How Malaysian Fashion Brands Strategised for CNY 2018, and If It Worked

March 13, 2018

Yi Jun

The Lunar New Year, or more commonly known as Chinese New Year (CNY), is many things: lion dances, reunion dinners and of course, the ‘ang-paus’.

For businesses, on the contrary, this festive season is an efficient marketing tool.

Usually, CNY befalls in the beginning of the year, January or February, and that means marketing promotions in the form of Youtube advertisements, special discounts and cross-collaborations would start rolling out by November or December. According to Google Malaysia, any searches relating to CNY start building up 5 weeks before the celebration. In a sea of keywords like ‘chinese new year recipes’ or ‘tesco promotion’, apparel is amid the top-searched categories. Of course, this comes as no surprise. If you’re not familiar with the Chinese festival, it is common tradition to wear everything brand new on the first day of CNY. Yes, from head-to-toe!

Malaysian brands Twenty3 and Doublewoot, which are popular shopping e-Commerce platforms among young women, both released exclusive CNY collections respectively. Twenty3’s collection was named “Joyful Beginnings”, while Doublewoot went with a simple “Oriental Collection”. From designing, production, to establishing a price, conceptualisation begin months in advance. Crucial business decisions comprise of many decisions, which includes determining the best product category, setting the right price and selecting the season’s hottest colour. This brings forth another question, how exactly did they strategised for this year’s CNY… and did it work?

Trends worldwide, such as the runways of various fashion weeks might be an influence. Internal consumer data plays a factor as well. Perhaps the most common of them all, is what human beings rely on everyday, intuition. Many still depend on good old fashioned ‘gut-feeling’. A McKinsey article states that “merchants prefer to rely on an intuitive sense of what the consumer would be willing to pay, competitive benchmarking, and margin contribution”. Consumer data and trends, of course, are useful, but the great dependency on intuition is outdated. Many brands have experienced the most successes utilising data, which includes the likes of Zara and Missguided.

For brands who grasp the importance of data, they use it as concrete evidence of trends actually trending, not just what is assumed. Remember the business decisions mentioned above, the best colours, categories and pricing? All of those can be analysed with data. In fact, it can even tell if the right decision was made, and if not, how to make better future decisions. In the case for Doublewoot and Twenty3, they definitely took initiative for the festive season. However, with data, it can be deduced that some of the decisions made just weren’t aligned with the current market. If you’re still not convinced, keep reading!

Using Omnilytics, an analysis of top colours, product category assortments and price architectures were studied thoroughly for both brands. To keep things fair, the same timeline (5 weeks before CNY) will be used as per Google’s CNY search increasement.

Top Colours – Black, No Longer A Taboo

‘Top’ here signifies the highest item at hand, so the data here is churned out by what was the most in stock during the pre-CNY phase. Both brands had different top colours: white for Twenty3, pink for Doublewoot. It’s no surprise that these colours were chosen, as they are traditionally safe selections. What’s most interesting here, however, is that black – once considered a taboo colour – ranked higher or equally with CNY’s primary colour, red.

So, did the safe colours sell during the time period? Not exactly. While Twenty3 seemed to have made the right option, Doublewoot slightly missed the mark. The former brand’s best-selling colours were blue and white, which were their top 2 choices. For Doublewoot, monochrome colours, black and white, were favoured much more. As a comparison, their highest-stocked colour, pink, was their fourth best-selling hue. Stocking up on the right colours – like Twenty3 did here – makes a huge difference. Still, it is a good thing red wasn’t the top choice here, as the once lucky colour placed last for both brands in their top 5 best-seller list. Black, white and blue seems to be the new red.

Top Categories – Guess the Dress

Source: Twenty3, Doublewoot

 

Dresses sit comfortably in the no. 1 spot for the top categories for both brands. The slight difference here is that Doublewoot seemed to have favoured lace dresses, while Twenty3 opted to stock up more on shift dresses. However, besides the same top choice for categories, the rest bared no resemblance. Jumpsuits and playsuits were in second for Doublewoot, while tops – especially long sleeved ones – were Twenty3’s silver medal. In contrast, the jumpsuits and playsuits ranked the last for Twenty3, followed by shorts.

Were dresses the right call? Well, not quite. The best-sellers for Doublewoot, instead of dresses with lace, were actually playsuits and jumpsuits. While the most popular item for Twenty3 was a dress, it wasn’t a shift dress. According to data on the Omnilytics dashboard, it’s skater dresses, with shift dresses falling in the fifth spot. Here, it seems that both brands stocked up less on high demand product categories. Lace dresses do seem to be a CNY favourite, while shift dresses are safe choices. Whether or not the Malaysian brands have suffered losses is hard to predict, but here’s what is hard to deny: merchandise planning is more than just internal data.

 

Price Architecture – RM100 or Nothing

 

Both Twenty3 and Doublewoot are considered to be of middle-range, with an average of RM100-RM200 for an item. However, only Doublewoot has a ‘premium’ range, with items in the collection expected to be around RM200-RM300. From the bar above, Twenty3 has a more divisive range, with items as low as RM50 on sale. Doublewoot, on the other end, seemed to price their items slightly higher than Twenty3, with most items between RM150 to RM200.

It’s a common misconception that only lower priced items can be sold out, as the highest range of sell-outs for both brands were the RM100-RM150 range. Here, Twenty3 seemed to have set the right pricing strategy with 51.7% of most products on sale in this price range. Doublewoot, on the other hand, set most of their products on sale for RM150-RM200. Of course, it’s important to note that while pricing can be a factor, it isn’t the only one. There are other attributes such as styles, colours or sizes.

Verdict?

Besides colours, product categories and price architectures, there are many more determinants that could be studied, such as discounts or strategies utilised. Based on just the analysis above, Doublewoot and Twenty3 made some decisions that paid off, but some that may not see the same results. There are a few key takeaways here, and the biggest one is this: festive seasons are a huge marketing campaign, and it takes more than just plain guess work. Understanding what your consumer wants, along with external data analytics is a pretty good CNY recipe.

*Not all items studied are from the CNY collection, as some may be from existing stocks.

The data above was obtained from Omnilytics, real-time market data platform. The numbers and statistics may vary, as the platform is updated every day. The time period of the information taken was between 16th January, 2018 to 16th February, 2018.