The global secondhand market grew 18% to $197 billion in 2023, 15 times faster than retail, according to the report.
Meanwhile, the U.S. secondhand market grew 11% to $43 billion in 2023, seven times faster than retail, according to the report.
Recommerce is here to stay and with the sustainability initiatives done by major fashion brands, it has got the desired boost.
Case – Poshmark
One of the best recommerce brand which is has built their business model around resale is Poshmark.
Poshmark is one of the resale market players which is leveraging AI for encouraging their users to post products for recommerce by making it easy for the users to post and sell on their platform using AI.
With the easy user interface (UI):
User just upload a photo, the AI tool then generates listing elements such as a title, description and category.
Users can review and edit the generated content before posting their listing.
The tool will appear as a button in the sell tab on the Poshmark app. It is similar to using Copilot app.
The Smart List AI tool is only available for iOS mobile app users in the U.S. and Canada in their first launch phase.
Experiential marketing at its best – Lessons from Coldplay concert.
Recently, I witnessed two live concerts in Dubai. (I am not a fan of live concerts but thanks to my better half who keeps me updated with city events).
First concert was of legendary Indian singer Asha Bhonsle and Sonu Nigam which witnessed a crowd of over 17,000 fans attending the concert.
Second one, was of #coldplay, whose tempo had started in month of October with online booking and thankfully, we managed to get two tickets.
Believe me, I had got calls from many friends and relatives who wanted to come to Dubai just for the concert.
Being a management student, who is keenly interested in understanding the customer’s behavior and buying patterns, below are few of my observations.
1) FOMO –
The fear of missing out is the biggest trick which triggers the dopamine in our brains and make us participate in the event wherein everyone is contesting for tickets.
Lesson– People love to buy product or services, when they see others are buying and there is hardly any chance for them to get it. This triggers the fomo effect and people were witnessed with waiting list on ticketing portal running into 1000’s..
To learn more about Conversational commerce, click here.
2) Engagement frenzy
Many retailers are working on the assumption that Technology will bring engagement into their stores… which is a myth.
Coldplay concerts proved the fact that technology is only an enhancer.
Today People live in digital connected world.
Hence, they seek an escape from this digitization to experience a LIVE concert and yet remain connected by means of sharing reels and shorts on their social media channels.
It’s not watching the concert or songs on the favorite social media app or even spotify but the thrill of experiencing the physicality of the concert, the energy driven stadium atmosphere wherein everyone is singing, dancing, experiencing the event in visceral ways.
Retailers selling sports shoes and showing the videos of the athletes on their video instore screens is certainly not “Customer engagement”.
But,
Making the customers wear that sports shoe, kicking the real football onto the wall with built-in Kinetics systems to indicate the strike rate and analysing the kicking efforts & providing tips for improving the kick is what real -life engagement means.
I have witnessed brands/retailers who have misunderstood the term “Omnichannel” retail and are spending millions on store decor just on the premise that dependence on technology would improve their customer experience.
It is not like standing in the middle of the store & a chatbot explaining the product features;
customer experience is all about educating the customer on the looks he/she can have with that garment, how that fashion accessory would increase their fashion quotient etc.
Technology is just a enabler, Retailers need to be creative to narrate a story of their brand using tech platforms.
3) Coldplay PR strategy is the key to build brand authority
Many retailers think social media marketing would suffice their brand awareness and conversions;
however, the reality is social media combined with PR tools provide customers- a Brand Voice & Brand authority.
Did you see #chris martins visit to local city’s hangouts even temple (In India)? PR is the key.
Below are the videos of both the concerts and personally I enjoyed the events and learnt a lot from Gen Z during these events.
4) Coldplay Going sustainable as your Purpose/ CSR
Even the power generated during the concert was self-sustaining, using the kinetic energy of the concert goers dancing on the rubber mats converted towards electrical power.
Brands need to find their purpose and link it towards sustainability to thrive in coming future.
Conversational commerce is where e-commerce and technology intersect, allowing brands to connect with their customers in new ways, 24/7.
Gone are the days of filling out an online contact form and waiting for a response during “business hours,” or trusting in a company that doesn’t consistently engage on social media.
Personalization is key to creating and retaining loyal customers, and that’s where AI chatbots, messaging apps, and other automation comes to play.
Convenience is paramount to shoppers who want to cut through the clutter and receive answers immediately.
The majority of buyers spend most of their time online, they expect brands to always be available to provide insight, help guide their decisions, and interact in real time.
To learn why fashion business houses are launching their fragrances, click here
Why conversational commerce?
Gen Z and millennials try multiple channels before making a purchase, they check social media, and e-commerce, chat with their friends for social proof, and then talk to customer care to clarify their doubts.
Today customer journeys are more complex and hence Artificial Intelligence and chat bots are helping retailers to keep their customers engaged and provide them with real-time updates.
Type of conversations commerce
Messaging Apps
Messaging apps like WhatsApp and WeChat have become a necessity to transfer customers from your e-commerce site to a chat channel.
This helps e-tailers to reduce their cart abandonment rates.
The main objective is to provide convenience to the customers in the checkout process which sometimes is too process-oriented, filling out the forms, etc;
imagine if you could speak to virtual customer care who would take care of all the documentation.
Remember, People love to do business with People.
Providing human help and personalization is one of the boon for e-commerce retailers.
To learn, fashion + metaverse + leadership = success , click here
2. Live Chat
Offering a channel designed to improve response time and customer service, live chat is software that allows users to initiate a chat session when they type a message into a pop-up window on a brand’s website.
It’s typically monitored by staff who work behind the scenes to answer questions and provide support to customers, offering a less expensive option than phone-based assistance.
3. Chatbots
As an alternative to live chat, many companies have instead decided to outsource to chatbots.
Using artificial intelligence (AI), chatbots are computer programs designed to understand customer questions and automate appropriate responses to them.
Voice Assistants
This is useful in the case of websites that are voice search enabled.
Amazon’s Alexa, and bot voice assistants, is integrated into a website or app to help customers navigate.
The users could directly place their orders by voice commands rather than browsing through the site.
Benefits of conversational commerce
The key objective is to remain engaged with your customers whenever they are coming onto your website.
Build loyalty and customer experience to retain customers and convert them into your loyalists.
Recently, while traveling and browsing the inflight magazine, one article caught my attention.
The article was on the fragrance markets in China and shared some key insights on the Chinese consumer’s preferences and buying patterns especially when it comes to fragrances.
One of the insights that came out from the study was the usage & acceptance study of fragrances among Chinese customers.
Unlike Westerners, who use fragrances to mask odor and enhance the mood, Chinese customers use fragrances that are inspired by their cultural values and enhance the aura holistically of the body and not just mask the bad odor.
“In-home-grown brands from China incorporate the healing properties of plants and link them to each of the signs and planets,” explains Evelyn Zuel, astrologer consultant for Pink Moon. And it’s the same for each note in a perfume.
This underscores their strong appeal among consumers who value quality.
Meanwhile, fragrances in the 10 RMB to 99 RMB ($1.4-$140) range represent the core consumer choice, with cumulative sales of 1.14 million units, highlighting their high cost-performance advantage.
These developments reflect a polarized consumer market:
one side favors luxury international brands, while the other embraces entry-level domestic fragrances incorporating Chinese cultural elements.
To learn why fashion houses to business houses are launching their fragrances, click here.
Growing fragrance market dynamics in China
Coty Group, whose portfolio includes fragrance lines from Gucci, Burberry, Marc Jacobs, and numerous others, reported a 10% YoY net revenue increase to $6.12 billion for the fiscal year ending June 30, 2024, marking the company’s fourth consecutive year of growth.
The Scent of Opportunity: Why Fragrance Brands Should Focus on Angola’s Market Potential
These statistics got me into strategic thinking mode wherein I utilized the rest of my flight time to browse the internet to gather data sets that can be used to launch a fragrance brand within the African market.
There is a huge gap and market in Africa that can be tapped either by multinational fragrance companies or local entrepreneurial-driven organizations that can dominate the fragrance sector in Angolan or even the West African region.
What is common between African countries and their people?
After due diligence for approx 5 hours of my flight time, I narrowed down my choices to “MUSIC”.
The Afro beats, the music events, night clubs, and carnivals are all inspired by the Music that unites the entire African continent.
The fragrance market in Angola is approx 39 million USD itself.
Angola has many traditional instruments, including the ngoma, a bongo drum, and the mpwita, a drum originally found in Kongo. Also noteworthy are the mpungu, a trumpet, and the Luandan hungu, equivalent to the mbulumbumbaof southwestern Angola, both types of gourd-resonated musical bow.
Launch story pad for the fragrance:
Every musical note tells a story that is similar to a fragrance note, every note evokes certain kinds of emotions and conveys its character in form of fragrant notes.
The blend of musical notes with fragrance notes will form a universal scent inspired by the music which would be mystical yet identifiable; the scent of the culturally inspired musical heritage of each community united by musical notes and their musical instruments.
This can be an ideal brief to master perfumer crafting the perfume blends.
Why do fragrance MNCs have to think local when embarking on the African market?
Price-sensitive market wherein the Per capita earning is less than USD 2/- a day. Even though the aspiration for using fragrances is high any fragrance brand that can sell its entry-level fragrances in the range of USD 4- 5/- would be able to tap into the big market share.
Depreciating currency fluctuations allows local manufacturers to tap into the big fragrance market and build market share as local production will reduce the cost of imports associated with depreciating currency.
Western fragrance brands are master storytellers hence to develop a fragrance suited to local tastes and cultures won’t be a problem.
Low cost of operations resulting from affordable manpower.
watch the challenges faced by the Beauty sector in Africa,
Grab a copy of my book to master the art of selling, click the picture below.
The beauty & fragrance sector is the closest to my heart; living in the African continent for over 11 months now and observing the beauty trends amongst millennials and Gen Z daily, I am going down pen down some of my learnings.
The Beauty market:
This market, currently valued at $65.93 billion with a 5.99% CAGR, encompasses a wide range of products, from skincare and haircare to cosmetics and fragrances.
The population aged 17 years and younger amounted to approximately 650 million. Source Statista.
This young population is fueling the growth of the beauty and fragrance sector in the region.
To discover why fashion houses launching their fragrance lines, click here
The Challenge:
However, despite its potential, the African beauty industry is not immune to the economic challenges that many countries face.
Heavyweight countries like Nigeria, for example, continue to experience financial fluctuations and economic instability which present significant hurdles for beauty brands operating in Africa.
One of the most pressing issues affecting the African economy, and therefore brand founders, is the high inflation rate.
For instance, according to Trading Economics, Nigeria’s inflation rate accelerated to 34.19% in June 2024, amid the removal of fuel subsidies and a weakening local currency.
The Impact:
The above factors contribute to reduced consumer spending and increased operational costs for businesses, including those in the beauty industry.
Product price rises with the currency depreciation, resulting in less offtake from the shelves by the customers.
Inflation led to recessionary pressures across the sector, reducing customer offtake, and throwing all the controls like inventory planning, etc out of control.
Underlying belief in Consumer’s preferences:
There is an underlying emphasis on beauty regime and grooming standards amongst women & that is one of the reasons that the beauty sector is still registering growth in the continent despite all challenges.
Especially the skincare, hair (wigs/artificial hair extensions) and fragrances. (edts, body sprays, deos, bath & body ranges, perfumed wet wipes, etc)
From my personal experience, Perfumes & cosmetics is the highest contribution category. (I have experienced a similar trend in the Gulf region as well as in Travel retail – wherein perfumes & cosmetics were the third biggest category drivers after tobacco and liquor).
Brands in the market are mostly sourced from China, Portugal, Brazil etc. However, there are plenty of locally manufactured brands as well which hold the potential to grow in price-sensitive markets as they can bring out smaller packs to mitigate the currency depreciation impact.
Economical ways to reach these customers:
Building your community.
By establishing strong relationships with local communities and consumers can provide beauty brands with valuable insights into consumer preferences and economic conditions, at little to no cost to the brands.
Engaging with communities using WhatsApp groups, and FB groups is one of the most effective ways to market beauty brands here in the African continent.
Influencer marketing is also seen as an effort to build online communities for promoting beauty brands.
Tips for creating a resilient & sustainable beauty business in Africa:
localize production capabilities using local ingredients
flexible pricing strategies,
leveraging digital platforms & building communities
diversifying product offerings,
educating consumers on beauty and grooming regimes.
If you are a business owner operating in the beauty/fragrance/fashion genre & want to grow your business & need a retail expert to help you achieve your “Vision to Reality” framework & strategize your business then feel free to schedule a discovery listening call over a #coffeechat. Inbox your text and my team shall reach out to you.
Fragrances blending both fashion & Business houses
Recently there has been an upsurge in fragrance launches across the globe.
Earlier fashion houses like Chanel, Dior, Gucci, etc who had established themselves as fashion brands introduced their signature fragrance lines to personify their presence and keep their customers engrossed with the brand personality.
This trend was carried forward by celebrity-driven fragrance brands like JLO, CR7, Paris Hilton, etc each having their signature fragrance line for their raving fans and followers.
Recently, the trend of fragrance launches has entered the publications/media world wherein the latest entrants are Esquire and Cirque de Soleil.
But why do fashion designers or celebrities have their fragrances?
The answer is – that fragrance is an extension of a fashion statement, it is aspirational, and it combines the story of a fabric with the sensory elements through scents.
Though fashion designers are not Perfumers they do have one thing in common i.e. the sense of art and story-telling.
Designers tell their stories through their fabrics, color palettes, styling, cuts, etc and Perfumers tell their stories with their fragrance notes, each blended like a musical note of a symphony.
Fragrance personifies the brand personas into its sensory elements and gives character to a fashion brand.
Look at the Esquire magazine fragrance line and their names, each distinct name personifies the media designations.
esquire fragrances
Cirque du Soleil, the Quebecois entertainment company known for its elaborate Las Vegas shows, launched its first fragrance this spring.
Crypto exchange platform Binance created a perfume in March to attract women to cryptocurrency.
These launches speak to fragrance’s growing power as both a revenue stream and a marketing tool.
According to data analyst firm Circana, fragrances represent the fastest-growing prestige beauty category this year thus far, with dollar sales up 12% in the first half of 2024 versus the same period in 2023.
If a brand wants to create a sensory experience for their customers and weave them into their fabric of storytelling, then developing a fragrance line is the answer.
Being a student of the fragrance and fashion sector and having spent over 25 years in the industry, I still feel so excited to learn new marketing tools that are emerging in the sector new concepts, and new mood boards for fragrance launches, I am confident that coming times are brighter for fragrance sector overall.
If you are a retail fashion /beauty business owner and want to scale your business both in physical and digital space, Schedule a coffee chat with me to grow your business.
Freakonomics means the asymmetrical information, and irrational behaviors that influence cultures and businesses beyond economics.
The statistical data often DO NOT explain how consumers behave.
Do you know the business model of Mcdonald’s?
Previously, I had penned an article on the business model of McDonald’s’ which is not a burger fast food QSR but a real estate investment trust (REIT).
The only reason, they can sell a burger for a couple of dollars is due to the fact that the land is owned by McDonald’s and leased out to a franchisee to run and operate the restaurant.
There are many business models whose revenue model is different from their main line of business.
Business model of Movie theatres is a classic example.
The theatre owners don’t make a profit by exhibiting the movies but by selling food i.e. popcorn, drinks, snacks, etc.
On the Movie ticket, the theatre owner gets approx. 25-30% margin but on the food the margin is in multiples and add to it the “cinema advertising” revenue stream and earnings from concessionaires etc
Food and advertising options cover most of the theatre’s overheads.
Now comes the great reveal of the month.
What do you think the Indian airline carrier Indigo’s Business Model?
If you answered, by carrying passengers, you are partly right.
The main contributor to Indigo’s profit is the in-flight catering (food) that they sell to the passengers.
The profit of the airline’s food business is greater than that of the Pizza chain.
The below picture shall reveal the stats
The study of Business and its models has always fascinated me all these years of my management career. In fact, studying the business KPI and its economies are my hobbies now.
What is multi-touch attribution channel retail,? click here
I invite my readers and fraternity to list out other examples from the field of Business wherein the revenue model of the business is different from the mainline business itself.
About the Author
Ritesh Mohan is a retail expert with over 24 years of experience in the retail sector handling some of the biggest brands in the fashion, beauty, and fragrance sectors both in India and the Middle Eastern region. He is an author and a thought leader in the industry. He is a regular contributor to business magazines, papers and newspapers wherein he shares his wealth of retail wisdom.
If you are a Brand Owner operating in the beauty/fragrance genre & want to grow his/her business & need a retail expert to help you realize your vision then feel free to write to me at riteshmohan@yahoo.com
How Multi Touch Attribution is helping omni-channel retailers?
In retail, you need to build systems/ processes wherein you can measure each and every touch point that involves customers.
The User Journey initiates several steps prior to the customer making a visit to your store.
It starts from the Discovery stage wherein your customer sees your brand communication online and gets exposed to it.
Several exposures of the brand’s communication bring the brand into his/her “Consideration set”.
The next stage leads to the online exploration stage of your product and services; this is the moment wherein brands try to retarget the customer through their retargeting ads on Instagram/Facebook/TikTok and use the data to create a look-alike audience for the ad campaigns.
You try to capture the customer’s email coordinates by giving some complimentary products like product samples or e-books of seasonal fashion trends etc.
By capturing emails, you build your database and use the same for educating the customers with the latest trends and news in the sector by sending emailers/catalogs. This is where “Top of the mind” recall is established.
The objective of omni-channel marketing is to create a seamless platform wherein the user journey is mapped from online to the store level.
This is where MTA (Multi Touch Attribution) comes into play.
What is Multi-Touch Attribution MTA?
MTA is a marketing attribution technique that assigns credit/ weights to different marketing touchpoints in the customer journey, from the first interaction to the final conversion.
Basically, MTA provides the aerial overview of the customer’s touch points in the overall journey thus providing a scope for carrying out improvements in the customer’s experience with the brand.
Multi Touch Attribution- Insights into the customer journey
MTA uses, user-level data to capture the effectiveness of individual touchpoints, such as email opens, paid search views, ad clicks, YouTube views, or Direct Mail exposure across various channels.
Omnichannel user experience
From online the journey leads to a physical store, which includes customer service, the discovery of merchandise, trials of products, time taken at the check-out, and overall exit from the store.
Mapping the entire store journey becomes a critical part of Multi-Touch attribution.
To learn more about Hyper-Personalization, click here
Real-time optimization- Multi-touch attribution
With MTA, marketers can identify underperforming touchpoints and shift resources to higher-performing channels, tactics, or audience segments.
Benefits of MTA –
Faster and more accurate decision-making by retail professionals.
Better user experience and brand recall.
Technology tools Enhancing personalization through user-level data – Multi-touch attribution.
MTA’s user-level data allows for better targeting and personalization of marketing efforts.
By tracking individual customer interactions and understanding which touchpoints resonate with specific audience segments, marketers can tailor their messaging and offers to align with customer preferences and behavior.
About the author
Ritesh Mohan, is a retail expert, with over two decades of experience in building and scaling retail brands and businesses.
If you are a business owner operating in the beauty/fragrance/fashion genre & want to grow your business & need a retail expert to help you achieve your “Vision to Reality” framework then feel free to write to me at riteshmohan@yahoo.com
We can schedule a discovery listening call over a #coffeechat.
Most of the brands and brand owners hesitate to allow their store personnel’s to develop their social influence & help the brand create a “community”.
My article may not go well with digital agencies as they will tend to lose their clients.
As a retailer, one of your key strength is direct access to customers, and this gives you an opportunity to build a social “community” and drive product loyalty and build future sales.
Store employees and their interactions are becoming more important for brands, with consumers becoming more discerning and competition for their dollars at a high.
To ensure the right store representatives/personnel’s are in place, brands’ hiring processes are becoming more demanding and challenging.
To learn about Artificial Intelligence and skincare, read here
How store personnel’s use social influence?
Today, each one of us are micro/nano influencers as we all are present on prominent social media channels.
The trick is to use your store personnel’s social influence to build your brand’s community of loyal shoppers.
British Jewellery brand Astrid & Miyu has just started experimenting with this concept successfully.
Astrid & Miyu recruits talent through traditional job sites and LinkedIn, with an eye on applicants with their own business or a significant social following. Both offer the opportunity to create awareness of the brand among a new audience.
While the brand’s store employees are not paid to be influencers who leverage their own followings, they regularly take to Astrid & Miyu’s Instagram, TikTok and YouTube accounts while in-store to make recommendations or offer explainers on how to wear the brand’s products and use its services. Live streaming the videos straight from the stores.
Mantra here is – People love to buy from People with whom they resonate and feel connected.
Using store personnel in brand’s “How to use” videos or tutorials help reach new audience.
It’s much better than paying macro influencers thousands of dollars to promote the brand.
It’s all about Organic growth versus Exponential growth.
To learn more about, importance of niche retailing, click here.
Social influence – Brands need to embrace “content creation”.
Brands need to create trust amongst their users and hence content creation becomes a critical tool to:
Building trust
Converting customers into raving fans
Bringing Authencity & social relevance in the process of shopping
If you are a business owner operating in the beauty/fragrance genre & want to grow your business & need a retail expert to help you achieve your “Vision to Reality” framework then feel free to write to me at riteshmohan@yahoo.com & schedule a discovery listening call over a #coffeechat.
Modern-age retail is all about experimentation and bringing out concepts and themes that can create excitement as well as engagement amongst the targeted customers.
One such concept that caught my eye, it’s an American brand called Container Store.
They have a very focused category called College Shop.
The concept is unique since it offers storage solutions to students who live in college dorms or hostels to pursue their studies.
They offer storage solutions, bedding and under-bed storage, and study zone assortments like tables, lamps, laptops desks etc which can fit in small spaces.
Recently, my daughter entered her college dorm life in India, and I wondered why no Indian brand has thought about such innovative retail concepts targeting students and universities.
Since their prices are pocket friendly keeping students in mind, hence the marketing vehicle used by container stores is only SMS or WhatsApp text messaging.
They have over 100,000 subscribers with whom they communicate directly through SMS or text-based ads.
To learn how AI & Beauty merge together, click here
Retail marketing Vehicle SMS
The main marketing vehicle is SMS.
Social media has now become cluttered and to grab attention and generate sizeable impressions, you need dollars.
Rather SMS or text-based communication is a very personal and intimate form of communication.
And comes with a high rate of response as the messages are opened and read by the majority.
To learn how AI in fashion is disrupting “Fit tech”, click here
Result:
Today, the Container store has become a store where you can get almost everything you need for your dorm room.
Thus, proving the fact that money lies in niches.
Unfortunately, none of the middle eastern retailers of furnishing has ever thought about such a concept yet.
Staying agile and adaptive is the only retail game.
I have co-founded a retail accelerator for beauty brands called Adhara Retail which is a one-stop retail accelerator for testing brands in retail, Pop-ups & provides expert consulting in Retail leasing, staff training & retail ops, and franchising to scale your brand.
If you are a business owner operating in the beauty/fragrance genre & want to grow your business & need a retail expert to help you achieve your “Vision to Reality” framework then feel free to write to me at riteshmohan@yahoo.com
We can schedule a discovery listening call over a #coffeechat.
