Got-to-have-it shoppers willing to trade expedience for ambience


From September 2007

By Fred Minnick

Forget the fitting room. Consumers are trying on Giorgio Armani and Prada while seated at their computers. The fashion e-commerce sector is booming, according to research firm Forrester. Its recently published “State of Online Retailing” indicates that online fashion sales are expected to reach $22.1 billion this year, an increase of nearly 21 percent from 2006, and apparel, accessories and footwear trails only travel in terms of total online sales.

“Traditionally, we’ve comped the first quarter at 40-plus percent,” says Edward P. Foy Jr., CEO of eFashionSolutions. “We just don’t believe [this level of growth] is going to keep happening, but it has for the last six years.”

eFashionSolutions is a full-service e-commerce fashion company whose clients include DKNY, Rafé, Oscar de le Renta, Leiber, JLO, Phat Farm and Baby Phat. While using its clients’ URLs, eFashionSolutions is essentially a one-stop shop for online retailing: It stores clients’ merchandise in a warehouse, digitally photographs models wearing the apparel, mans a call center and executes live chats and e-mail. It also offers clients full customer service care, including returns management, payment processing and logistics.

Foy, featured by Entrepreneur Magazine in its 2004 “Young Millionaires” issue, says running a profitable fashion site “boils down to getting things live very quickly, making sure that it’s prioritized based on what’s selling and prioritizing your workflow to get the hot items constantly feeding on the site.”

Premium clothing designers have begun offering their apparel online, in some cases skipping traditional stores altogether and marketing directly to the consumer.

“The designer customer seems to be perfectly happy to shop online, which is a little surprising because of the price points and the difficulty of fit sometimes with designers,” says Dianne Starnes, a retail and fashion consultant who helped create the online clothing portal MyShape.com.

Foy says luxury consumers were a little slower to embrace online shopping because they are accustomed to the ambience of their favorite high-end stores. Now that they have come around, he says, it has become the fastest-growing segment for online clothing sales. Now, “the challenge is there’s not a lot of selection on these luxury sites.”

But niche items are precisely what online luxury customers – primarily 25- to 45-year-old women – are looking for. Just don’t expect this shopper to come back if you don’t give her a positive experience.

“The investment you put into customer service, digital photography and production … pays off because she comes back if she has a great experience,” Foy says.

Seeking the next new thing
“Fashionistas” visit luxury designer sites more frequently than regular shoppers, hoping to get a peek at the next new thing. Designers ship new apparel to eFashionSolutions biweekly or monthly, he says, because these high-end customers really “want newness constantly on the site, and they’re looking for special fashion-driven products vs. your basic commodity items. We literally see a spike in sales whenever we get a new shipment.”

Bernt Ullman, president of lifestyle clothiers Phat Farm and Baby Phat and a former executive of DKNY, says designers have become so good at offering “new things” that “quite frankly, it’s funny. We have solved that piece so well online that it’s actually becoming a challenge in some of our international businesses.

“We now have products available online before they show up with any of our international distributors,” he says.

Then there’s perhaps the biggest challenge of all: Convincing a customer to buy premium clothing without making sure it fits. The answer to this quandary is good photography, Foy says. That mentality has helped procure a 13 percent return rate for his clients.

“We don’t just put a photographer in there with a camera in his hand,” he says. “The photographer has … a stylist that’s saying, 'O.K. model, here’s what I want you doing. Photographer, make sure you get this highlight right here -- this triple-needle stitching is key.’

“Consumers of fashion want an emotional connect,” Foy says. “That all happens visually as much as it happens from a content point of view.”

Because they receive complete management services, the retailers and designers that work with eFashionSolutions are able to focus on merchandise and marketing strategies.

“We put together a buy and the client helps to determine what’s going on with the trends, what they see as the opportunity for a merchandise strategy point of view,” Foy says. “We come up with a point-of-sale strategy, a promotional calendar and plan the business from a retail flow point of view. What are the inventory levels going to be month to month? What’s the activity going to be, both with sales and the returns?”

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