets, insight into local customer expectations, and the chance to refine the product mix on the fly based on real-time sales data – taking the risk out of global expansion and achieing a significant reward.

Chris Griffin, CEO, Anatwine