The fashion industry has faced tough challenges in 2019.
Legacy retailers, such as House of Fraser, have undergone major transformations and mass store closures across the country. With Boohoo buying Karen Millen and Sports Direct acquiring Jack Wills, fashion brands across different tiers are also being consolidated.
The online channel is facing a slowdown too.
In the four months to July 2019, visits to the top fast fashion and mid-tier sites declined by -8% YoY and -4% YoY, respectively. The only tier to continue its rise was Premium, increasing by +4% YoY.
However, these challenges haven’t been felt across the board. A number of retailers and brands, like Net-A-Porter, Zalando and Charles Tyrwhitt, are rapidly expanding online. In this report, Hitwise breaks down the success of these retailers, and detail shows others can optimise and grow their online audiences.
Monthly Visits YoY
By Fashion Tier
PART I: SEARCH INSIGHTS
PART II: RETAILER INSIGHTS
PART III: AUDIENCE INSIGHTS
PART ONE: SEARCH INSIGHTS
How can Zalando accelerate their growth through search?
Zalando bucks fashion industry traffic decline
As Europe’s largest online fashion retailer, Zalando has big ambitions to double its customer base over the next five years. Founded only ten years ago, the digital darling holds over 26 million customers globally and sells over 2,000 brands on its site.
The UK is a key market for Zalando. The company ranks 30th when it comes to online fashion, but recent months show that Zalando is bucking industry trends. From March to July, visits to Zalando grew +10% YoY, compared to the top 150 fashion sites which declined by -4% YoY.
Co-CEO, David Schneider, stated that Zalando “doesn’t have to capture every fashion item ever, [rather] we want to have everything relevant to our specific customer”. How can Zalando accelerate its growth and capture their customers’ (or lost customers’) needs?
Monthly Visits YoY
Zalando vs. Industry Average
Understand who you are losing your customers to
Zalando could firstly address its customer leakage. A metric that can help support this is downstream clicks, so understanding where customers visit directly after their site.
Looking at the traffic that leaves Zalando’s site, ASOS receives by far the largest share of retail clicks at 10%, compared to sub-2% for competitors like Next and JD Sports. These clicks came from over 76,000 Zalando visitors in the months of June to August.
So, how can the retailer win these customers back?
Sites Visited After Zalando
Identify brand and product gaps using search
This is where search gap analysis comes into play, which involves identifying brand and product searches that ASOS receives but Zalando does not.
Categorising the top 100 searches, the majority of missed terms included brand searches, such as “Ann Summers”, occasion wear like “wedding guest dresses” and trending products, such as “high waisted bikinis”. To re-engage their lost customers, Zalando could feed these insights into product ranging, seasonal promotions, paid search and content tactics.
Search Terms ASOS Receives
AND Zalando Does Not
TOP TAKEAWAYUnderstand who you are losing your customers to through downstream analysis. Identify what specific brands and products these customers are seeking on competitor sites. Feed these keywords into promotions, paid search and content to re-engage lost audiences.
PART TWO: RETAILER INSIGHTS
How can Net-A-Porter target and expand their product range?
Net-A-Porter visits rose +30% over Summer
Premium Fashion was the only tier to rise this year.
Averaging 2 million visits a month, Net-A-Porter was its driving force, growing by +30% YoY in online visits in the three months to July.
As we approach the industry’s peak period at Christmas, what can Net-A-Porter do to continue their online success?
Looking at last year’s performance, Net-A-Porter capitalised over Christmas sales, with visits rising +16% YoY. Competitor retailer, Selfridges, saw a larger climb at the start of the quarter, rising by +10% YoY in October.
Weekly Visits YoY
Selfridge’s vs. Net-A-Porter
Uncover blind spots within retailer sites
Searches within retailers can help Net-A-Porter identify what drove their competitor’s rise.
In October, fast-rising terms on Selfridges included festive products like “whiskey” and “Christmas cards”. Additionally, Selfridges received new brand searches, such as “Gisela Graham” and “Olivia Burton”. Net-A-Porter could then feature these brands and seasonal products in October this year, to drive activity before Christmas.
Net-A-Porter could also benchmark these results against their own site’s searches. Compared to Selfridges, trending styles like “animal print”, “leather” and “metallic”, were among the fastest-growing terms. Understanding this differentiation, Net-A-Porter could emphasise the latest trends in 2019 in their site content and product display.
Top-Rising Internal Searches YoY
|“Le Pliage”||“Animal Print”|
Pinpoint what’s trending within your competitors’ sites and benchmark searches against your own site.
Source: Hitwise, US. Index of top searches leading to retail industry, 13 weeks ending 8/24/19.
TOP TAKEAWAYSearch gap analysis, as shown with Zalando vs. ASOS, can help win back your lost customers. Insights into how consumers search and browse within retailer sites, featured inSelfridges vs. Net-A-Porter, can help conquest your competitor’s audience. Use this data to identify fast-rising brands and products that you could also feature.
PART THREE: AUDIENCE INSIGHTS
What can T.M.Lewin learn from Charles Tyrwhitt’s segments?
The discounting challenge in menswear
The menswear market is one of the fastest-growing categories of fashion, projected to rise by over 10% by 2022. But a top challenge for this category is excessive discounting. In October 2018, the proportion of menswear revenues made on sales items skyrocketed by +50% YoY, compared to +10% for the industry average.
As a key player in this category, T.M.Lewin faces this challenge. The brand attracts a similar audience between their “sales seeker” (so people actively searching for a sale and visiting T.M.Lewin’s site) and their regular online visitor. In comparison, Charles Tyrwhitt has a clear distinction in age, income, and influences between these two segments.
How can T.M.Lewin benchmark against Charles Tyrwhitt’s segments in the lead up to peak period?
Audience Segments over Peak Period
Charles Tyrwhitt vs. T.M.Lewin
Benchmark your discount shoppers vs. your competitors’
An analysis into Charles Tyrwhitt’s segments can help T.M.Lewin re-define their own customer base.
Charles Tyrwhitt’s regular visitors are searching for classic British styles, such as “tweed jackets” and “chinos”. They’re visiting lifestyle publications like GQ and collecting frequent flyer points on Avios. In contrast, Charles Tyrwhitt’s sale seekers use student discount sites, such as My UNiDAYS, and seek younger brands like “Gymshark” and “Carhartt”.
With this information, T.M.Lewin can differentiate their own visitors and find new discount seekers using these affiliates and media sites. For example, the brand can place promotions on jackets and slippers. They can also advertise classic menswear styles on publications, like The Spectator, to grow their regular audiences.
Digital Behaviour over Peak Period
Charles Tyrwhitt Visitor vs Sale Seeker
|CT Visitor |
Vs. Online Population
|CT Sale Seeker |
Vs. Regular Visitor
|What are they searching for?||“Non iron shirts”|
“Tweed jacket men's”
|“Carhartt chalk jacket” |
|What affiliates are they using?||Cash back earners |
|My UNiDAYS |
|Where are they consuming media?||My Times Plus|
|What Hifi |
Discounting is unavoidable over peak period. To avoid diluting your regular shoppers, differentiate your products and channel strategy.
Source: Hitwise, UK. 12 weeks ending 29 December 2018. Discount Seeker is anyone that searches for retail sales, Black Friday or Cyber Monday-related terms in Q4.
TOP TAKEAWAYDiscounting is unavoidable. Distinguish your sales seeker from your loyal buyer to avoid diluting your brand. Benchmark your segments against the competition and understand how they communicate through different channels. This can help guide your product promotions, affiliate and display decisions.
Fast risers, like Net-A-Porter, Zalando and Charles Tyrwhitt, are bucking the industry’s traffic declines. In our report, we detailed what drove their success and other best practices.
In this summary, these include:
1. Find your gaps
Identify the brand and product searches you are missing out on vs. your competition. Feed these insights into your paid search and promotional campaigns to win back lost customers.
2. Uncover retailer blind spots
Pinpoint what’s trending and what’s converting by looking within retailer sites. This data can help you optimise your own site’s content, featured items and product ranging.
3. Get ahead of discounting through segmentation
Very few brands and retailers can avoid discounting and sales promotions. Get ahead by differentiating your “sales seeker” from your regular loyal buyer. Distinguish the products and channels that each segment uses.
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