Clothing retail has lagged online, but it's closing the gap
Even shopaholics sometimes dread the hassle of shopping for clothes, hunting for sizes, and waiting for the fitting room. Buying online eliminates crowds, but it's not a panacea, especially for finicky consumers and those who have a hard time finding the right fit.
So it's no surprise that online apparel has the second-lowest sales penetration, after health and beauty. In 2005, 5.9 percent of U.S. clothing sales were online, compared to jewelry and luxury goods at 7.5 percent, according to Forrester Research.
Tactile issues aside, analysts and even the brands themselves admit to lagging in sophistication and interactive efforts.
"As an industry, retailers are short-term-minded," says Marc Blumberg, senior vice president at marketing consultancy imc2. "It's hard to make online apparel sales profitable. Unless it comes from the top, a store manager won't direct shoppers online."
T.J.Maxx closed its e-commerce unit last year due to low profits. Even at Gap hailed for its integration of online and bricks-and-mortar business executives admit they could make better use of the Web.
"People outside of the apparel space do unbranded search much better than in our industry," says Scott Key, vice president, customer relationship management and business development for Gap's online unit.
>Sales Extensions. Online sales are proportionately low to store sales, but the category is huge. Apparel is the second largest online category, with 2005 sales at $12.5 billion, per an eMarketer report in June, and is expected to be among the fastest-growing segments from 2005 to 2010.
"When [a site] is treated as an extension of the store, it works better," says Blumberg, who helped launch Hanes.com.
"In the early days we only cared if the business was profitable. Now a smarter play is to understand consumers' intentions and how they impact retail stores," says Key, who launched Gap Direct nine years ago, and oversees Banana Republic, Old Navy, and Gap.
As part of an e-commerce overhaul last fall, Gap addressed consumers' biggest peeve by adding a "quick look" feature, Key says. Users can see SKU (stock keeping unit) information, size and color, and outfit tips without leaving the shopping section. The new "add to bag" feature uses a pop-up to put the item in the cart instead of redirecting users to a purchase page.
Eddie Bauer launched an interactive feature, Swim Finder, in March to make buying easier. Swimsuits are one of EB's most popular categories off- and online, especially for women who have trouble finding the right fit (D, DD, and plus sizes make up 50 percent of EB swimsuit sales), says spokeswoman Lisa Erickson.
Swim Finder features a "shop by shape" section, offering options like "minimizes hips" and "enhances waistline." Style choices include tips such as "ideal when shoulders or chest are larger than hips." Users can mix and match tops and bottoms and view how they look on a model.
>Customer E-Service. To drive customers to visit these improved sites, apparel retailers should take a cue from the entertainment industry, says Wendi Dunlap, senior vice president, TargetCast. The company created a Web site for designer Joseph Abboud. Dunlap recommends engaging young people with viral promotions and campaigns.
Retailers should remember basic offerings.
"Customer service is a challenge," Dunlap says. Customers need to know they can get help and make offline returns, if necessary.
Talbots has long focused on customer service. The chain began a soft launch in May 2005 to test "style search," which lets a customer contact a store that has an item she saw online. A salesperson calls back within 24 hours to ask whether the item should be put on hold, shipped from another store, etc. This sometimes leads to a shopping appointment, says Talbots spokeswoman Margery Myers. The program formally launches this fall.
"Our customers were late adopters of the Net," says Myers, so sales are still shifting. Online comprised 42 percent of direct sales in fiscal 2005, versus 36 percent the year before.
Talbots e-mails customers about upcoming sales and events, but Myers says the company tries not to inundate people with e-mail. Blumberg of iMC2 says that most retailers can do more ECRM, such as pushing gift cards and rewards programs.
Specialty retailers seem to be pushing branded credit cards harder, and many offer an immediate discount or reward. Gap takes it a step further, offering staffers incentives to encourage new accounts. On a recent visit to a Gap store, a salesman asked that his name be mentioned if an account was opened later. "We don't get extra money, but it makes us look good," he explained.
At Eddie Bauer stores, staffers entice new accounts with, "Would you like to save 10 percent today?" instead of the typical, "Would you like to apply for our credit card?"
>The Search Lag. These brands haven't yet firmly established search in their marketing strategies. "In e-tailing, search depends on margins, but search on shopping sites [bizrate.com, overstock.com, etc.] can offer a good alternative," says Blumberg. Currently, only the term "classic women's apparel" delivers the Talbots site on Google. Myers says Talbots' search capabilities will be expanded this fall. Gap started using search only last year, not with generic terms but with brand names.
"We've been trying to better understand the in-store outcome of search," says Gap's Key. "We're large enough that we didn't need it, but we shouldn't turn a blind eye if consumer behavior is starting to shift to search being the kickoff shopping point."
Luxury marketers operate differently than mid-tier brands, but Condé Nast's Vogue recruited web-shy luxury brands to its thrice-yearly ShopVogue.com. The site displays ads in the September magazine, allowing users to make an immediate purchase via a link to the advertisers' or department stores' sites. Associate publisher Deborah Cavanagh says visitors spent 30,000 hours on ShopVogue.com when it launched in September 2004, resulting in more than $4 million in click-to-buy sales.
"Luxury brands recognized that consumers have moved beyond bargain hunting," Cavanagh says. David Yurman's site was limited in 2004, when a click-to-buy feature linked users to Neiman Marcus. It now also sells direct on DavidYurman.com. Dior recently launched a direct site in France, and based on results will likely launch here as well.