Here’s How Farfetch Is Using Omnichannel and Data to Dominate Luxury Fashion
Luxury fashion brands have historically been resistant to immersing themselves into the world of ecommerce. The opinion has long been that the kind of tactile high touch experience luxury fashion customers enjoy simply isn’t replicable in the online space and have instead continued to focus on traditional brick-and-mortar experiences.
However, thanks to a proliferation of digital technology and no doubt motivated at least in part by the challenges of the COVID-19 pandemic, this attitude is beginning to shift, and we are seeing an increasing number of brands in this space experiment with and devote more attention to their online presence.
One brand which was ahead of this curve is London, England-based Farfetch, which has long been making serious waves in the luxury fashion ecommerce market thanks to a focus on collaboration and leveraging the power of digital technology.
Farfetch
One of the ways Farfetch has managed to succeed in the online luxury fashion space is by serving as a marketplace for third-party brands. The brands Farfetch collaborates with can choose how deep that partnership goes, with Farfetch taking a sliding scale commission depending on the amount of involvement it has.
Typically, this commission falls between 25 and 33%, depending on whether Farfetch manages shipping, returns, or other services alongside providing the marketplace on which the items are sold. This business model also reduces Farfetch’s investment risk as it does not own any of the inventory sold via its platform.
However, Farfetch is not abandoning the high street and also has a solid omnichannel strategy which will drive sales throughout its business, again driven by collaboration with other brands.
One such example is an app developed alongside Chanel which allows customers to book an appointment with a store associate. Before the appointment time, customers can browse items on the app and select them to try on when they’re in store. The associate can then have those products pulled and ready for the customer when it’s time for their appointment. Once in store, the fitting rooms have smart mirrors installed which can display the customer’s choices, recommend accessories and other periphery products, and display footage of professional models wearing the items on the catwalk, to give them an idea of how the clothes look in motion.
"For me it’s the meeting of the retail excellence of Chanel and the digital excellence of Farfetch," said a Chanel representative regarding the partnership. "They are convinced that luxury shopping will still happen in boutiques in 10 or 20 years. And on our side, we want to think of the clients of tomorrow, so we want to test this new client experience. It’s a test and learn approach."
Data
During the pandemic, Farfetch leveraged Google Search data to make sure it was keeping abreast of customer shopping habits. Things were changing rapidly as people around the world moved in and out of varying levels of lockdown restrictions and Farfetch knew it had to remain agile to meet these shifting needs.
One interesting trend Farfetch observed through this method was, when customers were forced to stay at home and work remotely, there was a sharp spike in searches for hats, shirts, blouses, eyewear, etc. You may be wondering what’s interesting about these items? Well, they’re all worn above the waist – a likely consequence of people wanting to look good on Zoom calls and other video conferencing platforms.
Of course, searches for loungewear were also up significantly through this period.
By following these search trends, Farfetch was able to react with agility and adjust its marketing and the products given prominence on its online platform to match customer demand. However, Farfetch doesn’t just use data for these performance-based purposes, but also to drive brand strategy through connected storytelling, content creation, and more.
"Leaning into Search data was also key, allowing Farfetch to pick up pockets of demand as the world moved in and out of lockdowns," writes Google in a blog post. "Farfetch has always drawn on many experts, from independent boutiques to stylists, curators, and creators — but with the speed of change and volatility, it had to change tactics. Using a combination of its traditional expertise along with Google Trends, the brand evolved its approach."
Final Thoughts
Farfetch is proving that luxury fashion can succeed in the online space. Through smart collaborations, omnichannel innovation, and leveraging the latest digital technology such as data analytics, Farfetch is proving itself one to watch in this lucrative corner of the retail business.
Data and other technologies are sure to part of the conversation at eTail Europe 2022, taking place in April at the Queen Elizabeth II Conference Centre, London, UK.
Download the agenda today for more information and insights.