‘The relationship between brands and consumers has flipped’: Insights from the Glossy Summit

Image result for ‘The relationship between brands and consumers has flipped’: Insights from the Glossy SummitLast week at The Glossy Summit: Future of Fashion and Luxury in Miami, fashion brands, both big and small, came together to speak frankly about the challenges they’re facing and what they are doing to evolve. From the main stage where speakers outlined their companies’ strategies to small working groups where attendees sought guidance from their peers, the event was full of modern retail insight. Here’s what we learned:

The power is with the consumer
On the minds of many of the brands in attendance was how the power to control the fashion conversation has shifted to consumers.

– Consumers, not brands, now dictate trends and have more knowledge than they have ever had before. They also have a huge number of options of where to buy their desired item. This has led to a fundamental shift in how brands engage with their customers, making reactivity and flexibility a core skill for the modern fashion brand.

– Brands like Universal Standard have worked extensively to make sure that their sizes are as comprehensive as possible, ensuring that every customer has a wide array of options. This required a significant amount of rethinking the standard fashion production schedule from design to manufacturing. It also created new ways of manufacturing fabric that could accommodate the brand’s extended sizing.

The bottom line: Brands need to listen to what consumers are saying and react accordingly. Through data collection, direct engagement with customers through social media, and wear testing, the power that consumers hold can be leveraged for a brand’s success.

Convenience is king
As consumers gain more control and power over the fashion industry, one way that brands are catering to them is through an increased focus on convenience.

– Since consumers have many options of where to shop, the slightest bit of friction can send them looking for an alternative. Brands need to make sure that they are digitally savvy and treat customers to the most seamless experience possible in order to lure them away from competitors.

– Charles Gorra, founder of Rebag, spoke about how his resale company courts two different types of customers, buyers and sellers, with opposite interests. Maximizing convenience is the best way to satisfy both.

– This challenge is different for bigger brands than for smaller ones. Large brands have the advantage of scale and resources, yet they also are more complicated and have more moving parts. Smaller brands do not always have the resources for a customer experience with the shiniest bells and whistles, but they are able to react more quickly.

The bottom line: When customers have a hundred shopping options at any given moment, they will take the path of least resistance.

Brands are taking things in-house
Alongside the shift to direct-to-consumer, companies are rethinking big parts of their business and wondering if they can handle them themselves. At the Glossy Summit, attendees at Monday’s town hall expressed doubt that they needed someone else to run things for them.

– One speaker spoke about using the same PR team for nearly 12 years with diminishing returns. When they eventually dropped the PR team and took it in-house, they did not see any noticeable decline in ROI.

– Laura Dowling of Digital Brands Group spoke at length about taking all of their influencer relations in-house. While a few other attendees said that working with an influencer agency affords opportunities and reach that would not be attainable otherwise, Dowling was not the only one in the audience who believed that an influencer agency was increasingly irrelevant.

The bottom line: Brands should not think that they can handle everything themselves, necessarily, but it increasingly seems like companies are feeling more skeptical about middlemen.

Speaker highlights 
Shira Suveyke, Shopbop President 

– Shopbop has fine-tuned its influencer strategy over the last two years — first, by moving the involved duties to a dedicated team versus marketing staffers focused on other responsibilities. “This ‘little thing,’ that was growing super fast and was driving a lot of revenue, was getting ignored,” said Suveyke. The company also started giving influencers “total creative freedom,” which was a difficult adjustment for the in-house creative team, and moved from working with macro-influencers exclusively to micro-influencers and nano-influencers.

– High conversion is not a KPI for influencer campaigns. Instead, the company is looking at engagement, then reach, and it’s weighing campaigns’ effectiveness and efficiency by looking at cost-per-engagement. Influencer marketing is now part of the brand’s marketing budget versus its performance marketing budget. “We see it as an opportunity to build the Shopbop brand on a social platform, and we believe that has a halo effect of downward revenue,” said Suveyke.

– The retailer just launched its  360-degree, content-fueled campaign called “The Summer of Shopbop.” Its brand marketing and creative teams traveled with eight influencers to Lake Como to create content around its travel-inspired story of the season. “It resonates with our customer when they have an affinity with the influencer, rather than Shopbop pushing the product,” said Suveyke.

Laura Dowling, Digital Brands Group CMO
– DSTLD’s (which is part of holding group Digital Brands Group’s portfolio)  millennial customer base values ethical behavior and transparent brand messaging, and DSTLD is an audience-driven brand. The mission of the denim and leather company is to distill its shoppers’ wardrobes down to essentials by updating the quality and consistency of the pieces, said Dowling. Unlike other brands, its sustainability message is not centered on the changeover of styles but rather on the lack of waste the brand is producing. “Quality equates to longevity,” she said.

– In the name of transparency and authenticity, the brand recently made changes: It has moved its production from Asia to Europe to ensure it is using mills that are ethical and sustainable, both in the materials they use and also in the radius in which they operate. “Our carbon footprint is as small as possible,” said Dowling. In addition, it has added a quality control step to production, enabling it to have just 3% waste, when the industry standard is 7%.

– To amplify its message for credibility, Dowling said the brand leans into press, letting industry publications tell its story. It also taps into relevant opportunities to amplify the story. On Earth Day, it launched an education-based marketing campaign for eco-conscious consumers on how best to wash jeans. And because music has been woven into the brand’s marketing since inception, it hosted a sustainability-centered activation at Coachella.

Nate Checketts, Rhone co-founder
– Checketts broke down the company’s data collection process into three steps. “One, you have to gather the data; two, you have to organize the data; and three, you have to take some actionable insight from it,” he said. “Most companies are stuck on part one, and for DTC brands, there are so many ingestion points of data that it can be hard to sort through them all of them.”

– In addition to the regular channels for data collection, like points of purchase either in Rhone’s DTC or wholesale business, the company also collects data from some out-of-the-box, third-party sources. Weather on the day of a purchase, the performance of stocks on a given day and other data points can help paint the picture of what a brand needs to know. According to Checketts, it all comes down to sorting through what’s relevant and what isn’t.

– The data collection and feedback used can also be a selling point for the company. While older generations may be less likely to appreciate how the data collected is used to improve their experiences, Rhone’s younger customers expect it. Whenever the company launches a product that was designed heavily with feedback from consumers, Rhone highlights that in its marketing, said Checketts.

Overheard
“If your advisers and investors are telling you that it’s too early to be thinking about and using data to improve your business, then you need different advisers and investors.”

“Going direct-to-consumer is definitely about brand control a bit, especially when you’re a new designer. You have a small assortment. On a shelf, you can only tell so much of your story. In pop-ups and on social media, you can speak to your customer a lot more.”

I believe in the power of full-frontal marketing, really thinking about what we need and driving understanding through to conversion. To do that, the best way possible, you have to lean into all the channels available to you.”

“If you look at, like, Marc Jacobs, that kind of old luxury, it used to be that designers did what they wanted and the women followed. What we’re trying to do is the exact opposite. They decide, and we follow.”

“We were able to start our direct business pretty early on, our first website opened in 2003. We’ve been able to go from 100% wholesale to 60% wholesale, 40% direct. Our ideal split is flipped, 40% wholesale and 60% direct. That’s where we are trying to be.”

Challenge Board

[“source=glossy”]

Providing CMOs Insights Across All Online Marketplaces: Jumpshot’s New “Insights” Product Now Enables Brands to Benchmark Against Competitors

Image result for New analytics tool reports consumers make over 50 percent of their online retail purchases on e-commerce sites like Amazon and Walmart.com

SAN FRANCISCOMarch 21, 2018 /PRNewswire/ — Jumpshot, the only company that unlocks walled-garden data, today announced the company has broadened its data offering to enable marketing professionals who manage brands to benchmark against competitors by understanding purchase behavior, all the way down to the brand and category level. From search engines and online marketplaces to competitive websites, the new solution, called “Insights,” allows marketers to map purchasing behavior online identifying their path to buy even within walled gardens.

Some examples of how this product is applied:

  • While overall purchases for Nintendo products were down across all online retailers in February by about 20 percent year-over-year, Target.com saw an 80 percent year-over-year growth for these products.
  • Though Amazon saw a 30 percent growth in pet supply purchases year-over-year, purchases on Chewy.com more than doubled from the year prior.

“Consumers make over 50 percent of their online retail purchases on sites like Amazon and Walmart.com, and that number is continuing to grow,” said Deren Baker, CEO of Jumpshot. “Our clients have increasingly used Jumpshot to better understand their target customers’ purchasing behavior, wherever they go online, and now we’re taking that a step further – allowing brands to also get insights into how their competitor’s products are purchased.”

Jumpshot’s Insights solution enables marketers to:

  • Benchmark your brand against competitors. Understand how and where you’re losing out in the purchase cycle to the competition. Compare your performance to competitors — by domain, brand or category — at every step of the funnel on any site to pinpoint strengths and weaknesses. This includes referral sources, keyword search and upstream analytics.
  • Improve your brand conversion funnels everywhere. Analyze each step of the path to purchase across retail, travel, and other types of websites. From visit to conversion, see where users drop off, where they get stuck, and how long they take to convert on all leading marketplaces.
  • Understand cross-visitation behaviors. With insight into consumer purchasing behaviors throughout the entire web, marketers can understand where and why their customers are buying if not on their own site. Pulling back and looking at cross-site visitations by category can reveal an even broader picture that offers meaningful insights across an entire vertical.

About Jumpshot:
Jumpshot delivers digital intelligence from within the Internet’s most valuable walled gardens. The company’s real-time, global panel of 100 million devices tracks five billion actions a day to deliver insights into online behavior from every consumer action. Jumpshot works with customers including Condé Nast, Kantar, TripAdvisor, Moz, SEMrush, IRi, and GFK, among others. Learn more about Jumpshot at www.jumpshot.com.

[“Source-prnewswire”]

In-depth: A tug of war between creative agencies and brands on remuneration

Shrinking profits, high rate of talent churn, looming threat from media and digital agencies and price competitiveness of smaller agencies. It’s been a double whammy for India’s creative agencies that have seen the remuneration from clients being stagnant for years and the business pie from the same client being distributed among various agencies.

There is a lot of hue and cry in the creative industry about not being paid well by clients despite the work load increasing. The agencies feel that these things will eventually affect the quality of work along with their balance sheets.

What has changed for creative agencies that were known to be the brain behind the brands?

Shiv Sethuraman

“The game has changed. Earlier, the creative agency always used to be at the top of the table, where they were considered the most important strategic partner,” said Shiv Sethuraman, Founder, The New Business.

“Today, the media and digital agencies are becoming more strategic. Also, not a lot of clients are spending as much on mass media as they used to. So, all of this has resulted in changing dynamics,” he added.

Sethuram said that agencies are equally to be blamed for their weakening position since they have been very slow to change which has led to casual erosion of their status and revenues.

Also, clients are not depending on only one agency and have empanelled a bunch of big and small agencies where the client fee gets divided.

Virat Tandon

“Clients are having to pay too many agencies. That is the new reality. Reducing the remuneration of the agency shows that probably the client doesn’t fully appreciate or understand their contribution. Or, that some clients are not getting their value from their agencies,” said Virat Tandon, CEO, Mullen Lintas.

In the hey days of creative agencies (the period between 1980’s and early 2000), brands had a single agency as partner to do media planning as well as creative work. Media and creative functions of the agencies disassociated with each other long time ago and became separate entities. Today, both marketers and agencies are trying to reach out to consumers through different mediums.

Prasoon Joshi

Prasoon Joshi, CEO and CCO, McCann Worldgroup India, Chairman McCann Asia Pacific, explained the changing scenario clearly. He said, “People are consuming content in a very complex manner. In today’s time, an agency is finding it challenging to build a brand and deliver its message and experimenting with various things like developing content and trying out different innovative ways to deliver the message. That world will definitely give birth to new revenue streams and it will also make certain ways of making money obsolete.”

Industry stalwarts feel agencies stuck with the business formula of 1980s are not going to stay in the game anymore.

Ashish Bhasin

Ashish Bhasin, Chairman and CEO, South Asia, Dentsu Aegis Network, added, “The inefficient dinosaurs are getting squeezed out. The people who have built the businesses on the 1980s’ formula and are not willing to change are going to feel the pressure.”

Besides competitive scenario, Dhunji Wadia, President, Rediffusion Y&R, cited value-engineering by clients as one of the main reasons behind the growing revenue pressure.

Dhunji Wadia

Wadia also held agencies responsible for not keeping the pace with the change and said, “If you always do what you’ve always done, you always get what you’ve always gotten. So, unless the agencies change their behaviour they’ll continue getting the same results. Today, most agencies have gone beyond the traditional advertising offerings. Those who don’t can keep complaining.”

Where does the problem lie?

GroupM, a global media management investment conglomerate, has forecast the country’s advertising expenditure to grow by 10 per cent and to reach an estimated Rs 61,204 crore in 2017 as compared to Rs 55,671 crore in 2016. Advertising expenditure of the brands is only increasing over the years. Then why is there so much cribbing about reducing profitability and not getting paid well by the clients?

The creative industry is one place where anyone with a laptop and ideas can open an agency. The urge to grow and the feeling of running independent cause dropouts from the bigger creative agencies and give birth to independent smaller agencies and freelancers. All this, in turn, opens up more options for the brands to choose their creative partners and leads to competition among the peers.

A senior industry person who didn’t want to be quoted and has worked on both the creative and the brand sides said, “We keep aside a fixed sum to be spent on the creative campaign and if the agency is not able to deliver a piece of work fast and in the desired manner, we give it to the freelancer. So, it is not that we don’t spend money on creatives but the amount gets distributed.”

Experts feel that the increasing number of small and independent players have hit the margins hard as the brands tend to go for anything that doesn’t cost them much.

Akashneel Dasgupta

Akashneel Dasgupta, Senior Vice-President and Executive Creative Director, ADK Fortune, said, “The advertising industry itself needs to be blamed because we tend to sell ourselves too cheaply. In advertisement, there is hardly an entry barrier. There is no infrastructure that you have to set up. There is no price for an idea. The whole advertising pie size has increased, but compared to that, the number of people who are staking claim of the pie has multiplied by 10 times.”

Adding to it, Tandon of Mullen Lintas said, “Agencies are also at fault for undercutting each other to the extent that sometimes it’s unbelievable how they will pick up businesses for a totally unsustainable fee.”

Another senior creative professional said the problem of not being paid well by the clients has multiplied manifold due to demonetisation and implementation of GST. He said, “Earlier, it was due to demonetisation that we faced this problem of outstanding payments. Now, the brunt has increased with GST coming in. We need to pay our employees irrespective of when the clients are able to pay money. Even if they are giving us the money, they are trying to negotiate on the payment front.”

The agencies earn money from what brands pay them for their services. Till the time brands don’t increase the spend on the creative partners, these issues will continue.

Brands want creative agencies to re-invent

BestMediaInfo.com reached out to brands to know their point of view. We put forward the queries of creative agencies’ about remuneration to brands.

A senior marketer of a top FMCG company said, “Nobody is ready to pay the money agencies demand as there are so many options. Agencies are not in a position to negotiate. Negotiation happens when there are equal partners. There is so much of supply.”

BK Rao

While marketing spend increased at Parle Products, the brand agrees that the money spent on creative agencies has not increased to that extent. BK Rao, Deputy Marketing Manager, Parle Products, said, “Brands started negotiating on the commission bit and slowly the agency commission went on decreasing. The agencies also agreed to work on lower commissions.”

Earlier, the media spend by brands was very minuscule as compared to now. Therefore, a marketer was able to pay more to the creative agency. Till mid 90s it was only Doordarshan on which brands had to advertise. But now with more than 800 channels, TV as the medium has fragmented so much that on an average, to get decent visibility, one needs to spend more than Rs 8-10 crore per campaign.

The clutter level has also increased, which in turn has caused brands to be more accountable and here, the negotiation comes into play. A few marketers said that the mediums on which the marketing and communication money goes have also increased.

Subhrangshu Neogi

Subhrangshu Neogi, Director, Group Marketing and Brand, Religare Enterprises, said, “Marketing spends today have become much more fragmented and essentially are largely ROI-focused, especially in a category like BFSI. While you may still be spending on conventional media from the context of brand awareness and recall, you are also focused on performance marketing, social, affiliate marketing, email marketing and so on and so forth.”

Parle’s Rao also said that the market condition is extremely tight right now, especially in the last one year post demonetisation and GST. “All the clients have really gone low on communication and there are so many creative shops rising. There is increasing competition as far as creative shops are concerned. So, clients really don’t have a dearth of creatives now. It has become challenging for the creative agencies to keep winning accounts and retain clients at the same time.”

A few brands argued that there is no direct relationship between agency remuneration and media buying spend. Agencies are paid on a remuneration basis and the amount that a brand spends on buying different mediums is not related to each other and can’t be compared. On the contrary, agencies argue that the kind of return on investment the creative idea brings to the table by putting the particular campaign/creative idea on different mediums is huge and should be paid over and above the usual remuneration.

Brands say that they’re willing to shell out more money to creative agencies if they can show path-breaking work that they’ve done for other clients.

Sushil Matey

Sushil Matey, Director, Marketing, at Livpure, said, “A typical creative agency can be good in (a) strategy and (b) creative. The best agency is the one that excels in both. In today’s cluttered media sphere, a creative agency should deliver three things – create awareness, build memorability and break the clutter. Allocating money is directly dependent on the budget allotted for creative/ advertising agency. Also, a fact to be noted here is that category A agencies will charge fees as per their expertise and norms and the same goes for category B and C agencies. All these factors combined help an organisation to decide on getting the creative agency on board. However, if an agency can show path-breaking work done prior in a competitive category, the brand/ company can decide on allocating more money to that agency.”

According to Neogi, “The order is that the brands now don’t just want creative ideas but marketing solutions. Clients today are not just looking at a one-dimensional creative solution but are looking at holistic solutions for their business problems. So, the expectation from partners is obviously revisiting their skill and capability sets. And it’s not that people aren’t doing that. A lot of the traditional agencies have been working remarkably well in that direction.”

“It cannot just be a plain straight-jacketed solution that says, ‘I am a creative agency, I will only do creative’ or ‘I am a media agency, I will only do media’. Ideas/ thoughts can come from anywhere. Ultimately, what clients value and are looking for are people who can help them as I mentioned: ‘solve their business problems’,” he added.

Another space where brands are spending the money on creatives is that even after having agencies on record, they are letting out important brand campaigns on a project basis as and when required.

Parle Products has Everest Brands Solutions and Thoughtshop Advertising on its roster but got its last two campaigns done by Taproot Dentsu on a project basis because they thought Taproot made more sense to do the brand campaign for Parle Products.

The reason that Rao gives for hiring agencies on a project basis is that the AoRs will no longer be given work on a platter. They need to fight for it and each time we want a creative campaign, a pitch will be called, when we want a creative campaign. It will be the game of the survival of the fittest.

Suggestive solutions

 

Neelima Burra

Neelima Burra, Chief Marketing Officer and Business Head Health & Wellness, Cargill Foods India, has a pretty good solution for agencies if they could deploy that in practice. She said, “The creative agencies have to relook the model of service. Probably, the old-fashioned retainership model where their risk is protected while business nowadays is far more volatile. The industry is far more dynamic with higher inflation and the cost to serve is also increasing. In such a scenario it is good if a creative agency comes up with a model where they can take some part of incentive or bonus to deliver better results or ROIs of the campaign which they are promising. Who doesn’t like incentives and bonuses? If the team that is working on the account is put on the performances, higher bonuses and incentives, they would not leave the agency.”

Wadia said, “An idea without execution would be just a hallucination. According to Steve Jobs, ‘It’s the disease of thinking that a really great idea is 90 per cent of the work.’ And if you just tell all these other people “here’s this great idea,” then, of course, they can go off and make it happen. And the problem with that is that there’s just a tremendous amount of craftsmanship in between a great idea and a great product. For me, ideas are worth nothing without execution. Great execution would be worth millions. And agencies that imbibe this caveat will stand to gain.”

Sethuraman said, “The only real solution that I can see for creative agencies is to strive for a much stronger integration with the data and digital side of the business. There are few agencies who have a good creative reputation and who will continue to make decent revenue but over a period of time I don’t think it is going to sustain.”

DAN is a 26-agency network and eight of them are in the area of data, technology and media. 1,400-1,500 out of 3,500 people are in digital. Search and performances are going to be the key.

Bhasin realised where the brands are willing to invest their monies quite early in the game. He said, “When I started the journey a few years ago, people were saying that digital is only five per cent of the market. We found the field opened for us. Some of the large legacy kind of agencies didn’t see the wave coming and couldn’t act as fast as we could. The competitors were also not looking at the out-of-home areas where the world is moving, as the infrastructure is improving. You have to follow where the consumer is and where the client spends are going.”

Tandon of Mullen Lintas said that an agency should be clear that the value it can create for a client, no other agency can and no businesses should be picked for an unsustainable remuneration.

“I know at Mullen Lintas, we have lost a few pitches because we refused to be beaten down on pricing. We are quite confident of what value we deliver to our clients,” he said.

Wadia suggested that one must evolve and adapt. The best way to address this is to find a correlation between profit margin and revenue tracking. Agencies that track revenue per client will have higher profit margins than those that don’t. So, unless the agencies change their behaviour they’ll continue getting the same results. Today, most agencies have gone beyond the traditional advertising offerings. Those who don’t can keep complaining.

Piyush Pandey

In a recent interview, Piyush Pandey summed up the discussion well. He said, “I think each agency network is trying their best to keep up the pace as they are all competent agencies. There has to be good discussions with the clients about being open with the budgets if they want great creative output. The client will have to partner me in getting better people. It’s all about understanding, negotiation and managing your businesses properly while making efforts to increase profitability.”

[“Source-bestmediainfo”]

3 big insights for fashion brands looking to compete with Amazon

L2, the business intelligence platform that tracks brands’ digital performance, held a clinic yesterday in New York for fashion brands looking to compete with — or simply stay afloat amidst — Amazon’s rise.

It’s a hot topic of late, and for good reason: Amazon has seen a $64 billion growth in overall sales since 2010. What’s more, 52 percent of Americans currently have Amazon Prime. To compare, L2 pointed out that just 51 percent attend church monthly and 49 percent own a landline telephone.

While many have been suspect of Amazon’s ambitions in the fashion space, and whether it can really pull them off, L2’s founder Scott Galloway believes the company has effectively declared war in the space. “This is a company that has conspired with consumers and technology to destroy brands,” he said, alluding to shoppers’ preferences for low prices and the sophisticated algorithms the company relies on.

But there are a few insights, outlined below, that brands can use to either leverage Amazon’s power for their own benefit or compete with them directly.

alexa-cp-dotAmazon’s Echo Dot, with Alexa voice activation

Get in bed with Alexa
Voice, in general, is on the rise, according to Greg Hedges, the director of strategy at Rain Agency, who predicts user growth in the space will increase from 390 million in 2015 to 1.83 billion by 2021. He went so far as to call this coming paradigm shift the “Age of the Ask.”

Amazon currently has the first-mover advantage on access, purchase intent and reach in that space with Alexa — the voice service that powers their Echo device — and L2 believes they will continue to dominate in the space.

As a result, if brands don’t do the work necessary to get involved with voice — specifically by creating skills and actions (the voice version of apps) for Alexa — Amazon is going to use that very tool to kill off many of the brands we know and love.

As L2 pointed out, the company is already working to drive more consumers to shop via Alexa than their website by offering discounted prices for most items purchased via voice. When you use Alexa to shop, you’re not surrounded by the usual visual cues from other brands, lending more power to Amazon’s preferred recommendations. “They will slowly but surely take control of your preferences so that they’re the ones Amazon makes the most margin on or that are Amazon Private Label,” said Galloway.

To mitigate this, brands will need to develop the aforementioned skills and actions that are popular enough on Alexa to drive direct brand purchases that are equally as seamless as those purchases made via Amazon’s marketplace. Everlane, for example, could create a shopping skill for all of their best sellers, allowing consumers to opt for their coveted tees or loafers over Amazon’s selection.

Hedges did offer one warning, however. “Think of voice as a product, not a campaign or a one-off,” he said. “Alexa’s the proxy, but how can you make sure she’s using your brand voice?”

il_fullxfull.2894834781Heritage brands like Hermès are at less risk than others

Not all products are Amazon-able
Oliver Chen, a senior retail analyst at Cowen & Company, is confident that certain retail sectors are more immune to Amazon’s reign. These include brands like Tiffany & Co. that serve up emotional content or offer an emotional shopping experience, like that of picking out your wedding ring with a loved one.

Heritage and luxury companies like Hermès and Louis Vuitton also wield more power against the juggernaut, due to the trust and craftsmanship often required of those purchases, neither of which Amazon is known for. (Counterfeit products are an ongoing issue.) Such premium products also require a level of brand control that, according to Ryan Bonifacino, the former CMO of Alex and Ani, a longtime first-party seller on the site, is “next to impossible at Amazon.”

Companies offering products that are experiential in nature or service-driven are also well-placed to compete with Amazon. Think brands like 3×1, with its made-to-measure denim offering, or Drybar, where customers can opt for a quick blowout alongside any product purchases.

7102b710_c9f3Basics are Amazon’s bread and butter

Replenishment categories are key
If a brand does decide to partner up with Amazon, limiting its product offering to only their brand staples is important, said Maureen Mullen, the chief strategy officer at L2. The replenishment of basics like tees and underwear is what Amazon sells really well, so to compete in the same space, brands should look to do the same. “Focus on a core assortment of 5-10 products in these categories,” she said, adding that it could be particularly well-suited to any licensed items.

What’s more, this allows a brand to retain some control over their image and continue driving customers to their own e-commerce platforms.

Mullen also suggests that brands use the site to target product segments they haven’t touched before, such as plus or petite sizes. It’s much easier to connect with these hard-to-reach consumers on Amazon, where they’re already shopping, she said, than to spend extra time and money chasing after them yourself.

[Source:-digiday]