Abstract
Online clothing retailing is a well established sales channel in most
developed countries. In 2008 clothing was the fastest growing category of
products to be sold online in the UK and the USA. And in China and France it
was the largest category in terms of value.
Online retailing offers distinct benefits for shoppers and retailers. From the
point of view of the shopper, comparisons of products can be made quickly and
easily from the privacy of the shopper' s own home. At the same time, retailers
can offer a broader range of products than they are able to do in physical
stores. Also, the cost of running an online store is only a fraction of the
cost of running a physical shop - especially in terms of rent, rates and
staffing. In addition, online shopping provides companies with the opportunity
to expand into new markets without needing to invest in physical retail sites.
There are, however, a number of challenges for online clothing retailers to
overcome - including the fact that customer loyalty is notoriously hard to
retain. Also, online selling results in a much higher level of returns than
retailing via physical stores - which is largely due to the fact that online
shoppers can not try on the clothing before buying.
Broadly speaking, the strategies of online retailers can be grouped into two
categories: multi-channel retailing and online-only retailing. Multi-channel
retailing is the most common strategy among large clothing retailers. It
allows a firm to use its website as a marketing tool, and enables customers to
browse items before trying them on in a physical store. Examples of
multi-channel retailers include USA-based Gap, the UK' s Marks and Spencer
(M&S) and India-based Future Bazaar - owned by Future Group, the proprietor of
Pantaloon Retail.
Online-only retailing involves selling branded clothing exclusively via the
Internet. Examples of onlineonly retailers include UK-based Asos, and
Italy-based Yoox. Online-only retailers are characterised by the fact that
they offer vast ranges of products - because they are not limited by physical
shelf space.
In addition to these strategies, a number of clothing companies have made a
foray into online retailing by forming strategic partnerships with established
e-commerce companies, such as Bivolino, in order to minimise risk.
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