When it comes to marketing, premium brands often take a different route than lower-priced brands. After all, premium brands have a different relationship with their more niche market customers. In this article, we explore the differences between each type of strategy.
How the fashion industry approached 2018
First, let’s consider how the fashion industry shaped up during 2018. With the introduction of e-commerce, shopping through social media, and a rise in technology-driven customers in recent years, the fashion industry has experienced a shift. So, what are some of the main issues of the sector today?
The State of Fashion 2018 report from the Business of Fashion revealed various ways the industry has developed and changed over the year:
- Customisation — More customers are looking for products that no one else has through customisable, unique or limited-edition products.
- Demands — Customers are becoming more demanding based on what they want from fashion retailers — convenience, quality, values orientation, newness, and price.
- Peer influence — With the use of social media still prominent, customers are becoming more influenced by what they see and read online. They readily share peer-to-peer information, reviews, and opinions. In fact, 55% of consumers purchase decisions are influenced by online reviews and 74% of customers’ purchase decisions are influenced by social media.
- Brand loyalty — As the ability to compare brands becomes easier, customers are less loyal than they once were. One statistic reveals that among millennials, two-thirds are willing to switch brands for a discount of 30% or more.
Brands are actively balancing the need to meet customer demands, as well as address and deal with environmental issues within the sector. But what else is at the forefront of industry goals?
- Improved supply chain — Retailers in the industry are running at an accelerated pace, as they try and reduce the time taken for a garment to go from design to customer. The digital consumer is becoming accustomed to next-day deliveries and instantaneous access to product ranges online — and brands must find a way to keep up.
- Tackling fast-fashion — One topic that’s on the lips of members of the government and eco-conscious individuals is ‘fast-fashion’. This is where consumers purchase a low-cost fashion item, wear it once or twice and then throw it out. Often, these garments are not recycled, and this is a growing concern.
- Sustainability focus — Clothing retailers now realize their responsibility to be eco-friendly. With the growing problem of ‘fast-fashion’ becoming a widely discussed issue, it’s important for brands to make changes. We can expect sustainability to become an integral part of the supply chain and operations planning systems in the coming years too.
Between luxury and lower-priced brands, the biggest difference in approach to these new goals comes in the form of online platforms. It is expected that premium brands will grow further into the online world. To extend their reach further, premium brands are collaborating with alternative platforms and broadening their target market online.
On the other hand, lower-priced brands are overwhelmed with online stores and online-only outlets. These differentiate through celebrity endorsements, unique product categories, and through social media. In this sector, customers are less focused on the brand and more on the price — in fact, evidence shows that customers are less brand loyal than they once were, and low-cost fashion brands know this too well.
Shared strategies
Are there any similarities in how each type of brand connects with its customer base?
For luxury brands, the important element is to build a long-lasting customer relationship. It’s important for premium brands to build up long-lasting relationships with their customers, and they do this by taking the time to understand their audience. Premium denim retailer of ladies straight cut jeans, Trilogy Stores, say: “An important part of our business is truly understanding our customer through the one-on-one relationships they have with our stylists. This allows us to tailor new brands towards their needs and develop our premium ranges further in relation to what we know about them. For example, our ‘Only at Trilogy’ designs are designed in partnership with our best brands to create exclusive styles to us in the UK. This keeps our customers brand loyal”.
Though premium stores are turning their gaze to the online world, they still have a preference for physical stores. Therefore, they must understand the importance of customer service and experience. Often a tailored service is provided, with employees offering a personal shopping service for those who visit and taking the time to understand what the customer is looking for. Premium customers often enjoy a sensory experience too. An example of this is Rolls Royce who diffuses a blend of mahogany wood, leather, and oil for their cars. When potential buyers sit in the model, they’re overwhelmed with the nostalgic smells.
Low-cost brands tend to focus on short-term relationships with their customers. This is done through social media influencers and celebrity endorsements. These marketing techniques bring the brand onto the customer’s feed without them fully realising it. However, the same influencer could promote another brand’s clothing after six-month and this could lead to the customer’s loyalty to stray. One of the main things that these brands compete on is price, and they must be innovative in how they present this to the customer. For example, one online womenswear retailer offered a ‘minimum wage’ category where everything was £7.50 to appeal to their younger market.
The fashion industry is always changing, and this changes how each type of brand approaches their marketing and customer relationships. Premium and low-cost fashion brands must keep in mind that, although they operate in the same industry, the way that they connect with their customers is entirely different.
Sources
https://cdn.businessoffashion.com/reports/The_State_of_Fashion_2018_v2.pdf