Are you being served? How are added value services changing fashion retail?

Contents 1.

Introduction: The fashion retail paradox

2.

What the experts say

3.

How is fashion missing out?

4.

Five insights and opportunities

1. Introduction: The fashion retail paradox by Glenn Shoosmith, CEO and founder of BookingBug

Fashion has always been an industry defined by its ability to add value, but it’s also home to a contradiction. At the high end, physical stores build brands’ reputation with carefully considered, hands-on experience and environments. At the low end, you’re lucky if someone will direct you to the fitting rooms. Burberry and TK Maxx may as well be on different planets. Earlier this year, we visited 20 top retailers and measured their commitment to offering added value services and experiences in store. 80% of the fashion brands we audited scored fewer than half the points on offer. That’s significantly lower than every other sector, from consumer technology to homestores and pharmacy. It came as a huge surprise to see that an industry still so naturally attracting customers in store was barely offering more than simple fitting room services once they got there. While other retailers tie themselves in knots to join those dots, you have to ask the question: is fashion squandering an opportunity to build relationships that any other retailer would kill for? With this in mind, we’ve returned to explore fashion retail in more detail, pulling together research from across the industry to reveal current trends. We hope you’ll agree, the following is a must read. Not just for those in fashion itself, but for any retailer hoping to increase brand loyalty and average spend by giving customers a better way to spend their time in store.

2. What the experts say

“Only 22% of consumers buy primarily online” Retail Week, 2014

“A lot of purchasing will still be done online, but building a relationship happens in-store. The challenge for retailers is to make it a consistent purchasing journey.” “It is about turning data into something that is more meaningful than a transaction.”

Jess Shepherd Digital & Strategy Director, Coast

"A store visit may make customers buy more items than anticipated. You have access to a wider variety of ways to influence people: music, scents, lighting, fixtures and sales assistants are all sources of influence that make us more likely to buy."

Philip Graves Consumer Psychologist

“The fashion sector has emerged from the online shakeup relatively unscathed. It is a sector that suits multichannel retailing particularly well – customers will often choose to research their purchases online before trying things on in a store.” “A high street presence is still relevant in fashion.”

Honor Westnedge Lead Retail Analyst, Verdict Research

“We are all social animals and human interaction is a critical part of retail.”

Jeremy Collins Property Director, John Lewis

“Fashion retailers of the future will be cross-channel, giving them a vested interest in the development of the UK high street.” “Stores will continue to thrive in fashion retail, but the pressure is on to create destinations that people want to visit.”

Julian Dunkerton Founder, Supergroup

3. How is fashion missing out? So, what are fashion brands leaving on the table? In our recent Retail Services Innovation Report, pharmacies stood out as a great demonstration of potential from the broad spectrum of industries that fall into the retail sector. Their close relationship to prescriptions and restricted medical products has put a counter and expert service right in the centre of store design for years. This familiar feature has been built upon and now includes appointments for everything from contraception to hair loss to cancer care. By comparison, the fashion industry could be using its familiar customer touchpoint of fitting rooms and other in store spaces as a similar mechanism to build upon. Customers are entirely used to interacting with staff at this point of the store and it’s a huge missed opportunity. Why can’t this become a hub for personal shopping, events or other services? Where could this take the added value of the fashion experience? Adopting this mindset and searching for the right opportunities has helped brands grow value and loyalty from customers for years.

Key observations from the Retail Services Innovation Report Earlier this year, we visited Retail Week’s Top UK retailers, assessing their maturity in five key areas of added value services: o Marketing of services in store and online o Accessibility of those services o Level of expertise available among staff o Delivery of those services in store o Overall attitude to in store services Finally, we visited the retailers’ digital collateral to establish how any services were communicated across online, mobile and social channels. Here are the results and insights from the top ten fashion retailers in the list download the full report at http://bug.me/retailuk.

Retail Services Innovation rankings Retailer

Score Attitude Marketing Accessibility Expertise Delivery

Debenhams

18

4

3

3

4

4

John Lewis

15

3

3

2

3

4

Sports Direct

12

2

2

2

3

3

Next

8

1

2

2

2

1

M&S

7

2

1

1

2

1

Primark

7

1

1

2

2

1

Burton

7

1

2

1

2

1

New Look

7

1

2

1

2

1

Matalan

6

1

1

1

2

1

TK Maxx

5

1

1

1

1

1

Real Life Example: #knowmysize Debenhams scored well overall, but it also provides a great example of the challenges in rolling out such services. Its bra-fitting service was advertised prominently in the front window of the store - but other than dropping everything and heading for the lingerie department, it gave the customer very few options to take advantage of it. The only call to action was the hashtag #knowmysize and the details being hidden several pages deep on the website (deeper on mobile), leading only to a store locator. As a result, you have to question what proportion of interested customers chose not to jump through these hoops, reducing the impact of an otherwise great campaign. At any step, introducing a way to capture this interest conveniently and effectively across platforms stands out as a clear enhancement to the campaign. When the campaign assumes people will be on their mobile to check the hashtag in the Twitter app, the absence of a convenient way to achieve this on the move feels like the ultimate missed opportunity.

4. Five insights and opportunities 1.

Services and experiences take multichannel to omnichannel Although we criticised the Debenhams #knowyoursize campaign for in store execution, it excelled as a demonstration of added value services connecting online and offline worlds. The hashtag, featured so prominently in store, is injected with further value and meaning online, where it becomes an anchor for discussion, community interaction and other valuable, relevant content. By creating something worth talking about and making it simple to continue the conversation online, Debenhams has avoided the feeling of there being two separate worlds - but it all starts from a central valuable service offered to customers in store.

2.

Offline services mirror the value of online content The biggest retailers have started to really reach their stride when it comes to creating content and acting like publishers online, attracting valuable attention toward useful insights and then making it effortless to buy related products. But alongside this, their offline added value services achieve a similar job by attracting customers in store for value in one area, and then making it convenient to pick up relevant products in a fell swoop. It’s the same dynamic, the same massive opportunity - just a different realm of execution.

3.

The HR supply chain is key If you hire skilled and informed retail staff, why do they so often end up not being fully utilised? Until you can balance predictable supply and demand, how can you feel like you’re using this resource to its full potential? And if your staff and their knowledge are truly an asset, are you really going to define the highest possible value you can get out of them as just another sale? Introducing in store services, education and expertise can elevate a ceiling on that value, allowing you to make the most of what should be a significant advantage over competitors.

4.

Do you help customers spend their time as well as their money? Online shopping has thrived on the advantages of saving time and saving money. However, the bricks and mortar retail experience is motivated quite differently. Customers embark on a shopping trip explicitly to spend time and spend money. This subtle difference belies an important opportunity. Yes, some high street customers will be looking for a simple in-and-out purchase. But for the many

who are really looking to invest hours of their time with a friend, crafting a really valuable experience as they browse the latest trends could tick a different sort of box and create new revenue for retailers at the same time. 5.

What are you showing the showroomers? The trend of customers spending time in stores to get hands on with products is becoming more common and more popular with the digital shopper. But if you know it’s happening, do you really want to make an “okay” browsing experience as good as it gets in your stores? Providing added value services creates the opportunity to not only paint products in the best light, but also develop perception of a richer halo that increases their value further. Showrooming has been an organic trend that sets the scene - it’s up to retailers to decide how they are going to confront it to create the most value.

About BookingBug BookingBug is a multichannel appointment booking and event management platform, used by businesses including John Lewis, Marks & Spencer and Westfield to increase footfall, conversion and drive new revenue. We’re passionate about helping retailers offer better added value services in their high street stores. Find out more at http://www.bookingbug.com