In my last post, I focused on fashion retailers who are struggling on the UK’s high streets. Yet, there are also retail players out there that are comfortable to challenge the status quo, who see the current climate as an opportunity to innovate. Farfetch is one such fashion retailer at the luxury end of the spectrum. They have carefully crafted their offering and are now set to carve out their place as a global retail player who is not intimated to tackle the large luxury markets of Asia which other retailers have previously shied away from. So what exactly is making Farfetch so successful ? What key learnings can we take away from Farfetch’s omnichannel approach to fashion retailing?
Image source:(Farfetch, 2019)
Online luxury retail platform Farfetch has enjoyed a spate of successful funding rounds, most recently as at January 2020 for $250m. This latest round marks a step change in the brand as it seeks to scale the business. This is just the tip of the iceberg as the brand has acquired funding in excess of $700m across 6 previous rounds. But this current round of investment speaks volumes not because of the amount but because of who is behind the investment, Tenecent and Dragoneer to be exact. Tenecent is Chinese owned and one of the world's largest venture capital firms with a strong focus on tech and e-commerce. Meanwhile, Dragoneer is a San Francisco based investment Group behind the now famous likes of Slack, Spotify, Alibaba Group, Uber and Etsy. These are both big players have went in for the long-term with Farfetch and they are definitely on to something.
So why is Farfetch so appealing?
Farfetch is on a global game plan, with new markets continuing to open for the retailer. Asia has been of particular interest and Farfetch is now knocking firmly on the door of China luxury fashion market and consumers are ready. With a suite of big name fashion brands on the scene including Saint Laurent and Moncler it’s a confident player in the luxury sphere. But it is the company’s agile ability to innovate which was been at the heart of its success. In 2019 the retailer launched the store of the future, a vision for augmented retail with a focus on truly integrating the online and offline retail. It’s the best example of omnichannel retail you are going to find and it’s all powered by data to deliver exceptionally personalised customer experiences but keeping the human touch with building relationships with store team in the physical setting. Time and time I have never understood why brands fail to integrate the online experience into the physical store setting. All those hours customers dedicate to choosing potential product to save in baskets or wish lists to then go in store and see no integration this to support purchase decision making has become somewhat baffling in my view. This approach by Farfetch is not only seamless but it’s a lot of common sense.
“This suite of technologies aims to improve retail productivity by capturing consumer data and enhancing interactions between consumers and sales associates, both in store and when the consumer interacts with the retailer or brand online. The open innovation approach to our operating system means that retailers and brands can also use third-party technologies on our platform. This allows for a uniquely tailored offering to each brand or retailer in keeping with their in-store and online strategy.” (Farfetch, 2019)
Anyone can play at online retailing but delivering a seamless experience is playing at another level...
There are also a few other strings to the Farfetch bow. They have developed a pre-owned fashion offering which is positioned right next to their new product, which is a big tick in terms of sustainability and sets the example of how other even high street brands could be doing this. But there’s more, the smart approach of Farfetch is that it has an open approach to systems meaning that retailers and brands can stay true to their own strategies while showcasing product on Farfetch’s platform - this means that the platform offers numerous different fashion boutiques online under one roof. So not only is the experience tailored for the customer - it’s tailored to each luxury brand that joins the platform which makes it even more appealing. Hence the emerging online-offline partnership with Chanel which is set to take shape this year and beyond. If there was an omnichannel model for doing fashion retail well right now - Farfetch is it.
I’ll be keeping a close eye on Farfetch in 2020. Which omnichannel fashion retail brands are on your watch list?
Watch more: https://www.youtube.com/watch?v=4Ex5CxXpjhg