A NerdED View On Fashion How early stage fashion moves from B2B to B2C.#LMFF | @andreasklinger
Andreas Klinger CWTFO of LOOKK @andreasklinger #LMFFSlides:http://www.slideshare.net/andreasklinger
My background is Tech/Business.Internal company rule:“Don’t ask me for fashion (style)direction”
I am one of the co-foundersof a fashion internet startupcalled LOOKK.com
LOOKK offers social tools foremerging fashion designers toreach their audience1) lookbooks (builds social capital)2) popup stores (monetizes social capital)3) pre-order stores (coming next)
INVESTORS Carmen Busquets Dave McClure Eden Ventures Sherry Coutu TEAM Tamas Locher Andreas Klinger Gilbert Wedam Rafael Jimenez Marco Innocenti 15 people fulltime LOOKK.comLaunched September 2011 Several hundredsdesigners using our tools. 70.000 users signed up.
“LOOKK [...] fundamentally reimaginesfashion retail in the context of the open social web, harnessing the voice of the end consumer to quickly understand marketdemand and drive more effective business decisions.” 02 Nov 2011
MISSON Bring better fashion to the market byleveraging the power of the Internet
Because… The next breakthrough in fashion won’t happen on fashion week. It willHAPPEN ONLINE
When I say fashion I mean… FASHION FASHION AS AS ART BUSINESS
Fashion as an Industry is in asimilar situation as Music onedecade ago.Internet offering perfect transparencyand distribution.Music’s product was all of asudden too expensive.Fashion’s product is all of asudden too slowThe market found alternatives in MP3& FastFashion
Result:We are working in anoversaturated market that wantspermanent rapid change.We are overfed.
Why is Fashion so obsessed with B2B? Eg. Fashion Shows
“My customer doesn’t want towear the same jacket she’s seenphotographed over and over [...]for six months.”Tom Ford - Vogue 2/11
He is right. Trend garments are blogged,liked, printed and pinned untilno-one can see them anymore.They are overhyped and when theyreach the shelf they are boring and old. Plus: “Topshop sold it 4 months ago.” Photo: One of our 7 shows in last year in Germany
Tom Ford is right. But who’s to blame.We are throwing the strongestmarketing tool fashion has (the shows)at fast media to create as much as desireas possible. And then under-service that desire. Photo: One of our 7 shows in last year in Germany
“Burberry tweeting images before theywent on the runway was basically a firstbig middle finger to the industry”Geoff Watts (EDITD) at our panel event #FashionBytes 2/2012
The industry changes their game…#livestream #celebrities #preorders #press #realtime
People are starting to sell at show date…Pre-Orders: BurberryPopup: TopShop sold Tshirts(!) at #LFW12
Fashion Shows today are B2C.Shows are part of the entertainmentindustry (IMG).Sponsors like Mercedes don’t pay to getthe attention of buyers.Only because of historic legacy we alignshows to B2B cycles.
But why do emerging designers still tryto play the old game?
But why do emerging designers still tryto play the old game?“To raise the interest of buyers”
But why do emerging designers still tryto play the old game?“To raise the interest of buyers” - No.
But why do emerging designers still tryto play the old game?“I show to get press and branding.”
“I show to get press…”There are hundreds/thousands of shows in a fewweeks. There is so much noise, so little signal.Several of our designers moved to off-cycle shows. Example: Mark&Julia Blogger & Friends Show created more press than most of local fashion week’s designers together.
“… and branding.”Good Online Lookbooks are more valueable than shows.Old saying: ”In the Internet nobody knows you are a dog” Example: Ksenia Schnaider Online Lookbook and Video Show. Our buyers (and customers) love it.
Sales at shows?Limited production for the showdate.Why not even:PopUp Store at show venue to sell low-priced generics.(T-Shirts like in the music industry) Example: J.W.Anderson & oki-ni collab Prefinanced by BFC #LFW10 Sold limited pieces online at show date.
“Fashion Shows are so last century[…to tell your brand…] make a Film”Diane Pernet (ASVOFF) at our panel event #FashionBytes 2/2012 Example: Roark showing a promotion film on their website.
Why are young designers so obsessed with B2B? Eg. Fashion Trade
Trade fairs“The second B in B2B stands for‘don’t bother me’.”We were at two emerging fairs this year in#PFW were designers were about to pack updue to the lack of buyers. And (even) we didn’tgo to all fairs.
“This is my first (commercial) collection…”(another not named designer, Holland 2/2012)“Nice collection. See you next season!”(every buyer)Tradefairs cost 2-6k GBP (excluding PR).Even if your statefund is paying it. This is an investmentthat does not pay off anymore.
Fashion gets to fast for risk.It’s not the buyers job to make adesigner successful anymore.Buyers push risk down to designers.Designers need to handle that risk bythemselves. Be very cash efficient, cautiousand entrepreneural.
If you starta label you are nota designer you are an entrepreneur. You are running a startup.
Designers are entrepeneurs.As any startup founders, designers are likelyto underestimate everything apart of onething: themselves.And they do same mistakes as any entrepreneur (including me).
Who is your customer?“I don’t know. I never met any…”(not named designer, London 2/2012)Btw I heard this from many other (non fashion) startups.
Are designers different thanstartups in other industries? TL;DR: No.
“Any other startup” in “any other industry” All startups need to know, understandFashion gets to fast for risk. and reach their customersTough times for buyers. & have a demanded product before they scale.Risk pushed down to designers.Designers break their business withpre-mature scaling.
“Any other startup” in “any other industry” All entrepreneurs write useless business plansFashion gets to fast for risk. speaking of customers they don’t know and sales they cannot project.Tough times for buyers. They do not test their make-or-break assumption in their business.Risk pushed down to designers.Designers break their business withpre-mature scaling. They focus on building a brand or product but not build product according to their market nor build the market at all.
“Any other startup” in “any other industry”Fashion gets to fast for risk.Tough times for buyers. Product / Market Fit B2B starts here. Discover Validate Grow ScaleRisk pushed down to designers. In the early phases (Discovery, Validation):Designers break their business withpre-mature scaling. #1 Job: Discover a market-demanded product. #1 Problem: Don’t know their customer. #1 Approach: Following patterns of companies in by far further phases. #1 Death Reason: Premature scaling. That’s the same in all industries.
“Any other startup” in “any other industry”Fashion gets to fast for risk.Tough times for buyers. Discover Validate Grow ScaleRisk pushed down to designers. Problem: In your first phase sales are an laggingDesigners break their business with indicator for success.pre-mature scaling. You need a product that will sell and your revenue comes in very late (esp in fashion). You need customers you can reach. You need feedback to iterate the product Feedback > Sales. Feedback > Press.
“Any other startup” in “any other industry” BUILDFashion gets to fast for risk.Tough times for buyers. Product Improvement LEARN MEASURERisk pushed down to designers.Designers break their business withpre-mature scaling. - Keep costs per learning as low as possible. - Avoid economical waste. - Reduce bound capital until you know in what to invest. - Improve the product. - Learn to understand your customer’s needs.
“Any other startup” in “any other industry” BUILDFashion gets to fast for risk.Tough times for buyers. Product Improvement LEARN MEASURERisk pushed down to designers.Designers break their business withpre-mature scaling. Goal: - Learn (iterate the loop) as often & quickly as possible. - Based on customer interaction and feedback.
BUILD Product ImprovementLEARN MEASURE For that you would… Not need Seasons. Not need Collections. Not need Buyers. Not need Mentors or Sponsors. You would need customer/ Example: Our Legacy releasing single products gaining as much blog attention audience giving feedback. as full collections.
“Any other startup” in “any other industry” The problem with feedback: - You must not bias your customer.Fashion gets to fast for risk. - They always try to be nice to you. - You cannot ask your customer what they “would” want.Tough times for buyers. - They can’t imagine products. That’s your job. - You must not sell but validate your core assumption. - Find out if they actually have the desireRisk pushed down to designers. - Purchase frequency, spending, wardrobeDesigners break their business with compositionpre-mature scaling. - Ask how they solve their “problem” currently. - Which brands, Perception of other brands. => Focus on real interaction with actual content. - Interaction with real garments offline & online.
Evaluate interaction on real products.Based on the customer feedback above.Which style would you focus on next? Example: Shwood’s online giveaway. Crazy amount of online attention and also customer insights.
Go offline and online to get feedbackto improve products and reduce risk.- Differ between qualitative andquantiative feedback.Build channels- Online Lookbooks- Tumblr- Facebook- NewsletterFocus on retentive channels.(Newsletter > PR agency)Train your channels to give feedback. Example: Daviddavid.co.uk Posting test products in tumblr + shop
Always have a way to sell online.If you don’t have the ressourcesput everything to “sold out” and askfor waiting/notification list signup.The value of having your own onlinesales channels is not the sales.It’s the customers contacts for gettingmore feedback.Sidenote: pre-orders to endconsumerswork if the delivery is below 6 weeks.So why not go for B2C pre-orders? Preview Pre-Order Shop LOOKK.
The Internet…Unique problem for fashion but alsounique opportunity for new labels. This generation of designers uses the Internet to go B2C in earliest phases.
Because… The next breakthrough in fashion won’t happen at fashion week. It willHAPPEN ONLINE