The customer

Assuming that your customers are all the same is possibly the biggest error that could be made and the crucial part of growing any business is knowing intimately who your customers actually are.

Understanding the profile and lifestyle of the consumer very well is key to determine that the most appropriate product is developed to cater for the relevant customer segments and to ensure that the product information is effectively communicated through an integrated marketing plan and packaging policy.

Various factors have an influence on the profile of customers and knowledge of these will assist in the categorisation of customers and apply the most fitting methodologies that are a prerequisite to best serve them. Generally the typical segmentation of customers is determined by their behavioural needs, their psychological characteristics and the environment wherein they exist. The strategic objective is to provide the customer with products that have a combination of integrity, quality and service, represent great value and create an enjoyable shopping experience in a pleasant environment that best suits the target market.

Behavioural influences are those that in the main are habitual and accommodate the personality traits of the customer. The motivating factor for making a purchase can be varied. A consumer may not be too influenced by the on trend level of the product but will possibly prefer to have an offering that will be durable, practical and functional. If these expectations are not met they will no doubt reject the product whereas at the other end of the scale these factors may be of lesser importance.

The potential customer could be more influenced by that which is socially acceptable and reflected in the media such as magazines, television and exhibited by role models like sports stars, actors and professional people who will play an important part of the selection process. The perception of fashion could differ considerably and therefore the fashion retailer will have to rely more and more heavily on practices that will assist in analysing their particular customer’s profiles or that which characterises them more accurately.

Other behaviour traits possibly are where purchases are infrequent and will exist based on a need that a shopping experience will be more of a special assignment to acquire appropriate clothing for special occasions such as returning to work, weddings, holidays or sports events.

Buying habits may include the infrequent visit to stores in order to replace the entire wardrobe on a seasonal basis in order to remain relevant and replace those clothes that have reached their performance expiry date.

The satisfaction of psychological needs such as status and image is a strong motivator in the selection of the styles that will help to achieve this objective. Included will be the perceived expectation that needs to be met by the social circle in which the purchaser moves or reflects a level of wealth that is enjoyed.

There might be the natural drive to exploit the best bargains available and some shoppers may even develop a hobby out of pursuing the greatest values available at a maze of factory and value outlets.

Trawling the glitzy malls and frequenting coffee shops and eateries can be the past time that successfully satisfies the social interaction compulsion.

The more down to earth factors that influence the shopping patterns can be the geographical location where the customer resides. As an example is that a definite difference is detected in style preference between the urbanized to those who live in remoter places where the differing demographics have a probable direct relationship to the social economic environment particularly in terms of gender, occupation, age emphasis, household income and life stage.

With the advance of till technology and the introduction of loyalty programmes it is now possible to gather a wealth of information that describes purchasing behaviour. The information that is harvested is the details of the product purchase such as style, colour, size, fit and price. The frequency and time of purchase and the relationship to other purchases can be analysed as well as the determination of the average spend per customer in different geographical areas is invaluable in building the profile of the customer base. What is of particular importance is the ability to assess the success of promotional launches and the impact they may have on other products during the time of the promotion.

There are some fundamental factors that need to be considered in terms of the population composition which needs to be taken into account in the longer term. A prime example is the greater number of older people who are still economically active at a much riper age. This is evident especially in the case of those individuals who were born at end of World War II when there was a significant baby boom and those babies are now embarking on their so called twilight years. With improved medical technology, healthier eating and lifestyles together with the explosion of health clubs as well as the trend to extend the years of economic activity has had the effect that the twilight years are going to be somewhat longer than in the past.

Another key factor is that the post war boomers enjoyed the availability of easy credit and a large number have accumulated high levels of debt with the result that when they should have been saving for their retirement years and reducing mortgages instead are landed in the situation that retirement is delayed or even worse some will have to continue working until their last.

Forensic auditing studies on mortality rate (SALT Table 1 – 1984-1986} compared in the National English tables for the period 2011 to 2013 showed that the mortality rate improved by 2.5% and 1.9% per annum for men and women respectively. Therefore the assumption can be drawn that a similar improvement going forward is likely to lie at least between these two extremes.

The impact on retailers is the need to make provision to accommodate the active aged in their store design. Store layouts will be required that are easy to shop with minimal confusion, lighting has to be bright and colour corrected to account for failing vision, noise levels need to be reduced to cater for the increased use of hearing aids, product weights must be considered and include an increased carry out service, font sizes need to be larger, shelf heights will have to be such to minimize bending and reaching while packaging should make for easier carrying and opening, queuing philosophies should be reviewed as well as the fitting rooms to permit the comfortable trying on of garments.

At the other end of the scale, the younger generations typically born in the seventies and eighties known as the millennial generation or generation Y are evolving into an extremely different personality to their predecessors and have become legendry in their prolific spending, their brand awareness and because they are technologically advanced this makes them more adventurous. Such characteristics may be in pursuit of their career aspirations as they tend to progress through various places of employment while carving their career at a whim in contrast to their parents who often followed the same occupation for a lifetime. Because these cool, energetic participants are screen junkies they are easily influenced by social media trends and fads. They are therefore able to make informed comparisons and as a result the loyal practice of only shopping at one destination is almost non-existent which places a real test on the retailers to capture a core base market.

Marketing is left with an incredible task to innovate and communicate with this new breed of customer that is arriving on the scene at a rapid pace. Retailers have to start thinking like their customers as in place of window shopping this new breed trawls the internet and stays in contact all the time via the social channels and consequently the retailer need to ramp up their image amongst the channels through financial investment in top class copy writing and superb photographs as well as actively interact on line with their customer. The location of the on line sites should, as with bricks and mortar outlets, be in the best possible space where the greatest exposure to the target customer through the measurement of the number of click troughs is achieved. The offering must be easily found on websites that are advertised forcefully among local advertising vehicles, public relations efforts, promotions and word of mouth.

 A popular trend emerging amongst digital enthusiasts is the support for blog sites where the brands are able to speak to an audience in a different light. There is a word of caution in that what they tell the people must be well accepted because should it be met with resistance the consequences could be equally disastrous. Examples exist of some successful fashion blogs that attract thirty thousand hits a day and may have up to two hundred thousand followers on twitter and therefore brands are happy to pay a lot of money to purchase advertising space in these forums. Some brands spend more than fifty percent of their advertising provision on electronic channels and collaborate with bloggers to gain the most editorial exposure. Many designers view the bloggers as their spokespersons as they develop strong relationships with customers by offering fashion tips and advice, the provision of educational material and programmes that help with the customer decision making process as well as at the same time enhancing brand awareness.

 

POST SEASON TRADE ANALYSIS

A key focus in the assessment of the past performance for the season is to compare the actual key numbers to that what was expected and understand the deviations whether they were positive or negative. The learnings are imperative in the compilation of a new season’s strategy and setting of targets.

The key topics that need to be questioned and evaluated are:

Product

-          Were the trends which were anticipated in line with what actually materialised? What needs to be taken into account when predicting the future season’s trends?

-          Did the strategy that was set for the brand and customer together with that of the group and department as well as the supplier selection deliver the envisaged objectives? What needs to be done differently for the new season?

Customers and competitors

-          Did the information on customer segmentation and the action plans cater effectively in the satisfaction of the needs? What adaptations and additional resources are needed for the future season?

-          Did the competitor initiatives which were anticipated actually happen and was it possible to effectively counteract them? What other methodologies are available to keep up to date with the market place activities?

Key performance Indicators

-          Were the targets of sales, margins, stock levels and turns, gross and net profits achieved as per plan or were they unrealistic? What measures require review and which activities are needed to be put in place to achieve them in the new season?

-          Was the product assortment in the right proportions and did they perform to acceptable levels to cater for all customer segments effectively? Were the product innovations and promotions that were implemented successful and at the right levels?

-          What were the actual colours and sizes sold in comparison to the volumes purchased and what should have been bought instead?

-          Identify product sales which need to be adjusted to a realistic level as a result of product failure, poor availabilities and any other factors such as competitive activity and what special events were there that may have influenced sales either positively or negatively.

Suppliers

-          Did the suppliers perform to the levels that maximised availability in the right quantities and on time?

-          Did the selected suppliers possess the right capabilities to deliver the programmes that were allotted in terms of innovation, complexity, capacity, quality and on time delivery? Are there other suppliers who should be considered?

-          Was the feedback received from suppliers of a nature that can help improve the working relationships going forward?

Stores

-          Were stores able to understand the structure of the ranges and easily display them to emphasize the thinking of the buying team? What improvements to guidelines can be made to assist them?

-          Was the feedback received from stores valuable and what mechanisms can be implemented to improve the quality of feedback?

Marketing

-          Were the marketing channels that were utilised effective and was the uplift in sales able to be measured accurately against control products? Which other communication mediums would be considered?

-          Were the promotions successful and what was the extent of substitution purchases?

-          What was the feedback from store staff and customers?

-          Were the social initiative objectives achieved?

The use of trials

The trusted use of trial quantities which can be put into stores prior to the season may be intended to test attributes such as styling, colours, prints, fabrics, fashion looks, technical or innovative direction or even a value added feature such as a detachable hood in order to gauge the potential of a market.

The trial must also be specific as to what is being tested and it is not advisable to combine different features at the same time. For example, if the purpose is to test a colour, it should be done in a tried and tested style rather than using a new concept style. If this is not done, it could lead to a confused result as to whether it was the style that was successful or was it because of the colour that sales were disappointing.

In order to get a realistic reading of the potential of an untested product it is important to utilise the stores that represent the target market across the chain rather than simply using the larger stores in an environment where there is all likelihood of selling.  It is preferred to use a selected cross section of stores and compare performance against similar control styles in the same stores and then extrapolate the results to all stores in the intended catalogue to determine the overall sales potential of the trial product.

Where open to buy is restricted, which is almost always the case, a recommended tactic is to hive off an amount upfront which will allow the freedom to experiment at any time and potentially grow a high volume line.

The eighty twenty rule

The eighty twenty rule

A point of consideration that should never be ignored is the eighty twenty rule, also known as the Pareto principle where it is acknowledged that eighty percent of the result is delivered by twenty percent of the effort or participants.

In the context of stores it is probable that twenty percent of the stores deliver eighty percent of the sales and deserve the proportionate dedication of energy and focus, as does the thick middle sizes such as medium and large and therefore should always be in stock. Core base colours such as white, black, naturals and greys also contribute largely to the sales and should always be evident in volume. It is clear that certain styling features will likewise guarantee the bulk of sales and should be finalised first and certain peak trading periods such as holidays or special events will contribute largely to the total seasonal sales and must be managed very carefully in terms of production planning and delivery scheduling.

It should be qualified that it is not necessarily exactly a ratio of eighty versus twenty as in certain cases it could be a ninety to ten or seventy to thirty relationship but nevertheless the principle still holds true.

TRAINING PRINCIPLES

One of the common requirements of each role that has been outlined is that in order to achieve the highest degree of proficiency there should be a structured methodology of training which will include on the job training where the incumbent is mentored by a qualified and experienced more senior specialist who in turn has had exposure to effective training methods and performance management techniques. Ideally as the trainee progresses they will take on the responsibility for a small section of their department in order to gain the confidence and skills that will stand them in good stead going forward and also serve as a contingency in the event of the loss of senior personnel.

Coupled to on the job training is the formal classroom style lecturing as is necessary and can be performed by either internal or external tutors who will provide the theory that is matched to that which has been learnt on the job. This is of great importance as it is not uncommon that with on the job training exclusively the poor habits of the trainer are frequently transferred downwards.

Equally important is for new appointees to have an understanding and appreciation of the roles of their counterparts in other areas of the business. In order for this to be achieved they should spend adequate time attached to specialists in other fields. An example would be where a buyer in training would need to spend time in stores interacting with customers, at suppliers, with merchandisers, technologists, the marketing team and packaging specialists, in the warehouse and with the logistical experts including forwarding agents. These attachments should be well thought out with specific objectives in mind and followed up in formal reviews in front of a panel of experts from each area who test their understanding. An independent representative from human resources should also be present to ensure that the consistency of standards applied across the business is maintained and the assessment is objective without any personal bias of trainers subjectively influencing the conclusions either positively or negatively.

Overall, in order to guarantee the creation of professional teams is that the training needs to be consistent and that the outcomes deliver broadly the same standard of qualified appointees. An outstanding illustration of this is where the customer enjoys the same high level of service from sales personnel in whatever store they frequent or suppliers enjoy similar levels of proficiency across different buying teams.   

NEW BOOK RELEASE - FUNDAMENTALS OF SUCCESSFUL AND SUSTAINABLE FASHION BUYING AND MERCHANDISING - Charles Nesbitt

The book outlines the fundamental principles and mechanisms that are applied in fashion retailing and illustrates as to how the major tasks and roles intertwine from the conceptualisation of the product through to the presentation of a finished garment to the customer and in doing so demonstrates how the key functions such as design, buying, merchandising, technology, production, logistics and selling each with their unique specialised operations manage to achieve this.

It will be particularly beneficial to students and those who are maybe considering a career in the industry. Individuals who are already part of the fashion buying and merchandising community will find this book to be invaluable in that it provides a complete simplified overview of all the integral activities and roles that go to make up the topic and thereby will provide a broader insight into their own career.

                                                                        

CHARLES NESBITT graduated with a degree in Economics specialising in Business Economics from Stellenbosch University, South Africa. He spent thirty five years at a leading retailer in Southern Africa where he was exposed to all the key disciplines of retailing during this period.

Check it out at

http://www.amazon.com/dp/B019C3VEUK