That’s right–it’s a bold statement. But we stand by it. Here’s why:
Five years is really long time in technology. Five years ago, many brands that are now household names did not even exist, including deal-of-the-day sites such as Groupon or Living Social, discovery communities such as Pinterest and Polyvore, curated commerce sites like Fab and AHAlife and flash sale sites, including Gilt and One Kings Lane. In 2012 flash sale sites captured $2B of $186B in total U.S. online retail market. Not too bad for a business model that is only five years old.
Publishers need new revenue sources. Subscription and advertising sales have been in decline. As such, publishers are venturing furtively into eCommerce, trying to diversify their revenue streams and engage new audiences. Most have already traveled half way to eCommerce by employing affiliate marketing, in which they provide a link to an item featured on their site that directs the consumer to the point-of-sale site, the brand manufacturer or the retailer. The publisher then gets a commission on that item. However, there are drawbacks to this tactic. First, 27% of shoppers are repeat customers but the publisher typically only gets a commission on that first sale. Secondly, publishers have spent a lot time and money engaging that reader by collecting customer data; with the affiliate model, that data is freely given to the retailer. Publishers are sending their most engaged customers to another site, which is where they then spend their money.
Retailers are (successfully!) competing with content providers. Retailers have found a way to disguise their catalogs—by making them look like magazines! They’re creating their own content and encroaching into the traditional publisher’s domain; for example, the John Lewis Edition, published by retail giant John Lewis, has become the #1 women’s lifestyle magazine in the UK. What’s #2, you ask? It’s online retailer ASOS’s magazine, with a circulation approaching half a million readers. This has further blurred the lines between content and commerce and infringed on publishers’ sales.
The shift to eCommerce has already begun. Some publishers are boldly striding into eCommerce. Thrillist saw its opportunity and purchased retailer Jackthreads in 2010 and now offers its subscribers access to this private shopping community. Harper’s Bazaar launched a marketplace on its website, Shop Bazaar, last year. As a leading provider of technology that enables shoppable content, we’re aware of many more efforts that are in development today. Finally, according to a recent study conducted by Forrester Research, 68% of publishers said that enabling eCommerce was important to their business.
We think the future will be rife with eCommerce as more and more publishers find it both an irresistible supplement to subscriptions and ad sales and a superior reader experience than the affiliate model.
Merchantry’s CEO, Tommaso Trionfi, explored these ideas in his keynote during the OnMedia Awards (Tommaso’s speech is in the second video, beginning at 2:15:30).
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Beam-it-down clothing that you can try on in your closet and beam back up if it doesn’t fit. A personal aesthetic “profile” that follows you everywhere you go, making it easy to find new fashion products you’ll love. Daily visual, shoppable RSS subscriptions of everything your favorite style bloggers and celebrities are wearing. Is this the future of fashion eCommerce?
Coinciding with New York and London Fashion Weeks, Merchantry hosted fashion eCommerce panel events featuring speakers from Arch & Loop, C. Wonder, Head, Perry Ellis, Polyvore and Thomas Pink. We discussed what some of the most innovative fashion brands—both emerging and established—are doing today and what they envision in the near term and beyond. Here are five trends to watch:
- Consumers will expect to interact with brands consistently and personally across multiple touchpoints, including via social media, mobile devices and curated commerce sites. This will require flexible multichannel technology, responsive design and thoughtful brand management.
- Personalization will drive a true omni-channel experience, with data sharing between online and in-store channels creating a seamless shopping experience.
- The fragmentation of authority will continue, with social media and user-generated content allowing new voices to be heard. A fashionista with a loyal Twitter following can establish real influence and, increasing, will expect to be able to profit from that influence.
- Curated commerce, powered by online marketplace technology, will allow retailers to differentiate themselves from generalist sites while giving fashion brands a way to access new customer markets—including international markets.
- Increasing numbers of brands will become “digital first”—launching online and establishing a following before venturing into brick-and-mortar retail.
Watch the full fashion eCommerce panel discussion or read the transcription.
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This week was NRF’s 102nd Annual Big Show – and was it ever big! Filling New York City’s Javits Center, the show attracted more than 450 solution providers and 25,000 attendees—and one topic more than any other reverberated throughout the event: omnichannel.
More and more, shoppers are expecting options for their shopping experience. Online, in-store, tablet or mobile, not everyone prefers to shop the same way: to keep up, retailers need to offer every option available and anticipate prospective ways to reach shoppers. This is omnichannel.
In conjunction with omnichannel, attendees discussed showrooming, a well-known phenomenon, and a new term: reverse showrooming. Commonly, shoppers would evaluate products in-store and then head online to purchase. And many shoppers who did purchase in-store have said their next purchase will be online. Now, however, some shoppers research products online but want the instant gratification of heading to their local store to buy it same day—reverse showrooming. Retailers need to switch their tactics to see showrooming as an opportunity rather than a lost sale by directing shoppers to their own sites. The ability to showroom and reverse showroom require having a well-designed, well-executed omnichannel strategy.
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