2 days in Germany

Hopped over to Germany with our Retail Director for Europe last week to see our stores and meet some of the online teams I speak to.

It was a great opportunity to see the brand in store over there and get to know the department stores as well as the other brands we’re placed near. Lots more on the horizon for new spaces in the future!

It was lovely to catch up with the online teams for Karstadt and Brueninger, as opposed to just on conference calls. We got to hear about their AW16 plans and our on-going partnerships. As international continues to grow for us its so valuable to see these markets and to understand how their multi-channel operations are evolving.

 

Below – Kuafhof, Frankfurt – mannequins showing off the new collection-

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Kaufhof, Dussledorf the new collection

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Last day of lovely sun in Stuttgart, hope to go back again soon..
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Phase Eight is stocked at Kaufhof stores. It is online and in stores with Karstadt and Breuninger.

 

 

 

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eCommerce passport stamps

2016 seems to be the year to explore even more cross border eCommerce. This of course isn’t revolutionary, international expansion has been growing steadily especially in the US and China with brands such as ASOS, Superdry and Primark stamping their mark into these markets. John Lewis announced this week their down under adventures, opening six concession stores in the department store , Myer. This is big news as already, H&M, Zara, Gap, TopShop and Marks and Spencers have ventured to Australia.

This year I had first hand experience of going into Australia online managing the online production of a separate Australian website channel.

There’s obviously many important elements to consider when expanding into new territories online, it offers new possibilities for a fashion retailer in terms of customer but it also brings with it some of  the most basic problems such as delivery, language and imagery. Ensuring you’re in line with the customer and climate is key but so are the basics such as a smooth shopping experience with clear product and delivery messaging.

“We’re delighted to be expanding our international presence and bringing John Lewis to new countries around the world, both through physical collaborations and by expanding our online international delivery destinations,” said Katie Jordan, head of John Lewis’s international development.

 

I have reviewed a couple of big multi-channel players who have begun to explore the Australian market:

Marks and Spencer

On entering the M&S Australia site you are greeted with a pop up 20% offer mentioning their ‘new’ site which has been live since February 2016. This is still coming up in July 2016, which is interesting as they’re still offering an incentive and branding it as ‘new’. Be good to understand how the first 5 months have gone for them on the this new channel.

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Their homepage (above) is customised to the Australian market focusing on Autumn season – the current season down under.

There’s slight amends to product banner images and copy to be in line with the current season feel.

There’s less top navigation categories on their Australian website as well, pairing back the offering, a good idea in my experience is a good plan whilst trying to manage cross border online territory CMS areas. Also sticky header on delivery follows around the website (below) – a great idea to highlight the importance of delivery for the Australian customer.

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Karen Millen

Their homepage is tailored to the Australian customer again making sure the banners and product copy is leaning towards the Autumn season. Products have been merchandised to reflect this.

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Again, sticky header highlighting delivery.

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Looks like they trade the counter season to the Australian customer, so AW15 while UK is in SS16. The Australian homepage is messaging the new season, with the striped dress on the Australian homepage marked as ‘new’ and full price but on further inspection it is on sale in the UK – see below.

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I also assume that when looking at these sites if I was in Australia that I would be auto directed to the Australian site based on my IP address/configuration.

I wonder how far the Australian customer looks when shopping to see these differences, does it depend how well-known the brand is? Should they be offering specific Australian stock packages? Do they expect to pay more for British brands delivery options?

I don’t think there’s ever one perfect rule to execute this as there are so many factors as I mentioned such as price, imagery and  brand awareness- such as is it already stocked in an Australian department store? or does the brand already have a stand-alone store? I have found the sore presensc ein a country is sometimes key to lifting online. Browsing in store and discovering more, such as a full collection from the brand on the website.

With department stores like David Jones reporting 8.5% increase in sales for 2015/16 (52 weeks up till June 2016) there’s cause to maybe rethink these questions.

Like-for-like growth at Myer was 3.4 per cent in the three months to April 23. Its better-than-expected first-half sales grew by 1.8 per cent to $1.8 billion for the 26 weeks to January 23 and comparable store sales were 3.3 per cent stronger for the same period.

Macquarie Wealth Management’s research suggests ‘international retailers account for only 1 per cent of Australia’s clothing and department store sales though’.
So what we also see now is a squeeze on the department stores from the likes of heavy weight global players such as H&M which recently reported a 50 per cent surge in its Australian sales for the May quarter as well as investment in local discount department store chains Big W and Target.**

Just a peek at what can be expected, deep breath – H&M will increase from nine stores to 40, Topshop from four to 20, Zara will increase its store numbers by 30 per cent and GAP will boost numbers more than fourfold to 25 stores. Wow.

 

‘Macquarie Wealth Management’s research suggests international retailers account for only 1 per cent of Australia’s clothing and department store sales’ 

Of course how this directly affects online is not entirely known but from experience the store presence of the brand is key to online with more pressure on wallet share. I think is a positive element creating much more of a ‘stage’ for international brands,  however to what effect this eventually has on Australian’s homegrown discount stores and big department stores, only time will tell. Recent reports show that cumulative market shares from these department stores have fallen from 15 per cent at the tail end of 2008 to 13 per cent in 2016***.

The international expansion of eCommerce rolls on and I hope this continues despite Brexit!

 

 

* Source: Telegraph, 15/07/2016, http://www.telegraph.co.uk/business/2016/07/15/john-lewis-goes-down-under-with-australian-shops/

**Source: The Sydney Morning Herald, 14/07/2016, http://www.smh.com.au/business/retail/david-jones-unveils-strong-fullyear-sales-20160714-gq5u6q.html

***Source: The Sydney Morning Herald, 17/06/2016, http://www.smh.com.au/business/retail/international-retailers-like-hm-zara-topshop-have-only-started-their-invasion-20160617-gplczt.htmlrese