3 Things To Be Aware Of When Operating Online Clothing Stores

The unpredictable pandemic has created great impact and damage to many industries, including the clothing industry, which emphasizes highly on their store experience. Due to social quarantine and curfews for epidemic prevention, many shopkeepers of physical clothing stores have been suffering from loss of income. These shopkeepers need to pay high rents let alone the decrease in customers' walk-in. As a result, many fashion shops have been forced to shut down due to insufficient income and overwhelming expenses. Fortunately, many online store operating platforms have appeared on the market, encouraging physical store owners to switch their businesses online. The convenient one-stop function of these online platforms has also attracted many small merchants and individuals who want to start a business to join the clothing market. Thanks to these emerging online platforms, opening an online clothing store is no longer a difficult task, however, making an online store successful is still not easy. Merchants not only need to choose the appropriate target markets amongst diverse customer needs but also need to find ways to retain customers. In the face of fierce market competition, how can these newbies open an online store to improve their survival rate? And how should old store owners who just switched their business online improve their business efficiency and increase the customer’s return rate?

The clothing industry is a highly competitive industry. However, this competitive industry is experiencing negative growth during the pandemic. According to the data of the Hong Kong Census and Statistics Department, the local retail industry has suffered a dramatic decline due to the pandemic. Compared with September 2019, the total retail industry in the same month of 2020 has decreased by 12.9%, of which the clothing retail industry has decreased by as much as 20.6%. Clothing production activities have stalled due to global transportation constraints, and the number of customers has also decreased significantly due to the restrictions of community contact. Moreover, since people often stay at home for epidemic prevention, they also reduce the need to purchase new clothing. As a result, many physical clothing stores have suffered losses. At the same time as the passenger flow is reduced, they have to pay expensive store rents month by month. Product stagnation has also led to a continuous increase in operating costs. Many clothing shops, even those well-known ones, decided to shut down since they can no longer bear the heavy financial pressure. This includes Renown, a century-old clothing company in Japan; Lucky Brand, a denim brand in the United States; and Reitmans, a Canadian women's wear brand, which has all closed down due to the severe impact of the epidemic. Fortunately, in recent years, the development of e-commerce has grown by leaps and bounds. There are many E-commerce platforms that have appeared on the market for users to choose freely. Platform users just need to pay a fee to the website regularly, they can then manage their business online simply. Even beginners with no experience in website design or management can manage orders systematically and professionally through these platforms. With such convenient E-commerce platforms, it is no longer difficult to open a store. Shopkeepers also save high costs of opening a physical store, including paying rental fees and hiring store staff.

Accordingly, it can be said that the threshold for opening a store has been lowered. A sea of online clothing stores has sprung up on the market. However, they are selling similar goods, leading to a situation where supply exceeds demand. Particularly, a lot of new entrants select Korean women’s clothing to develop their core business since they perceive that its demand is relatively higher than other clothing types. Korean women’s clothing is not only cheap in price, but also rich in styles. Shopkeepers can also easily find suppliers and sources of products in the Hong Kong wholesale market easily. For online store owners, they don’t need to bear the cost of managing stranded goods because they can order from suppliers after customers place an order. However, once the market gets saturated, that means it is more difficult for online stores to retain consumers since they can easily find similar substitutes from the market. Eventually, these novice entrepreneurs may be forced to fight a price war. In the long run, they are more likely to end up at a loss. Therefore, for clothing stores, it is not always wise to only consider which types of clothing are in high demand. The shopkeepers should also consider whether the market is saturated, whether they have unique selling points to stand out from competitors, and even increase the rate of return and customer loyalty, etc. Nowadays, market demand is becoming more and more diversified, and various new types of customers have appeared in the market. Stores need to keep abreast of and grasp the latest trends and opportunities in the market to improve their competitiveness. We propose three new customer types which can be witnessed in the clothing market. We believe they can be helpful for online clothing stores to understand their potential customers better and make marketing decisions wiser.

Type 1: Rational Consumer This type of customer attaches great importance to economic benefits when buying clothes. For these customers, the price and practicability of clothing are their primary considerations. Some consumers will consider whether there is enough space at home before they consider buying new clothes. Such consumers rarely purchase on impulse. Even if they found favorable clothes, they think over and over again before actually buying. Although shopping online is convenient, customers cannot touch and feel the texture of the clothes, they also cannot try on the clothes, this can hinder the rational type of consumer to proceed to the purchase step. If online clothing stores can take advantage of delightful prices, while providing reliable logistics services and low-risk return options, they will probably stand out from competitors and attract this type of consumer to purchase their products.

Type 2: Green Lovers Due to the intensification of global warming and various climate problems, more and more consumers around the world take the initiative to find the choice of sustainable fashion. Such consumers reject fast fashion culture and believe that excessive consumption of clothing is one of the culprits leading to environmental problems. Therefore, they advocate second-hand clothing and they are even willing to pay a higher price to buy environmentally-friendly brands. In addition to the clothing itself, such consumers are highly concerned about the performance of other brand-relating services. For example, they pay attention to whether their packaging bags are renewable, whether the brand itself has negative news on environmental issues, and whether their logistic options are harmful to the environment. As a result, if online clothing stores are able to incorporate environmental considerations into their development blueprint, they are able to attract this type of consumer. For example, they can introduce more environmentally-friendly clothing options and cooperate with green smart logistics services.

Type 3: Maverick With the improvement of life quality, the new generation of consumers is developing diversified tastes in fashion. More and more consumers consider fashion as a way to express their taste, identity, and even personality. Cultural value and artistic charm represented by the brand are highly appreciated by this type of consumer. Therefore, we can witness that there are more and more new demands for fashion brands, such as designer brands, creative brands, retro brands, and so on. For entrepreneurs who just started their online clothing business, meeting these new market needs is a good way to make a breakthrough in the fierce competition. Instead of blindly following the market trend and getting defeated in a price war, finding and meeting gap needs can be wise solutions. Online shop owners need to firstly understand the needs of different customers and also develop a good knowledge of their own position and core customer groups. By making good use of the online e-commerce platforms, they will then be able to improve their operational efficiency, so as to survive in the market competition.

After understanding different types of consumers, online store owners should be able to develop their positioning strategy, then, the important task lies in how to improve their service quality and create brand edges to increase consumer loyalty. As an online fashion store owner, if you can choose a reliable logistics company to assist in your operation, it will be icing on the cake. Pickupp as a smart logistics company aims to assist online store operators to manage their orders and inventory more systematically. Online store owners can always gain a better understanding of their consumer behaviors by reviewing their past orders and data. They then are able to improve their business strategies from time to time. In particular, Pickupp also provides green logistics options. By combining orders in the same region and offering bulk delivery services, Pickupp helps businesses allocate resources more reasonably, at the same time reducing transportation costs and other impacts on the environment. If you are looking to improve your business, consider choosing Pickupp service and increase the efficiency of your operation to a higher level!