January 31st, 2006
Danielle over at Final Fashion wrote an interesting post about how runway shows are a money-losing proposition and only really appropriate for Big Name designers. Fashion Merchandising 101 told me that runway shows, while Glamorous, are staged more for branding purposes than for actually directly generating sales. I’m generalizing here, but runway shows are staged for the press (so they’ll write about you and promote you to Jane Q. Public) and for your top clients (so they’ll feel special and buy more of your clothes!).
As Bob McCarthy pointed out in his blog, The Direct Response Coach, the advertising world is made up of two groups with very different philosophies: branding and direct response. The fashion world, for better or for worse, is heavily weighted towards the branding camp. Why? Well, fashion depends heavily on perception, and having a strong brand gives a product a leg up in the marketplace. And what makes branding so enticing to fashion companies is that building a strong brand allows them to elevate consumers’ perception of their entire product portfolio—all in one fell swoop. When you consider the number of products that are in a typical fashion line (from dozens to hundreds), branding as an advertising philosophy makes a whole lot of sense.
Direct response, however, is the reigning queen of the online advertising space. What’s so interesting about Internet advertising (as compared to offline advertising) is its inherent measurability. If you run an ad through Google AdWords or through Yahoo! Search Marketing, for example, it’s possible to see how many people saw that ad, how many people clicked on your ad, and how many people bought something/registered for something/etc on your site. You can calculate your return on investment (or ROI) for your advertising dollars. You can quantify how effective your advertisements are and make adjustments as needed.
Branding vs. Direct Response. In the fashion world, branding (at least offline) is the clear winner as I write this in January 2006. But what about the future? Will branding continue its reign? Or will direct response win out in the end?
I don’t pretend to know the answer to this question, but I’ll share with you my humble prediction. The forces that make branding so enticing today will continue to exert influence in the years to come. But the allure of direct response’s measurability will also have an impact on how fashion advertising budgets are spent. There’s something to be said for a quantifiable ROI. Already, some fashion companies are listing their products on direct response-type sites like Shopping.com and Shopzilla.com. A quick glance at women’s apparel on Shopping.com showed items from Bergdorf Goodman, Bloomingdales, J. Crew, and Kenneth Cole. I predict that we’ll see a significant increase in this direct response advertising, but we won’t see that jump until we see more specialized fashion shopping search sites. That is, it’s not going to be a Shopping.com or a Shopzilla.com that’s going to see this gain (unless they radically improve the way their sites work for the apparel category). Instead, I think it’s going to be a specialized fashion search vertical.
What do you think about the future of fashion advertising? Branding? Direct response? Or both?