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Emerging Themes Affecting the Fashion Retail Industry

An Asos.com Case Study

Academic Paper 2018 16 Pages

Business economics - Company formation, Business Plans

Excerpt

Table of Contents

1. Introduction

2. Critical Evaluation of the Case Study

3. Critical Discussion
Demographic Changes, Social Trends and Shifts
Legal Transformations and Global Economic Issues
Technological Advancements
Industry Globalisation

4. Critical Evaluation

5. Recommendations

6. Conclusion

7. References List

Emerging Themes Affecting the Fashion Retail Industry

1. Introduction

Most industries have experienced radical changes in the last few decades as a result of emerging themes commercial undertakings. Particularly, the fashion retail industry has also experienced radical changes due to emerging issues. This paper seeks to review the asos.com case in attempts to critically evaluate various themes affecting the fashion industry in the contemporary environment. The findings will be used to establish various strategies that will continue to affect the fashion industry in the next five years. Lastly, the report will develop several recommendations based on the inferences obtained from the critical evaluation and analysis of the asos.com case study.

2. Critical Evaluation of the Case Study

Since it was started in 2000, asos.com has become one of the leading online fashion store in the United Kingdom (UK). asos.com has experienced tremendous growth nearly two decades since it commenced its operations. Currently, the store records over 3.3 million unique clients on a monthly basis and has more than 1.8 million registered users. In a span of five years, asos.com expanded its physical stores from 550 square metres to 32,500 square metres, as well as the number of permanent staff from 47 to more than 250 employees. Similarly, the number of sales increased by more than 90% in 2008 (Business Case Studies LLP. n.d.). The rapid growth represented by asos.com development is largely considered as organic since it shifts from the traditional setup, and bricks and mortar retail industries. Apparently, the rapid growth witnessed by asos.com has compelled the organization to enact far-reaching changes in attempts to accommodate emerging themes in the industry, market, technology, society, along with the working environment (Kim et al., 2017).

One of the developing themes observed in the case study is the concept of e-commerce. Initially, asos.com targeted a small number of online shoppers as indicated by the size of the company’s workforce along with the warehouse space. This changed drastically in a span of three years, from 2005 to 2008, as the organization increased the number of workers to five times the original number and more than fifty times the initial size of the workspace in attempts to meet the growing demand (Business Case Studies LLP. n.d.). This highlights e-commerce as an emerging theme in the retail fashion industry. Besides, asos.com has witnessed a tremendous growth of the market size, with a record of over 90% demand increase for a period of 23 months in 2008. Asos.com statistics indicate that the society is gradually shifting from traditional physical retail shopping to online shopping activities (Business Case Studies LLP. n.d.). The fashion retail industry is also shifting towards convenience and technological sophistication (Liu et al., 2016). This is evident in asos.com’s focus on the need to meet high expectations by improving convenience and quality services in attempts to achieve ultimate satisfaction to the customer base.

Multinational companies in the UK region often use acquisition strategies to expand their primary operations into other regions. As a consequence, companies using these approaches require physical presence within the proximity of the target market to increase the market shares or the number of sales (Piotrowicz and Cuthbertson, 2014). On the contrary, asos.com business case illustrates an exceptional shift from the traditional business setup to modernized business strategy. The case describes this form of growth as an organic growth, which means virtual expansion (Business Case Studies LLP. n.d.). In other words, asos.com expanded the scope of its market by investing more in online infrastructures as opposed to physical structures in the process of expanding the customer base. The virtual nature of the business enables asos.com to overcome environmental barriers by trading its shared on the Alternative Investment Mark (AIM) (Business Case Studies LLP. n.d.). This approach saves the company from stringent operational factors as it is the case with traditional business setups.

3. Critical Discussion

Demographic Changes, Social Trends and Shifts

The last few decades have experienced an increment of digitization and automation of various aspects of the human life. This is attributed to massive developments in technology, with convenience, efficiency, and sophistication as the primary drivers of advanced technologies. As a consequence, the contemporary society is gradually transitioning to become digital-centric. This is one of the factors that has led to the rapid growth of online fashion stores as illustrated by the asos.com business case. Technology is gradually emerging as an essential component in the contemporary population (Fernie and Sparks, 2014). The increase of digital device consumption and affordability of internet services has further led to the expansion of online activities, including e-commerce platforms. Most fashion retailers are integrating online payment gateways as well as the implementation of efficient delivery logistics. This is attributed to the features of the modern society, in which affordability, efficiency, and sophistication (Carey et al., 2018). Evidently, asos.com was forced to develop strategic e-commerce goals to improve the convenience, interesting products, variety, and also implement competitive pricing strategies that would cater for the needs of different customers (Frishammar et al., 2018). The organization was also forced to develop logistic designs that could ensure expeditious and reliable delivery of products ordered from their store.

Consequently, technology makes it easier for consumers to discover trendy fashion products and also facilitate the acquisition or purchase process. A person sees an attractive handbag or clothing and technology provide more details regarding the price, the point of access, or similar models. If the price for a particular product is prohibitive, it is possible to access other options offered by other fashion retailers (Choi, 2016). This shows that the society is increasingly depending on e-commerce platform to understand, window shop, and perhaps purchase from online retailers. It is no coincidence that asos.com attracts more than 3.3 million unique visitors on a monthly basis. Thus, the society is increasingly depending on online platforms to gather detailed fashion information and analysis, which helps them in making purchase decisions (Caro and Martínez-de-Albéniz, 2015). These tendencies show that the fashion industry is likely to invest more in e-commerce platforms, which will increase online visibility and hence the market shares. Convenience, logistics efficiency, product variety, and consumer satisfaction appear like some of the major areas of focus in the contemporary and future online fashion industry (Shen, 2014). Besides, most of the physical retailers in the fashion industry will be forced to shift their attention to e-commerce business operations in the midst of turbulent forces in the current and future market.

Legal Transformations and Global Economic Issues

The asos.com business case strongly indicates that the fashion capitals are gradually transitioning to digitisation. The fashion agenda is currently set on a virtual reality, which is complemented by the digital space. Designers and retailers are directly interacting with the target audience in efforts to maintain a high level of competitiveness and efficiency in the fashion industry (Chan et al., 2017). Through the social media such as Instagram and Periscope, fashion retailers are bringing the shopping experience to the conform of the consumers. The announcement of new products is also directly delivered to the target market segment, increasing the efficiency of tailoring fashion trends to conform to the market needs. Trendy fashion products can be accessed almost instantaneously following their release. Online fashion retailers can also alert the existing and potential shoppers concerning the availability of new stocks or products (Riaz and Raman, 2015). These trends in the fashion work environment are likely to shake the traditional structures and create the need for new operational strategies to cater for the emerging themes associated with the digitisation process of the fashion industry. Furthermore, the speed at which the demand is increasing and behavioural patterns characterising the emerging changes in the society will create the need to increase the rate at which fashion orders or requests are processed. This is attributed to high expectations in online shopping consumers, which is based on experience, convenience, flexibility, and affordability (Brownlow et al., 2015). The work environment must cater to these expectations in efforts to remain competitive and also increase the customer base (Xiang et al., 2015). Therefore, the work environment performance will be viewed from competence perspectives, with a particular focus on logistic reliability, convenience, a variety of fashion products regarding prices, goods, and services, as well as the shopping experience.

The modern consumers are often hyper-connected with numerous internet platforms and also expects to interact with fashion retailers via compound channels simultaneously, while expecting integrated and consistent experience across different platforms (Pantano and Priporas, 2016). This necessitates the fusion of digital and physical platforms as the retailers strive to satisfy these expectations. Moreover, escalating consumption of smartphones, tablets, and other portable digital devices leaves a thin line between the online and offline marketing world. The level of online activities with regards to fashion analysis has also escalated. As a result, the nature of physical stores or warehouses and space occupied by fashion retailers will experience considerable change (Groß2015). This is likely to make bricks and mortar fashion retailers to online hubs, where all orders are proceeded and sent to the consumers from a central location. An increase in demand will create the need for more space, human resources, and a change in the management structures. This is explicitly illustrated by the asos.com’s ascendancy to the leading online fashion retailer in the UK. Therefore, space and business operations will affect the existing bricks and mortar retailers, compelling them to adopt centralized operations in attempts to reduce the cost of expanding fashion retailing activities (Blázquez, 2014). The need to increase the customer base along with the competitiveness level in the market has, and will continue to compel fashion retailers to adopt the digitisation of the work environment. This will increase the ability of these businesses to navigate around environmental factors and turbulent market forces by overcoming manifold barriers associated with bricks and mortar stores in the contemporary working environment (Jones and Livingstone, 2015).

Technological Advancements

Perhaps, the fashion retailing niche is one of the leading industries that has experienced a complete revolution due to emerging technologies. The asos.com's business case study best illustrates the impact of technological advancements in the fashion industry. Asos.com experienced a multifarious transformation, from a small online retailer to a giant fashion platform in the region in a span of less than two decades. One of the major emerging themes in technology is visual search (Business Case Studies LLP. n.d.). The online fashion visualisation allows the consumers to search specific products from the internet database. Visual searches depend on the shape, colour, size, portions, and materials to identify similar items in a large database. This provides online shoppers with a tailored experience, which makes it easier to identify a specific item, from either a single online shopping platform of multiple retailers (Kim et al., 2017). Additionally, delivery returns are some of the major online retailers are striving to address in attempts to improve the online shopping experience. Thus, virtual fitting and three-dimension scanners are emerging concepts that allows consumers to identify appropriate matches that fit their preferences, taste and bodily features (Riaz and Raman, 2015). Integrated internet platforms permit online shoppers to evaluate a wide range of choices and make an appropriate selection, depending on the provided visual aids.

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Details

Pages
16
Year
2018
ISBN (eBook)
9783668729742
ISBN (Book)
9783668729759
File size
530 KB
Language
English
Catalog Number
v428643
Grade
78.00
Tags
emerging themes affecting fashion retail industry asos case study

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Title: Emerging Themes Affecting the Fashion Retail Industry