Industry
Fashion
Date
How brands are using AI-driven insights to transform discount strategies
An Ever-Changing Retail Landscape
In light of the current economic environment, the fashion industry has found itself juggling rising production costs, disrupted supply chains and shifting consumer behavior, which have in turn made collection planning and management increasingly complex to navigate. This requires mastering the art of discounting to combat reduced consumer confidence, dwindling savings, and excessive inventory.
To secure margins and optimize sales, the key is a well-calibrated discount strategy, coupled with real-time market data. With the holiday season and Black Friday fast approaching, leading fashion brands are turning to Lectra’s AI-powered merchandising platform Retviews, to reshape and optimize the way they approach discount strategies and spot opportunities in the market.
Discover how AI-driven real-time data is transforming leading brands’ collection strategies. Dive into the key elements needed to best navigate discounts and stay ahead of a rapidly changing industry.
Generate your own competitive analysis report with Retviews
Perfecting your brand’s discount strategy is a delicate balance between timing and discount rates. Go too high, and you risk margin loss, go to low and you may lose shoppers to the competition. Additionally, discounting the wrong product, at the wrong time only further eats into your margins.
As the upcoming discount season approaches, monitoring your competitors’ discount rates and the exact timing behind their discount strategies is crucial in strategically positioning your brand on the market and minimizing margin erosion.
Thanks to Retviews you can go back in time and see exactly how brands discounted assortments in key sales periods throughout the year, offering valuable historical data. You can also track discounts in real-time and adjust your strategies in the pulse of the market right now.
Looking at the past two holiday discount seasons, Retviews’ data show a significant increase in the US market regarding both discount rates and rate of discounted items, contrary to the European market. Considering a decline in consumer confidence in the US market, what can brands expect this season within the market? Implementing real-time data within their benchmarking, fashion brands and retailers can spot opportunities to optimize discount strategies and make data-driven decisions instantly, adjusting as the market quickly shifts.
A critical aspect when planning your discount strategy for the season is being able to monitor exact timing and releases, with regards to your competitors’ discounts. Considering the prominence of Black Friday, and its global reach, tracking the market’s changes is key.
Are your competitors launching Black Friday sales ahead of you, causing your own brand to miss out on key sales?
How can you leverage market insights to best prepare for upcoming Black Friday sales?
Taking two key markets, the United States and the European market, Retviews’ real-time data can clearly indicate the contrasting timelines found in each. Within the past winter discount season, brands in the US market discounted a large portion of their collections from Black Friday, through the end of the holiday season, whereas brands in the European market exhibited two peaks: one isolated around Black Friday and the other throughout January. Considering this, brands in the US market consistently discounted a larger portion of their collections.
As we anticipate the upcoming holiday season, discounts are projected to rise rapidly, as brands are aiming to appeal to inflation-hit shoppers with limited discretionary spending. Ensuring that discounts are no longer arbitrary but strategically aligned with market dynamics and consumer behavior, can only bolster collection performance, and optimize margins.
Brands are crafting their holiday discount strategies months in advance, to match economic conditions and align with consumer behavior. Quick access to in-depth, real-time market insights becomes the competitive edge for brands, when preparing discount strategies.
Retviews’ data show how discount rates have shifted within the past two years, throughout the spring and summer seasons. Looking at the US mass market, discount rates shot up this year, compared to the past two years, whereas the European market most recent discount season remained stable in comparison to 2021, dipping from their recovery in 2022.
Effective marketing plays a pivotal role in successful discounting. By monitoring competitors’ newsletter communications and website changes, you can pinpoint the ideal release times for your discounts. How early did your competitors start talking about Black Friday? How often did they mention it, and what products took the spotlight?
Lectra’s automated benchmarking platform Retviews tracks each of your competitors’ promotional activities. You can filter based on specific topics, whether it’s Black Friday or new seasonal collections, and precisely identify when their promotions began as well as monitor their frequency. This data, available in real-time allows your teams to spot the best way to promote your own discounts.
Retviews’ data highlights distinct approaches among brands, during the fall season. Abercrombie & Fitch already began discounting its past collections, as the brand dove into autumnal discounts on select styles in September, aligning with the start of the fall season. Similarly, GAP offers a wide scope of discounts, across its full collection in October, marketing its 40% discounts through its newsletter. Meanwhile, ZARA and Aritzia focus solely on promoting the release of their newest collections, with no mention of discounts between September and October. Retviews data also indicate the frequency of competitors’ newsletters. ZARA in particular, releases newsletters on a nearly daily basis, highlighting new collections and trend edits.
AI-powered data allows you to target popular styles for full-price sales while clearing inventory of slow-moving items and staying on top of new collection releases. Stay updated on releases in real-time as well as out-of-stock rates, with automated market intelligence.
Taking ZARA’s latest collection, Retviews’ data show that skinny jeans released within the past month have not displayed any stock level changes, except when offered a 37% price discount. In contrast, straight leg jeans fared differently, stock levels shifting while at full price. Retviews shows that skinny jeans are not selling out despite price decreases, suggesting that it is a category to discount, as opposed to looser styles.
In the era of quiet luxury and the allure of timeless pieces, merchandising teams have a powerful ally in real-time data. By tracking collection stock rates, new arrivals, and discount history, they can strategically identify which items should be sold at full price and which can be discounted, all aimed at maximizing profitability.
Want to know what works and what doesn’t? Spend less time wrestling with data sheets and with inaccurate data, and more time making confident decisions that lead to better collections and higher profits. Lectra’s automated benchmarking tool, Retviews is fashion’s biggest brands’ game-changer, using AI-powered market insights to give you all the real-time data you need in a matter of minutes, with unmatched accuracy. Don’t just keep up with the competition, lead the way with information only access to an automated tool can bring. Find out how you can stay ahead of the pack with Retviews.
Use the Retviews platform to benchmark your offer against your competitors
