More Customers For Your Online Store – Part 1

What types fashion marketing activities are effective for your online store?

As an online fashion retailer of cosmetics, shoes, jewellery, clothing or fashion accessories, you probably don’t have a lot of money to spend on fashion marketing and advertising.

So what can you do to increase sales?

fashion marketing online store

One way is to focus on your most popular items (say the top 10) and examine where the sales enquiries (or visitors) come from.

For example, you may be a stockist of a particular brand and most of your web traffic for that brand comes via the company’s website where your link is listed as a retail supplier.

To find this out check your website statistics or your Google Analytics account.

 

Oh, by the way, if you are an online fashion retailer, you really should have Google Analytics installed (ask your website person for assistance with this).

STEP 2 – Increase website traffic

The next step is to see how else you can increase traffic (and the sales) of those top 10 products.

You can do this by:

  • Improving the SEO ranking for those product pages
  • Utilising social media such as Facebook
  • Using directories and other relevant fashion website to produce traffic
  • Maybe look at paid online advertising as long as it makes you money

If you would know the specifics of how these strategies work in more detail then check out our fashion marketing secrets mini-course, CLICK HERE for free access.

 

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!

How Often Should You Email Your Fashion Store Customers?

I am frequently asked this question. Why is it so important?

Well, you have a list of email addresses given to you in good faith by your customers and you want to do the ‘right’ thing.

Fashion marketing email how often?

That ‘right’ thing involves respecting their privacy, not sending them rubbish and not hounding them.

So most fashion retailers typically end up on the conservative side when it comes to communicating to past customers via email.

What is an acceptable frequency of contact?

Here’s my recommendation…

On one end of the spectrum is the least frequent… Once a month should be the maximum time between contacts. Otherwise what will happen is when you send infrequent emails, the customer is likely to say “What’s this email? I don’t recall requesting this!” and they’ll click on the unsubscribe button. And you certainly don’t want your list to decrease in size over time.

And on the other end of the spectrum is most frequent – it could be daily, weekly or fortnightly (that is anywhere between 1 to 14 days).

However, emailing your fashion customers shouldn’t be just about promoting sales and events. You’ll need to try to offer something of value such as information as well.

"What type?" you ask. Okay, how about something NEWSWORTHY such as new styles women are wearing in Europe and now being seen in Australia. Or how to clean certain types of shoes, clothing, etc. Or style tips – this goes with that. And so on.

By offering good information on a topic or subject, you see a stronger retention of customers on your email list as well as creating more interest in your future emails. That is, your fashion store customers would be more likely to open and read your emails.

Okay – so the plan is to communicate to your customers via email at least every 14 days. Sounds like a bit of work. But, I’ve got some good news for you… I’ve got a shortcut which I’ll share with you on a future fashion marketing post. Stay tuned…

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!

Surprising Results With Customer Fashion Marketing

A fashion shoe store owner (a client) and I have just been analysing the results of her recent Back-to-School summer marketing promotion.

The shoe store owner was thinking about how big her database was getting and the cost of mailing out a letter promotion to 4,000 past customers (about $3,400). So instead, we just did one email and two SMS campaigns.

Did they work? Absolutely. The almost identical SMS, email and letter promotion has been sent out the past 4 years. Every media worked – email, SMS and post.

See the results below:

Fashion marketing shoe sale results

Now the 110 (approx) sales the store owner missed out this year (Jan-Feb 2013) versus the 2012 result of 225 came down to not posting the letter. So I did the sums. 110 sales x the average sale. The result was approx $2,000 profit.

So the moral is… if a promotion works, don’t stress about the cost.

If your database is growing – fantastic!

If on the other hand you don’t know if your letter or SMS campaign will work, then test on a small batch of 400-500 customers. Less than 400 won’t give you enough of a measurable result.

How To Advertise Your Fashion Retail Boutique Store

Imagine – today a small boutique fashion retail store opens for the first time. How does the owner attract people and potential customers – where no store brand, awareness or recognition existed before?

fashion advertising for boutique retail stores

If, like most fashion retail store owners – they buy $50,000 to $200,000 in stock, make the shop nice, and then open the doors hoping to attract customers.

Perhaps, if they have any money left over – they place a few fashion advertisements, showing off a new season garment, shoes, jewellery or accessories.

This is a very slow way to advertise and market a fashion retail store.

I’ll let you in on a little ‘secret’…

Most retailers, want a customer to make a sale (i.e. to make profit). Whilst the smart retailer, wants to make a sale to get a customer!

This is profound. I hope you see the distinction.

If a fashion store can build a strong clientele base quickly – the store can achieve profitability much sooner. The alternative however, is years of slowly rising revenue using traditional fashion advertising which in most cases is not very effective.

Most fashion retailers still rely on the same techniques to advertise and market their store – where ‘smarter’, more efficient methods are available today.

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!

Will Mobile Phone Shopping Affect Fashion Retailing & Marketing?

Mobile Phone Apps and Fashion Marketing and Retailing

What do you think about the above article from the Wall St Journal? It’s an important shopping trends not only for US consumers but for Australian shoppers as well.

Fashion retailers, importers, designers, wholesalers, manufacturers and anyone that sells a fashion ‘product’ will be affected by the growing trend towards researching and even purchasing fashion online.
Once wary and shy consumers are now experienced online consumers by the use of ebay, Google, Gumtree and even Facebook.

Whilst many traditional brick’s’morter fashion retailers look at online shopping as a possible way to reduce their overheads (offering more stock without increasing floor space and reducing staff costs) it means they are now competing even more.

Whilst fashion retailing is less exposed to the move to online shopping due to the need for consumers to ‘try-it-on’ – certain fashion merchandise and products could be – such as shoes, bags, belts, hats, jewellery and so on.

Fashion marketing, branding and the retail experience for the customer has to be even better so that consumers WANT to make the trip to a retail store. This factor has become more and more important and may mean the difference between success or failure in fashion retailing.

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!

Using The Mailbox Flyer Fashion Marketing Strategy Successfully

"Fashion Retailer Brings In An Extra 51 People In One Week!" – but, first a little background information…

Shoe store fashion marketing logo

Often fashion retailers approach me and say they don’t have a lot of money to spend on advertising. If their fashion shop is in a residential area, or in a suburban shopping centre, I often recommend the mailbox flyer marketing strategy.

A mailbox flyer is a one page pamphlet stuffed into residential mailboxes (letter boxes).

Many retailers may have tried flyers in the past, but stopped because they didn’t get a good result. However, John’s Shoe Store brought in an additional 51 people in one week last month (they tracked them) using the flyer from our Customer Marketing Sales Kit.

Getting a good result from a flyer design 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. Sure, you can achieve a similar result from Community Newspaper advertising, but occasionally I like to ‘mix-up’ the marketing to reach local, surrounding homes for stronger store recognition and branding.

Oh yeah, a tip: I prefer the A5 size (1/2 A4) as it doesn’t require folding (as you would need to do for the A4 size), you get double the amount of flyers when printing, and the A5 size is easy for someone to put in letter boxes.

Fashion marketing with mailbox flyers

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!

Getting Good Results From Your Fashion Advertising

Having a quiet week? Want to bring in more store traffic – right now?

Good, consistent store traffic year round is the holy grail of fashion retailing. There’s no point spending money on good stock, hiring the best sales staff, having the nicest store with the best customer service if people don’t come in. Ensuring regular people traffic is one of the major challenges for most fashion retailers.

Message branding advertising

Our Fashion Retail Insiders know the twelve (12) specific ways to bring in more traffic to a fashion store and they understand the specific tactics that make them successful.

Many of the twelve traffic strategies will be familiar to you, like … print media advertising, internet fashion advertising, good building signage, referral programs, and so on…

However, in order to get a good result from any fashion advertising or marketing campaign, a specific tactic or marketing message, is required.

For many smaller retailers especially (and larger fashion retailers too), the focus needs to be on generating a customer. Yes, absolutely branding is important, but if it’s the sole message in the advertisement, it will be a costly expense for the retailer – as we say in the marketing game – "you need deep pockets". A better way, is to employ a marketing message that brings in paying customers AND builds your brand at the same time. That way your fashion advertising and marketing will pay for itself.

Take for example; Fashion Retail Insider  Gill from John’s Shoe Store. Gill took one of our designs and tested a very small advertisement in the local community newspaper – it brought in $1,382.70. Granted it was a very small advertisement and dollar sale, but you can see the potential of running a similar advert weekly. i.e. $1,382.70 x 52 weeks is $71,900.

I’m sure adding almost $72,000 in annual revenue would be welcome by any fashion retailer.

Not only is the revenue important, but see what else happens :

  • 12 new customers were introduced to the business (from one week) – that would be 624 new customers a year. Those customers would return to make additional purchases and refer other people to the store, and,
  • The retail store would achieve brand awareness with the readers of the local community newspaper.

And that’s a good result from fashion advertising!

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!

Hmmm, a Very Untidy Clearance Shoe Store

Shoe Advertising clearance store sign

Yes, I understand the need to move last seasons shoe stock, but an unattended (and very untidy) clearance store didn’t leave a very good impression with me. See the photos…

Selling shoes for $10 a pair doesn’t leave much in the kitty for staff. I didn’t even see the cash register!

Shoe Advertising clearance store

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!

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!

Closures In Retail Expected

A friend of mine sent me a link to a recent 2010 article by the Dominion Post about the typical trend of retail closures just after the Christmas period. i.e. January and February every year. Here is an excerpt from the article…

CLAIRE MCENTEE – The Dominion Post. Original article

"More retail closures could be in store following the rash of holiday receiverships. Several retailers were declared insolvent in January, including 10 Stax fashion stores, electronics store Eastern Hi Fi and Christchurch cycle shop Bike HQ. Three Wellington Mitre 10 stores were put into receivership shortly before Christmas."

"PricewaterhouseCoopers partner John Fisk said businesses that had struggled all year often capitulated in the face of holiday wage costs and a slowdown in turnover. Some retailers were thriving but many had been forced to swallow large rent increases, and there were likely to be some smaller ones hanging on and waiting for their leases to expire so they could close."

"Each insolvency was different – in the case of the Mitre 10 stores poor property investments by the owner were blamed – but a common cause was purchasing the wrong stock and being forced to discount it. ‘That puts pressure on the margins and it can be a slippery slope.’  KPMG head of restructuring and insolvency Shaun Adams said the holiday season was traditionally crunch time for struggling retailers."

So let’s review the main causes from this article and others that I’ve picked up in my business experience over the years:

  • Increases in rent in the New Year.
  • Staff wages costs over the holiday period : Overtime, annual leave pay, etc
  • Purchasing stock that didn’t sell well over the holiday period. Or overstock.
  • Having to discount heavily to compete with other retailers.
  • The sales slump that occurs from mid-January onwards after the Christmas and post-Christmas sales (The exception may be shoe stores that do well with Back-to-School promotions until the first or second week of February).
  • Having to commit to purchase $50k, $100k, $200k or more in stock for the upcoming winter season which puts a strain on balance sheets and bank accounts.

Sound familiar? In my next post I’ll show you some ways to counter these challenges for a typical fashion business. Stay tuned.

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!

Fashion Retailer Increases Sales by $10,683 in One Day!

Shoe store marketing

Gill and Kim

Directors, shoe store, Midland, WA.

(Full name withheld due to privacy reasons)

"We are really hitting our stride now using promotions to increase sales."

"Our Back-to-School event created another $20,039 in additional revenue. Recently we ran our one day May 2009 promotion and increased sales by $10,683."

"We can’t wait to see the results of our July clearance event!"

May 2009

We Can Now Respond Quickly To Slow Months!

Shoe store marketing

Gill & Kim
Directors, Retail business, Midland, WA.

(Full names withheld due to privacy reasons)

"We began working with Mark Fregnan from Kinetic Media and Marketing in December 2008."

"At Mark’s recommendation we installed a traffic counter from Total Count in Melbourne in our store from the 1st January 2009. This will enable us to know exactly how much traffic our store produces each month."

"There are two benefits of using this system – one, we can monitor all of our marketing to make sure that our store traffic volume doesn’t fall below our specific targets, and two, so we can better plan promotions to avoid the slow periods."

11 February 2009

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.