Contemporary Issues and Trends in Vm

Contemporary issues and trends in VM 

A strategy does not descend from the sky; it has to be formed and/or be allowed to evolve…

Strategy as a plan

- You can only have a relevant plan if you have knowledge of the business environment in which you are planning

Strategy as a perspective

- You are more likely to adopt a relevant perspective if you have knowledge of the perspective of others

Strategy as a position

- You will have a better idea of an appropriate position of others and what position would be relevant

Strategy as a pattern

- You will be able to decide to continue successful patterns if you have some idea of their relevance in the future

Understanding the consumer: The 5 Customer Segments of Technology Adoption  

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Blue curve represents groups of consumer adopting a new technology.

Yellow curve is the market share which obviously reaches 100% following complete adoption – this is the point of market saturation.

Innovators (2.5%) – the first individuals to adopt an innovation. Innovators are willing to take risks, youngest in age, have the highest social class, great financial lucidity, very social and have closest contact to scientific sources and interaction with other innovators. Risk tolerance has them adopting technologies which may ultimately fail. Financial resources help absorb these failures (Rogers, 1962).

Early adopters (13.5%) – second fastest category who adopt an innovation. Have the highest degree of opinion leadership among the other adopter categories. Typically younger in age, have a higher social status, more financial lucidity, advanced education, more socially forward than late adopters.

Early Majority (34%) – these individuals adopt an innovation after a varying degree of time. This time is significantly longer than the innovators/early adopters. Early Majority tend to be slower in adoption process, have above average social status, contact with early adopters and seldom hold positions of opinion leadership in a system.

Late Majority (34%) – will adopt an innovation after the average member of society. Approach an innovation with a high degree of scepticism and after the majority has adopted the innovation. Typically sceptical about an innovation, below average social status, very little financial lucidity, in contact with others in late/early majority, very little opinion leadership.

Laggards (16%) – the last the adopt an innovation. Individuals in this category show little to no opinion leadership. Typically have an aversion to change-agents and tend to be advanced in age. Laggards typically tend to be focused on ‘traditions’, likely to have lowest social status, lowest financial fluidity, be oldest of all adopters, in contact with only family/friends, very little to no opinion leadership.

Technology: mobile shopping/omnishopping behaviour

Mobile technology:

- Bringing together of promotion and distribution

- Informed customers at the point of sale

- Use of apps/QR codes

- Technology use over life-stages

- How/when will mobile customers respond to marketing stimuli (relevance)

- Mobile pay point (no tills)
- Informed customer service

Multi/omnichannel purchasing:

- Flexibility, the ‘seamless experience’ (click and collect)

- The informed customer

- ‘Showrooming’ ‘webrooming’ – the practice of researching items online then buying them instore, is the reverse of showrooming – browsing for items in a store/purchasing them online later

- Brand touch points – social media of choice? (eg. growth of Insta users)
- See Drapers Multichannel Reports

Technology: virtual and augmented reality

VR is possible through a coding language known as VRML (Virtual Reality Modelling Language) which can be used to create a series of images and specify what types of interactions are possible for them.

AR is developed into Apps and used on mobile devices to blend digital components into the real world in such a way that they enhance each other, but can also be told apart easily.

VR and AR are great examples of experiences and interactions fuelled by the desire to become immersed in a simulated land for entertainment and play, or to add a new dimension of interaction between digital devices and the real world. Alone or blended together, they are undoubtedly opening up worlds – both real and virtual alike.

Other technical applications

- Neuroscience

- Eye gaze visual technology

- Tracking – both store and non-store

- Brain activity – stimulus and response science (multi-sensory experiences)

- Analytics – coping with ‘big data’

Collaborating with the customer – UGC

User generated content refers to any digital content that is produced and shared by end users of an online service/website. Includes content that is shared/produced by users that are members or subscribers of the service, but not produced by the website/service itself.

Collaborating with the customer – Social Media

- Fashion’s New Order

- Social shopping

- Bloggers/vloggers as experts – authenticity? influence?

- Immediacy of soundbites (Twitter), images (Instagram), news (Facebook)

Most popular social networking second quarter 2017

Facebook: 2 billion estimated unique monthly users (900,000,000 in 2016)

Instagram: 800,000,000 estimated unique monthly users (600,000,000 in 2016)

Twitter: 328,000,000 estimated unique monthly users (310,000,000 in 2016)

LinkedIn: 500,000,000 estimated unique monthly users (255,000,000 in 2016)

Google+: 111,000,000 estimated unique monthly users (2.2 billion Google users)

Pinterest: 200,000,000 estimated unique monthly users (120,000,000 in 2016)

Consumer involvement and personalisation

- is crucial to the financial success of a brand where response to consumer reaction to or acceptance of a product is essential.

Empowering the customer

- is essential, a brand must develop ways of continually interacting with customers giving individuals a sense of convenience and personalised experience at every point of contact.

Communicative channels

- must be expanded at every opportunity to enhance the feeling of customer involvement.

Polarised consumer markets: lower disposable income vs super rich

Coping with economic slowdown  

- lack of consumer confidence/more restrained shopping behaviour

- investment dressing vs fast fashion

- luxury accessories do better than clothing (better status symbol/easier to fit)

- The ‘lipstick’ effect – theory that when facing economic crisis/recession, consumers will be more willing to buy less costly luxury goods.

- different demographics are hit with different severity

- consumers will avoid companies that don’t offer value for money (at any price level)

“Did you cut back on the amount of money you spent on clothing for yourself during the recession?” 63% yes / 37% no

Price polarisation of industry

- Strength of value retailers

- Weak middle market (now regaining strength) - good place to buy investment clothing

- Strength of luxury/designer (although slowing)

Global perspectives

Internationalisation of the industry

- ‘new’ markets, especially luxury… China, India, South America

- low trade barriers, increased flexibility

- global democratisation of fashion ‘masstige’

- international competition

- online retailing breaking down international barriers (virtual marketplaces)

- but it’s not easy… even for ASOS

The ethically informed consumer

Sustainability (triple bottom line… social/environmental/economic)

- reducing, recycling, reusing … re-commerce (C2C)

- ethical/sustainable sourcing

- energy efficiency

- environmental damage

- more support for new talent, SMEs, social enterprises

- transparency/traceability in supply chains

- ‘locally made’ as a selling point – ‘Brand Britain’

- the conscious consumer; guilt-free status symbols (trendwatching.com)

‘Ethical fashion’ is a broad term – it needs to be accurately defined.