For our Digital Design & Media issue, we sought out a professional who could share their insight on the current state of fashion in the online space. Who better to discuss to top than CGS’ Paul Magel? As the president of Business Applications and Technology Outsourcing division, Magel leads the company’s flagship BlueCherry Enterprise Suite of solutions for the fashion, apparel and consumer lifestyle products industry. He also manages the Cloud Technology and Cybersecurity practice overseeing sales, delivery, support and development.
What is your experience/background in the fashion industry?
My education is in Information Technology and I spent my early career at IBM. For the past 22 years at CGS, I’ve focused on the fashion industry, leading our BlueCherry software solutions business across the supply chain in apparel, footwear and accessories companies. The BlueCherry enterprise suite provides a complete concept-to-consumer supply chain solution for apparel, footwear and accessories companies.
Additionally, I serve on the International Trade and Marketing Advisory Board of the Fashion Institute of Technology (FIT), which is one the most prominent universities dedicated to fashion. I also belong to several fashion-specific organizations and have spoken at such industry programs as Apparel Executive Conference and the AAFA Executive Summit. I am proud to also be a regular contributor to Fashion Mannuscript.
What changes have you seen since a large part of fashion business has moved online over the past decade?
Along with the fashion market, CGS has experienced rapid changes within the past decade. CGS has grown from a single order-to-cash system to a complete end-to-end supply chain solution, encompassing ERP, PLM, planning, manufacturing, logistics, B2B ecommerce, shop floor control, warehousing and collaborative supply chain management.
With the fashion industry moving online, we are seeing a greater need for a true technology platform with the capabilities to manage inventory across all channels of business. Integrating with all of the online platforms from Amazon to Shopify have become minimum requirements to survive in the industry.
One of the biggest changes I see in the space is the role of technology moving very rapidly from being a “cost center item” to a valuable strategic asset that is necessary for survival and success in fashion.
Increased investments in technology that deliver automation, real-time analytics and collaboration will be key to competing with industry “disruptors” while also providing a platform for business growth. Insights derived from artificial intelligence (AI) can help manage issues associated with disruptors and minimize the potential impact on brand reputation and overall profitability.
What are the biggest issues online-only brands are at risk of running into? How can they remedy these problems?
Today’s consumers expect greater product choice, quality and shopping options—challenging brands to deliver a consistent flow of on-trend, highly available merchandise to them. There are low barriers to entry for an online-only brand; scale becomes a risk for many of these companies. If too much time is spent on the front-end of the business without the same level of enthusiasm and dedication to the back-end supply chain and IT systems, the company will fail ironically as a result of its success. I have often said that we deal with the unfashionable side of fashion. However, today, back office has become the new black.
What is the most effective way to promote products and engage buyers in ecommerce?
The more things change in the industry, the more they stay the same. Consumers want what they want, when they want it and at a fair price. Today the metrics behind that statements are different than in the past, but the statement still holds true. So, building brands—whether online or for brick-and-mortar—will rely on many of the same marketing science. Yet, online allows for a higher level of personalization and targeting by marketers, making predicative analytics, forecasting, pricing strategies and availability all that more relevant and the investment in technology all that more necessary.
Where do you see the future of online fashion going? Will brick-and-mortar stores ever be obsolete?
The industry continues to evolve as do brick-and-mortar stores. So, no, I don’t see brick-and-mortar stores ever going away. The truth of the matter is, with all the publicized retail store closings, in aggregate, more stores are opening than shutting their doors. What has changed is how the shopping experience has evolved and needs to continue to evolve to engage consumers and bring them into a brick-and-mortar outlet. Today, we can see many examples of online-only companies and brands starting to open retail stores to offer a memorable brand experience or serve as a warehouse location from which to ship online orders.
An overwhelming amount of retail sales still take place at brick-and-mortar locations. In a recent CGS survey, found that nearly three-quarters of U.S. shoppers prefer their purchases be shipped to them. Yet, 74 percent said that they will return an item in-store before shipping it back.
Bottom line: consumers want a seamless experience when interacting with brands—from storefront to website. And, they’re expecting goods to be delivered fast. A focus on optimizing omnichannel fulfillment means more success for the brand, and happier, loyal customers.