Brands Must Adapt to Rising Consumer Expectations
The prevalence of e-commerce giants has completely changed consumer buying expectations. Apparel, fashion and retail companies are all feeling the effects of the shift toward unified commerce and the pressure to deliver on consumer demands. Going beyond shipping, fulfillment and customer experience, consumers are looking closely at how a product is made, and making purchase decisions based on sustainability and ethical production.
With changing consumer expectations, manufacturers and brands need to revisit their planning, supply chain and distribution strategies to ensure transparency. We recently conducted a survey of U.S. shopping preferences and developed some takeaways for manufacturers and brands looking to succeed in the "era of Amazon.com."
Ethical Manufacturing Will Win
As brands strive to maintain transparency across the product life cycle, customers are starting to take notice. Recent research shows that the top factors that affect consumer purchasing decisions include the material and fabric of products and the ethical manufacturing of products. In fact, more than a third of all respondents noted “where a product is made” factors into their purchasing decision.
Manufacturers can capitalize on this sustainability movement by using next-gen technologies that enable transparency in the supply chain. They're setting a high baseline standard for labor regulations and environmental regulations (e.g., fair wages, overtime, factory safety, how resources are used, chemicals and water processing). From the farm to the shelf, consumers want to see the full life cycle of the garment, and brands can further highlight their ethical manufacturing efforts.
In recent years, more brands are embracing sustainable products and processes, and consumers are willing to pay more for these ethically manufactured goods. Each day, brands are reminded of the importance of sustainability, and consumers are continuing to rally around this cause by favoring those that have sustainable practices in place.
Our findings showed that half of millennial consumers, 45 percent of Gen Xers and 40 percent of baby boomers would pay more for a sustainable product. Take, for example, Adidas, which recently paired up with Parley to repurpose millions of pounds of plastic currently polluting the world's oceans. Through this sustainable business plan, Adidas has found great benefit to protecting the oceans while boosting its revenue. Levi Strauss & Co. is at the forefront of sustainability; it began a campaign in 2011 to use less water for its signature 501 jeans. One example is Levi's use of a technique that can save up to 96 percent of water used in the denim finishing process.
Omnichannel Fulfillment is a Necessity
With 92 percent of retail sales still taking place at brick-and-mortar locations, it’s no surprise that consumers are looking for a balance of digital and in-store experiences. Nearly three-quarters of U.S. shoppers prefer their purchases be shipped to them. Yet 74 percent said that they will return an item in-store before shipping it back. Additionally, 65 percent said they will research a product online before purchasing it in a store.
What does this mean for fashion brands? A unified commerce strategy will be necessary. No matter the medium, consumers want a seamless experience when interacting with brands — from storefront to website. Even more so, they're expecting these goods to be delivered fast. A focus on optimizing omnichannel fulfillment means more success for the brand, and happier and loyal customers.
Retailers and manufacturers must have tools to drive their fundamental business processes and ensure profitability while providing the best customer experience. Today’s consumers are looking for a seamless transition across all channels, including product availability and delivery, and are embracing sustainable, ethical products. Brands will need to adjust their strategies to remain profitable in an ever-changing industry.
Paul F. Magel is the president of the business applications and technology outsourcing division of CGS, a global provider of business applications.
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