Timing Your Fashion Marketing Event

I just got off the phone with one of our retailer clients and I was typing up the action plan for our next marketing event when I realised the timing required for a successful promotion. Here’s a brief list of some of the things we usually need to organise:

  1. The media we plan to use. The answer comes from asking these questions… Who are we promoting the event to? Just to store customers? To new customers? All customers?
  2. The running of the event : staff resources, signage, tables, displays, etc.
  3. Photographs of the fashion apparel, shoes or jewellery we are promoting.
  4. The design of the email and/or print marketing campaign.
  5. The third-party advertising and marketing suppliers (if required). The SMS marketing company, the newspaper company, the flyer distribution company, the mailing house, etc.
  6. The exact timing sequence. When do the adverts appear? When does the mail out need to arrive at the customer’s house? And so on.

Even though the action list items sound like a lot of work, in reality most events are small and don’t require more than 8-10 hours of preparation.

If we assist the retailer with the promotional event then most of the action items are handled by our company – the retailer can then focus on the event itself, without all the extra worry.

About the author: I’m Mark Fregnan, founder of Smart Fashion Marketing (Kinetic Media & Marketing) – an Australian consulting business that assists fashion retailers to increase sales and improve business value. Because we have a passion for marketing, our fashion business clients enjoy better store and label brand exposure, greater cash-flow and more time off to enjoy the finer things in life!

Low Cost Fashion Advertising – The Trusty Old Mailbox Flyer

Fashion marketing to mailboxes

You know… a mailbox flyer – an A4 or A5 sized one page pamphlet stuffed into residential mailboxes (letter boxes). Many fashion retailers overlook the humble mailbox flyer as a marketing strategy for producing more retail store traffic.

I like mailbox flyers for apparel, clothing, footwear, and jewellery stores – they are quick and simple to produce, low cost and very effective in targeting people that live around the store.

For the cost of around $470 you can typically reach around 5,000 homes. The ‘trick’ is to produce a flyer that gets results. Many retailers who may have tried flyers in the past, stopped because they didn’t get a result and came to the incorrect conclusion that flyers don’t work. They do!

Effective flyer design comes down to simplicity with a marketing message that entices the reader to visit the store. Often retailers will focus too much on a ‘branding’ message rather than a design focusing on new styles and looks. As we have created many mailbox flyers for our clients we have a good understanding of what works and what doesn’t. If you like – send us a copy of your mailbox flyer and we’ll be happy to critique it for you.

About the author: I’m Mark Fregnan, founder of Smart Fashion Marketing (Kinetic Media & Marketing) – an Australian consulting business that assists fashion retailers to increase sales and improve business value. Because we have a passion for marketing, our retail business clients enjoy better store and label brand exposure, greater cash-flow and more time off to enjoy the finer things in life!

What About Fashion Business Advertising?

Frequently Asked Questions About Fashion Business Advertising

Fashion advertising is a hot topic – common questions I get asked by retailers are – "How can I get more customers?" or "Where should I advertise?" or "What do you think of this advertisement?"

fashion advertising example

If you have an established retail fashion business (clothing, footwear, jewellery, etc) seventy percent (70%) of your advertising dollars should be spent on re-selling to your existing customers. Why?

It’s 5 times easier to sell something else to your existing customers than to get a new customer.

And yet I see most retail businesses spend thousands of dollars in the media trying to get new business – only to forget all about those people after they buy. If you were to communicate to your customers and ask them to buy again, you’d see an almost magic increase to your bottom line. Done correctly, this always works better than chasing new customers.

Listen, next time you are going to run an advertisement in the newspapers promoting a sale or whatever, try this. Reproduce the advertisement and send it to your existing clients. Attach a note saying . . .

"I thought you may want to see this, come in the day before to get your best pick of the bargains. Regards . . . "

This will work wonders if your sale has a genuine appeal!!

About the author. I’m Mark Fregnan, founder of Smart Fashion Marketing (Kinetic Media & Marketing) – an Australian consulting business that assists fashion retailers to increase sales and improve business value. Because we have a passion for marketing, our retail business clients enjoy better store and label brand exposure, greater cash-flow and more time off to enjoy the finer things in life!

Fashion Advertising Basics For Retailers

Most fashion retailers at some time will invest money into fashion advertising. As with all fashion marketing there must be a purpose or objective. Generally this purpose is to lift the awareness of the ‘label’ or ‘store’ through image advertising, or, to drive more potential customers into a particular store or chain of stores.

Fashion advertisements typically contain the product being promoted (i.e. footwear, jewellery, clothing or fashion accessories) on their own or with models wearing the fashion product. Often, fashion advertising is heavily linked with sexuality, glamour, beauty and youth.

Fashion advertising usually falls into one of four main categories :

  1. Branding. Model or models wearing the item with just the name of the label or store (with logo)
  2. Benefit. A fashion advertisement containing words describing the benefits of the product.
  3. Sale / Offer. Using an offer such as % (percentage) OFF or $ (dollar) OFF to bring in customers during a sale or as an enticement for a certain period of time.
  4. Event. To promote an event such as a store opening, fashion parade, celebrity visit, etc.

Here are some examples :

Fashion advertising brand awareness example

Fashion advertising brand example

 

Fashion advertising benefit example

Fashion advertising benefit example

 

Fashion advertising sale / offer example

Fashion advertising offer example

 

Fashion advertising event example – Summer Fashion Parade

Fashion advertising parade example

 

About the author. I’m Mark Fregnan, founder of Smart Fashion Marketing (Kinetic Media & Marketing) – an Australian consulting business that assists fashion retailers to increase sales and improve business value. Because we have a passion for marketing, our retail business clients enjoy better store and label brand exposure, greater cash-flow and more time off to enjoy the finer things in life!

Clothing Manufacturer & Retailer Grows After Being ‘Stuck’ For Over 5 Years!

clothing manufacturing marketing

Elana Geldenhuys
Director, Geldens Pty Ltd, Leederville WA.

"We signed up for Kinetic Media & Marketing services at a time when we had been in business for 20 years. We felt that we were no longer growing and had in fact become quite stagnant.

Mark Fregnan from Kinetic, has guided and assisted us through several business decisions that have resulted in changes to strategy, and has provided us with the tools to grow.

We have implemented clear policies and documented these. This has improved our selling technique and saved time as finally we are organized! We have graded our customers (A,B,C) and are setting up a proper customer base that will be an added asset to the business.

We have changed our approach to marketing and advertising, and Mark advised us on our brochure information and layout, which has definitely resulted in improved sales.

We have established a good relationship with Kinetic Media & Marketing, and will continue to use their services as consultants in marketing and advertising and in any way that will continue to improve our business.

This has been an investment (not an expense), and I would recommend other businesses to join the programme."

27 Questions You Should Ask Before Buying A Fashion Retail Business

I met the husband and wife owners of a small retail shop recently. The business was running at a $65,000 (approx) annual loss. They had purchased the business over 12 months ago and had been steadily losing money. I looked briefly at their books and realised they had paid too much for the business. On top of that, both of them had no retail business experience and they had decided to cut out all of the advertising that the previous business owner had been running – due to cost reasons only.

I asked them how much research and due diligence had they conducted before buying the business. I was shocked by their response…

Don't sign to purchase a fashion retail store without doing your homework

"We asked the solicitor who was performing the business settlement service if the business was a good buy."

In otherwords, they asked after the sale… Talk about throwing money away. Needless to say, they no longer have any available capital to invest in marketing or anything else. The outcome will be to close up shop and accept the loss, and the lesson.

 

This is real important…

I’ve spoken to and met with many business owners who have paid too much for their business (and not just fashion retailers – all types of businesses). It’s like paying $100,000 extra for a house. The problem is that usually the extra capital has been borrowed which puts a strain on the business cashflow. Often it’s very difficult to recover from this situation.

To gain $100,000 in net profit in a fashion retail store may require at least an additional $800,000 in sales revenue (i.e. on a 12.5% net profit margin).

$800k in ‘additional’ (over and above existing) sales revenue which isn’t a very easy thing to achieve in a short-time frame, i.e. 12 months.

So how do you actually avoid this type of business disaster?

Do your homework – Ask yourself these questions…

1. What do I want from being in business?

  • Freedom to do ‘my’ thing?
  • Be an entrepreneur?
  • To make more money than being an employee?
  • Work fewer than 30 hours a week?

2. Why am I going into a fashion retail business?

  • For lifestyle (to work fewer than 40 hours per week, with the freedom to go on holidays whenever you choose)
  • To make a profit by building the business up (increasing sales) and then selling it.
  • To generate more cash-flow than than a 9-to-5 job.

If your reasons are not listed above (lifestyle or profit) – don’t buy the business. If you want to be involved in retailing out of interest and passion for fashion – honestly it’s much safer to be an employee.

3. What will be my exit strategy to get out of the business?

  • Sell the business for a profit
  • Sell the business to a major shareholder(s) and become a silent partner
  • Pass the business down to a family member
  • Franchise

4. What skills do I have that will make me successful in this business?

Please don’t think that all that is required to ‘improve’ the business is cosmetic – by changing fashion labels or re-designing the store interior. Unless the store has poor stock and an ugly showroom – these ‘improvements’ won’t double sales.

Only very good marketing, a good sales team and good systems will increase sales significantly. Sorry, I’ve seen many business owners take over an existing fashion retail store – changing labels and interior perhaps at best has increased sales by 30% initially and then nothing after that.

5. What skills will I have to “hire in”?

  • Sales staff/assistants
  • Bookkeeper
  • Fashion buyer/consultant
  • Sales trainer
  • Outsource marketing?

6. What monthly cash-flow do I need?

  • To pay myself a decent wage
  • To cover all the retail business expenses
  • To cover the repayments if I borrow to purchase the business
  • Additional business profit

7. How much working capital do I have access to?

Can I get an overdraft to cover seasonal buying?

8. Will this business suit me i.e. hours, type of operation?

To ask the vendor who is selling the business…

9. How long has the business been operating?

10. How long has the current owner had the business?

11. Why is the current owner selling?

  • Worn out from working long hours for little money?
  • Couldn’t make the business work (perhaps in it’s current location)?
  • Actual legitimate reasons such as retiring, moving to another state or country, or looking for another challenge in another business?

If it’s retiring – also be aware that may business owners in their 50/60s hang on to a unprofitable business (maybe paying themselves a very basic wage) because it was too difficult for them to have sold earlier and got a job.

12. What is the Cash flow and Profit (Gross and Net) for the business?

13. What is the business owner paying him/herself?

14. What do the last 3 years of financial accounts show?

15. How has the business been valued?

16. Who are the key customers, suppliers, staff?

17. What are the terms and length of any leases?

18. Will the current owner stay on and assist for a period of time?

Ask them to put this period in WRITING!

19. What areas of the fashion retail business are systemised?

For example:

  • Point-of-sale (POS)
  • Bookkeeping
  • Marketing / customer marketing systems
  • Website / social media (e.g. Facebook)
  • E-commerce website

20. Is there a business plan?

21. How many hours a week does the current owner work in the business?

22. When was the last time the current owner took a holiday?

23. What is the marketing systems like? Do they make money for the business?

Review all advertising material, the customer database, the POS systems, any loyalty programs, special promotional material, etc.

24. What facts support the "story" of the business?

25. How secure is future income i.e. contracts with customers and suppliers?

26. How dependent is the business on the current owner?

27. What will it take to grow the business so I can sell it for a profit?

Fashion stock

Often this is the BIG ONE – many fashion retailers overcapitalise in stock in relation to the store sales annual turnover. Ask your accountant is there is too much capital tied up in stock on the balance sheet. If there is – don’t buy the business!!! Tell the vendor. You can either wait until they sell down the surplus stock at regular prices, or they can offload it at cost. Don’t let their past buying decisions become your problem!

Before you make an offer

1. Get your accountant to check the financial accounts

Obtain actual lodged tax returns with the government, not the business owner’s printout or handwritten bookkeeping summary.

Your accountant will ensure that the business has cashflow and is not over-capalised.

2. Hire a solicitor who is experienced in buying fashion retail businesses like the one you are looking at.

Your solicitor will ensure that the contracts with suppliers, the landlord, etc don’t have any surprises.

3. If you are spending over $250,000 on the business, or even if you want to be extra careful, pay for a business valuation.

Pay a licenced valuer to come in and audit the business. Even if you have to spend $7,000 for the valuation, it’s still much better than paying $50,000, $100,000 or more than you should have to buy the business.

You may even be able to ‘use’ the valuation to negotiate a better price.

The lesson

Homework always pays off in business. Sure, there is a lot of questions (above) – but, like with real-estate, the profit often is made when you buy the business, not when you sell. Taking shortcuts and buying a business on emotion often lead to regrets. Don’t let this happen to you.