Marketing strategies for firms in the garment industry

Just i have finished reading “The Marketer” Hash Ladha profile article. This is a must read for marketers those who are in the garment industry. A very good read..

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Thriving despite the downturn, Asos.com seems to exist in a bubble of its own. Floating on top is marketing and operations director, Hash Ladha

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Based in vast art deco offices in London, the setting for online fashion retailer Asos.com ( As a growing marketer i can see the UI guides are well used in the site, which suits the target audience best and the web is also well optimized for the search engines specially for Google) shouts big-scale business, with style. While peers are struggling, Asos more than doubled its sales over the Christmas period, with profits for the year to March on track to be greater than expected at £13.8m. Business buoyancy seems to ping off the walls – staff members strut the corridors dressed to the nines, while models pound the office catwalk at a punishing pace to be snapped in the hundreds of new product lines that are added to the site each week.

Customer focus

But beneath the glitz and buzz of business success, the surprising shabbiness of the reception area’s coffee-stained table and carpet betrays a practical, customer-centric philosophy at the heart of the company’s strategy (very impressive) – after all, it is the website, not the office, that is the real face of the organisation. “We honestly believe that if we act in the interests of our customers they will keep coming back,” says marketing and operations director, Hash Ladha. Asos has found a winning formula for its proposition – “choice, presentation and service for our customers” – Ladha believes, and he is adamant that all marketing initiatives adhere to it strictly: “I tell my staff that if they aren’t concentrating on one of those three things then they’re probably doing something quite irrelevant,” he says.

Online island

Established in June 2000 and admitted to AIM, the London Stock Exchange market for smaller companies, in October 2001, Asos was originally called As Seen On Screen, selling affordable reproductions of clothes spotted on TV celebrities. Since expanding its stock to include versions of catwalk fashion as well as other big label brands, Asos is now the UK’s largest independent online fashion retailer, offering 20,000 branded and own label product lines, from menswear to beauty.

From small beginnings, its staff headcount has almost doubled to more than 400 employees in the two years Ladha has worked there. The website boasts 4.5 million unique visitors a month, with nearly 2 million registered users and 1.2 million active customers (those who have bought within the past six months) – an increase of 112 per cent in the last year.( I think the traffic and the SEO gave them 6 Google PR currently).

So, with companies across all industries collapsing under hostile market conditions, what makes Asos so special? The effort invested into the visual merchandising of the site gives it a competitive advantage and, by necessity, makes it the company’s main and most effective marketing channel. Although label-branded clothing results in lower margins than Asos’s own clothes, that’s no excuse for sloppy presentation, says Ladha. The site’s “Outlet” section, which includes brands such as Alexander McQueen and Dolce & Gabbana at cut prices, displays every item of branded clothing in close-up photo stills and catwalk fashion shots, just as on the rest of the site.( The way they present the product is so amazing)

“We have good quality models, good quality design teams and take time to shoot every item – we take pride in what we do,” he says. With the site being the company’s selling ground, the marketing team’s main focus is to generate traffic. Through the use of search engine optimisation and pay per click advertising on women’s magazine sites such as Look and Grazia, it ensures that 25 per cent of its customers are new every week, which translates to 1.7 million unique visitors.( I think based on my initial search even they can stick only with organic search)

“Our number of unique visitors tends to be up 100 per cent each year, and the number of hits the site has from Look and Grazia is comparable to that of Topshop, which is obviously a much bigger business,” says Ladha.

Social networking has played its part in raising awareness – in six months Asos has become the second largest UK fan group for any fashion retailer on Facebook, overtaking Topshop and Urban Outfitters to come just behind H&M’s 90,000 fans. With this raised awareness and the wide array of products on offer from the site, Ladha admits the marketing team has reached a point where PR can almost run itself, so frequent are the press requests for product placements or features. “The magazines know they can give us a brief and we can send over what they need,” he says.

Not just celebrity rags

The single biggest investment made by the marketing department is Asos’s print magazine, which is sent to 500,000 active customers. Showcasing other brands’ products alongside its own, a team of seven is dedicated to layering photos of fashion icons with editorial to create content that competes with news-stand glossies. “We straddle being both a retailer and a media outlet, which makes us unique,” says Ladha.

From the company’s roots in celebrity culture, the magazine has always been of a higher content quality than the simple product-plus-description format of the average online retailer catalogue, he says. “Like it or not, our society is obsessed with celebrity culture, from lowbrow celebrities to Hollywood, Bollywood and everything in between,” says Ladha. “We will do a feature with celebrity-inspired clothes, but there is also a lot of stuff there without the celebrity focus.”

Ladha claims that the emotional loyalty the magazine drums up in its recipients make it a valuable as well as effective marketing tool. “We know that the customers who receive our magazine spend more time on the site, have a higher basket value, and take up the promotional incentives that we offer, which drives higher conversion rates and higher spend.” Nevertheless, it is an expensive investment. “With customer relationship management we’ve found that not all of the active customers who receive the magazine remain active because of it. Sending the print magazine to all of them is a high-cost strategy, so in the future we will be looking to send only to those customers who have a higher propensity to spend.” Ladha admits it is also not the most cost effective way to acquire new customers: “We reduce the cost of acquisition by putting a 24-page supplement in magazines such as Glamour and Cosmopolitan instead.”

The focus on content translates into the company e-newsletters, which Ladha sees as “weekly campaigns”. A team of 10 is dedicated to crafting the two weekly newsletters, ensuring they have relevance and pace in the manner of a weekly magazine, and four million e-mails are sent out each week to the website’s database of two million registered users.

Asos is careful that it does not bombard its customers and has a strategy for dealing with those who have lapsed, says Ladha. “We have three attempts over six weeks to try to reactivate them. If this fails, we might try a discount to entice them back. After that they would become a non-target, unless we ran a separate reactivation programme.”

With click-throughs straight to the site from the e-news, Ladha claims the accurately measured ROI this provides makes them far more effective than anything more nebulous to measure such as sponsorship. “Three years ago we sponsored Britain’s Next Top Model, but that is all just about brand awareness. We know that our e-mails work,” he says.

As a small business in a cluttered marketplace, with competitors in both offline and online retail, Asos is reluctant to reveal exact click-through rate figures for its e-newsletters. But Ladha says that it overtook its biggest rival in terms of website hits, fashion mogul Next, for the first time in February. It has since been neck-and-neck, according to rankings by website Hitwise.co.uk, which reports on the anonymous online usage and search behaviour of eight million UK internet users.

Bespoke marketing

Underpinning all of Asos’s marketing channels is a sophisticated CRM system from SmartFocus. Working with Asos’s rich pool of customer data, the software has produced some interesting insights into spending behaviour. “We found that men are more generous than women and are more likely to include items for their wives or girlfriends in their shopping baskets,” says Ladha.

With 20,000 products live on the site at any time, and 800 new product lines being added every week, it’s crucial that a customer’s marketing message is personalised to include the kind of items they are most likely to buy. The software has created five female and three male customer profiles that identify a customer’s propensity to spend, their trigger points and whether they tend to shop at the weekend or during the week.

With the varied spectrum of goods on sale, from a £5 bracelet to a £1,000 designer handbag, Asos also ensures that its communications only include items in the applicable spending bracket. He is proud that Asos is the only fashion retailer with the ability to use this kind of CRM software. “In other fashion stores there are people profiles, but it’s based on a little bit of data and the consumer’s opinion. I can tell you what a customer’s favourite colour is just by looking at his or her buying behaviour,” he says. First purchased eight months ago, Ladha says that Asos will be stepping up its tailored marketing using CRM with profile-specific communications in the coming months.

At your service

High-quality service for customers is the third prong to Ladha’s marketing mantra. The customer care team is now available 24 hours a day, seven days a week, closing only for one day at Christmas. “We found that our busiest period was after 5.30pm on a weekday – just as our customer care team were preparing to go home. There’s no point in having a care team that isn’t there when the customer is.” Team members are required to reply to customer enquiries within an hour and are judged by the speed and quality of their reply. “Last week all of our customers got a reply within half an hour. I want to get to the point where they’re getting immediate replies.”

Asos is working on stepping up its delivery options and on a returns service that collects an unwanted garment from the customer’s house. While the inevitable delivery delays of an online service could detract from a customer’s willingness to buy, Ladha says that its flexible online model means it can communicate with customers in advance of any inconvenience. When snow was imminent earlier this year Asos sent e-mails to customers warning them that it might delay their delivery. Once it did snow, an apology e-mail was sent offering a delivery refund and 10 per cent off next orders ( I can give 1000 thumps up for this marketing attitude)

“Things might go wrong, but our customers are happy as long as we communicate with them effectively,” explains Ladha. This is a strategy of engendering trust that he transfers into the promotional communications too. “I hate creating spin. We don’t hide things from our customers – if we are offering free delivery for a spend of £75 or more, I make sure my designers put both parts of the offer in equal font and with equal emphasis, so the customer isn’t led into something only to be let down.”

With the recent launch of the kidswear and new high-end designer ranges, Asos plans to continue expanding its products. “We see ourselves as the Amazon of fashion (Great)– we hope that the trust our brand has will mean we can sell just about anything,” says Ladha. With plans for a community section of the website, and a section for customers to trade between themselves, it is perhaps just a matter of time before this is the case.

While it is an exciting time for staff working at Asos, Ladha keeps morale pumped up with reward cards that ensure every staff member has their birthday off work and is treated to a lie-in or afternoon off after a period of particularly hard work. The close alignment between the company’s business strategy and its other departments is evident from the all-staff Monday morning summaries of the past week’s trade.

Ladha is positive about the future despite the shroud of recession: “Although online growth is slowing, it’s not slowing as much as everything else. We have to make sure that if a customer has one shopping trip a month we are that one shopping trip.”

After reading the above post published in “The Marketer” my mind started to Zoom the Sri Lankan market. According to my knowledge (sometime I might be outdated about the garment industry in Sri Lanka) the firms in Sri Lanka are not considering these type of marketing tactics and strategies. Sometimes you may argue that Sri Lanakan customers are more touch and feel oriented, but it times for a deep thinking about online world for Sri Lankan garments. Specially targeting Colombo  will give them a good success rate.