Fashion Digital New York Conference (Part 1)

On October 10th, a new conference premiered in midtown, Fashion Digital New York. It is a retail-focused event, and a crowd of tuned-in attendees packed the McGraw-Hill Conference Center to hear from a power list of online fashion retail’s key players.

story and photos by Charles Beckwith

On October 10th, a new conference premiered in midtown, Fashion Digital New York. It is a retail-focused event, and a crowd of tuned-in attendees packed the McGraw-Hill Conference Center to hear from a power list of online fashion retail’s key players. There were about a dozen sessions, many running concurrently, so you had to chose between them, broken up with networking refreshment breaks. I attended the Social Commerce panel, The Disruptors panel, and the keynote. The keynote will be discussed in Part 2 of this article.

The Social Commerce panel was subtitled “Beyond Facebook,” and from repeated references by the panelists, it seems that a lot of people got burned trying to capitalize on Facebook the wrong ways. There is no benefit to moving your ecommerce site wholly onto Facebook, people still have to leave the system to pay for things. “People don’t like to click off of Facebook to do something,” said Daniella Yacobovsky, co-founder of Bauble Bar, a popular jewelry site with humble beginnings. As Dustin Rosem, CEO and co-founder of Pose said, “buying something is the least social part of the experience.” It seems that major retailers are finally waking up to the notion that analyzing your company’s impact in the social realm should be ruled by engagement metrics rather than immediate and direct returns on investment. Smart companies are now internally differentiating their social marketing and affiliate marketing efforts, whereas before it tended to be “online.” A major shift seems to be that there are more tech savvy people in power positions, who understand that different systems like Facebook and Twitter and Pinterest need to be handled differently. Each system has its own community, and you have to figure out what is successful for you within each separate network. Within that sphere, Yacobovsky also said, “Pinterest is visual Google.” Macy’s Global Vice-President Serena Potter spoke about how Macy’s breaks down their engagement tactics, pushing editorial more on Pinterest, offering fan bonuses on Facebook, and using Twitter more for promoting live events like their parades and fireworks displays. There were several mentions of email being the most successful engagement tool, though that is something you have to be even more careful about using than social sites.

When the moderator turned to the audience for questions, there was a lot said in a short amount of time. One of the panelists mentioned a special strategy, to identify 20 people who love your brand and have a lot of followers, then engage them directly and assist them in promoting your brand; that you need to be addressing your audience directly, and picking leaders helps. Another good tip was regarding the great advantage of being an early adopter of new social platforms, but you shouldn’t be afraid to drop what isn’t working.

Interestingly, Bauble Bar started online, but is now launching brick and mortar retail presences. That’s an important thing to keep in mind. The world isn’t just going digital, it’s finding balance, and sometimes that means pop-up shops and sometimes it means advertising in traditional media. It’s easy to assume there are hard and fast rules for how to approach digital retail, but in reality those rules are constantly being challenged and revised, because this whole thing is new. Ms. Potter said Macy’s calls this hybridization of digital and real world points of presence being an “omni channel” business.

The last great quotation from the panel came from David Cook, Vice-President of TheFind, who said of engagement metrics, “they at least liked it enough to press a button,” which is what social commerce boils down to. You want people to share what you’re doing, even if they don’t buy, because their friends might.

The second panel I attended was called The Disruptors: Fashion Digital Power Panel. On the stage were the moderator, Vanessa Friedman, Fashion Editor at The Financial Times; David Gilboa, Founder of rapidly expanding eyewear startup Warby Parker (confronted Luxottica Group and others and their monopolistic 10-20X markups on eyewear); Divya Gugnani, co-founder of Send The Trend (“Saks styles at Target prices”); Stacy Igel, Founder & Creative Director, Boy Meets Girl (who went from traditional RTW designer into online retail, and has now become the chief fashion editor and stylist at Lockerz, a company which seems to have taken the Pinterest interface and made it click-to-buyable); Áslaug Magnúsdóttir, Co-Founder and CEO of Moda Operandi (Vogue partner and buy it right off the runway purveyor, “it’s about giving access to the special pieces you wouldn’t otherwise be able to get”); and Dr. Nita Rollins, PhD, a Futurist at Resource Interactive (who said her favorite book is The New Rules of Retail: Competing in the World’s Toughest Marketplace, by Robin Lewis and Michael Dart). Together, all cue balls on the table, metaphorically speaking, people who have had a significant impact in the field, and also seemingly people who decided to bootstrap operations to get off the ground, relatively speaking (Warby Parker was started by a college student who couldn’t afford to replace his broken glasses, while Moda Operandi’s first raise was only $1.5 million, according to Ms. Magnúsdóttir).

These panelists are really the experimenters, people who have made smart stabs into uncharted territory and had some measure of success. However, they represent a small percentage of the attempts. The marketplace is littered with carcasses of ecommerce failures. Most of the designers modaCYCLE talks to have expressed frustration with the state of online fashion retail. Despite being approached constantly to provide stock for new sites, most of the offers propose consignment-based operations, usually without an existing customer base, so essentially shots in the dark with no net. It seems right now that unless a major retailer wants to buy wholesale, it’s better for designers to try launching their own ecommerce sites with turnkey systems like the one provided by eBay subsidiary Magento, which was a major sponsor of this conference.

Most of the conversation was specifically about the brands represented by the panel, which resulted in a lot of statistics, but not a lot of insights.

Divya Gugnani had an interesting statement, “press is a one-way channel and social media is interactive,” pushing the idea that social networks have an advantage, but she came back to traditional media with its great enduring toe-hold, “Twitter is not The Today Show.”

Áslaug Magnúsdóttir said, “ten years ago people would say they look online to research and go to stores to shop, and now it is the reverse.”

In response to the moderator’s question, what do people on the panel need to worry about, futurist Nita Rollins replied, “imitators. That is what you need to worry about.” I would tend to agree. Digital moves so unbelievably fast, and your two-year reign can be eclipsed in an hour.

Regarding startups, David Gilboa said, “what you need to focus on in the early days is the quality of people.” Other panelists seemed to agree with him, saying that you need to find other founder-like people to be your core team. Divya Gugnani even went so far as to say that you need reliable people more than you need reliable technology, which I would disagree with, you need both in equal measure for a startup to function.

There was a fleet of red soles on the stage.

After the panel concluded, I had a chance to speak with Áslaug Magnúsdóttir. Usually her partner, former Vogue contributing editor Lauren Santo Domingo, is the face of the company, but it seems like Ms. Magnúsdóttir is the business mind behind the company’s rise. Seth Friedermann and I have been watching Moda Operandi (surprisingly pronounced “oper-andy” vs. “oper-and-i” by the co-founder) with a quizzical eye since before its launch. There have been a lot of questions. From the start it seemed to be an unworkable model in the existing marketplace. Designers need 6 months or longer to deliver mass-produced versions of the samples shown on the runway, and major department stores demand to receive first dibs on delivery dates. We wondered, how can this function? How many people will be willing to wait that long for a retail purchase? We also noticed that in partnership with US Vogue, reviews of runway shows suddenly had “click to buy” affiliate links on vogue.com, which would directly drive profit to the magazine from endorsements. Although it is already unusual to see Vogue publish any sort of negative commentary on one of their advertisers, there was now an even greater profit incentive threatening journalistic integrity. So, I posed these questions to Ms. Magnúsdóttir, who replied that the insulation for Vogue’s journalistic integrity is that they automatically include a sales link for any collection they review which is a Moda Operandi partner (they launched with about 50 partnered brands, and are now up around 300). Although this is a response, it would not seem to be an answer, because Vogue is still left with a profit motive for pushing specific brands in front of consumers and singing praises of which those collections may or may not be worthy.

On the functional sustainability question, she had already on the panel disclosed that the company launched early to beat out potential competitors, perhaps a solid strategy and perhaps a bit of paranoia, but speaking with me afterwards she added that they have agreements with designers to be on the same short list with major brick and mortar buyers, and that the company expects the 6-month delivery cycle must eventually come down to a two-month cycle. She seems to believe this is inevitable. “It must happen,” she said. Moda Operandi will inevitably sink or swim on that point, because the handful of highest end early adopter consumers they currently service, those with AMEX “Black” cards and the patience to wait 6 months for a new fleet of cocktail dresses, are most likely not in the end a large enough market to sustain the model. Something has to give for this company to be successful. They must be able to reach a mass market audience, even if it is only reaching down to the upper middle class. Moda Operandi is perhaps the most disruptive brand represented on the panel, for consumers and designers alike, as they seek to change Press Week and Market Week from a wholesale to a retail buying season. It is a gamble, but one that could pay off for everyone involved if they are actually able to advance the delivery cycle for the majority of runway looks. We may see a split happening soon, with a handful of the more artistic designers who will always need that degree of lead time, remaining behind in the old cycle, which would defeat Moda Operandi’s originally stated intent, to make the most unique pieces more available. Many questions remain, and the only thing certain is that only time will tell.

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