E-commerce Success in Fashion and Beauty: Navigating Challenges and Seizing Opportunities

Despite economic recovery and growth in the fashion, apparel, beauty and luxury spaces, retailers and brands face evolving challenges as they attempt to grow e-commerce sales. The keys to success lie in understanding shifting consumer expectations and leveraging innovative technologies for a unified, omnichannel shopping experience.

Here, Veronica Servantez, senior vice president of marketing at BigCommerce explores these trends and shares how platforms such as BigCommerce can help businesses scale, adapt and thrive in the ever changing e-commerce landscape.

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Fairchild Studio: What are some of the e-commerce challenges facing fashion apparel, retail, beauty and luxury SMBs?

Veronica Servantez: Even though the global economy is on the rise — our research found that average e-commerce order values increased 8.3 percent globally in the first half of 2023 — apparel merchants are still facing a ton of challenges when it comes to e-commerce. One of the biggest e-commerce challenges faced by fashion, apparel, beauty and luxury businesses is the massive shift we’re seeing in customer expectations.

BigCommerce research shows that 50 percent of customers made a purchase on a mobile device in 2023. And customers expect fast, easy ways to checkout online, like digital wallets, one-click checkout, or buy now, pay later (BNPL). WorldPay estimates that by 2026, digital wallet payments will make up 56 percent of all online payments.

Brands that fail to adapt to these shifts in customer preferences, or to take advantage of e-commerce technology that allows them to sell across channels and create a unified omnichannel experience, will suffer.

Fairchild Studio: And where are the opportunities?

V.S.: BigCommerce research shows that cosmetics and body care were the third most-purchased product category online in 2023, behind groceries and entertainment, so there’s tremendous opportunity for growth.

Who is behind this opportunity? America’s youngest consumers, Millennials, Gen Z and — soon — Gen Alpha. Together, Millennials and Gen Z shoppers account for 42 percent of the U.S. population and hold more than $3 trillion in combined spending power.

Younger consumers, especially Millennials, value convenience over anything else, while Gen Z consumers like to browse products in stores and make purchases online. Meeting these consumers’ needs and providing a unified shopping experience across all channels are going to be imperative when it comes to succeeding online.

Taking advantage of this opportunity means creating a tech stack that allows for these kinds of unified, omnichannel experiences — and more. By finding and implementing a future-fit tech stack, your business can grow and evolve with consumer preferences for years to come, without the need to constantly shift and change at a foundational level.

According to Forrester Research, companies committed to a future-fit technology strategy grew revenue 1.8 times faster than their peers. That means finding the right technology now that allows your brand to grow in the future will almost double future revenue compared to your peers.

Veronica Servantez, SVP of marketing, BigCommerce. <cite>BigCommerce</cite>
Veronica Servantez, SVP of marketing, BigCommerce. BigCommerce

Fairchild Studio: What do consumers expect from an online shopping experience?

V.S.: Consumers expect a personalized, frictionless shopping experience that allows them to purchase when, where and how they want. That means giving shoppers the ability to easily purchase from your e-commerce site, but also across channels in a unified, omnichannel experience.

When it comes to your e-commerce site, one-click checkout is a must. A number of providers can help provide these experiences, like Stripe Link, Visa Click to Pay or Bolt One-Click Checkout. Data on customer clickthrough patterns showed that over the 15 months following signup, one-click buyers visited the website on average 7 percent more than before sign-up, viewed 9.3 percent more pages on the website, and spent 7.8 percent more time on the site per visit, according to a Cornell University study.

Shoppers also want flexible payment options, like digital wallets, crypto, and buy now, pay later (BNPL). In fact, 11 percent of customers will abandon their carts if they don’t see enough payment methods, according to the Baymard Institute. WorldPay’s Global Ecommerce Payments Report found that digital wallets, like PayPal, Apple Pay or Amazon Pay, make up 56 percent of online payments. And Capital One found that nearly one in five American consumers used BNPL in 2023. Offering these payment methods is key for e-commerce success.

When it comes to omnichannel, creating a unified experience across multiple channels is
crucial. Social media, for example, is already the number one channel for product discovery, and Insider Intelligence projects that 110.4 million people will shop using social channels in 2024. Additionally, apparel was the most-purchased product category across social media channels, making up 26 percent of social sales, according to Statista and Influencer Marketing Factory.

Beyond just social media, brands and retailers must connect the dots between all touchpoints and channels, from online stores and brick-and-mortar to marketplaces, search, affiliates and more.

Fairchild Studio: How does a poor online experience impact the relationship between a brand and the shopper?

V.S.: Brand association is real, and key to that association is the customer’s experience. We’ve talked a lot about the purchase experience, but the post-purchase experience is equally as important.

Shipping and returns are huge factors when it comes to the decision to purchase. Shoppers expect fast shipping, detailed delivery updates/alerts, and a simple return policy with strong customer service. In fact, 47 percent of shoppers in 2023 abandoned their carts because extra costs like shipping and fees were too high, according to the Baymard Institute. It’s no surprise that 80 percent of American shoppers expect free shipping above a certain order threshold — and 66 percent expect free shipping on all orders, according to Capital One Research.

This means that making fulfillment as easy as possible is a must. Brands can meet and exceed customer expectations by incorporating buy online, pickup in-store (BOPIS) and buy online, return in-store (BORIS) functionality. BOPIS and BORIS give shoppers the opportunity to easily pick up or return items, while also getting shoppers in store to find new merchandise, giving businesses the opportunity to upsell. It’s important to remember that today’s buyers are increasingly savvy — they are comparing commerce experiences, and if you don’t meet their expectations, they may choose another brand that does.

A 2023 FedEx Study found that 98 percent of shoppers would be willing to order from a brand again if it offered fast and convenient returns, and 56 percent are willing to pay for hassle-free returns. Implementing practices like one-page or one-click checkout, BOPIS, BORIS, and free shipping can help vastly improve customer experience across the board, delivering a positive brand association, improving sales, and creating the valuable but illusive return shopper.

Fairchild Studio: What is the value proposition of your platform? What differentiates it in the market?

V.S.: BigCommerce helps brands and retailers build the shopping experiences that customers expect, designed to captivate and convert. Our open commerce solution delivers all the scale and convenience of SaaS but with API-enabled freedom. Simply put, that means you get all the benefits of   SaaS ecommerce with more flexibility, enterprise-grade functionality, customization, and performance. Our customers can customize to meet their shoppers’ growing needs — often at a lower total cost of ownership than monolithic platforms.

Our open SaaS model offers applications and integrations with best-in-class partners to help businesses of any size. We have relationships with over 800 technology partners and over 5,000 agency partners across the globe, which allows for unlimited customization to fit any need.

And our native multi-storefront capabilities help merchants create personalized experiences and storefronts for a variety of regions, currencies, and more, all from a single back-end.  This functionality is critical to streamline operations as brands start to scale.

Fairchild Studio: Can it help a retailer or brand scale their e-commerce business? How?

V.S.: Solutions like BigCommerce and Feedonomics, our omnichannel feed management system, help fashion brands solve the challenges  in delivering unified commerce.  Customers expect and want to purchase products easily, no matter the channel; you must meet them where they live, and Feedonomics allows you to do just that.

Feedonomics is a full-service channel management system that is built to help merchants quickly and efficiently manage product data across 300+ online marketplaces, social channels, and search engines.

It integrates with multiple sources, like your ecommerce back-end, product inventory management (PIM) system, and enterprise resource planning (ERP) software. The system then takes in that data and optimizes it for every channel you sell on. This, along with Feedonomics’ order management and data protection software, means that nothing slips through the cracks while your business sells across channels.

Simply put, Feedonomics allows businesses to focus on growth rather than managing day-to-day operations.

Fairchild Studio: What are ways that BigCommerce customers improve ROI?

V.S.: BigCommerce customer Badgley Mischka needed to modernize their direct-to-consumer channel, so they switched to BigCommerce from their previous platform, Pulse Commerce.

Katie Ouaknine, owner of Badgley Mischka Web, said that “We knew we wanted to plug in a bunch of different integrations, and BigCommerce was the way to get that done.”

They began using a variety of tools to help improve customer experience across their site, including Bolt One-Click checkout and Feedonomics to help manage their social, search, and marketplace feeds. When asked about the Feedonomics integrations, Ouaknine said, “…holy cow, they are changing our lives a little bit.”

After switching to BigCommerce, Badgley Mischka saw a 61 percent increase in revenue.

Coldwater Creek, another BigCommerce customer, was being held back by their previous e-commerce platform. They needed to improve customer experience across the board, drive new growth, and refresh their brand.

With the help of BigCommerce agency partner CQL, they were able to use BigCommerce to transform their entire digital ecosystem. The new, modernized tech stack has helped drive brand expansion, delivers a cutting-edge customer experience, and provides Coldwater Creek’s internal teams with new, easy-to-use tools to help scale and grow revenue.

Since switching to BigCommerce, Coldwater Creek has seen an 8.5 percent increase in revenue, an 8.5 percent increase in orders, and a 20 percent cost savings over their previous platform.

And finally, BigCommerce customer Natori was purely wholesale until 2008, when they decided to also begin selling direct-to-consumer. In 2016 they realized that they needed a more robust e-commerce solution that allowed them to move from a purely wholesale model to include direct-to-consumer sales. They also needed a platform that was easier to use than their previous one, had better merchandising capabilities, and streamlined navigation/filtering functionality.

Since switching to BigCommerce, they have built up an impressive unified commerce strategy, selling across social channels and marketplaces. Working with Feedonomics, Natori experienced a 10 to 15 percent lift in the luxury fashion retailer’s main key product indicators, including overall volume growth, increased click-through rate and decreased cost per click. Improving accuracy enables brands to target customers more effectively, resulting in a greater return on ad spend, boosted revenue, and expanded reach.

Between January, 2020 and January, 2022, Natori saw a 141 percent increase in customers, a 164 percent increase in orders, and a 163 percent increase in revenue.

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