New Market for Apparel: Online Flash Sale Stores

Transcript:New Market for Apparel: Online Flash Sale Stores:
New Market for Apparel: Online Flash Sale Stores ECON 1465, Fall 2010 Brown University Jina Park Significance of Online Retail According to new forecasts by Forrester Research*, online retail in both the U.S. and Western Europe is set for a strong period of double-digit growth over the next five years. * Forrester Research an independent technology and market research company providing proprietary research, consulting, events, and peer-to-peer executive programs. Significance of Online Retail (cont’d) U.S. online retail will grow at a 10 percent compound annual growth rate over the next five years to reach nearly $249 billion by 2014, up from $155 billion in 2009. In Western Europe, Forrester expects a 11 percent growth rate for online retail sales, going from $93 billion (68 billion Euros) in 2009 to $156 billion (114.5 billion Euros) in 2014. Significance of Online Retail (cont’d) Forrester Research http://www.forrester.com Significance of Online Retailing (cont’d) "Much of the overall retail sector's growth in both the US and the EU over the next five years will come from the Internet," - Forrester Research Vice President and Principal Analyst Sucharita Mulpuru. Three product categories that dominated online retail are apparel, footwear, and accessories; consumer electronics; and consumer hardware, software, and peripherals. These three product categories represented more than 44 percent of total online retail sales ($67.6 billion) in the U.S. in 2009. Types of Online Stores for High-end Apparel Brand’s own online stores: stores that carry items of own brand (ex. http://www.gucci.com/) Department Store Sites : stores that carry multiple brands that are also present in actual stores (ex. www.saks.com) Independent Multi-Brand sites: stores that carry multiple brands, sometimes with discounts. (ex. www.net-a-porter.com, www.shopbop.com (with sales section) ) Flash Stores : stores that sell goods from multiple brands at discounted prices for a limited time (usually a few days) and quantity of stock. (“flash sales”) (ex. www.gilt.com, www.ideeli.com) Types of Online Stores for High-end Apparel Brand’s own online stores: stores that carry items of own brand (ex. http://www.gucci.com/) Department Store Sites : stores that carry multiple brands that are also present in actual stores (ex. www.saks.com) Independent Multi-Brand sites: stores that carry multiple brands, sometimes with discounts. (ex. www.net-a-porter.com, www.shopbop.com (with sales section) ) Flash Stores : stores that sell goods from multiple brands at discounted prices for a limited time (usually a few days) and quantity of stock. (“flash sales”) (ex. www.gilt.com, www.ideeli.com) What is a Flash