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The Future of Clothing Retail

In Planning growth, Raising finance, Retail - 2 years ago - 5 min

The Future of Clothing Retail

The rise of e-commerce has put pressure on many high street retailers. But now, the industry is coming full circle as shifts in consumer demands are resulting in e-commerce sites establishing temporary stores to stand out from the crowded online market.


Online retailers are paving the way in the reinvention of retail, with consumer demands increasingly shifting towards convenient and reliable shopping experiences. The number of visitors to shopping centres has fallen at a rate of 6.3% over the past four years (September 2013 to August 2017) and 2016 data from Statista shows that, in the UK, consumers purchased more items and services online than consumers in any other country in Europe. Research from IBISWorld has identified that nearly 17% of all UK retail sales now take place online.

E-commerce fashion retailers, including and Net-a-Porter, pose an increasing threat to the industry, offering consumers a quick yet personalised experience, with ever-expanding product ranges from online-only stores. Amazon is charging ahead with annual UK sales of £7.3bn, while ASOS saw sales of its 80,000 plus products shoot up by 32% in 2017.

At the other end of the spectrum, start-up retailers are benefitting from low barriers to entry in the e-commerce market, launching online-only stores. This has allowed for aggressive competition on price and wider consumer reach.

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Online footprint in the real world

In recent years consumer expenditure has shifted from products to services and experiences. Online retailers are embracing this change by creating showrooms to showcase their products, then feeding buyers through to their e-commerce platforms. For e-retailers, physical showrooms put ‘experience’ front-of-stage for the consumer whilst allowing the retailer to exploit varying locations at a lower cost.

Amazon’s offering, Amazon Go, provides consumers with the chance to leave the store with their products without any cash physically changing hands. This is just one example of how online retailers are creating different kinds of footprints in the real world and catering to customers who increasingly expect more interaction and deeper relationships with retailers and brands.

With Amazon also opening a bookshop in Seattle, the irony hasn’t been lost on many traditional retailers, whose business models have been undercut by online giants. Yet innovative online retailers are making the so-called shift from clicks to bricks.

In the US, glasses retailer Warby Parker and men’s fashion site Bonobos have embraced the trend, as has global handicrafts outlet Etsy, the latter partnering with Nordstrom in the US and Selfridges in the UK to have physical space.

Some habits stay the same

For Warby Parker, it began when Cofounder and Co-Chief Executive Neil Blumenthal invited consumers to his apartment to try on pairs of glasses. Customers then used fellow Co-founder and Co-Chief Executive Dave Gilboa’s laptop to make purchases via the website.

‘It was clear that some of our customers wanted a physical shopping experience,’ said Blumenthal. The low-cost designer spectacles company would later launch the Warby Parker Class Trip, a store built into a school bus that visited 15 US cities. The retailer now has more than 30 retail outlets across North America.

What we’re seeing

As the popularity of showrooms rises, we could expect to see these kinds of stores in every town. On the high street, the showrooms that might start to appear are likely to stock a limited number of products for customers to experience. Customer service may be drawn from the hospitality and leisure sector, with staff becoming brand advocates and customers being treated more as guests than shoppers. Grant Thornton’s Head of Retail, Ian Smart, says:

Online retailers are increasingly showcasing their products to enable customers to view and feel them before they buy. Many consumers still want the experience of the physical proximity to the product, particularly products such as fashion garments and furniture. Showrooms blend the ease of technology and online shopping with the enjoyment and benefits of the shopping experience.

Building a brand

Pop-up boutiques are an equally efficient way for smaller online retailers to build their brand amongst target customer groups, instead of establishing permanent bricks and mortar stores. Unlike mini-showrooms, pop-up boutiques in shopping centres or at pop-up malls, such as Shoreditch’s Box Park, allow brands to efficiently build their presence in one area, before moving onto the next.

‘This approach helps retailers establish themselves as purveyors of lifestyles, rather than goods – something that will go down well in the age of Instagram and is a move towards more experiential living,’ says Smart. These are unlikely to end up looking like your local branch of Tesco. They might be sparsely stocked, feature fridges of drinks or be styled like a coffee shop that’s a hip space to lounge in while encouraging you to post products on social media.

Opening doors to new markets

Pop-up showrooms are also entering more novel locations, like’s airport location in Amsterdam or at music festivals, which brands love because they can get their name in front of high-spending, young, early adopters.

‘A key benefit to online retailers is that they can tear up the rule book and be more dynamic than those with a strong existing store presence. This allows them to personalise their stores to the location in which they are based and to the customers they are trying to attract,’ says Smart. ‘CEOs may want to adopt this model to protect and grow revenues, as well as to build market share as consumer tastes change.’

‘Many consumers have developed a ‘showroom’ style of shopping’, says Smart, ‘going into a physical store to browse and get a sense of the product they would like to purchase, before doing so online’.

But with approximately 80% of all retail purchases still coming through physical stores, online retailers seem ready to take their products directly to their customer.

Bricks to clicks – what to consider

  • Establish the business case – Why bricks and mortar? Will it add a new dimension to your business and, crucially, will it drive sales growth?
  • Think logistics – Displays, promotions, stock levels, equipment and materials must all be covered in your plans.
  • Scan the market – Research local competitors and look at footfall before you choose a location. Make a realistic estimate of how many people you’ll be able to bring in, and are they your target market?
  • Recruit the right sales staff – Staff will make or break your business. Hire personalities who can engage customers and help them complete purchases.
  • Rethink your advertising – Advertising a physical business is completely different to its online equivalent. Think local, but don’t ignore the web tools marketers use.
  • Speak to others – Join a community where you can speak with others about their experiences, biggest hurdles and greatest learnings.
  • Finance appropriately – One of the attractions of an online shop is its low cost compared with running a physical location. How are you going to finance the investment?

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This is an edited version of an article which first appeared on Strategies for growth.