Unless there's been a long lapse in your WWD subscription, you know that online sales of apparel experienced tremendous growth during the 1998 holiday season. According to the Cotton Incorporated Lifestyle MonitorTM, 9.3% of women now browse the Internet for clothing, a rise of 37% in just three months, and up 63% from a year ago. Five percent of women did some or all of their holiday shopping (though not necessarily clothing) on the Internet, according to the American Express Retail Index, compared to 7% of men.
The number of "first-time" (not repeat) visits to apparel Websites increased 73% during the four-week period leading up to Christmas, according to Media Metrix, a firm which cracks Internet usage of a representative sample of national households. "A lot more retailers are going online," says Scott Silverman, director of Internet retailing for the National Retail Federation (NRF). "In most cases the 1998 holiday season is what drove that decision." According to Jupiter Communications, online apparel sales totalled $330 million in 1998, which represents two-tenths of one percent of total apparel sales for the year. However, online sales are doubling every year, while total retail sales have grown an average of five percent over the last five years.
"What everyone saw is this is the first time that ecommerce made an impact on traditional retailing," says Mark Goldstein, president of Impulse! Buy Network (www.impulsebuy.com ), a company which licenses etailing technology to retailers and portal sites such as Women.corn. "Looking forward to the twenty-first century, retailers are seeing that they have to take ecommerce seriously and not [view it] as a stepchild."
"Merchants and manufacturers of women's apparel have been relatively blind to the potential of the Web to date," says Ken Cassar, an analyst in the digital commerce group of Jupiter Communications (www.jup.com ), an Internet research firm. "Women have historically represented an inordinately small proportion of the online population—and a particularly low proportion of the online shopping population," he remarks. This is changing though— women's online adoption rates are growing at a faster rate than men's adoption rates, bringing us closer to gender parity. Women's apparel retailers are certainly beginning to appreciate the opportunity that lies before them. Their constituency is increasingly going online and online shoppers are, in general, becoming increasingly willing to buy highly differentiated products after cutting their teeth on books and CDs.
Some companies which have a Web presence but do not sell will start to test the waters. Other retailers that have already invested in cyberselling are Fine-tuning their strategies for next season (it's never too early).
Take Macys.com, which experienced 400-500% sales growth in the 1998 holiday season over 1997 (which itself was a 300% increase over 1996). "Sales of sweaters and pants, and our home business were very strong," says Kirn Miller, director of Internet strategies for Macys West. "We will expand, add new products, and test new concepts online,"
"What you're going to see is a lot of retailers using the holiday season to find out what works and doesn't work, and throw out what doesn't," says Silverman at NRF.
"We definitely expect to see a lot of women's apparel retailers, as well as manufacturers, opening up online stores," says Melissa Bane, senior analyst at the Yankee Group
Retailers' success online will depend on how they combine their online strategy with their offline strategy. "[Brick and mortar] retailers have to understand their core competency and ask how that unique core competency can be extended to the Internet and leveraged," says Goldstein of Impulse! Buy Network. "For example, Filene's Basement is famous for its great closeouts. They have been planning their online site carefully, and of course they will use what they're known for." He continues, "On the other hand the Gap’s strength is the quality of the shopping experience. So the company thought TheGap.com through, put a lot of time and money into it, and really integrated their online presence with their stores. For example, say a local Gap is out of a customer's size jeans. She can buy online while she's in the store, and it will be shipped to her home without shipping charges. The Gaps online presence benefits their stores, and vice versa. As a result, TheGap.com is doing really well."
"We have very vocal customers, and we've gotten a great reaction from them about the 1998 holiday season," says Rebecca Weill, the Gaps spokesperson. "We don't look at our site as competing with our stores at all. There's a lot of synergy; they're very complementary. A customer may prefer to pre-shop online and make a purchase in the store. That's fine with us."
What’s on the horizon for etailing? Bane at Yankee Group cites personalization technologies such as customer profiles, gift registries, reminder services, and email for direct marketing. Cassar at Jupiter cites the Lands' End "my virtual model," which allows you to build a model of yourself and try on different outfits. "It's rough now, but it offers interesting possibilities," say Cassar. "Live Picture is a company whose technology is used on the Gap and other sites. It allows you to zoom in on a product without any degradation of resolution (in fact, the resolution improves as you zoom). It offers the potential to improve the catalog visual experience."
"We want to be there in whatever way the customer wants," summarizes Weill at the Gap, "Our site is all about making shopping easy for customers."