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Top 10 mobile adoption myths in fashion and luxury apparel

By
May 6, 2016

Stephan Schambach is founder/CEO of NewStore

Stephan Schambach is founder/CEO of NewStore

By Stephan Schambach

It is perplexing to observe the number of retailers in the fashion industry and elsewhere who have failed to take note of something that Burberry, Kate Spade, Ralph Lauren and a host of other significant names have now seized upon – that the must-have accessory for retail is the handheld mobile device.

From haute-couture boutiques to the Big Box retail stores, virtually all shoppers browse with their smartphones in their hands. Others visit a store’s online site, either before making the trip, or in place of it and, in most cases, this is also done from a phone or tablet.

Mobile is the shortest and most direct route to a customer’s heart and wallet. Any retailer who resists is doomed to failure.

So, what are the myths about mobile adoption, and why do they still exist?

1. It is a money pit. Many in retail know the pain of razor-thin margins. Any additional outlay is perceived as an expense rather than an investment.

Technology always appears costly and requires the expertise of equally pricey technicians, something that few retailers care to take on.

But mobile technology is not an add-on – it is a core component. It has melded inwards to become part of the human body and mind.

Consumers do not turn to their devices for a second opinion – it forms part of the primary, initial purchase decision.

Retailers must re-assess this money-pit label and envision the relationship between mobile technology and their business in the same light as fuel is to cars. You cannot have one without the other.

2. It is a labyrinth. Numerous executive decision-makers feel intimidated by the inherent complexity and sophistication of modern technology. This is not exclusively the domain of the over-50 set.

Younger professionals also find their comfort with technology not quite keeping pace with its evolution. It takes time to learn and understand new things.

But this is where we can apply a classic rule of management: the 80/20 principle. This rule states that applying some of one’s time to working “on” the business – that includes ensuring technology is up to date – yields far greater profitability than spending 100 percent of one’s time “in” the business. Learning pays off.

3. It is not secure. In an ironic twist, retailers are more comfortable with paper money and credit cards, both of which are highly insecure tools of commerce. They work in an industry rife with fraud, counterfeiting and undercutting, but these are understood and accepted as industry risks.

The risks associated with online commerce are greatly magnified in the media, and they present the retailer with an entirely new set of problems.

The fact is that technologies involved in mobile payments – especially single click, like ApplePay and AndroidPay – offer less risk than their predecessors.

4. It is not how things have been done. Traditionally, the fashion industry has told consumers what to wear, and then makes it available for sale.

Now, in the mobile age, customers are telling fashion what to do.

From the catwalk to the sales floor, consumers have the choice and the voice. They can crosscheck prices online, demand instant satisfaction, influence every step of the journey, from browsing through to returns, and they can make their opinions visible on social media.

Consumers can even buy direct from the manufacturer or designer, potentially cutting the retailer entirely out of the relationship. These are serious changes that should never be ignored.

5. It is risky. Retailers may not like risk, but they are in an industry surrounded by it. You cannot go into business if you are not willing to accept it.

In private enterprise, there is no such thing as stasis. You are either moving forward or sliding backward.

It is prudent to identify the risks in adopting mobile technology, but the next step is always to understand this risk and embrace what needs to be done to mitigate it.

6. Mobile is not profitable. A significant number of brands currently base their investment in mobile on how much it has contributed to the bottom line to date. Historically, it has accounted for only a small percentage of revenue.

What they are not taking into account in this equation is the amount of influence that mobile has on a consumer’s purchasing decision. It is around 80 percent.

Also, they are not taking into consideration the trajectory of mobile-first purchases as a percentage of mobile commerce, which is projected to be $800 billion annually by 2018.

7. Online is not as important as in-store. Wrong. Often, companies have legacy issues in which the people involved in online commerce are kept separate from the store associates, which only exacerbates the issue of mobile.

This is particularly the case when one of the brands is very much about the store experience, and leads to the majority of its revenue coming from the store.

Retailers often keep digital commerce as its own division with a separate P&L, which further segregates it.

Mobile is left as an orphan, sitting somewhere in the ecommerce side of the house. A key suggestion here is: there is no “ecommerce.” Take the “e” away. It is all commerce, and should be blended accordingly.

8. This is not natural for us. Many retailers do not consider the mobile experience to be a natural skillset for their industry. It is seen as being expensive to build in-house, complicated to run, and somewhat alien from the tangible nature of the retail store. It becomes a challenge to think entirely from the point of view of a mobile experience.

To see this more clearly, retailers must ask themselves, “What if this was the only way for digital consumers to interact with our brand?”

This kind of thinking is required to do things right when it comes to mobile applications since it is very close to current reality.

9. Mobile is just a small desktop. Well actually, it is not.

There are substantial differences between shopping on a desktop and a mobile device.

Similarly, there are vast differences between a Web-based store app and a native smartphone-based app.

Too many retailers have defined mobile merely as an addition to the desktop. As such, the screens and visual layout – the very area where customers are expected to interact and make purchases – are literal reproductions of a full-size desktop page, but due to its unresponsive and static design, it will not convert at a successful rate.

Retailers must invest the time and the resources to design mobile to its own channel.

10. This is not a fashion thing. The easiest way to recognize how valuable mobile adoption is to retail is to take note of those who have already made the investment and who are benefiting as a consequence.

These monobrand retailers include Burberry, Kate Spade, Ralph Lauren, Louis Vuitton, Tory Burch, Coach, Gucci, Michael Kors, Calvin Klein, Hugo Boss, Jimmy Choo, Tommy Hilfiger, Marc Jacobs, Diane Von Furstenberg, Cole Haan, Hermes and Sephora.

Some of these brands already offer sophisticated apps. Others are actively using social media such as Instagram live from the runway, and still others are venturing into one-click payment systems and customized programming on Apple TV.

The best way to see what they see and know what they know is to follow their activities and see how they are rewriting the book on connecting customers with fashion.

These, after all, are the brands that make it their business to succeed by selling the way the customers want to be sold to. There is no better lesson available.

Stephan Schambach is founder/CEO of NewStore, Boston. Reach him at schambach@newstore.com.

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