In an industry of erratic consumer demand and short product life cycles, marketing in the fashion industry is a tough terrain to conquer. Add to that a highly fragmented social media landscape and you face a task that that may resemble Mount Everest. Believe it or not, there is a way to scale this beast.
The US Fashion Industry
It is important to understand the competitive arena of the fashion retail market and the major factors affecting the industry in order to stand as a leader in the marketplace for maintaining and identifying opportunities. The market suffered major setbacks following the global financial crisis. However, we are starting to see the market rebound, and growth across the board has been moderate at 4.2% (MarketLine Advantage via RMIT University private database). It is expected to grow even further over the next four years, so there is certainly potential within the market to expand.
As of March 2013 (according to MarketLine Advantage data of the US Apparel, Accessories and Luxury goods industry) there are two key competitive forces at stake. The first is new entrants in this sector. The industry growth has been moderate with low barriers to entry which means that new players are steadily entering the market. For new and existing players, it is important to establish and build brand equity whilst also building a switching cost for your customers. The second force is the intensity of rivalry. To protect your business you must ensure that you have a robust competitive strategy, a point of differentiation, and advertising regime.
So how do you work with these forces to ensure profitability? Well the answer is Social, Local & Mobile.
Social media is everywhere. It is a highly consumer driven platform that allows customers to connect and engage with your brand. Its growth has been phenomenal for a relatively new virtual concept. We would liken the hype of social media today to that of television years ago. The difference now between social and television is that social is much more affordable, measurable, and highly targeted toward your intended audience, assisting with the two identified forces. More importantly, if you’re a smaller company, the reduced costs associated with the platform will greatly enhance your marketing efforts.
According to BIA Kelsey, 97% of all consumers use online media to shop locally. By enhancing your local strategy, you’re raising your visibility as a business. Keep in mind the issue of intense rivalry within the fashion industry — this is how you make sure the new or the established local finds your company. By including a localized strategy you are standing out from your competitors.
No one can deny the rate of smartphone adoption rates in the US and the rest of the world. We see now that page views rates are declining on PCs and increasing on mobile devices. Consumers are dictating which brands they access through apps and GPS enabling in smartphones has only enhanced location precision.
With a mobile strategy in place this allows fashion retailers an exact method of targeting their customers. Mobile apps may be used to deliver promotional information directly to your customer. This offers engagement opportunities, data reconciliation for better customer servicing and branding connections for recognition and recall benefit. It also protects your business from rivals and the threat of new entrants taking market share by building switching cost as customers establish more of a direct relationship with your company.
Come One, Come All
A marketing strategy does not need to be a liberty afforded to only larger retail brands in this industry. No matter the size of your business, by implementing the most fundamental and precise tools your business can capitalize on market forces and protect your bottom line.
Social2B, in conjunction with the Accessories Council, will be hosting an informational presentation this Wednesday on the concept of SoLoMo. Should you wish to attend the event, please refer to our News and Events page for further details. Our presentation will be available on SlideShare after the event as well. We look forward to seeing you there.