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Does digital finally have a seat at the table?

Fashion and luxury goods companies are hiring chief digital officers in a bid to integrate digital thinking into core business strategy.

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“A revolution needs leaders,” says Luca Solca, managing director of luxury goods at Exane BNP Paribas, on the digital transformation reshaping fashion and the recent introduction of chief digital officers (CDOs) at some of the largest fashion and luxury companies.

In one of the biggest moves, this summer, LVMH appointed Ian Rogers, Apple’s former senior director of iTunes, to the newly created position of CDO, giving digital a seat at the top table at the world’s largest luxury conglomerate for the first time. “I am happy to welcome Ian into our group to strengthen our digital ecosystem. He will build on the foundations laid by Thomas Romieu, take the houses to the next level and explore new opportunities for the group in the digital sphere. Ian will bring his extensive experience in high-end digital ventures and his innovation-driven spirit to develop LVMH leadership in the digital luxury field,” said Bernard Arnault, chairman and chief executive of LVMH, in a statement at the time of the appointment. (Thomas Romieu is the company’s group digital director, who will remain at the company.)

“This is a signal LVMH has embraced digital for real; [that it] will be more and more integrated in its business,” says Solca. “A very senior role is required to lead the way, promote cooperation and remove roadblocks.”

Rogers is not alone. Senior digital appointments are on the rise across the fashion industry, with chief digital officers now in place at companies ranging from Westfield, one of the world’s largest owners of indoor malls and an early adoptor of the CDO role, to Kering’s luxury fashion house Saint Laurent.

Whereas once digital was relegated to the e-commerce team and a subsection of the marketing team, these moves reflect a newfound need to integrate digital into core business strategy. “There was some digital before, but the difference between now and then is that it was a subset of what people did under marketing and now it’s a department of its own and reports directly to the CEO,” explains Kevin McKenzie, CDO at Westfield. “The company recognised that the consumer was changing in the way that they purchased and the influence that they have from digital, and they thought it would be a good idea to hire someone to help educate them on digital trends, to articulate some thoughts and ideas on what that could mean for the business, and ultimately to develop a strategy for products and services.”

“Previously, the attitude was that we can continue doing great without digital, but that is finally starting to change,” says Perrine Corvaisier, CDO at Maison Ullens, a small Paris-based luxury brand established in 2010 and focused largely on leather and cashmere pieces.

For years, many luxury brands believed they could afford to move slowly on digital, because growth could be found elsewhere, notably in China. “As Patrizio Bertelli [chief executive of Prada] once told me: ‘It’s not that I am skeptical about digital, it’s just that I have many more important things to do,’” recounts Solca. But a slowing China has changed the equation. “[E-commerce] is one of very few ways luxury goods companies can now grow,” Solca continues.

Now, many brands are racing to catch-up with a luxury consumer that is more digitally active than the general population. “Digital is now the engine of the luxury shopping experience,” according to a report published in July 2015 by the Altagamma-McKinsey Digital Luxury Experience Observatory.

While e-commerce made up just 5 percent of the global personal luxury goods market in 2014, it is expected to reach 9 percent by 2019, with a total value of $27 billion, says Mario Ortelli, senior luxury analyst at Sanford C. Berstein. What’s more, online now influences over 60 percent of luxury purchases, making a robust digital strategy indispensible, Ortelli adds.

Indeed, a report by Solca entitled “Digital Frontier: The New Luxury World of 2020,” predicts that digital will become essential to more than e-commerce and marketing, impacting all stages of the value chain. “The development of digital capabilities will be a necessary condition for survival,” says the report.

While the ultimate task of the CDO is evolving his or her organisation towards this deeper and more holistic view of digital, there are often several near-term hurdles to overcome first, including how to define the role, says Ashley Friedlein, president of Centaur Marketing and founder of Econsultancy.

Friedlein points to two different types of CDOs. “Ambassadorial CDOs” are often put into place as an early bid to signal to shareholders that a company is serious about the digital opportunity. But they often have no real operational impact and work in posts that rarely come with a P&L attached, he explains. “The challenge for these people is that if the role is more about a statement of intent, or if it’s just about education or inspiration and they can’t fundamentally change the business, they leave,” says Friedlein.

What Friedlein called “transformative CDOs,” on the other hand, typically have a strong grasp of both marketing and technology (often sitting above or replacing the chief marketing officer or chief information officer) and usually come with an operational background. They frequently control product and pricing, and sometimes customer service and sales as well, and they know how to engender change, he adds. In September 2015, McKinsey published a paper with a headline suggesting that effective CDOs must be “transformers in chief.”

But making change is easier said than done. “You need to be a good internal consultant and a good internal sales person, and at the same time you need to be very analytical,” explains Corvaisier. At Maison Ullens, her objective has been to place digital at the heart of everything the business does. “I’m thinking about digital from the outside in, and the other way round. It’s a very broad role in terms of scope; it touches every part of the company.” Previously, she ran a similar, though much larger, team at Hermès as global digital director for e-business and communication.

Meanwhile, Francesco Bottigliero, chief digital and information officer at luxury Italian fashion brand Brunello Cucinelli, has a role that straddles digital marketing and traditional information technology. Part of his focus is smoothing internal integration. “Typically in our industry, IT is completely kept away from any digital project or decision; digital is more closely aligned with marketing and then there’s cultural clash when they need to work together. So we decided to merge the two,” he explains. But, ultimately, he wants digital thinking to permeate the entire organisation. “It will get into our manufacturing process, replenishment, design and more. We will move from traditional IT legacy systems into digital applications across the company.”

While LVMH declined to discuss the specifics of Rogers’ new role, Ortelli says that, at a high level, his primary objectives will be to help the company’s senior management become more digitally savvy and to share best practices in digital across the group’s brands. “He’ll look to develop synergies and align the brands, and he’ll be there to act as an advisor on digital propositions put forward,” says Ortelli.

For all CDOs, integrating customer relationship management (CRM) systems is one critical area of opportunity. “CRM is the real future opportunity. Anything that helps brands improve this is something they will try to embrace,” says Ortelli. But many smaller luxury companies, lacking their own direct-to-consumer e-commerce channels, don’t have control over their customers’ online data, explains Lindsay Nuttall, CDO at advertising agency BBH, which has worked with brands like Burberry. Much of the initial work to be done as a CDO, therefore, surrounds reclaiming data, she says. “The fact they’ve given part of their supply chain away to third parties like Net-a-Porter could prove an increasing problem over time. It can affect really practical things, like their margins, and really huge things like their route to the customer. By not collecting data on them, you don’t understand how they’re evolving.”

Another issue, she adds, is not being able to connect the dots and identify individual consumers across touch points. “If I’ve spent £5,000 in a Bond Street store, [the brand] doesn’t know that I’ve also walked into the store in New York before that. And they definitely don’t know I’m shopping and spending online the other 90 percent of the time.”

To help address this, Westfield has just hired a chief data and analytics officer, Raqhav Lal, who will work alongside McKenzie and the company’s chief information technology officer, Denise Taylor. “Data is such a core part of digital that it made sense to add that pillar to our organisation, strategy and thinking. We hired a chief data officer to educate us, but also to create applications for how to use this data to better operate our business and create better experiences for the customer and the retailer,” McKenzie explains.

If it is successful, the role of the CDO is, almost by definition, an interim one. According to Corvaisier, who is about to leave her position at Maison Ullens to launch her own digital consultancy, CDOs should aim to make themselves redundant and exit the stage once digital has been adequately embedded throughout a business. “The role is to excite and show the way with digital; to set up a few guidelines and some technical points, so that the organisation can change and continue to lead on its own.”

Indeed, at digitally mature companies, digital strategy is fully integrated into overall business strategy, negating the need for a specific chief of digital. “As in the case of Burberry, the alternative is to have the CDO and the CEO roles coincide,” says Solca.

“In the 1920s businesses had chief electricity officers because it was such a new thing,” adds Friedlein. “This feels like that; a moment in time that will pass.”

This story first appeared on The Business of Fashion.

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Editor's pick film

London Fashion Week turns to performance poetry in ‘Ode to Soho’ film

London Fashion Week is celebrating its move into Soho, with a short film dedicated to the “richness and diversity of the fabulous square mile”.

Created by BBH, the ‘Ode to Soho’ features a poem written and performed by World Poetry Slam Champion, Harry Baker. In one part, he voices: “A place of history, disbelief and everything that’s in between. One can come to live the dream, and live it individually. Wicked beats, inner peace, different scenes, hipster please, collaborate and intervene at Soho.”

Adds the write-up: “The aim was to create something that wouldn’t just appeal to the fashion lovers, but also to the people of London, specifically the eclectic workers and dwellers of Soho. We want them to see this video and get excited about the impending fashion takeover, and to feel proud of the unique heritage of their chosen area.”

BBH Zag, the branding and venturing division of BBH, has been appointed lead creative agency by the British Fashion Council for LFW. Its brief is to help turn fashion week into the UK’s leading cultural event. The relationship will encompass developing a long-term brand strategy and core brand identity for LFW that will be adaptable for each season.

Watch the film here:

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data e-commerce Editor's pick social media

British brands enabling fans to shop real-time #LFW trends by leveraging outdoor advertising

This post first appeared on Forbes.com

Despite fashion week being all about what clothes we’re going to wear next season, brands including Hunter Original and Topshop will push current stock in a big way when London begins from Friday.

Both are turning to digital screens up and down the UK in Ocean Outdoor’s network, in a bid to truly capitalize on the hype that London Fashion Week brings. They will run real-time out-of-home (OOH) campaigns that not only provide consumers with more access to the event than ever before, but encourage them to actually shop by placing existing product, rather than new, front and center.

The fashion industry has struggled to solve the conundrum that building huge hype during fashion week season brings, when that tends to be six months before products hit the shop floor. Essentially, by the time the collections arrive, the shopper is already on to the next. Burberry was one of the first to make some of its line available for purchase immediately as far back as 2010, in response. Numerous other brands have followed suit since, including as recently as Tommy Hilfiger yesterday in New York.

But that idea only goes so far in practice. By the nature of their release, those items tend to be limited in numbers; either pre-produced thus run as more of a campaign (Tommy Hilfiger), or available for pre-order and delivery in just a few weeks on items that are straightforward to do so with (Burberry). Shifting the production process any further is quite an ordeal for most design houses, but for those on the high street it can be quite a different story.

“Since Burberry first [live streamed its show] there has been a slow trickle of better accessibility and speed to market from fashion week,” Lindsay Nuttall, chief digital officer of BBH and former global head of strategy and communications at Asos , told me. “Zara famously turn around production in a rapid process to soak up demand piqued by fashion week coverage. At ASOS we would provide guides of the key trends from each season for fashion hungry customers that related directly to current stock we were carrying. Innovation in digital formats like mobile and digital outdoor is shifting this up a gear now and taking it out to the mainstream consumer.”

Hunter and Topshop will be some of the first examples of brands making fashion week shoppable by promoting current, and therefore assumedly less limited, stock in conjunction with their shows.

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Hunter will kickstart its initiative by live streaming from its catwalk on Monday February 23 at 6pm GMT simultaneously across nine billboards. Run by agency Candyspace, this digital first for the industry (Burberry previously live streamed its show on just one billboard in London’s Piccadilly Circus), will hit high-traffic retail environments in London, Manchester, Birmingham, Leeds, Liverpool and Glasgow. Messaging alongside the show will drive the audience to Hunterboots.com, as will a content takeover on the landing page of the WiFi-enabled sites for those logging in via their mobiles.

The brand will continue its campaign for three further days after the show, pairing content from the new Fall 2015 collection alongside similar pieces already available for purchase this season, including a poncho, parka and boot. By focusing on core silhouettes and ‘icon’ styles, rather than merely newness, the brand aims to offer the inspiration, not to mention the functionality, for immediate purchase.

Topshop meanwhile has partnered with Twitter to showcase  key trends emerging from London Fashion Week according to tweets using the #LFW hashtag. That real-time data will be fed through to billboards around the country from Friday February 20 until Tuesday February 24. It will be displayed as a word cloud and placed alongside corresponding shoppable Topshop product.

Consumers will also be invited to tweet to @Topshop with any one of the trends highlighted (it might be #pleats or #colourblocking for instance), to then receive a curated shopping list in response. Six billboards – all of which are within 10 minutes walking distance of a Topshop store – will be utilized for the time period. The experience will be replicated in one of the Topshop Oxford Circus windows as well as viaTopshop.com.

Sheena Sauvaire, global marketing and communications director at Topshop, said: “Through Twitter’s listening power, we can allow our global consumer to shop the trends as and when they happen, and give them insight and access into runway shows. The idea of live advertising is just beginning, and thanks to the Ocean Outdoor sites, this will be a first example of real-time shoppable billboards.”

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For both Hunter and Topshop, which are of course two of the more accessible fashion week brands in terms of price point, it’s a smart move to marry fresh and buzzworthy content with current stock. It’s smarter again to facilitate the shopping element of it all by integrating a seamless mobile experience, says Nuttall. “Linking everything to mobile means awareness and engagement is never more than one swipe away from converting to purchase, right there and then, wherever they are.”

Both campaigns have the potential to not only satisfy consumer appetite, but also provide measurable return on investment (ROI) on what would otherwise be a pure brand awareness push.

As the Hunter team said in a statement: “[It] will allow Hunter to capitalize on the heightened brand attention afforded by London Fashion Week and maximize this considerable commercial opportunity, addressing the challenge to drive sales six months before the runway collection lands in stores.”

This focus on ROI also comes at a time when the industry seems to be moving away from large scale, or more PR-worthy, innovation usually seen during fashion week – think drones at Fendi or a 4-D water show from Polo Ralph Lauren. Instead the emphasis so far in New York this season has been on social media programs that drive conversion, according to WWD.

As Melisa Goldie, chief marketing officer of Calvin Klein, told the paper: “You can have millions and millions of eyeballs, but if there’s no real conversation it’s nothing but a bunch of eyeballs… We really want to show that we are getting a return on our investment that is beyond just brand awareness and buzz. That is the next phase of digital.”

OOH done well has the potential to fit within that remit. Says Nuttall: “Outdoor has always been a brilliantly high impact and creative medium. It’s also always been able to reach a burgeoning young fashion consumer at a key moment that is both inherently social and ripe for conversion – when they are out and about shopping with their friends.”

The idea of a shoppable OOH campaign is “hard working commercial stuff”, she adds. “If the fashion industry embraces the creative and commercial opportunity that it represents, it will be really exciting to see where they take it.”

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Asos targets men with new interactive campaign

Asos is combining entertainment, editorial and shopping with the launch of a digital campaign aimed at men for the first time.

Created by advertising agency, Bartle Bogle Hegarty, the “Urban Tour” is a viral, digital and social feat comprised of a series of shoppable films showcasing the online retailer’s autumn/winter 2011/12 collection.

Viewers are able to click and buy any of the looks worn by performance artists showcasing the latest trends in culture, music, art and fashion from seven cities around the world?London, New York, LA, Berlin, Paris, Tokyo and Shanghai.

Three films, shot by two of the world’s leading street-culture directors, in London, Paris and Tokyo, for instance, feature extreme examples of talent from the worlds of dance, music and skating.

Lindsay Nuttall, global head of strategy and communications at Asos, said the push was based on the insight that men were more likely to follow peers than be inspired by catwalk shows, reports Marketing magazine.

“Men are into details, such as materials and textures. They are more likely to focus on tiny differences. It’s about being a nudge above their friends’ style.”

Jason Gonsalves, head of strategy at BBH, added: “A lot of guys aren’t scouring magazines to draw their inspiration, they are looking to culture, bands and films to shape their look. This is why we had to do something different from traditional fashion advertising.”

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Fashion communications should be based on selling ideas not products

I wrote this blogpost after returning from Cannes Lions this year – it was recently published on the all-new Huffington Post UK

There’s no escaping the overwhelming association with luxury in Cannes. Star-studded hotels sit next to boutiques from every designer name you can imagine: Louis Vuitton, Chanel, Gucci, Prada. Balenciaga too, Céline coming soon.

But head inside the Palais des Festivals in June for the world’s most famous advertising festival, Cannes Lions, and there’s barely a whisper of the fashion industry at all. In a celebration of the best in campaigns from around the globe, some of the most creative brands existing, are distinctly absent.

The obvious answer is budget. Traditionally, fashion not only doesn’t do big scale advertising (TV), but doesn’t, of course, work with ad agencies. Who needs a creative director from Madison Avenue, when you have one in Karl Lagerfeld, Marc Jacobs or Christopher Bailey in-house?

Print has always been their home. Seasonal campaigns that tie in with seasonal collections. Bold concepts whittled down to a beautiful aesthetic portrayed through a couple of models and an exotic set. Glossy magazines as premium placement, the odd outdoor billboard and the glittering flagship store.

But advertising has changed. Consumers have changed.

Cannes Lions rebranded for 2011 from the prosaic International Advertising Festival to the International Festival of Creativity, to reflect that. Advertising, once clear-cut in definition, can now encompass anything from an experience to new technology, from the use of social media to an event. More often than not, it’s all those things together.

Proof lies in this year’s winners. Yes, Nike’s epic Write the Future spot took the film grand prix, but it was the likes of Decode Jay-Z with Bing, which had no TV attached to it, that cleaned up.

Taking Jay-Z’s new autobiography and leaking it page by page – printing it in inventive spaces such as the bottom of a swimming pool and a vintage Cadillac Seville car – it then released a series of clues online for a month as to each page’s whereabouts, a ruse which saw fans scrabbling to find them in a Bing-enabled scavenger hunt.

It’s in this integrated realm fashion could do well. On a smaller scale, early adopters are already proving such; taking their glossy seasonal campaigns and using them to spark conversation around the brand both on and offline.

“Content” is the new buzzword, with behind-the-scenes footage, viral teasers and fully fledged online films becoming popular formats.

Prada’s spring/summer 2011 effort for instance, won the top spot on The Business of Fashion’s list of fashion films for the season for its “infectious charm and masterfully executed quick edits”. It also worked wonderfully in the interactive banner space, and translated equally well to print.

Meanwhile, for autumn/winter 2011/12, Mulberry brought its campaign stills by Tim Walker to life in a film created retrospectively through the use of numerous CGI techniques.

And Chanel, one of the masters of the teaser spot, even launched a full 30-minute piece around its cruise collection in May called The Tale of a Fairy.

Then there are the more creative integrations – the cunning of a previous Calvin Klein Jeans billboard inviting us to unlock its censored ads through a QR code; or Burberry’s experiential videos allowing viewers to rotate, pause and change perspective through the use of motion-responsive technology.

But, regardless of such clever executions, the basis for each is still (in the main) that print imagery. Fashion communications remain about print ads selling product over campaigns selling ideas. And that is what needs to change.

Sir John Hegarty, worldwide creative director at advertising agency BBH, told a brimming auditorium at Cannes Lions the future is about doing something different. In a telling demonstration he ran a series of beauty industry ads. With their taglines removed, it was almost impossible to tell which was which.

The same could be said for fashion. By the time you’ve seen the collection, heard about the designer’s inspirations and remembered which photographer they’ll use, you can almost even predict the look of the ads before they’re released.

Hegarty referred to this homogenisation as “windtunnel marketing”, and called for a change in approach.

Denim labels, in that case, offers a lot to be learnt from. Ditching the idea of seasonal ads, Diesel launched its Be Stupid campaign in 2010. Based on taking risk, being spontaneous and saying yes, it’s a philosophy spawned from president and founder Renzo Rosso’s experiences in first launching the brand. It won the outdoor grand prix in Cannes last year.

The tagline has remained since, but the ads – often somewhat risqué themselves – are frequently updated: new models, new product, new multimedia executions.

The same can be seen with Go Forth, the long-term campaign from Levi’s, and the brand’s first global creative platform in its 138-year history. Based on a rally cry for positive change in the world, the latest instalment includes a 60-second film called Levi’s Legacy that was unveiled last week (though has been postponed in the UK following riots across the country).

This kind of big thinking for an apparel brand not only makes a campaign more relevant to different hemispheres when launched internationally, but ties in well with the fact collections are becoming increasingly transseasonal.

Accordingly, while the Cannes Lions rebranding might have taken the focus off traditional formats, it doesn’t rid us of the fact that overarching ideas are what advertising remains about, especially in the new digital age, where execution can overshadow concept.

Fashion therefore – an industry with creativity at its very core – needs to shake off its seasonal collection focus and start thinking instead about campaigns built around big ideas.

A good starting point for inspiration, you could say, is Cannes Lions.

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New Matalan ad orbits perfect spring day

This is a lovely video from UK discount retailer Matalan for spring/summer 2011.

Part of the store’s new ‘Feel Good Fashion’ brand campaign, it sees a series of models interacting with each other as well as their future selves as the camera continuously rotates on the same picnic scene.

With the title Forever Spring, the aim of the 60-second TV spot was to encapsulate the perfect everlasting spring day.

It was created by BBH and directed by Scott Lyon. Richard McGrann of BBH said: “We set out to make a fashion film that not only stands out, but gives the audience something new to spot each time they view it.”

The campaign is also running in print, while a second TV ad is due in the summer.

The soundtrack Plage by Crystal Fighters can be downloaded for free at Matalan.co.uk.