Market Intelligence Report: Fashion Retail (Exec Summary)

ONLINE CLOTHING RETAIL WOMENSWEAR

INTELLIGENCE REPORT

October 2011 to March 2012

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WHAT WILL YOU GET FROM THIS REPORT?

WHAT QUESTIONS DO WE ANSWER?

KEY FINDINGS OF THE REPORT

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A who’s who in online womenswear clothing retail.

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Who are the market leaders?

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In-depth market analysis covering October 2011 to March 2012.

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Which keywords are driving market visibility?

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Over 100 individual pieces of key insights.

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Over 50 individual pieces of statistical interpretation.

What are retailers doing to achieve maximum market share?

Mounting pressure on household budgets are generating more online retail searches as people work harder to compare prices and track down value. The result is a dramatic increase in market competition as more and more multi-channel retailers (those using physical/high-street stores and the internet) go head to head with the pure online retailers for customers (source: Clothing Retailing - UK - October 2011: Mintel).

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Analysis of 50 retailers across the top 100 online clothing retail keywords.

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How are retailers using social media to acquire customers?

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What will shape retail strategies in 2012?

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An interpretation of the top retailers search and social media strategies.

WHAT’S SHAPING ONLINE WOMENSWEAR? • Online clothing sales continue to buck the current economic climate growing by 20% on the previous year (source: Office for National Statistics).

TOP INSIGHTS

• 97% of the most visible retailers within search are multi-channel high street brands (source: Office for National Statistics).

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Multi-channel retailers dominate both search marketing and social media.

• Brand volume comprises 54% of all search volumes and plays a significant role in last click conversion.

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ASOS is the only retailer that is visible in the top 10 for all the primary keyword product markets including dresses, accessories and shoes.

• Marks & Spencer, John Lewis, Next, New Look, Debenhams and ASOS take the lions share covering an impressive 62% of all brand search impression volume.

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House of Fraser leads the dresses keyword market with strong consistent rankings for all top volume terms including dresses, party dresses, evening dresses and maxi dresses.

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No one single operator dominates all the top womenswear generic phrases terms, therefore competition between Boohoo, ASOS, Lipsy, Dorothy Perkins and Missguided remains intense.

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New Look has developed a social strategy that has the most robust balance between engagement quality and volume.

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Topshop has the most holistic Facebook and Twitter presence in which they have the largest audience that is both consistently and positively engaged.

• Dresses accounts for 50% of all product volume and is the most important non-brand keyword in women’s online retail.

• House of Fraser is the leading retailer for the keyword market dresses, pushing ASOS into second place.

• Competition is fierce within the organic index for womenswear generic phrases. Boohoo leads with ASOS, Dorothy Perkins and Lipsy close behind.

• Debenhams dominates the accessories paid and organic keyword search markets having solid coverage for jewellery, handbags and scarves.

• Competing head-to-head with the top fashion brands are Amazon and eBay who both feature prominently for a large number of the long tail phrases, out pacing retailers such as Boohoo, Very, Republic and Dorothy Perkins.

• Both Amazon and eBay are providing consumers with a cost effective alternative and feature prominently for a large number of the long tail phrases in markets such as leggings, accessories and knitwear.

• ASOS, Topshop and New Look are the most innovative retailers within social media, making the channel a key element of their online market strategy .

• Retailers are primarily using price promotions and customer service content techniques on social media to engage with potential and existing customers.

EXECUTIVE SUMMARY

“SUCCESS IN FASHION RETAIL IS CENTRED ON BUILDING A BLENDED SEARCH STRATEGY ACROSS ALL KEYWORD CATEGORIES INCLUDING BRAND, GENERIC FASHION, PRODUCT AND GENDER. WITHIN THIS SECTION WE LOOK AT THE MOST DOMINANT RETAIL BRANDS AND REVEAL THE MOST VISIBLE BRANDS ACROSS BOTH PPC AND ORGANIC SEARCH.”

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EXECUTIVE SUMMARY

Figure 1 Year on year growth trend of internet clothing retail sales

ONLINE SHOPPING: SIZE OF OPPORTUNITY Despite the current economic climate, online retail is on an upward growth trend with the value of internet retail sales rising by 82% since 2008 (see Figure 1). This trend has continued during 2011 with online sales of £3.7 billion, representing an increase of 20% on previous year (see Figure 2). Moreover this has continued with positive growth for the first half of 2012 (see Appendix B Reference 2).

Source : Clothing Retailing - UK - October 2011: Mintel

4.0 3.5 3.0 2.5 2.0 1.5

WHAT’S GALVANISING WOMEN’S ONLINE SHOPPING?

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For those clothing retailers who are online, growth is galvanised by: •

Price: mounting pressure on house hold budgets are also generating more online retail searches as people work harder to compare prices and track down value.

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Accessibility: women’s fashion is increasingly moving away from being something associated solely with the exclusiveness of the catwalks towards something that is more accessible for the masses.

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Service proposition: free and next-day deliveries as well as specific time slots and easy return policies.

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Customer buying experience: improved photography, better use of video and easier website functionality.

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Wider use of social media: improved brand communications and promotion through social media touch points such as Facebook, YouTube and Twitter.

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2011

Internet Retail Sales Billions (£)

Source : Office for National Statistics

Figure 2 Year on year growth for quarter 1 for internet clothing retail sale

£500000000

Source : Women’s Fashion Lifestyles - UK - May 2011: Mintel

£400000000

MULTI-CHANNEL RETAIL: WHERE ONLINE MEETS OFFLINE

£300000000

Although only 8% of total retail sales are online, it is important to recognise the wider attributing impact of consumers online engagement (see Appendix B Reference 3).

£100000000

The more savvy retailers are developing a multi-channel strategy by bolstering their foot traffic with a highly visible online proposition. This multi-channel strategy enables consumers to research and compare product prices and information prior to purchase.

Customers are more informed and more goal-directed in their purchasing. The internet is central to the customer experience and contributes to the decision making journey, irrespective of whether the last point of purchase is online or offline.

£200000000

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2010

2011

Jan Source : Office for National Statistics

2012

Feb

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EXECUTIVE SUMMARY

INTRODUCTION TO ONLINE WOMENSWEAR

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Generic women’s clothing and fashion Dresses Accessories Shoes Jackets and coats Leggings Skirts Knitwear Trousers

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Womenswear is defined by a broad product range and can be broken down into a multiplicity of specialist markets. We have focused our analysis on the top women’s specific product keyword markets as well as an analysis of which keywords drive generic search activity.

A BALANCED AND HOLISTIC KEYWORD PORTFOLIO ENSURES THAT A RETAILER ENGAGES THE CUSTOMER AT EVERY POINT IN THEIR JOURNEY TO PURCHASE

% Split

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Womenswear is made up of a diverse set of keywords that are designed to reflect the different stages within the customer lifecycle. These include brand phrases such as Next and ASOS, generic phrases such as women’s clothing, as well as more market specific terms such as dresses, women’s jeans and wedged shoes. Generic terms are typically used to develop search exposure and help initiate the search journey, while the more specific market keyword phrases help drive the conversion process. Brand typically comes into play during the later stages of the search process when customers have selected the product.

Figure 3 % Split of search impression volume generic women’s clothing and fashion terms

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Source : Google Keyword Estimation Tool

Figure 4 % Split of search impression volume womenswear product specific terms % Split 60

Generic women’s clothing and fashion terms are highly competitive and are driven by a small number of variants (see Figure 3). Product specific womenswear terms are dominated by dresses which comprises 50% of all search impression volume. This is followed by accessories with 20%, shoes with 9% and jackets and coats with 8% (see Figure 4).

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The following insight analyses the top 100 keyword phrases within each of the primary verticals across the top 50 retail operators. We have removed all none commercially related websites from our Statistical Interpretations e.g. Wikipedia.

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organic search PPC (Pay Per Click) social media

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This report analyses the leading retail brands within online womenswear between the period October 2011 to February 2012. Our findings will detail tactics and strategies as well as reveal the most visible retailers within:

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HOW DO WE MEASURE THE SEARCH MARKET? •

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EXECUTIVE SUMMARY

Search Impression represents the number of times a website page is displayed within the search results. It is only after the results are displayed that visitors are able to click on either a PPC advert or an organic link. Therefore, “click share” represents the act of a visitor clicking on a PPC advert or an organic link and is calculated as follows: •

organic click share is the number of clicks that an individual operator has achieved against a keyword, as a measure of where they rank for that keyword.

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PPC click share is the number of clicks that an individual operator has achieved against a keyword as a percentage of their Share of Voice (SOV). SOV is a measure of how often a retailers PPC ads appear and their position.

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The skirts sub-vertical is dominated wholesale by ASOS with 20.91% click share. Not only do they post top rankings for the keyword skirts, they occupy the top two positions for pencil skirts, as well as top spots for maxi skirts, maxi skirt and skirt.

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New Look has developed a social strategy that has a robust balance between engagement quality and volume.

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ASOS’ social media content strategy is primarily focus toward engaging its audience in high quality customer support.

BRAND SEARCH IMPRESSION VOLUME Key findings of our analysis

See Appendix A Reference 1 for a full break down of our methodology.

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Brand volume comprises 54% of all search volumes (Appendix B Reference 4) and plays a significant role in last click conversion. However, 46% of the search market is non-brand related and a strong presence within this area allows smaller or niche retailers to compete directly with the larger brands.

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MOST VISIBLE WOMENSWEAR RETAIL BRANDS IN SEARCH: KEY HIGHLIGHTS

Marks & Spencer, John Lewis, Next, New Look, Debenhams and ASOS take the lions share covering an impressive 62% of all brand search impression volume (see Appendix B Reference 5).

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In terms of clothing sales Marks & Spencer remains the undisputed leader with £3,746m for the period 2010/2011. This is followed by Next with £3,158m and the Arcadia Group with £2,777m (source : Clothing Retailing - UK - October 2011: Mintel).

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62% of all brand related search impression volume comes from just 6 retailers: Marks & Spencer, John Lewis, Next, New Look, Debenhams and ASOS.

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Traditional high street retailers dominate our brand index with ASOS the only “pure play online retailer”.

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ASOS is the only “pure play online retailer” within the top 10.

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Overall click share of generic women’s clothing and fashion terms is closely contested between Boohoo and ASOS. A small improvement in ranking for ASOS particularly for the keyword women’s clothing, could see them take the lead and dominate this keyword market.

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80% of all women’s product specific search impression volume comes from just 3 keyword markets including dresses, accessories and shoes.

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Of this group, dresses is the most dominant product category with 50% of all search impression volume. High rankings within this market are critical for maximising visibility within womenswear.

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The leading brand within the dresses keyword market is House of Fraser. This position is a result of strong consistent top positions across all the top volume phrases including dresses, party dresses, evening dresses and maxi dresses.

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Competing head-to-head with the top fashion brands are Amazon and eBay who both feature prominently for a large number of the long tail phrases in markets such as leggings, accessories and knitwear.

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Debenhams aggregated click share of 18.21% is indicative of an aggressive paid and organic search strategy making them a leading brand within the accessories sub-vertical.

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Competition within the shoes keyword market between the general clothing retailers and the footwear specialist is intense. While New Look leads our aggregate click share index with 17.41%, this position is under threat from both Viva la Diva and Barratts.

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The sub-vertical trousers, jackets and coats are heavily driven by fluctuations in seasonality. The real winners are those retailers who are able to maintain high consistent organic ranking as well as being able to deploy a cost-effective PPC campaign during peak periods.

54% OF ALL BRAND VOLUME COMES FROM

JUST SIX RETAILERS, WITH MARKS & SPENCER HAVING

THE LARGEST SHARE

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ABOUT

ABOUT STICKYEYES

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Stickyeyes is an international digital marketing agency with a pedigree in SEO, PPC and display, social, PR and content provision, consulting and insight and design and development.

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Philip McGuin

Head of Insight 0113 391 2929 phil.mcguin@stickyeyes.com

Lisa Wisniowski

Brand Communications Director 0113 391 2929 lisa.wisniowski@stickyeyes.com

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ABOUT THE AUTHOR Philip McGuin, Head of Insight and Market Research at Stickyeyes has 15 years’ experience in the areas of online marketing, performance based lead generation as well as, data analysis techniques including web metrics, portfolio score carding, attribution, econometrics and statistical modelling.

He has worked both client and agency side for a range of sectors including public bodies such as European Parliament, European Commission promoting the EU’s policy on Information and Communication Technology (ICT ) as well as the Department of Trade and Industry (DTI), marketing policy on e-Government. He also has extensive experience in the private sector as Head of Marketing for an enterprise software provider as well as the Head of Online Marketing for one of the UK’s first private online higher education training providers. Prior to his career in the private sector Philip worked as a doctoral research fellow in Economics, Politics, Public Policy and Administration

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