Newness is an imperative strategy in today’s fast-fashion industry – which shows no signs of slowing down.
Consumer demand is stronger than ever before, driven by instant gratification. Consumers first developed the “I want it now” mentality when social media became the norm. All it took was a tap to see what everyone was wearing, leading them to immediately search for similar pieces they liked. Whoever provided, won.
The rapid growth of the eCommerce scene further fuelled the demand, as smaller players came into the picture and saturated the market. These smaller players may be niche, but they offer an alternative, one with stronger branding and USPs. An abundance of brands and retailers, paired with the convenience of online shopping, granted consumers the power of choice.
Which is why new-ins are crucial for your business’s growth today, as regular launches ensure you stay on top of your customers’ mind. In other words, when you consistently meet their demands, they’ll choose your brand over the rest.
How the big players do it
Fast-fashion retailers have a responsive supply chain as each competes with one another to be the first in the market. We analysed top retailers Zara, Boohoo and Missguided to understand their speed to market strategies, and how you can adopt the best ones into your own business.
Looking into their average pieces per launch and launch frequency gives you a clear idea of the newness level. Are they stocking up fast, but in low quantities? Or are they stocking up infrequently, but at higher levels?
Boohoo’s average products per launch and launch frequency
From January until mid-October of 2018, Boohoo released new products on a daily basis with an average of 150 new products per launch. The peak was in April, almost double the amount in March – likely due to the Summer season.
The popular brand adopts the test-and-repeat model, mining Instagram to identify trending styles and then creating similar designs in small batches. If successful, the design is restocked in larger quantities. The high level of newness is expected of a large online retailer like Boohoo, as the brand offers a wide range of categories and caters to both men and women.
Missguided’s average piece per launch and launch frequency
Missguided, on the other hand, had a slightly more sparse pattern. The brand had uneven launches throughout the year, both in the number of products and days. As seen from the chart above, there was a slight dip in the number of products from May to August. In the month of June, there were plenty of first-time discounts which may explain the low number of new-ins as they clear old assortments.
Similar to Boohoo, this strategy could also be due to the onset of Summer, whereby more stocks were brought in earlier to prepare for the season. Nonetheless, the brand showed signs of high launch frequency, as there was still a stream of new products introduced every month.
Zara’s average piece per launch and launch frequency
Out of all three, Zara had the most consistent launch strategy – with the exception of January. Zara saw a significant increase in launches in January 2018, of which more than 50% of these launches were discounted in the same month. This suggests a post-year-end clearance of old assortments, to make way for new stocks in the new year.
In comparison with Boohoo and Missguided, the average number of launches throughout the whole year was much lower. However, this agile retailer may be doing so to create demand – a combination of newness and scarcity. Constantly replenishing new items, but in lower quantities creates a sense of exclusivity. Furthermore, as Zara is the only one with brick-and-mortar stores, a seamless online-to-offline strategy has to be in place, as both platforms have to be well-stocked at the same time.
From a customer’s point of view, a regular level of newness keeps the shopping experience exciting – upon each visit, there’s always something new to look at.
Boohoo’s homepage on the 30th of October, 2018
Boohoo’s homepage on the 31st of October, 2018
All three fast fashion retailers not only refresh their assortments on a daily basis but constantly update their visuals on the homepage too. This practice engages customers – just like walking into a store with new items.
Key takeaway: Have consistent launches to ensure customers keep coming back.
While it’s important to have a constant flow of new products, the process has to be done right. H&M is a prime example of bringing in too much, as the brand is infamously known for having an overstocking issue. So how do you strike a balance in the logistics equation; one that makes you and your customers happy?
Finding balance between the old and the new
Brands and retailers may be hesitant to bring in more stocks as there are still existing ones piling up in the warehouse. This issue escalates into fear when it leads to deadstock. In order to catch up to the market today, however, it’s important to address the situation, not the fear. Just like the 3 big names above, all 3 simultaneously brought in the new, while clearing out the old.
The first key step is to revisit the production process. Compare your in-stock levels between new assortments and ageing products to identify your next steps. Here, Zara and Missguided are a contrasting example.
A comparison of Missguided vs Zara stock levels
From the table above, it’s clear that both did have clear strategies in tackling newness. However, Missguided’s ageing stocks are a concern here- as more than half of them were launched over 90 days ago. If your current assortment looks like Missguided’s, it’s best to investigate two things: stocking levels and buying processes.
High levels of aged stocks are a cause for concern and discounting strategies are commonly executed for clearance. However, balancing branding and clearance is equally important. Assortments should be monitored regularly to ensure slow-moving stocks are quickly identified. While clearance is generally used in tandem with discounting, it may not necessarily be most effective or only option for a brand. When identified early, brands have more options to clear these products, either through bundle deals, restyling, or through marketing campaigns.
In retrospect, looking into your buying process helps in identifying the cause, thus helping you to plan better in the future. Perhaps your team has been buying unpopular trends. To ensure you have the bestselling ones, this handy guide on how to create the bestselling assortments will help you stray away from fads. Another reason for overstocking could simply lie in the quantities ordered, a simple case of purchasing more than needed. Finding the right balance in supply and demand for your business is key in helping you stock at the right levels.
Key takeaway: Balance old stocks and the new to ensure brand sustainability.
Newness is Key
Prioritising newness along with a curated assortment maintains market share, as a robust renewal rate increases traffic, conversions and sales. The big players are proof that in order to remain relevant in today’s ever-changing fast fashion industry, it’s important to be up to speed. Other factors, such as setting the right price and releasing the right trends, impact your speed to sellout too.
Strike the right balance between the old and the new by eliminating deadstock early and finding the right balance in supply and demand. Ultimately, the right way to tackle newness is to devise a strategy that benefits both you and your customers.
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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 1 January, 2018 to 15 October, 2018.