E-commerce platforms know full well that generating a better consumer experience through customization optimizes the customer loyalty ratio and creates a much more fluid purchase process, allowing customers a much more agile and satisfying product selection, spending less time searching for the model they want. From this first conclusion, we will analyze other findings in McKinsey’s comprehensive report – The State of Fashion 2018 and how the current reality is changing fashion supply.

The customer’s digital footprint originates the customized offer.

What the online platforms have fundamentally generated is a continuous and cyclical process. The more information they gather, the more individualized their communication and services become; this helps to attract even more future customers, allowing these platforms to expand Big Data. This process is crucial because for e-commerce it is as valuable to obtain “data of interest” as it is to obtain “transactional data”.

“Imagine if e-commerce platforms could take advantage of Google and Facebook data as well as their own. That is fundamentally what JD.com is generating today. We’re collaborating with social network and search engine leaders in China, producing an unprecedented amount of data to produce the best personalized marketing in the world,” said Xia Ding – president of JD.com’s fashion division – talking about the alliance with WeChat, Tencent and Baidu, the Asian Giant’s largest search engine.  He added, “Access to consumer data is the holy grail for the platforms because exclusive ownership allows us to exercise control over the rest of the ecosystem“.

With collaboration between the two organizations, consumers looking for products on Baidu’s mobile application can access a special section to purchase items directly from JD.com. By encouraging users to stay in the application and buy, JD.com can gather valuable information about customers’ preferences. Marketing customization not only benefits brands and platforms seeking to gain market share; consumers also benefit from sophisticated algorithms that will facilitate the purchase and decision process.

AI creates on-demand and predictive sourcing.

Artificial intelligence (AI) will operate chatbots that mimic user interaction with a salesperson, sales representative, or customer service assistant. For example, chatbots allow shoppers to analyze models of the brand’s new collection by consulting it to help identify user tastes. The goal is to drive traffic to the web and create a personalized shopping experience.

E-commerce is also using artificial intelligence to make sound business decisions and optimize the supply chain, from packing to R&D. This is essentially fundamental in the case of fast fashion, where consumer trends and tastes change rapidly and supply chains must be ultra-fast in their reaction to the market.  In such a reality, having a direct link between the Big Data generated by the users’ digital footprint – on their preferences, interests and desires – and transmitting that back to the supply chain, means that fashion designers and creators can respond with the right models in much shorter delivery times.

In this article you will be able to delve into and learn the secrets of this extremely successful relationship in the fashion sector, e-commerce + customization: E-commerce customizes fashion, provisioning responds

Storage and advance shipment

The e-commerce giant Amazon applied for a patent for “advance shipment”. Based on this, it uses artificial intelligence to predict which products and models will be the most popular and in demand among users in certain cities and different locations. From this analysis, Amazon ships and stores those products in small stores near the sales points. This allows the retailers to have the right items in stock before the consumer orders them, resulting in faster logistics operations and simpler inventory operations. AI helps automate tasks, freeing up time and resources for companies to invest even more in customization.

As the process of feedback between brands, platforms and customers becomes faster and more connected, we will get much more versatile supply chains and a greater choice of items available. Any platform that has access to user data and, through them, detects what the consumer really wants or needs, can connect directly with the manufacturers of the product and place orders with the necessary specifications so that the final model is tailored to the consumer.

Customer information is the currency of exchange

The means of exchange for an increasingly individualized and rapid communication and service in e-commerce is the customer’s private information, their own digital fingerprint. Like any other exchange transaction, users will eventually give that currency to the brands and retailers they believe in and can trust. It will become a usual and basic business cycle and if someone wants to be successful with their customers, forging close and loyal relationships, they will have to show them that they respect their information and that they will treat it with responsibility and caution. We have come to the situation where, if a user requires personalized suggestions and solutions, they will have to provide their data and personal information to achieve that goal.

The improvements that data can provide, from online marketing to optimizing the digital customer experience, will change the rules of the game in the marketplace. The brand with the most information and intelligence applied to data analysis will gain market share. Fashion companies looking to move up positions should focus on the depth of the data rather than the extent of the data.  Scale customization only becomes powerful when there is depth in the analysis. Regarding this last statement, I suggest you read this previous article to perfectly assemble the information on the topic: Personalized fashion supply.

The essence of the process is to attract the client and know their information

The most important thing in the long run is that fashion brands and organizations will stop focusing exclusively on transactions and instead they will concentrate on attracting consumers, because attraction leads to data and, once you have the data, they will be able to lead them to new transactions.

Customization and artificial intelligence are affecting retail and fashion and driving supply chain processes. Platforms enable collaboration, which has become essential for brands that want to survive in the digital marketplace. They can create value as a team by joining forces to share consumer perspectives, allowing a greater degree of individualization than what a brand could achieve on its own.

This unstoppable and very powerful current process significantly changes fashion sourcing and from our position, we must respond appropriately to our businesses and the consumer through a digital supply chain, always connected and on demand.

See you next time!