Digital Strategies for Custom Clothing Companies – A Post COVID-19 Plan

A custom clothier asked an intriguing question during a recent webinar, “Live Q&A Forum with the CTDA’s Board of Directors”, hosted by the Custom Tailors & Designers Association, CTDA.

“How do you build a sustainable custom clothing business in a digital world?”

The question made me think about several custom clothiers, with very different business models, who applied digital strategies to build successful businesses.

These include J.Hilburn, Tom James, Alton Lane, Proper Cloth, Savile Row stalwart Richard James, and high-end luxury suit company Brioni.

With that in mind, let’s turn that question into a statement:

“A Digital Strategy is NEEDED to build a sustainable Custom Clothing Business … in today’s digital world”

In this article I will explore how the companies mentioned have applied digital tools to build profitable, sustainable businesses, and highlight ways you can add similar, or new, strategies to your own business.

I will also include research data from different sources for retailers (including custom clothing companies) and consumers in the US, UK and Australia. 

So how do you implement a digital strategy? I know this can seem daunting. 

However as you read further you will see that regardless of your budget or time commitment, you can implement a digital strategy to see positive results.

First, let’s get two things out of the way:

1. Digital Strategy is more than Digital Marketing

There is sometimes a misconception that digital strategy is the same as digital marketing. 

If you google the term “Digital Strategies for Small Business”, the results almost all focus on “Digital Marketing” or “content marketing”.  

See Google search results below:

According to Accenture, digital strategy looks for ways to use technology to transform your business.

• The focus is using technology to improve business performance.
• You can apply technology to any area of your business that you are focused on to improve performance.

Alton Lane applied digital strategy across their sales, marketing, order management and financial operations. 

2. Digital Strategy is not New to Custom Clothing

All the way back in 2012 according to Inc., J. Hilburn used digital assets such as email, website, and an iPad app called Style Kit in a coordinated business strategy to scale personalization and enable rapid growth. 

The Result?

 J. Hiburn doubled revenue in 2012 to the tune of $35mill (up from $16.7 mill in 2011). 

What exactly is a Digital Strategy?

According to the PwC 2017 Digital IQ report, digital strategy today refers to using technology to innovate in your business. 

Below are two important concepts:

• Digital strategy focuses on using technology to improve business performance.
• Digital strategy is part of the business strategy and experts maintain that it cannot be effective or successful if built independently.

It is made up of 9 key components. 

Based on your business strategy and priorities you may include some of these components and not others. 

1. Online presence – This refers to how and where others can see your business online: including your website, social media profiles, advertising, and reviews. 
2. Digital marketing – The promotion of your business using online resources and tools. Tools include websites, mobile apps, and social media platforms, and this falls under your overall Content Strategy.
3. Selling online – This refers to an ecommerce site where customers can buy from you any time.
4. Customer interaction – This is about giving customers access to your business through whatever means they prefer – mobile device, desktop, phone, social media, store. *It should be easy for customers to find the information, service, or product they are looking for.
5. Online security – This is operational procedures to maintain and protect collected data (e.g. from your customers).
6. Supplier interaction – This refers to interactions with suppliers in a global marketplace. For a custom clothing business, from made-to-measure to bespoke – interactions with a global supply chain to fulfill each customer order is critical.
7. Mobile-based solutions – This includes mobile-based solutions such as responsive websites, and mobile applications.
8. Cloud computing – This refers to storing and accessing data on the internet instead on local computer hard drives. Tools such as Google Drive, Slack, and DropBox facilitates cloud computing.

Implement a Digital Plan to Grow Faster than your competitors

From Delloite’s Connected Small Businesses US study, small businesses with higher digital engagement had:

• Higher 4X revenue growth 
• Higher 2X as much revenue per employee 
• More customers across the sales funnel

*These companies were also more likely to innovate through new product offerings.

The infographic below illustrates this quite well.

Growth is crucial for your company’s long-term survival.

Whether you are a one-person direct seller working out of your home or have a showroom, retail store, online store, or an outbound sales team.

Digital strategies are expected to propel business growth. 

But most companies struggle to commit the effort to implement a digital plan.

You can implement your own digital plan using many technologies available.

There are free tools, pay-as-you-go options, or more standard pricing models to fit your budget.

Align your Digital Strategy with your Custom Clothing Business Strategy

While there are 9 key components of a digital strategy,  its best to focus on implementing a few for your business.

According to Boston Consulting Group, focusing on two or three use cases delivers the best results.

For example you could start by focusing on automating certain sales funnels and streamlining your order fulfillment. These are two of the areas Alton Lane focused on improving as shown below.

You can then move onto other use cases such as automating more of your sales funnels, integrating bookkeeping, etc.

Alton Lane  revamped their digital tool set and strategy to align with their business goal of improved efficiency.

At that time the company had many data silos – measurement data stuck in 3D scanners, fit preferences on the iPads, order data at the factories, and customer data on notepads in showrooms.

They implemented advanced digital tools that connected across the organization in areas such as CRM, Order Management, and Financials.

 Efficiencies gained included:

1. Consolidation of all of its customer and sales information
2. Integration of data from marketing campaigns, payments, and measurements

Alton Lane made it a priority to improve efficiency – from their sales team, across their showrooms, and interactions with their supply chain (CMT Manufacturers, fabric vendors, etc).

A sustainable business must grow sales with only incremental growth in work (and complexity) – efficiency within your organization is key.

Inefficient or Impractical Business Processes is cited as one of the main causes of slow business growth.

Efficiency is especially important in the custom apparel industry.

 Custom clothiers “effectively run an international supply chain for every customer and have to deliver every time our customer wants access to that data in real time”, as Peyton Jenkins, co-founder and president of Alton Lane points out.

One custom order may involve sending purchase orders to multiple CMT manufactures and fabric vendors in different countries.

Each purchase order (e.g. for fabric or lining, or tailoring instructions) may require different systems to submit and track (email, PDF or Excel order forms, fax, online order systems, etc), and you may have your own systems to store data – paper, local systems, cloud apps like Google Drive, etc. 

And we have not talked about payment processing, invoicing, book-keeping, updating customers with order status, etc.

To grow from one order per day, to two, three, four and so on requires efficiencies, automation, and clear repeatable processes – a digital transformation.

Make it Personalized Across All Channels and Consumers will Pay More

According to a recent study of 1,200 consumers and 400 retailers in US, UK and Australia by Wakefield Research, The Retail Doctor, and Oracle NetSuite

• 42% said they would pay more to have a more personalized shopping experience. This includes almost two thirds of Millenials – 63%, and a quarter of Baby Boomers – 25%

As a Custom Clothier you have the most real personalized data for your customers. 

Not even Amazon, Netflix, or Zappos know the level of detail about their customers as you do. 

You know your customers’ detailed measurements, color preference, where he/she lives, their kids’ names, the pets’ names, vacation spots and so on. 

With this much data, and using digital strategies you can further enhance the relationship and improve the customer experience and build deeper relationships.

With digital tools you will now have a truly 360 degree view of your customer as you will now understand what they do online – which digital platform they prefer, what products they buy/like online, and so on.

J.Hilburn focused on mining this data to create a personalized customer experience across multiple channels.

Below are excerpts from Inc. showing how J. Hilburn was able to successfully use these digital assets:

• E-mail updates with smart product recommendations–simple things like matching ties for your shirts, but also more sophisticated picks based on unexpected correlations. For instance, if most people in Minneapolis who buy V-neck sweaters and striped shirts also buy sports coats, anyone there who bought a V-neck sweater and a striped shirt but hasn’t yet bought a sports coat should get an e-mail that recommends a specific sports coat, made to his precise measurements–and he can simply click to buy.
• On the website, what each customer sees will be unique to his history, much as on Amazon or Netflix but based on data that’s quite a bit more personal.

• Style Kit app for salespeople feeds them smart recommendations and flags potential measurement errors. And targeted e-mail marketing and e-commerce can take the salespeople out of the reorder process entirely (while still paying them commissions).

• Via the app, J.Hilburn will be able to keep an invisible hand in the in-person interaction between client and salesperson, to help push up order size. 
• J.Hilburn wants to drive reorders to its digital channel
• The products themselves are getting a data-driven makeover, too: “The next evolution is, we could have a dozen variations of the size Small for our ready-to-wear collection,” Davis says. “We can take our customer buckets and really narrow them down, to get as close as possible to a perfect fit off the rack. Retailers and brands are never going to do that, because they’re not going to take the inventory risk without having the data to support it. We already have the data.”

Learn from Success of Other Custom Clothing Companies

The companies mentioned before have used digital methods to grow revenue and improve the customer experience.

Here are just some of the results they have achieved with differing digital approaches.

• Tom James retail business achieved 33% sales conversion from their website channel
  • They upgraded their online channel with a business goal to increase revenue and improve online branding.
•  J. Hilburn doubled sales to $35 million in 2012
  • They used data mining, digital marketing and other methods to create an omnichannel customer experience across multiple touchpoints.
• Alton Lane tripled their number of showrooms (from 4 to 12) 
  • Efficiency with technology was prioritized to optimize their core business processes.
• Proper Cloth grew revenue to $10 million in just 7 years, and added a 12,000 square feet location.
  • Online sales (90% of 2016 revenue was from online), online presence, digital marketing, and efficiency through technology have been key focus areas.

These companies have experienced tremendous success.

They all have different growth stories.

Proper Cloth had a boot-strap style startup and almost no subsequent external funding.

• The company has focused on organic growth (fund the business with revenue for the most part).

Alton Lane and J.Hilburn have used a more traditional institutional approach to funding.

• Alton Lane raised startup capital and raised $10M over several rounds of funding.
• J.Hilburn also raised startup capital of $650,000, and then raised $26 million over several rounds of venture capital funding.

Tom James’ founding was triggered by a $40 ($377 today) loan in 1956 to Spencer Hays by his grandmother. 

• Spencer Hays turned that $40 loan from his grandmother into a successful 10-year career in sales, then used those skills to found Tom James with 2 employees in 1966.

If you have large startup capital and access to venture capital, great!

However if you don’t, you can grow your business to the size you envision. 

Tom James and Proper Cloth did not leverage venture capital for growth (at least not early in the case of Tom James).

Any custom clothier regardless of resources (funds, human capital, etc) can grow. One place to start is with a digital plan.

COVID-19 Crisis has accelerated the need for a Digital Plan

The coronavirus outbreak is accelerating the growth of e-commerce, bringing changes that were expected in 2030 to today.

Business Insider

The coronavirus pandemic has disrupted the custom clothing industry – much like everything else in its path.

The good news is that this has led to positive changes.

Custom clothiers, bespoke tailors, and retailers have quickly adapted to digital strategies, added new product categories and altered core processes.

Virtual selling, virtual fittings, and virtual engagement have been added, along with technologies to support them:

J.Hilburn’s Shop Virtual:

Proper Cloth’s Virtual Appointment:

Savas’ Virtual At-home Fitting:

Black Lapel’s Virtual Happy Hour:

New product lines such as face masks and scrubs have been developed quickly.

Richard James’ Scrubs:

View this post on Instagram

A post shared by Richard James Savile Row (@richardjamesofficial)

Huntsman’s Scrubs:

View this post on Instagram

A post shared by Huntsmansavilerow (@huntsmansavilerow)

Huntsman’s Face Masks:

https://www.instagram.com/p/B9rY_Iunh-L/

Brioni’s Face Masks:

View this post on Instagram

A post shared by Brioni (@brioni_official)

Adrian Jules’ Face Masks:

Proper Cloth’s Face Masks:

https://www.instagram.com/p/B_0WDxfpJEM/

Sava’s Face Masks:

https://www.instagram.com/p/B_QrydphcSK/

Today, the question is not how do you build a sustainable custom clothing business in a digital world? 

The question … if you ask one is How can your custom clothing business survive without a digital strategy?

The answer – You will not. 

The Time is Now

The quote below sums it up.

If you have any of the typical excuses below, then just cross them off and start building a sustainable business. 

1. Excuse #1 – My business is not big enough. it’s just me.
   1. This means you definitely need digital tools to automate your business. From selling to order routing to manufacturers and fabric vendors. To scale, you must automate as much as you can in this situation.
2. Excuse #2 – I don’t have funds
   1. There are many tools that are free, have free trials or are pay-as-you-go so upfront cost can be minimized.
3. Excuse #3 – I don’t have time
   1. Not having digital tools to help run your business will ensure you will never have time. 

Conclusion

A digital strategy is needed to build a sustainable custom clothing business.

The COVID-19 crisis has led to quick adaption of new technologies, modification of the sales process with virtual-selling, -fitting and -engagement. As well as introduction of new product categories such as face masks and scrubs. 

It’s now time to put together a digital plan that goes well beyond the current crisis.

The good news for you is that digital tools are available for any size budget and time constraints. 

Below summarizes some of the reasons to “digify” your business now:

1. Custom Clothing companies have been using digital strategies for years to leapfrog the competition.
2. You can improve the personalized customer experience and build deeper relationships.
3. It’s expected – customers expect to interact with your company across different touchpoints.
4. Increased revenue potential – customers will pay more for more personalized shopping experience (online and offline) and they will buy more across different channels

How do you use digital tools in your business? … answer in comments below