So you need to sell products. Like any brand, or business, sales keep you going. They pay for your costs, overheads and time, so that you can keep doing what you love. So it makes sense, that with an increase in sale and discount sites like Groupon, you’ll be tempted to go for the quick sale. But in this post, I’m going to tell you why that is a bad idea for your fashion brand and could damage you long term.

HOW DO THEY WORK?

Discount sites like Groupon, work by giving attractive deals to customers, in the hope that they will share those deals with friends, who will then buy something too. The referred friends, then share those deals with other friends and so on……

The discount sites make money by taking a percentage of each sale through their site, or by charging brands for listing products with them.

Brands and retailers use these sites, to take advantage of their large customer base and marketing to attract customers. As a retailer, you can get rid of additional stock. Fill up empty seats in restaurants or classes, or offer basic services, to reach new potential customers.

By offering products and services in large quantities, you can offer discounts in return for a higher volume of sales. This means that you make less profit per sale [due to the discount] but make up that profit by selling more.

THE GOOD

I should clarify that discounts sites aren’t bad for everyone. If you’re selling a service for example, you could attract a new customer with a basic package and then offer additional paid options, when they meet you, or use your service. If you provide something that suits their needs, then you may have a new customer for life. In the same way, if you are selling an exercise class, or a restaurant deal, then the whole point of the discount site, is to get ‘bums on seats’ and hopefully make a good impression that will create repeat customers.

Alternatively, if you have a clothing line and have too much stock of a particular product, the discount can encourage sales so that you can get rid of your stock. Essentially, this is why we have sales periods in retail, like Christmas, or seasonal sales. These discount sites provide a continuous sale period all year round, so that you don’t have to wait.

You would naturally assume then, that with all of these benefits for your fashion brand, I’d be encouraging you to use them. But I’m not, and here is why….

THE BAD

If you need to get rid of stock or increase your brand awareness, then reaching the most amount of people is key. Yes that is just common sense. However, if you damage your brand image in the process, is it really worth it?

In retail, it’s accepted that there will always be sales periods. Customers expect you, as a fashion brand, to have sales, but when they happen, customers just accept that it’s because of the time of the year. It’s a special occasion, like Christmas, or the end of a fashion season.

When customers go into your store, or shop online during a sale, they specifically come to your brand because they want your goods, with your brand values, just at a cheaper price. Your sale customers are usually looking for a deal because they couldn’t afford your products at full price, or discovered something they love, close to sale season and just delayed their purchase because they knew a sale was coming.

A sale doesn’t affect how customers see your fashion brand image, when it is done at typical times of the year. Your core customers, who love your clothing line or adore your products, will shop with you at any time of the year and sale customers still want your clothes specifically, just at a reduced cost.

Every part of your brand image and reputation is intact and unaffected by a traditional sale.

Now think about how your brand image would be viewed by a customer, if they saw it on a discount site. How would you view products that were heavily discounted, on a third party site?

THE CHOICE….

When I mention low quality, cheaply priced products, people automatically see that as a bad thing. This might indicate how people view products that are sold on discount sites, but I should point out that it’s not bad or good. It’s simply a business model.

If you are a fashion brand that makes its money by selling low quality, cheap products at a high volume, then any sale that will get rid of stock, is not a problem. Groupon and other discount sites are probably a good idea. More sales mean more profit and if you already have cheaply priced products, actually, you are probably reaching your target market just by using discount sites. Remember that regardless of your brand and market, you should be putting the right products in front of the right people. A discount site’s customer base is just the type of customer that you are trying to attract.

But what about brands who don’t use that type of business model, or aims to attract a higher end customer?

You’ve spent all of your time refining your Core Brand Values; perfecting your products and packaging, then marketing your clothing line to the right target market. All to project a particular brand image to your customers. If you then add your brand name and products to a discount site, this will send a message to your customers that you need sales. It tells them that the brand image you are trying to project to them and reality, are vastly different.

The key to any brand image is consistency. If the brand image you are trying to project and where you sell [as well as every other aspect of your fashion brand], don’t align, you’ll just end up damaging your brand image in your customers mind. Customers will start to see your brand at the level of the discount site regardless of your brand image.

AN EXAMPLE FROM BURBERRY

As a short example, I want to tell you about Burberry. Burberry has always been a luxury brand, with its roots in knitwear, although it was known more for trench coats. Its iconic feature, was the Burberry Tartan, known as the Burberry Check. This pattern was instantly recognisable as Burberry and is pictured in the photo above, with Emma Watson.

Back in the 90’s Burberry was gaining in popularity and at the height of its game until a huge wave of Burberry Check baseball hats [illegally copied ones] made their way onto every market stall across Europe.

There is obviously a difference between the customer profile of market shoppers and luxury ones. Neither is bad or good, just different. But if you gain in popularity in a market that is completely opposite to the one you are aiming for, the results are never good. This iconic check pattern became popular with a market known as ‘Chav’ culture. According to the Cambridge English Dictionary a ‘Chav’ is described as

someone, usually a young person, whose way of dressing, speaking, and behaving is thought to show their lack of education and low social class.

During the 90s, suddenly this very recognisable check pattern was being worn with shell suits and trainers. Not the image Burberry was known for at the time and so many people bought these caps, that it damaged the brand name to the point where luxury customers, loyal to Burberry, moved onto other brands.

Burberry drifted out of the media and popularity for around 15 years, before making a strong comeback in 2008. The brand image was damaged and the business itself fell into hard times. It took them around 15 years to shake off the brand image that had been formed around the ‘cap’ issue and to remind people of their real brand image. The Burberry Check is no longer promoted as a ‘must have’ item and actually, very rarely appears anymore in their advertising.

If you’re worried about copying and illegal reproductions, I should mention that since the 90s, mainly to do with the damage to Burberry’s business, laws and regulations across the world have tightened. Countries like China, take illegal copies very seriously and there are heavy penalties for selling illegal goods, including fines and even prison time.

Copying will never completely be wiped out, but situations, like Burberry in the 90s, where damage to brands can fold a business, will never happen again in today’s world.

MARKETS AND DISCOUNT SITES

Traditional market stalls are still thriving, attracting a particular customer. Discount websites, like Groupon, are simply a modern version of the market stall, but their customer base is actually a lot bigger.

Market stall shoppers will use these sites to get higher quality products at cheaper prices, but higher earners, on the hunt for a good bargain, will also use these site. They may not shop at their local market stall, but will in fact, look through the deals online.

If there is a lesson to learn from Burberry in the 1990s, it’s that where you sell your products, is just as important as what you sell. If you are thinking about selling on a discount site, or even approaching a buyer for a department store, you should always consider whether this is the right platform for your fashion brand. Are their customers your customers?

FINALLY….

So now that we’ve talked about the damage to your brand image by choosing the wrong selling platform and who should use these discount sites effectively, you should be able to choose whether these are the platform for you, your fashion brand and your customers.

If you are thinking about using a 3^rd party platform [a platform not owned by you, like Groupon or Amazon] to sell your clothing line, then I have some steps below to help you make your decision and avoid damaging your brand image.

[wc_fa icon=”cogs” margin_left=”” margin_right=””] Action Steps:

So if you are trying to decide where to sell your products [other than your own website] then these steps will help make your decision.

Look at the Customer Profile of the platform [or store] you are thinking of selling on.
Look at your Customer Profile.
Compare the two profiles.
If they don’t match up, then ask yourself if selling on this website would cheapen or damage your brand image.

P.S

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PHOTO CREDITS:

Burberry Photo with Trench Coat and Bags - Emma Watson - Burberry Spring Summer 2010 Campaign

Burberry hat - Profile picture from Twitter. Teddy Cross