May 14, 2024

Market Insights

Retail Spotlight: How ASOS's Losses are NZ's Gain

In April, ASOS reported a staggering 18% YoY drop in sales, bringing its annual pre-tax losses to more than $250 million NZD – widened from $184 million the previous year.

Symptomatic of a wider, post-pandemic reckoning which has seen global e-commerce retailers including Matches Fashion struggle to acclimatise to increased costs and decreased demand, ASOS’s loss of market share presents a golden opportunity for niche, boutique brands and local e-retailers to thrive.

For New Zealand businesses operating in the premium fashion, beauty and lifestyle space, identifying competitive, unique selling points to weave through your marketing delivery is the key to capitalising on this drastically shifting retail landscape.‍

Designed to entice customers and repeat sales away from the global fashion giants – and beat local competitors to the punch – here are five key strategies for NZ fashion brands to implement right now.‍

Offer a Strong First Purchase Incentive
Enticing customers with a compelling incentive for their initial purchase is a powerful way to capture their attention and encourage conversion. A first purchase discount of at least 10% is critical and outperforms other incentives including free shipping and bonus gifts. Providing value upfront significantly increases the likelihood of securing that crucial first sale. 

Implement a Simple Loyalty Program
A straightforward and clearly-communicated loyalty program incentivises repeat purchases and fosters customer loyalty. High-value rewards include discounts, exclusive access to sales, and points that can be redeemed against future purchases. Keep messaging around benefits and T&Cs clear to ensure customer engagement and retention, and encourage positive word-of-mouth.

Build Trust through User-Generated Content (UGC) and Google Reviews
In the age of social media, user-generated content and positive reviews instil trust and credibility in your brand. Encourage satisfied customers to share their experiences through reviews, testimonials, and social media posts featuring your products. Additionally, actively soliciting and responding to Google reviews can enhance your visibility and reputation, helping to attract new customers who value authenticity and peer recommendations.

Target a Competitor’s Audience on Meta Platforms with Specific Acquisition Strategies
With many international brands facing financial challenges, there's an opportunity to reach out to their audiences on Meta platforms like Facebook and Instagram. In the case of ASOS, crafting a new customer acquisition strategy tailored to resonate with their existing customers can yield significant results. Utilise targeted advertising and engaging content to capture the attention of this demographic and redirect them to your e-commerce platform.

Enhance Visibility through Google Shopping and Optimisation
As mainstream customers increasingly rely on Google Shopping as a primary shopping search engine, optimising your presence in this space is paramount. Ensure your products are searchable and easily discoverable by optimising your Google Shopping campaigns and shopping listings via Google Merchant Center.

While the challenges faced by global fashion giants may seem daunting, they also present an opportunity for niche fashion retailers in New Zealand to thrive. By implementing targeted performance marketing strategies focused on incentives, loyalty, trust-building, audience targeting, and optimisation, agile businesses can set themselves up for success, sustained growth and increased resilience in the face of industry disruptions.

Talk to one of our expert strategists today and turn ASOS’s losses into your gain with a robust performance marketing strategy, tailored to you.

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