Eric Chemouny, Senior Vice President EMEA of Mirakl, gives his view on the IMRG Fashion Connect event 2016
The recent IMRG Fashion Connect event in London served up plenty of food for thought for the fashion industry, with interesting market data, and comments from attendees. Much was discussed in terms of the online shopping experience for fashion retailers including sales, mobile commerce and the thorny issues of abandoned transactions. One of the most interesting stats I saw was on Black Friday, which in the UK was by far the biggest sales day of the whole Christmas period. Not only did Black Friday prove to be the biggest day in the retail calendar, but Amazon UK was used by half of online shoppers, with household name retailers trading a much smaller percentage of the online market for their goods (typically under 10%).
It was very interesting to discuss established Marketplaces such as Amazon with attendees, many felt they understood the role of the online marketplace and how being on a site like Amazon can help lift their transaction volumes, but this underlines one of the big misunderstandings about marketplaces: Retailers have the opportunity to build and run their own Marketplaces – being on a third party’s Marketplace is not the only option. Department stores, fashion retailers and fashion brands in general should not just rely on Amazon or other big marketplaces, grabbing low revenues and having a lack of control of their relationship with the customer and taking the risk of poor customer feedback.
They should federate around their significant brands an ecosystem of sellers, generating more revenues and having direct impact on their customers’ expectations.
A Marketplace is a powerful e-commerce channel for any retailer, bringing together buyers and sellers under that retailer’s brand. Many retailers in fashion are laser focused on improving their profits and margins through constant website tweaking, implementing click & collect offerings or adjusting their supply chain to enable drop shipments, but all of these changes offer only small incremental benefits. Building a marketplace, rather than simply operating on one can be a powerful way for any brand to extend its reach and quickly boost margin and profitability.
Building a fashion Marketplace using established technology, can be fast and enable a brand to quickly take sales directly from consumers, but not just for its own products. What about accessories, footwear, coats, make-up and even storage solutions – all the things a consumer might want. The power of the Marketplace is being able to bring other categories from new suppliers into your retail experience without needing to understand those products in detail, hold stock, or make substantial and risky investments. A Marketplace becomes a rich, one stop shop for consumers that they want to revisit because of its diversity, and your suppliers will also benefit from increased sales and exposure. Adding new products and suppliers is easy and helps drive repeat business, as well as new buyers, all the time increasing gross margins by avoiding increased costs.
Outside the UK, Marketplaces are thriving. In France for example, Amazon has 9 or 10 large competitors, all of whom are a success story. For the fashion conscious UK consumer, if they love your style, and they can come to your online Marketplace, buy your dresses and buy great accessories that you recommend, why wouldn’t they? As fashions change, a Marketplace gives you a way to quickly move with the market, expand and change categories, and excite your customers, at no financial risk.
Building a Marketplace is a fast process, and doesn’t need an army of experts to develop or maintain. If building your margins and customer base is a priority over the coming years, then a Marketplace, could well be on the fashion pulse for you, rather than grappling around for tiny marginal revenue increments
Written by Barry Murphy
Barry Murphy is the Director of Content and Product Marketing at Mirakl. In this role, Barry leads the alignment of Mirakl's offerings to market needs for the next generation of online commerce. Barry previously ran product marketing organizations for X1 and Mimosa Systems (now part of HPE). Barry also had a highly successful stint as Principal Analyst at Forrester Research. Barry received a B.S. from the State University of New York at Binghamton and an M.B.A from the University of Notre Dame.