Section 11 Technology and Retailing2848 (1)
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Transcript of Section 11 Technology and Retailing2848 (1)
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Technology and its impact in the on-line fashion
industry
Group 3 Katie Reimer
Linda Jacobsen Bill Messick Jimmy Asip
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Branding a Lifestyle and an Image
Internet advertising is impacting the way fashion retailers market and differentiate their brands by further developing their corporate images and
accompanying messaging in accordance with their business strategies.
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Causing this trend in high-end retailers
Retailers must align e-market place with their business strategies
Business Strategies may prohibit online sales, promote online-catalogs or encourage lifestyle marketing
Retailers with durable brands and corporate images find customers find them regardless
Many of these products not sold online
Need to feel, wear, see product before purchase
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Advertising focusing on an image
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Big Picture Snapshot
Department of Commerce eCommerce sales $86.3 billion for 2005. Forrester Research reports $12.5b spent on apparel.
Latent Buying, shop and buy later. Browsing, compare, buying
phase.
4th quarter most important draws population to eCommerce more than any other
Jupiter Research: more than 80% of shoppers browse online before in-store
comScore 63% of online browsers purchases off
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US Advertising Spending
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Website Evolution
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Electronic Brochure Site Model
Created a visual internet presence for a company
Described its goods, services and sometimes corporate philosophy
Labor-intensive and time-consuming to modify
Minimal cohesive visual consistency and user interface design.
No site differentiation or personalized content
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E-Commerce Site Model
Main purpose was to sell merchandise
Product catalogue and pricing information
More complex than brochure site. Addition of: Style sheets
Forms
Shopping cart functions
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Business Application Site Model
Site differentiation is achieved by providing: Value-added information
(reviews, suggestions, advice etc. )
Interactivity
Frequent, useful content updates
Information personalized for specific users or user groups
Converts users from passive viewers into active participants.
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Technologies that Support the Business Application Site Model
Broadband
Flash-ware
Secure transactions
Authentication (name and password)
Digital signatures
Encryption
Secure servers
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Website Evolution Example
Brochure Site Model Reebok 1996
E-Commerce Site Model Reebok Store 2002
Business Application Model
Reebok 2006
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Website Evolution
http://shop.org/video/mov-sm.asp
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History of Shopping
Local seamstresses and tailors made clothing to order Mostly domestic, usually not much stock on hand
Sometimes sold at town shops
Exporting - 1831, George Opdyke, later Mayor of New York, began the manufacture of clothing on Hudson Street, which he sold largely through a store in New Orleans. Increased Southern Trade Market
Mass Production 1851 Singer sewing machine was invented Strong enough to sew leather shoemakers used quickly
Larger scale production of clothing products was made possible
Cheaper labor costs because machine saved time
More Choices 1856 first synthetic dye invented more color options
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History of Shopping
Catalogs introduced in 1872 by Montgomery Ward Sears introduced their catalog in 1888
Department Stores Bloomingdales was founded in 1872 Choices led to the growth of specialized clothing stores
& more chain/department stores
Malls the first mall was built in 1922 in Edina, Minnesota Another outlet for purchasing the latest fashions
Internet stores began around 1995 Sales from Brick and Mortars impacted greatly
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Catalogs Today
Sales over the internet have increased three-and-a-half times in the past four years, while turnover from catalogues has declined What such surveys do not fully take into account is the impact that
catalogues have on online sales.
Retailers that still carry and distribute catalogs are making them thinner and are still investing in them to spark customer interest and direct them to purchasing and browsing online.
Limited size and color selections in stores force people to order online or use catalogs, especially for plus sizes and petites.
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Applying Technology to branded lifestyles
In the beginning, consumers didnt have a choice between many products and therefore companies didnt focus on their target market.
On-line Technology matches lifestyle image to corporate values
Flash
Graphic/video selection
Proprietary Technologies
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Survey Components
Used the 2 types of fashion web sites:
Solely for Brand Marketing: Diesel
Prada
Markets Brand but is Sales Oriented: Puma
Old Navy
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Survey Questions
1. How appealing is the web site?
2. How user friendly is the web site?
3. How strong is your initial reaction to the web site?
4. How effective was the web site in marketing the brand?
5. Did your perception of the brand change after viewing their web site?
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Diesel
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Diesel
1. 70% 4 or 5
2. 45% 2
3. 55% 4
4. 40% 4
5. 70% No
1. Overall appeal of the site 2. User friendliness 3. Strength of initial reaction 4. Effectiveness in marketing the brand 5. Did your perception change
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Diesel
Clothing company which produces premium apparel for men and women between 18 and 35 years old.
Privately Owned.
Sales: $1,227.6 Million
1 Year Sales Growth: 61.5%
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Prada
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1. 46.7% 2
2. 73.3% 1
3. 46.7% 2
4. 80% Tie between 1 and 3
5. 80% No
1. Overall appeal of the site 2. User friendliness 3. Strength of initial reaction 4. Effectiveness in marketing the brand 5. Did your perception change
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Prada
Prada sells upscale apparel, shoes, fragrance, and accessories for men and women, as well as its less-pricey Miu Miu apparel line.
Privately owned
Sales: $1,991.4 Million
1 Year Sales Growth: 16.7%
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Puma
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1. 68.8% 4
2. 56.2% 4
3. 90.3% 3 or 4
4. 43.8% 4
5. 81.2% No 1. Overall appeal of the site 2. User friendliness 3. Strength of initial reaction 4. Effectiveness in marketing the brand 5. Did your perception change
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Puma PUMA has the long-term mission of becoming the most desirable
Sportlifestyle company. focusing on bringing distinctive designs and a global outlook to each
product range by blending influences of sport, lifestyle and fashion. In order to achieve these goals, our brand template emphasises PUMAs distinctiveness, individualism, spontaneity, internationalism and sporting heritage. An important part of our brand strategy is maintaining vigilant watch over our distribution channels, ensuring that we maintain the high level of desirability necessary for sustainable growth.
PUMA focuses on creating a differentiating yet unmistakably clear brand message that resonates with our consumers
Above all, PUMAs marketing will always strive to surprise, stimulate, entertain and engage. By constantly delivering the unexpected and challenging perceptions, PUMA aims to continue to be a defining voice in the world of Sportlifestyle
Markets brand but is also sales oriented.
Sales: $2105.1 Million 1 Year Sales Growth: 0.9%
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Old Navy
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1. 87.4% 2, 3, or 4
2. 50% 5
3. 62.4% 3 or 4
4. 68.7% 4 or 5
5. 100% No 1. Overall appeal of the site 2. User friendliness 3. Strength of initial reaction 4. Effectiveness in marketing the brand 5. Did your perception change
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Old Navy Old Navy's mission is to offer affordable,
fashionable clothing and accessories for the whole family.
Sales oriented: Recently added features to make online
shopping easier and faster Pop ups to view clothing and add to cart and not leave the
homepage so you can continue to browse. Quick confirmations of added apparel
Sales: $6,856 Million 1 Year Sales Growth: 1.6%
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Lifestyle Conclusions
Old Navy has the most sales but less annual growth.
Diesel had the highest annual growth which seems to suggest that their marketing efforts have begun to be accepted and will continue to be successful.
Prada has a high growth rate as well.
Puma needs to enhance their efforts to gain more market share.
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Survey Conclusions
Technology does not always improve a web site
The user reaction to a site largely depends on the purpose of the web-site
The degree of a persons initial reaction in our 4 surveys always represents how appealing and how effective they find the web site
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Survey Conclusions
After analyzing the survey data, we determined that based on our criteria that our sample rated the sites as follows:
1. Old Navy
2. Puma
3. Diesel
4. Prada
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Conclusion
Technology has greatly impacted the way that companies advertise and market their brand online
As more people continue to use the internet, it will continue to grow in value as an advertising medium
Promoting lifestyles around a brand image is the current trend in many fashion companies and is likely to continue to grow as more companies work to expand their web presence
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Future Trends
The applications and interfaces users navigate on-line will become more advanced as technology develops.
Number of users on-line shopping will continue to grow as well as on-line revenues.
3D web technologies are being developed and more users will shop in the metaworld.