Growth in online is relentless as we all knowOnline is not everything through. Offline market is still MUCH bigger. n US offline electronics market is 5x the size of offline.So multi channel strategy MUST be the right approach. Then you have the best of both worlds. Right?BUT is this right? Offline much of the cost base if fixed, and rises pretty much year on year. If sales are not rising profits will continue to decline, year on yearTipping points – there will be a tipping point where the offline model is no longer viable – happened in low margin sectors – music / electronics / video rental. Is it not only a matter of time for it to happen in all sectorsDoes multi channel help? Jessops had £300m of offline sales and 40% of its business was online – this didn’t stop it going bustMulti channel retailing is just a stay of execution – inevitable will still happenTipping point is reached – nirvana for online retailers as they will have the market place all to themselves!
Transcript of "Ecommerce Forum: Atterley Road (Edward David)"
Atterley Road2• The online destination for premium womenswear inthe UK, and then globally• Best of the high street and discovery brands fromaround the world• 100 brands / 2,000 styles• First mover in a market worth £5bn globally• Launched in August• Attract 200,000 visits a month• Voted #5 best fashion site by Vogue• Voted #7 best fashion site by The Times
60-70% of fashion spend in ten years will be online -Nick Robertson, ASOS3• Convenience: 24-7 shopping / saves time / less hassle – kids, parking /lack of shops nearby• Experience: Wider choice than in store / no queues / can try on items incomfort of own home / “me time”• Inspiration: Easy way of getting ideas and exploring new brands
95% of ecommerce is outside the UK4• Launching in Australia and the US in the next couple of weeks• Distance not a barrier• next day service to New York• Sydney two day service• UK is globally leading in terms of people, knowhow and suppliers
Great business model / fantastic payback5online retail stores restaurants / cinemasCustomer acquisition 100 100 100profit per order 40number orders a year 3annual profit 120 50 25payback - years 0.8 yrs 2.0 yrs 4.0 yrs
Why we didn’t start with a boutique: multi channelretailing and tipping points6
Lessons still learning: make things easy7• Site:• Speed• user experience• checkout• plug ins / bells and whistles• Delivery and returns• International: currency / language / delivery and returns
Lessons still learning: in house versus outsourced8• We outsource nearly everything:• Warehouse• Delivery / returns• Photography• Ecommerce• Marketing• What not to outsource?• Core functions• Functions were suppliers sell time
Lessons still learning: People don’t walk past the web9• Communities / residual value• House file• Email• Social• SEO:• Needs to be understood given the quality of third party providers• Don’t underestimate on site optimisations• Attribution• CPA of channels broadly similar• offline