Understanding International Seasonality Drives Positive Results for Fashion E-Commerce

By  By Charles Whiteman, SVP Client Services, MotionPoint — February 09, 2016

Thanks to the Internet, it's easier than ever for brands and fashion e-retailers to expand into emerging and developed markets, and achieve powerful results.

The smartest companies are naturally complementing their in-market, brick-and-mortar efforts with translated, localized websites. Authentically "talking the talk," and engaging new consumers in their languages of choice, is a critical first step in generating local interest and sales inside these markets.

But launching localized websites isn't enough to generate sustained growth. An understanding of and respect for the local market — from culture to climate — is essential. This is especially critical in fashion e-commerce, where the nuances of market-specific "seasonality" can make or break a retailer.

Indeed, the lack of a deep understanding of an international market's unique seasonality — its regular and predictable changes that occur throughout the year — often leads to alienated customers and missed sales opportunities.
More than 10 years of working with fashion brands and e-retailers as they enter new international markets online with localized websites has taught us a great deal about global markets, and the buying preferences of their residents. We've learned that seasonality greatly informs consumer shopping habits.

Leveraging data we've amassed from operating these sites, we'll examine three markets and highlight their unique tastes and trends. Retailers that adapt to such particular shopping behaviors (by appropriately stocking preferred accessories, for instance) can win big in global markets.

Market spotlight: Russia
Despite recent economic fluctuations, Russia remains an attractive emerging market for expanding fashion e-retailers. The country continues its lead as Europe's largest online population (80+ million users as of June 2015), with rapidly growing Internet penetration (larger than Italy's and China's, according to the World Bank). Connection speeds in major metro areas are increasing rapidly.

Savvy fashion e-retailers also know that fluency in the Russian language is high in neighboring countries such as Estonia and Ukraine, making localized Russian e-commerce sites a beacon for shoppers in those markets, too.
We've found that Russian fashion e-commerce traffic peaks between late December and early January, and again in July. Winters see the biggest traffic bump, with year-long highs in transactions, conversion and revenue. Interestingly, average order values (AOV) are often higher during the summer months.

Newcomers might be mystified by the post-Christmas surge in sales. Why doesn't Russia experience a pre-holiday revenue spike, as seen in many Western markets? That's because Russians exchange gifts in early January. Due to the comparatively late celebration date, shopping skews later into December.

And why does AOV skew higher during summer months? Russians are decreasing their holiday budgets, according to Deloitte's New Year Spending Survey 2015. Additionally, they're less inclined to buy clothing as gifts for others. Russians prefer giving cosmetics, chocolates and books. (And increasingly, cash.)

Our tip: Offer more affordable gift-type items during the winter. These are a hit with Russian online shoppers.

By contrast, Russians have little problem buying clothes for themselves when the weather warms. We recommend offering potential vacationers tantalizing and timely products. They're more likely to splurge during the summer.

Russians love buying shoes online, particularly during the spring and summer. Of the top 30 bestselling products we identified during this time of year, an average of seven products were shoes. (Here's a shoe-related tidbit, based on our data: Russian women strongly prefer flats, and Russian men prefer stylish brown leather dress shoes.)

Between the brutal climate and local fashion norms, no self-respecting Russian ventures out in winter without a hat. Retailers should stock products accordingly: Russians are naturally likely to buy knit hats in the fall and winter (between September and December, specifically). Curiously, holiday-themed hats seem to be a big hit.

Another intriguing insight: Russian shoppers are crazy for inexpensive add-in items. Lip balm is consistently one of the most frequently purchased items, regardless of season. We recommend optimizing a localized site's conversion funnel to feature these low-cost items throughout the checkout process.

Market spotlight: France
Moving on to France, we'll pull our focus away from product-specific shopping habits, and instead examine how a nationwide retail phenomenon can generate amazing results for progressive e-retailers.

Fashion brands have long known about the French retail tradition of "Soldes," the six-week-long nationwide sales event that occurs each summer and winter. These events' store-wide deep discounts — often 30 percent or more — generate gobs of sales for brick-and-mortar fashion retailers. Companies from department stores to luxury brands get in on the action.
However, Soldes also represents a promising opportunity for online fashion brands and e-retailers. For starters, French consumers are already predisposed to shop during this period.

Further, French brick-and-mortar retailers are bound by law to discount only what they have in-store during Soldes. Online retailers have far more flexibility. Offering Soldes-themed sales— particularly when combined with free shipping (to further reduce costs, and achieve parity with brick-and-mortar stores)— is a straightforward way to compete without drastically slashing prices on items.
This tactic works. We recently analyzed the performance of two fast fashion e-commerce retailers operating in-market French websites. One company benefited during the 2015 Soldes periods. The other didn't.

The first retailer leveraged branded, in-language Soldes marketing campaigns during the two six-week periods. Its website saw astonishing results. On the first day of Winter 2015 Soldes (January 7) and Summer 2015 Soldes (June 24), the localized site's revenue skyrocketed by about 350 percent and 320 percent, respectively. This single-day jump alone generated hundreds of millions of dollars in additional revenue.

Further, thanks to timely and powerful in-market promotion, the number of visitors to the French site went through the roof, contributing to increased sales. (The first day of summer Soldes was the site's most visited in 2015; the first day of winter Soldes was the second-most visited. Traffic grew by nearly 100 percent on these days.)

By contrast, the retailer that did no Soldes-related promotions saw a comparatively modest sales increase of 47 percent and 52 percent for those days. This is especially disappointing, considering that on June 24 (the first day of Summer Soldes), the localized site hit a year-long high in visits. Lots of traffic and few conversions show that this was clearly a missed opportunity.
Our tip for fashion brands and e-retailers entering France should be obvious: French shoppers expect sales events such as Soldes to apply to localized e-commerce sites. Companies that fail to pay attention to such local customs can miss out on major opportunities for revenue growth.

A follow-up tip: If your company isn't already translating its e-mail campaigns and newsletters, get on that. Our analysis suggests this is the optimum way to engage customers, and to promote sales such as Soldes.

Market spotlight: Germany
As we move from France to its neighbor Germany, we'll focus once more on local consumer behavior, preferred products, and online-exclusive insights.

For starters: Ever the planners, Germans tend to begin their summer shopping in March, earlier than other consumers in other European markets. (By contrast, our data reveals that French shoppers usually don't start shopping for summer apparel until May!) Unsurprisingly, sales of flip-flops and swimming suits increase steadily until July, and then plummet until the following March.
E-retailers engaging the German market should note that temperatures drop in Germany much earlier than in France, and should stock product accordingly. Winter products take off in September, and peak in November. Wool products are big sellers in Germany; cardigan sweaters were particularly in vogue during 2015.

A clever way to capitalize on seasonal spending is to promote low-cost winter accessories. Our sales data reveals that German shoppers love these products — especially scarves. We suggest promoting these low-cost (usually between 10 euros and 20 euros) customer-favorite items during the checkout process. This is a smart and easy way to increase overall order values.

If your organization enters the German market with a localized site, be sure to offer Black Friday and Cyber Monday specials. We've found that Germans are reasonably aware of these "American" shopping events, and visit local websites looking for deals.

We recently examined the holiday 2015 sales performance of a German site we operate for another fashion retailer. This company made savvy decisions in offering Black Friday and Cyber Monday specials, and won big. Both days generated more product sales — and more revenue — than nearly any other that year. The site generated about $500,000 in those two days.

Here's another German-specific Black Friday/Cyber Monday insight: some of our clients have seen exceptional results by offering an entire weekend of shopping deals (Friday to Monday), rather than just two discrete days of sales. We believe that the association between these days and sales isn't as "tight" as it is in the United States. Spreading the sales period out over more days casts a wider net for consumers to engage and buy.

In the end, remember that Germans tend to do their shopping, be it for the Christmas holiday or summer vacation, roughly one month earlier than the French. Companies that time their marketing campaigns accordingly can reap some robust rewards.


Charles Whiteman is senior vice president of client services at MotionPoint Corporation, an enterprise localization platform. He may be reached at cwhiteman@motionpoint.com.




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