Changing consumer behaviour has led to a revolution in fashion retail. 4C Associates’ Milan Panchmatia considers how the “See Now, Buy Now” approach will impact established practices.
Generally speaking, businesses which sell directly to consumers tend to be those which need to be most reactive to their demands. The propagation of connected devices has led to an increasingly expectant population, which has in turn forced many sectors to adapt. However, some have been slow to change.
Up until last year, prominent fashion shows based in Europe’s style capitals, showcased clothes which would not be available for purchase until the following year. Buyers attending these events would place orders and receive deliveries months later. Consumers anxious to get their hands on the latest styles would simply have to wait. But not anymore.
London Fashion Week 2016 saw the industry, and more specifically Burberry, unveil its first “See Now, Buy Now” collection. This new format allows consumers to purchase the items showcased instantly, a move which many in the industry believe was long overdue. In the words of Burberry CEO Christopher Bailey: “We have all become so used to technology allowing us to [experience everything right away].”
Adapting to the market
For those unfamiliar with the ins and outs of the fashion industry, it might seem natural to take advantage of interest linked to popular events to generate sales. However, the new approach has been hailed as a revolution and fashion houses such as Tom Ford have already followed suit. But how have consumers reacted?
It is still early days for the new model, however, initial feedback is positive. Speaking to Business of Fashion, Joshua Schulman, President of Bergdorf Goodman and Neiman Marcus Group International, revealed that the day after Tom Ford’s New York show, was the brands biggest sales day of the year. Michael Klige, President of MyTheresa.com, said that the Burberry collection saw an instant uplift in sales, following London Fashion Week 2016.
In Schulman’s words: “The immediacy of being able to buy immediately after the show, combined with the impact of seeing the whole collection on the floor at once, gave our customers a sense of urgency to buy now.”
So, how did Burberry engineer this revolution? Well, it goes without saying that implementing such a new approach would not have been possible without a revised supply chain strategy. There is a huge difference between providing stock months after orders are placed and having it ready to go the second a new collection launches.
On top of this, a certain flexibility is required to meet unknown order quantities. Another issue the brand had to face, was aligning its marketing department to its supply chain – a key element of driving sales in the fashion industry.
In the past, the British fashion house would have begun designing a collection due to debut in September, in May. However, the new approach has seen the design phase shifted to January. Throughout the design process, the team was constantly communicating with suppliers, informing them of production deadlines and lead times. Samples were then created ahead of the show for advertising purposes.
Whereas buyers previously discovered new collections alongside the public, in this case, Burberry held a private event for buyers to see the clothes in July, after they had signed a confidentiality agreement. Once the buyers had placed their orders, production teams began creating the requisite level of stock for retailers.
Of course, this strategy only works for businesses which control the entirety of their production. Organisations which operate differently will need to devise their own models.
Making the jump
There are clearly a number of opportunities for fashion retailers linked to the “See Now, Buy Now” model. The success described above is just the beginning. The evolution towards a more consumer friendly approach represents a prime opportunity for retailers to leverage demand and get ahead of the competition. However, it is not without its challenges.
Implementing Burberry’s model required a complete reimagining of the organisation’s business model. Retailers looking to follow in their footsteps must first work out how they can best adapt their supply chains to deliver the service their customers have come to expect. This entails a robust risk management programme, to ensure poorly performing collections do not prove too costly, and a level of supply chain flexibility which was previously unheard of in the industry.