real-time-retail

Real-time Retail: The Rising Of Real-Time Fashion

Real-time retail involves the instantaneous collection, analysis, and distribution of data to give consumers an integrated and personalized shopping experience. This represents a strong new trend, as a further evolution of fast fashion first (who turned the design into manufacturing in a few weeks), ultra-fast fashion later (which further shortened the cycle of design-manufacturing). Real-time retail turns fashion trends into clothes collection in a few days cycle or a maximum of one week.

Understanding real-time retail

In the digital era of instant gratification, consumers expect a seamless shopping experience from retailers on a variety of devices. But the preference for consumers to shop online also presents a huge opportunity for retailers who can gain a competitive advantage by meeting consumer needs in real-time. 

e-commerce-marketing
E-commerce marketing is part of the digital marketing landscape, and beyond, where e-commerce businesses can enhance their sales, distribution, and branding through targeted campaigns toward their desired audience, convert it into loyal customers which can potentially refer the brand to others. Usually, e-commerce businesses can kick off their digital marketing strategy by mastering a single channel then expand for a more integrated digital marketing strategy.

Using real-time technology in search, retailers can adjust their reach, competitiveness, and relevancy during critical times to boost conversion rates. For example, how might an air-conditioning business target search terms before a forecast heatwave? How might a fashion retailer identify the next fall trend before it comes mainstream?

The importance of real-time retail is also exemplified in delivery times. Giants such as Amazon are now making same and next-day delivery the new normal. This poses a problem for smaller, less efficient businesses that find it difficult to offer a level of service consumers now expect.

To that end, real-time retail increases efficiency in every aspect of a retail business. Practitioners of real-time retail note many processes that should be real-time or as close to real-time as possible. These include processes in areas such as supply chain management, inventory, marketing, advertising, product creation, and customer experience.

Real-time retail practices

Let’s now take a look at some of the more impactful real-time retail strategies:

  1. Proximity marketing – in general terms, proximity marketing involves the use of streaming analytics and mobile infrastructure to locate customers in real-time and analyze their behavior. In a typical store, streaming analytics help retailers track the physical location of each customer and send them product offers when they are in a certain radius of a product or aisle. This form of promotion allows the retailer to avoid pushing out random and untargeted product offers that are unlikely to convert.
  2. Contextual recommendations – Amazon generates over a third of its total revenue through contextual recommendations based on products purchased by similar customers. Despite its effectiveness and perhaps through a lack of suitable data, some retailers have been slow to incorporate this real-time retail process. 
  3. Ad optimization – in the previous section we noted the example of an air conditioning business changing its strategy to reflect periods of hot weather. Real-time analytics can help the company decide when to bid for digital ad space based on current trends, market penetration, and consumer purchasing behavior. Such analytics correlate views or clicks with user demographics and marketing budgets in real-time. In fact, real-time retail provider Experian uses streaming analytics to optimize ad placement in less than a millisecond.
  4. Personalized shopping experiences – real-time retail also makes a highly personalized shopping experience possible for consumers. Jewelry retailer Helzberg Diamonds developed an app for employees to enhance the experience of shopping for jewelry. Using the app, sales staff have real-time access to a customer’s purchase history, wish list, and contact details. The app also provides data on inventory levels and can display product information from the store catalog. 

Key takeaways:

  • Real-time retail involves the instantaneous collection, analysis, and distribution of data to personalize the consumer shopping experience.
  • Real-time retail applies to most aspects of a retail business, including marketing, distribution, advertising, inventory management, and product creation.
  • One form of real-time retail is proximity marketing, where retailers track the physical location of customers in a store and send targeted offers. Streaming analytics data is also used to optimize advertising in response to fluctuating trends or events.

Related Case Studies

zara-business-model
Zara is a brand part of the retail empire Inditex. Zara business model, with over €18 billion in sales in 2018 (comprising Zara Home), and an integrated retail format with quick sales cycles. Zara follows an integrated retail format where customers are free to move from physical to digital experience.
wish-business-model
Wish is a mobile-first e-commerce platform in which users’ experience is based on discovery and customized product feed. Wish makes money from merchants’ fees and merchants’ advertising on the platform and logistic services. The mobile platform also leverages an asset-light business model based on a positive cash conversion cycle where users pay in advance as they order goods, and merchants are paid in weeks.
poshmark-business-model
Poshmark is a social commerce mobile platform that combines social media capabilities to its e-commerce platform to enable transactions. It makes money with a simple model, where for each sale, Poshmark takes a 20% fee on the final price, for sales of $15 and over, and a flat rate of $2.95 for sales below that. As a mobile-first platform, its gamification elements and the tools offered to sellers are critical to the company’s growth.
etsy-business-model
Etsy is a two-sided marketplace for unique and creative goods. As a marketplace, it makes money via transaction fees on the items sold on the platform. Etsy’s key partner is comprised of sellers providing unique listings, and a wide organic reach across several marketing channels.

Read Also: Shein, Wish, Poshmark, Etsy.

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Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which reached over a million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get The FourWeekMBA Flagship Book "100+ Business Models"