Fashion Retailers: Personalize or Perish
Even before the pandemic, it was already evident that data and personalized marketing would be crucial for fashion and luxury brands aiming at building long-term relationships with their clients.
However, Covid-19, with its far-reaching economic impacts, forced apparel and fashion retailers to focus almost exclusively on online platforms, making, thus, personalization a necessary prerequisite.
The fashion industry was hit hard by the economic repercussions of the pandemic. According to the McKinsey Global Fashion Index, retailers lost approximately 90 percent of their profits in 2020. While consumer confidence started to recover in 2021, one thing became apparent: fashion companies need to choose between investing big in personalization and business intelligence or perish.
In fact, retailers capitalizing on data analytics to offer targeted marketing and personalized e-commerce experiences have seen their digital sales growing by between 30 and 50 percent, while a McKinsey report reveals that those companies are outperforming their competitors by 68%. The gap between data leaders and laggards has widened.
“Indeed, the 25 top-performing retailers—most of which epitomize the powerful shift to digital, data, and analytics—represent more than 90 percent of the sector’s increase in global market capitalization during the pandemic.”
Source: McKinsey and Company
Simply put, some of the benefits of leveraging insights from data are the following:
Price items correctly
Know when and how much to discount an item
Supply stores on time and according to future demand using predictive analytics
Recommend the right items according to customer preferences
Stock the right styles
Be able to choose the right sizes, colors and fabrics
Engage customers online to build solid, long-term relationships
Data-savvy fashion and luxury retailers have seen their market value increase significantly, while others have been left behind by competition. The question for apparel and fashion retailers remains: which side of the scale will they find themselves on?
Workearly Business is filling the gap in the provision of personalized training in business intelligence and fashion analytics, helping apparel and luxury retailers reach higher customer satisfaction and drive profitability further.