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Fashion eCommerce and retailing: A small business owner's manual for success
Download the PDF version of this article! It is the opportunity for small business owners to disrupt fashion eCommerce. Find out how with this guide.

Download the PDF version of this article! It is the opportunity for small business owners to disrupt fashion eCommerce. Find out how with this guide.
Table of Contents
The McKinsey Global Fashion Index forecasts growth in 2019 of 3.5 to 4.5%, slightly below 2018 figures. By geography, the most optimistic about the coming year are executives in North America. By segment, the most positive are executives from luxury brands, reflecting their strong growth trajectory in 2018. In comparison, value and mid-market fashion players appear to be more cautious.
The fashion industry is inherently sensitive to cross-border trade policies and politics. While the trade tiffs continue to happen between China and the US, the American consumer’s indispensable status is gaining hot competition.
The size of the Asian middle class is expected to reach nearly 3.5 billion people, or 65% of the world’s total by 2030.
Despite the threat of trade wars potentially affecting consumer spending power, expanding global markets could also provide an opportunity for smaller and pure-play brands to outpace the bigger established fashion players.
Mainly due to the fact that emerging brands are able to adopt a more nimble approach compared to the legacy supply-chain set up and slow commercial processes of established brands.
An evolution of the global middle class with rising disposable income is creating a new market of sophisticated and seasoned shoppers.
This is great news for emerging eCommerce brands. Why? Because the middle class drive demand in the global economy. This new type of shopper is able (and willing) to pay for premium and quality for not just the basic necessities, but the kinds of products they ‘want’ versus ‘need.’
But where exactly are these next big spenders?
The rising incomes of Chinese over the past years have catapulted millions into middle class status. But of the many emerging Asian markets, India is the country to watch.
India’s GDP is expected to grow at the highest rate; 8% each year between 2018 and 2022 and its apparel market will be worth $59.3 billion by 2022, according to data from McKinsey’s FashionScope.
India's GDP growth rate between 2018 and 2022
Worth of India's apparel market by 2022
Over the same period, India’s middle class is forecasted to outpace China, Mexico and Brazil by 1.4% each year. With this growth, India is set to evolve from an increasingly important manufacturing and sourcing hub, to one of the most attractive consumer markets outside the Western world.
This prosperity creates major opportunities for fashion players, given India’s fast-growing population of ultra-high-net worth individuals and the highly aspirational young generation with disposable incomes in an upwardly mobile market.
We’ve been mobile-first for a while, with consumers turning to their smartphones to help them research products, compare prices and discover new fashion trends. Fashion is personal and from a technological standpoint, your mobile is too. When combined, they create a powerful pairing.
In the world today, there are 5.11 billion unique mobile users. The projected number of smartphone users in India alone by 2022 is 690 million, 2.3 times more than the usage in 2017.
unique mobile users in the world today
projected number of smartphone users in India alone by 2020
The accelerated growth outside the West is thanks to increasing online access and the rise of smartphone use. Such growth is mainly coming from the ease of buying online. Any person in the world can purchase through an eCommerce store on their phone.
Today, it’s also becoming more convenient to use mobile phones for completing the transactions through mobile payments whether on browser, in apps or through mobile wallets.
We can only expect this percentage to grow as more time is spent on mobiles, and brands take advantage of the merging worlds of technology and commerce to create better buying experiences on mobile.
Alex McBride, founder of watch and lifestyle brand The 5TH, built a following of 70,000 followers on Instagram before taking any of his designs to market. When The 5TH finally put its first line of watches up for sale, the company sold out its entire inventory within the first day.
The customer journey is becoming more complex. Technological innovations in our always-connected world have led to more customer touchpoints such as voice-powered home speakers, smart appliances, vending machines, and smart mirrors.
To meet the customer where they are, some brands are divorcing their website’s front-end and back-end to build powerful, personalised and engaging commerce experiences.
This is known as experiential commerce or headless commerce.
The top three advantages of headless commerce architecture
(compared to traditional commerce)
As a brand, transitioning to a headless commerce architecture allows you to deliver a faster, more reliable, and immersive customer experience, regardless of whether the user is connected to the internet.
The terms themselves may sound new or futuristic. But, this is where small retailers can differentiate themselves the most. Not by plugging into smart speakers, appliances, or mirrors. Simply by connecting front-end sales channels with a single inventory, order, and customer-management back-end.
Whether you call it experiential or headless commerce isn’t the point. The point is to develop a multichannel strategy that spans online storefronts, online marketplaces, and offline retail while at the same time providing a consistent experience for shoppers.
With globalization and rising internet adoption, reaching new customers abroad has created a huge opportunity for smaller brands to expand. It’s estimated that cross-border B2C eCommerce spend will reach $629 billion by 2022.
With that said, taking your brand beyond the borders can be the easiest business decision you make, but it does come with its challenges.
Between establishing a new customer base, navigating local laws and regulations and finding partners and suppliers you can trust, it’s important that you cover all bases of preparation before you put in the hard yards.
Start by having a clearly defined level of brand investment in each market you’re looking to expand into. Make sure you are specific with the countries you’re expanding into and avoid thinking about overseas markets in vague terms.
Start by looking at where your biggest opportunities are by conducting adequate local market research and taking a deep dive into your analytics.
Pair that research with local buying trends and demand in those international markets. Then, understand who your competition is in a particular market and whether or not what you can provide is going to disrupt the market or get lost in a sea of the same products.
Once you’ve done due diligence to market research, then you can set aside a marketing budget. Keep in mind that what worked for you domestically in establishing your brand, might not work for you the same way internationally.
Knowing how important the speed of global growth is to your brand is essential. Jumping straight into cross-border expansion may not be the best decision for your business just yet, or it can be absolutely vital to your brand’s survival. But how do you decide that?
Once you’ve worked through these considerations you’ll have a better idea on your speed-to-market capabilities and where you should focus your attention.
Do you want to have full control over the end-to-end experience by launching your own store on an eCommerce platform? Or selling through an online marketplace?
There are pros and cons to each. Make sure you research how existing fashion players in a particular market survive and succeed.
For example, China is heavily marketplace driven and it’s one of the largest unified economic spaces. Yet, many Western brands have failed in the pursuit of the Chinese consumer mainly due to ineffective branding and poorly executed marketing campaigns.
This doesn’t mean your brand won’t succeed using a marketplace but it is important to consider how you will build your brand in a new market where people don’t know about you. Teaming up with local partners can help you to navigate the most effective way to establish your brand and figure out what marketing and advertising channels will help you reach the right people.
By considering these three factors, you are taking the first steps toward global expansion. Just don’t forget the people who got you to that point in the first place; your existing customers.
The next chapter of this series will help you understand how to reach and connect with a new revolution of the conscious fashion consumer.
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