Just a decade ago, nobody could’ve predicted the bricks and mortar, trying and buying, retail therapy experience would give way to the great online shop.
You can’t try anything on! The experience wouldn’t be the same! We like looking ‘round the shops with our friends! We cried.
But a spate of digital-native fast fashion retailers led by Shein had an answer for everything.
If it doesn’t fit, you can return it for free (but it’s so cheap you probably won’t bother).
The social experience still exists – just in the form of making TikToks about your clothes instead of trying them on with your friends.
And even if you still preferred shopping malls over website trawls, the pandemic said “too bad”.
Tapping into the world’s fast fashion obsession, Shein app downloads overtook Amazon downloads globally in 2021, and in the States in 2022. It’s worth an estimated USD $100 billion. For a Chinese app, dominating a US market is no mean feat.
While you might question the senselessness of pumping poorly-made polyester into a world awash with waste, Shein has undeniably built a hyper intelligent system that tracks the spending of millions of users, passes trend onto manufacturers in “ghost factories”, and gets products onto its digital shelves weeks before Zara or H&M can sign off a single stitch.
It’s called LATR – large-scale automated test and reorder. Similar to the auto industry’s TPS, engineering’s Agile, and A/B testing in the startup-sphere, it allows Shein to scour the internet for trends, churn out thousands of test items a week in batches of 50-100, ramp up production on what sells and ship the rest to the third world.
No startup should churn unnecessary, built-to-be-binned products into bloated markets that pollute the earth, exploit workers, and shame and manipulate its customers for not having the “cool” clothing or the “right” body shape to wear it.
But if there is any silver lining to the situation, it’s the opportunity for businesses built to do good to learn from Shein’s success.
Under the influence
Marketing-wise, Shein’s success has largely been powered by both macro and micro influencers.
Partners include Khloe Kardashian, Lil Nas X, and Katy Perry, but anyone with a TikTok or Instagram account can direct followers to a shopfront and receive commission for successfully pushing products.
Shein also jumped on influencer marketing when it was relatively new and three to five times cheaper than current rates.
But behind the (changing room) curtain is where the real money (an estimated USD $30 billion in sales for 2022) is made.
Fashion takeaways
Shein certainly doesn’t do good, but it does things well. There are things we can learn from its super agile, hyper feedback-driven LATR model.
1. If you need to “go” digital, you’ve already lost the race.
Shein never wasted money on shop refits or long-term leases. It funnelled all of its cash into tech, cloud-based supply chain management, automation, and analytics to storm the market with viral items the second they germinate. Insights and analytics must be baked in from the beginning.
2. Lots of little things can be more powerful than a few big things.
Put less confusingly, recruiting countless micro influencers at the nadir of “real” and relatable marketing created stronger network effects and drove more revenue than the handful of celebrities promoting the product.
It paired perfectly with TikTok’s path to purchasing – the infinite loop between discovery, review, participation, brand and community acceleration, and back to ever-increasing discoverability.
It also ties in with the 5 second rule. This form of hyperfast marketing is so dopamine inducing and trust inspiring (despite young consumers’ broad awareness they’re being marketed to), users are willing to purchase a product as soon as they discover it.
Fitting rooms seem like a pro for IRL fashion, but they likely dissuade as much as they encourage purchases. TikTok’s one-click purchase page leaves no time to think – no reality check in the mirror, no long walk to the tills to talk yourself out of it.
The takeaway is not to push your users into a blind purchase, but to make their checkout so fluid there are no barriers to completion.
3. In terms of experience, Shein has succeeded where ecommerce at large often fails.
Its gamification strategy injects some of the fun back into shopping, rewarding customers with points for logging in, buying, and reviewing, and allowing them to top up by watching live streams or playing in-app games.
There are non-cynical ways to enhance consumer experience online, as championed by experiential retail platform Preezie and their work with Triumph, Lorna Jane, and Everlast.
Triumph speaks to the shopper, asking them what lifestyle element they need a bra for (maternity, sports, romance), rather than affronting them with an endless scroll of irrelevant products and out of stock sizes.
Everlast gives you a mini quiz to guide you to the appropriate gloves for your sport and ability level.
Deploying Customer Experience (CX) principles like quizzes that assess needs, virtual shop assistants, and subtle gamification are all non-toxic ways to follow (and do better than) Shein’s example.
Ultimately, Shein’s value proposition is (shamelessly) clear. Its super efficient supply chain enables (shamelessly) low prices. In the same way Google was not the first search engine, Shein has not created any product or model that doesn’t already exist elsewhere.
To take the best and most basic lesson from a bad situation, Shein proves that you don’t have to reinvent the wheel to succeed. You just need to execute better than anyone else.
