Internationalization is a hotter topic than ever in retail. How do successful retail brands grow their customer base overseas in a way that adapts to the cultural and logistical needs of each market, without losing their global identity?
For the fashion industry, that question is particularly complex. Building a global footprint means taking into account all the things that other retail sectors need to consider, plus a whole wave of further questions. Which styles translate across markets, and which don’t? What’s the best way to balance product range in countries where the climate varies significantly between regions? Which channels and media must be influenced to start building a following?
But even before getting too buried in these issues, fashion retailers need to first decide where to grow – and how to grow there.
With regards to the where, retailers need to make the decision as to whether they want to target well establish markets, which offer great spending power but also intense competition, or emerging markets, where more education and infrastructure will be needed, but which might offer bigger long-term growth opportunities.
There’s no right or wrong answer here; a fashion brand launching in the U.S. or China isn’t necessarily going to be less successful than one exploring India or Iran. Both will have to use data analytics to understand customer behavior in granular detail in order to maximize market share.
The next decision when growing globally is which channels to target. Many fashion retailers build their go-to-market strategy around online, because it is more cost-effective and can enable dynamic change. Others, however, find bricks-and-mortar more impactful and easier to gain immediate market traction – New Look is an example of a fashion retailer that has made significant inroads in China with a physical retail launch. And there are further issues to consider for an offline launch, such as new stores versus franchise or department store concessions.
As with the choice of region, the key is having a well-researched strategy that takes regional nuances into account. For instance, online might seem like a safer option, but fashion retailers need to know that their ecommerce platform is robust enough to cope with surges in activity, and when peak shopping days occur to prepare for these surges. Singles’ Day in China is a good example of this.
With market and channel chosen, the next big hurdle to tackle is what local regulations and practicalities stand in the way. Language, currency, local taxation, legal and compliance framework, courier networks, road systems – they all impact the attractiveness of a new territory.
Finally, before launching, fashion retailers need to think about what they must do to surprise and delight new, unknown customers, and how they’re going to get up to speed with their demands.
Ignorance is not an excuse, and therefore it’s vitally important to capture as much shopper data as quickly as possible, both to nurture first time shoppers into regular customers, and to understand broader consumer behavior patterns. The role of omnichannel retail technologies in accelerating this journey should not be underestimated.
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