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Jessica Quillin: In this edition of FSW Conversations, we are talking to Philipp Labkovskiy, global e commerce director for ECCO, overseeing the brand's digital commerce strategy to drive growth and enhance the customer experience worldwide. With over two decades of experience, he is an accomplished leader dedicated to integrating innovation and consumer centric solutions in the digital retail space. First of all, thank you so much for joining us today, Philipp. I would love for you just to chat a little bit about how you got your start in the worlds of retail and digital.
Philipp Labkovskiy: Yeah, hi Jessica, thank you very much for having me today and Yeah, I mean it's um Quite I I don't know if that's a usual, uh journey or an unusual journey, but my corporate journey started in wholesale more than a decade ago, uh with a fashion industry, so I'm kind of stuck with our beloved industry Uh, but but it's great because this is a super exciting, uh area and super exciting time for for our industry. However, Yeah, started in a wholesale grown to a wholesale director for, for
fashion brands.
And after that, uh, we actually, but there was more than 10 years ago when e commerce was really picking [00:01:00] up and, uh, we started establishing own and operate at e commerce marketplaces and everything. And, um, after that, uh, I moved across a couple of, um, the retailers, a couple of them, you might know, uh, brands called Boardriders that includes wonderful brands like Quicksilver, Roxy, DC shoes, Billabong, et cetera, et cetera.
Um, and, um, uh, for the past almost five years, I am working in a wonderful brand called ECCO. Uh, ECCO, uh, we are a Danish company. Uh, We make the best shoes in the world and we sell
them globally, uh, throughout our own and operated e commerce as well as our wholesale partners and marketplaces. And right now I'm in charge of the global e commerce setup, uh, driving, uh, yeah, all efforts, uh, when it comes to online sales, uh, through DTC channel.
Jessica Quillin: No, that's fascinating. And I love how your career has sort of, uh, grown with the sort of expansion of, of e com itself, some kind of from the beginning. Um, cause I think that gives you such a unique place in terms of, you know, your career is going as the [00:02:00] industry itself is sort of being shaped. Um, So one question I have just kind of starting off, given your kind of unique positioning as an e com director is just how has the evolution of e com transformed consumer expectations for retail experiences in recent years? Um, Because I feel like ecom coming into the pandemic was one thing ecom coming out of the pandemic is something else. So they think customers sort of, their sort of expectations from brands now are quite different than they were, say, even four years ago.
Philipp Labkovskiy: Yeah, Yeah, that, that, that's very true. Um, I think that what really shaped during, uh, the lockdowns, our, uh, consumer expectations is, um, before that DTC retail and DTC omni channel was an expansion of retail in general. There was some additional service that retailers were offering and there was a complimentary channel to the retail strategy.
After the pandemic, we got so used to things being delivered and we got so used to, uh, using the digital platforms. Um, I think again, no news, no surprises here, [00:03:00] Amazon and other retailers in different regions, different countries, there will, there will be a different, uh, player in, in, in that area. They now shape the expectations, which means that if you're a DTC brand and you're offering You know, delivery terms, returns, uh, terms and conditions, and
then payment methods, your consumers are not going to
Jessica Quillin: compare you with other retailers, they're going to compare you with the experience
Philipp Labkovskiy: that they're getting, uh, on these big platforms and marketplaces, which really puts a lot of pressure because it's easier said than done, uh, in many cases, especially if you're a big company or, uh, have a complicated IT setup or just operate across different markets, it makes it more and more sophisticated to, um, cater to, to the needs of a modern consumer. But it's necessary.
Jessica Quillin: That makes a lot of sense. Um, and actually one question that I actually, I have for you later that actually jump to now, cause it, it makes sense. Um, is just How important is data for you right now and sort of understanding sort of the changing nature of consumer tastes and expectations as you go.
Like, how do you, how do you, how do you learn what to expect from consumer needs? Um, you know, [00:04:00] because as you know, I work in the field of content and content strategy is really all shaped by sort of finding that happy place where, you know, sort of brand vision meets consumer needs. And I'm always curious, sort of just from a data strategy side, especially for Ecom, like, how do you learn about your customers?
Philipp Labkovskiy: This is, This is really a very important question for the industry. And I think for all of the retailers out there, but also for us in ECCO, this is where we really focus a lot, uh, in this year and, and we'll focus in the coming years because consumer data is, uh, where, uh, you can gain so much insights, uh, and
it can go throughout your whole strategy from what
product do you make? What services do you provide? How do you provide them? How do you build your value chain? And
For us particularly this is very important because ECCO is one of the last standing, completely vertically integrated brands. Maybe our listeners will be interested to know that, we actually manufacture ourselves in our own factories, all of the products that we sell.
Um, No, [00:05:00] almost all of the products, the shoes for sure. And, um, uh, we also own all of our stores, the value chain. So full, full value chain, uh, owned by us. And you can imagine that the more data we have, the more we can predict uh, how to move across this value chain and how to create value um, then an interesting conversation and to link it to your previous question, the every retailers and every uh, every retailer and
every brand these days have a very interesting crossroads So to speak and a decision to make you can start selling with the marketplaces and they solve a lot of, uh, operational questions and operational problems for you.
Uh, You can start very fast and you can deliver a very good experience for your consumers. And the main thing you can, you can gain consumers very fast, but at the same moment, you don't get data and that's one of the key elements of this, uh, of this deal, you start selling through Amazon, but they don't share the data with you.
But at
the same moment to get your data, you need the DTC channel. This is where you can sign in, sign up your [00:06:00] consumers, and then actually put together some kind of segmentation strategy, and personalization strategy, CRM, direct communication strategy, which is necessary if you want to retain your consumers, and if you want to have a sustainable business, you want to retain your consumers. and uh, I am a, I really believe that retailers these days need to play in both fields and, uh, be excellent in, in, in, in both. This is just how commercial landscape is today. Um, But if you're playing the
DTC game. One of the key advantages of this game is, of course, getting the consumer, uh, data. Uh, It becomes more and more complicated.
Um, Different, uh, headwinds, uh, really make our job more and more interesting, uh, every year and more complicated. Um, yeah, that's, that's, that's for sure. But,
um, in an essence, it's, uh, the game is still the same. Uh, This is your consumer buying directly from you. So you maintain the relationship, the instruments, the techniques, how to do that may vary, but then the idea is you maintain this relationship directly and you have a possibility to actually, um, still, still [00:07:00] be top of mind for this consumer after they purchased your product or services.
Uh, And this is something very valuable and this is super hard to achieve if you only sell through wholesale or through marketplaces.
Jessica Quillin: It's hard to track things that you don't have control of, obviously.
Philipp Labkovskiy: Exactly, exactly. Because This is how it just works in all of the, uh, because now being in a global e commerce position, I have a good overview of how e commerce works in different parts of, uh, uh, you know, our, our, our map. And, um, uh, for example, in China, there is no DTC, so it just doesn't exist. They only sell through local marketplaces like Tmall, JD.
But the interesting thing is that you can set up your own shop over there and they will actually give you access to your consumers because it has the inbuilt CRM system and etc, etc in the Western countries, we only dream about that and we certainly not getting that from Amazon or other other marketplaces
Jessica Quillin: Oh, that's fascinating. Transparency from the Chinese market sounds really strange, but that's, that's very awesome.
Philipp Labkovskiy: Nobody in their right minds is opening a direct to consumer e commerce website in China because it's just, uh, nobody will
[00:08:00] go there. Nobody
will buy there.
Jessica Quillin: you. That makes sense. Um, Just to keep on the data thread, I'm just curious from just a general standpoint. Um, you know, as As a content strategist, I think a lot about success metrics, mostly because I feel like no brand actually measures content performance anywhere. But I'll get to that later. And I'm curious from your perspective, just for, you know, other e commerce leaders in the field, what are the most important metrics or kind of data points that you track when it comes to both, I think, you know, kind of customer behavior as well as sort of, you know, product performance and that just from a high level.
Cause I know that people always loved, you know, kind of those KPIs or any, I'm just curious for you. What, what sort of, what your mind goes to when trying to figure out, you know, are we doing okay? Are we not?
Philipp Labkovskiy: Yeah. Yeah, of course. Uh, And actually, um, I don't know about all brands, but we do track the effectiveness of our content. And, uh, at least we try to run an AB test every time we're doing any major change in our user interface and experience on our websites. Uh, so we do run uh, those A B tests to prove, uh, that, that, uh, the changes are improving our, uh, business.
Uh, Sometimes it being painful, uh, to see that the results
are not [00:09:00] there. Sometimes you spend a lot of time on actually implementing something or improving something. And you're thinking, yeah, that's the winner. That's the one that is going to change the, the game for us. And you see the results of an A B test and it's just not there, but, uh, this is also part of the game.
Sometimes there will be, will be something you don't believe in and it's being implemented. And you're looking at the results and all of a sudden it gives you a double digit growth. And, well, that's, that's, that's part of it. We, we, uh, we try and we learn.
Jessica Quillin: I, That makes me very happy. I'm writing an entire book on basically retail content strategy and content operations and that sort of A B testing is exactly the sort of kind of short term kind of measurement for success that we, that we recommend, um, simply because, you know, you don't know how well, uh, you know, some, some sort of, you know, new website, whether it's a component or a campaign or whatever actually is working unless you're actually measuring it.
Um, so I love
Philipp Labkovskiy: Exactly, exactly. But then, you know, to just a KPI is such a broad area and we can really, I think, talk for an hour only about the KPIs, but just to give you a very broad overview of how do we try to
measure all of [00:10:00] that and keep track of everything. We use this term of consumer journey, and this is super outdated.
This is this, this conversation. It's like an omni channel conversation. It's been around for decades, blah, blah, blah, CGM. But
Jessica Quillin: have opinions on that, too.
Philipp Labkovskiy: Yeah. Yeah. Yeah. Every, everybody, Everybody uses
it at one point, but at the same moment we actually use it and we see the effectiveness of this because we think in micro conversions.
So, and, and, And we think in terms of how can you improve specific areas of your business. So for example, if, uh, if you, if, uh, if we're talking digital or, or we're talking omni channel, if you see that your consumers are, uh, visiting your website or a mobile app, uh, from, from, from this specific channel, how can you increase, uh, the KPI of them actually, you know, transitioning and, um, uh, join and seeing the website or for an omni channel perspective of entering the store?
So visual merchandising or, Um, the marketing will be very important here in in terms of marketing. It can be, you know, click through rates so we will be testing
different creatives uh how they result in different click [00:11:00] through rates and then we try to divide all consumer journey into different areas and think of okay
how the decision is being made How do we try how do we improve those areas of conversion and how what we do is we commit You to specific areas and we try to, uh, to
to, to push, uh, this area to the limit, to do the tests and to actually improve that area.
So we give ourself, uh, as a team some time, uh, to, to, to improve this and then we move to the, to the next task and the next task. Of course, sometimes the reality is that you need to, uh, keep track of multiple tasks at the same time. You need to improve multiple
areas at the same time. But our
company is privileged because we have a global setup for a reason we also have local teams in every region.
We have an e commerce team and We we work of course together on those improvements. So that means that It's great Quite a big, uh, team and quite a powerful team in, in, in, in, in doing those improvements, of course, we have some overarching, uh, metrics like a net promoter score, uh, to keep [00:12:00] track of overall consumer satisfaction and, and, and, uh, we give, uh, our detractors, of course, a possibility to leave comments. And,
um, they can leave the comments what was, what was wrong with their interaction with the, with the, with the brand, what, what went wrong so we can actually drill down and improve those areas. Uh, If we see that something needs an improvement, we use the next step of metrics, uh, that we call customer satisfaction index.
Uh, and, um, we can actually use
this KPI to drill down to specific operation, uh, where our consumers are saying that there is a problem, for example, with, you know, like returns. And, uh, then we will, uh, put together a framework with this customer satisfaction index and try to understand how to improve it to an AB test, implement, see what works better, uh, and then roll it out for the global setup
to, to, to improve an overall number. And then we always see, You never see an immediate result in NPS. So anybody who uses an NPS and thinks that, yeah, we will just improve this and NPS will, will, will, will grow. It won't. Uh, this is a metric that will show [00:13:00] you results in, uh, in, in the longer run. But then you can always see, um, you can find satisfaction in a customer satisfaction index and you can find quicker wins over there.
Uh, or of course, um, you know, in. I really like to think of a funnel for any purpose. If I need to explain something
to, to our team, to our um, colleagues in the organization or to, uh, sometimes, uh, to, uh, to management, uh, an analogy of a funnel really helps all the time. So you need to acquire a consumer, then you need to convert the consumer.
Uh, We use of course, our websites, our mobile apps, our retail stores for that. Then there is an operation, um, moment happening for e commerce. This is the largest part of the iceberg, uh, when actually the books get picked up at the warehouse and being put in the truck and there is somebody delivering, returning, et cetera, et cetera.
And we have an order management system for that one that, um, manages all of the statuses across the status model after the order is placed, what happens. And there is numerous KPIs across that stage of operations to make sure that if we promise to deliver within the certain time frame that we [00:14:00] actually do deliver within the time frame.
We have algorithms, we have, uh, and here is not a buzzword, but we have AI algorithms that help us.
Jessica Quillin: I was going to just ask about that. Yeah. And that's, I have sort of several questions. I mean, that was, that was amazing. And I love how sort of, I don't want to say data driven you are, but I think I love how data informed your sort of strategic decision making is.
Philipp Labkovskiy: We try, we try. it's it's it's a, it's a never ending. It's like, it's like digitalization. The thing that we started hearing about decades ago, and we still talking about digitalization. We're still going through this digitalization and improvement, improvement, because there is no end of, Of this
process.
Jessica Quillin: No, but you have a very integrated sensibility. And again, as a content strategist who spends half my day, you know, trying to educate brands and sort of this importance of this more holistic mindset and why data in all these different touchpoints matters. I think you guys are doing that. So I love hearing about that in action. Um, Just to dive in the weeds a little bit, since you mentioned AI, and I'm just curious, um, for you guys, or even just in your opinion, what role do personalization and AI play in really delivering those sort of more exceptional online shopping experiences? Because, you know, there there is a power in AI tools. I will never be a person to say that anyone should have AI replace their content [00:15:00] production, because I'm a writer and I think that good content doesn't necessarily come from AI. And, you know, I'm not going down rabbit holes about structured content and getting your content ready for AI, But I know, especially for everything from just the logistics of getting goods to people and tracking customer behavior, it does have a lot of power.
So I'm just curious for you guys, how are you kind of tackling personalization and how are you sort of integrating AI tools into your processes?
Philipp Labkovskiy: Yeah. Yeah. Let's Let's take on the personalization in a moment I just really want to also comment a little bit on this topic with content and AI because we're we're having this discussions uh at the moment and this is kind of like I think majority of players in the retail space
are faced with all of those AI opportunities to create the content and um, we of course also look in this area and I think that we won't be able to replace, uh, this creative, uh, brand storytelling completely with AI, and there is no need for that, uh, I think, but there will be areas where creativity limits
uh, effectiveness [00:16:00] sometime limits the velocity. And for example, with something that we discussed with the marketing creatives and, uh, click through rates, if you can update those, uh, images that you use then in Facebook or Instagram or in any other, your marketing channels, AI is, is a wonderful tool. And there are many, many, uh, vendors who, who offer, um, you know, to improve it, actually even Meta has built in, uh, uh, possibility
to improve your creatives.
Uh, so, so here, I think that this will really help, but when it comes to choosing your positioning, choosing the brand message that you want to send, um,
Jessica Quillin: Today we think that our, we call it brand studio does a wonderful job of actually telling the story we want to tell to our consumers. And AI is only
Philipp Labkovskiy: a
tool in their hands.
Not, not, not
more, but, uh, talking about personalization, this is, um, this is, uh, it has so many layers to this topic because it goes through all of this funnel, if you will. And the fourth step of the funnel that we haven't actually mentioned is the retention. So [00:17:00] after you have
sold
something, so you acquired, you
converted you made all of the operations and now consumer is the happy owner of your product or service. You hope to retain them. So now you have your loyalty program, your CRM system, uh running And personalization can be used across all of those steps of the funnel this is why I love this funnel analogy so much because it really can be used in all of the different topics You can
personalize your acquisition strategy and uh, we'll Um, all of the marketing channels are doing it for us.
So no worries I
am sure that Google and Meta will just improve and improve and improve in this area. So we will just provide the budget for them and they will Uh personalize it to the audiences. And
Jessica Quillin: have a lot of faith in Google. Google's broken at the moment, but I won't go down. Yeah.
Philipp Labkovskiy: part is always a little bit tricky, but instead of, In terms of, sorry, their strategic objective, of course, I'm sure they would love to just, you know, provide us the budget, and this is the amount of impressions that you will get, and this is the amount of conversions you will get, and to
predict that,
That is personalization.
Jessica Quillin: No, and I, so look, I, I, I spent, I was at Gartner for it's been a [00:18:00] while working on things and, you know, there's been a lot of buzz the last, say, two years or so about hyper personalization and sort of the ability to kind of find people and find exactly what they want to deliver, you know, exactly the right content to them, you know, at the right time. Which I won't dive into my own opinions on it, but I'm just curious from a hyper personalization, you know, kind of I mean, tools like AI kind of offer the potential to really, I think, rarify content and kind of direct, you know, be more kind of directional and purposeful with, you know, kind of getting the right product to the right people, but it can be creepy.
And I'm just wondering from your end, sort of, you know, how kind of going into the future, are you um, kind of thinking about personalization, you know, kind of across your different customer bases and, you know, trying to leverage technology in the right ways without kind of being predatory about it.
Because I, there's a lot of sort of nuances to that. So I'm just curious from your end, sort of, how do you balance the, you know, keeping things retaining customers without, you know, turning them off. I guess.
Philipp Labkovskiy: Um, So listen, we, we, we, we know the value of our products and we, we, we value our, uh, key USPs first. So we make a really, really good shoes and we know the reasoning for why our consumers choosing us. And in terms of [00:19:00] personalization, there is of course ways how we
can segment and create hypothesis around different kind of monetary and behavioral types of segmentations to offer our consumers, uh, something that there might not even know, but from just the pattern of their behavior of their spending with us within we are 60 year old company.
So we were around for quite a
while. So, um, Some of our consumers might not even no, be aware of the pattern of buying our shoes for years and years. And just to be there at the right moment to say, Hey, by the way, this is the time to replace the laces, or this is the time when you usually buy your new, uh, golf shoes, et cetera, et cetera, is it's, it's, it's, it's very helpful and coming up with the right price points, coming up with the right model that people
would love, because we know what we're doing.
What their preferences are. I think that this is very useful for consumers. And this is a good reminder our lives are very busy these days. And if the brands can remind you at the right [00:20:00] time, this might be beneficial for both, I would say for the brands and for the end consumer at the same moment, of course, that implies you said the word creepy.
Sometimes when, when, when, brands and brands have the possibilities to know too much, uh, sometimes,
um, when it's used, um, uh, how to say, you know, in a way that will, um, creep our consumers out. We, we, we, We don't want to do that again. We know the value of our product and we just want to be there for our consumers at the right time with the product that we know they love.
And, uh, for us that, that, that's, that's enough, uh, there will be just smarter ways and more automated, automated ways to do that. Um, but our brand mission, uh, still is the same provide, uh, comfortable and, um, quality product.
Jessica Quillin: No, you guys make great shoes. Um, you know, it's, it's, I, I, I love the way you're talking about personalization and sort of a more contextualized way. I mean, I think it's funny because when I was talking about creepy, I think from just a consumer standpoint, the, you know, the basic technology of say, you know, you leave an item in cart, they send you an email, you know, saying, by the way, you left this in your cart.
And honestly, for me, depending on the brand, I'm okay with that. Sometimes, other times it does seem creepy because I'm like, I was just kind of, I was Looking around on your site, how did you know where, what my email address was? Cause like I, I only looked once. So I think as [00:21:00] you're saying, being discerning about those customers and their unique journeys and their history with you, I think is, is an important part of that.
So I really, I really love that.
Philipp Labkovskiy: Yeah. And it will be, we will see in the coming years. Listen, there is all of the data. Think about the fact that all of the data about all of our purchases, our behavior exists somehow in the world. So your bank knows everything about your purchases,
your telecommunication company knows everything about your searches or about your calls or about whom you contact with, et cetera, et cetera.
So, There is, of course, a certain way how legislators need to make sure that it doesn't become like one big pile of information because if
everything put together, then real creepy things might might happen, of course, from a commercial standpoint. Uh, that will be beneficial for the
businesses. But from a moral standpoint, that's that's arguable because that's, that's already, you know, forcing, forcing our consumers.
So I'm a big believer in doing a fantastic product and being valuable, [00:22:00] bringing value to consumers. But then of course, using some technologies to make your, your, your, you know, your organizational structure and your business a little bit easier. Uh, But the core thing is, is, is our products and, uh, value for consumer.
Jessica Quillin: I love that. And actually, from an e commerce standpoint, I know the question of community is usually more a question for like social strategy and media strategy side of things. I'm always curious from an e com side, how you think about using, you know, kind of e com technology and sort of these sort of, yes, omni channel types of things to build your business.
kind of build community because you're talking about customer attention. You're talking about customer acquisition. And I think community and sort of building that brand loyalty is for me, a natural part of kind of what you do. And I'm, I'm just curious how you do that. Cause there's so many, even technologies out there say, even on, you know, on Instagram brands, you know, selling you, uh, where we can, you know, offer you customer data and you can just, you know, DM everyone and they can shop through Instagram that way.
And I'm like, that's a little strange in some ways, but I'm just curious for you as thinking about e commerce, How do you sort of. think about community and kind of building building that sort of connection with consumers because I think it is sort of that humanistic side to what you do.
Philipp Labkovskiy: Yeah, no, that's, that's a wonderful question. And I think that's, uh, this moving forward for many, many brands, building a community of loyal consumers will be one of the key challenges and one of the key tests, because in the world where cookies are a thing of a past when the world where it's harder and harder to track our [00:23:00] consumers.
Um, And, um, You, you want to have a direct line of communication and, uh, this, uh, and, and you want to have this line, um, um, accepted by the consumer. So they will willingly say, that's fun. This is cool. I want to be a part of that. And to do that, it's very, very hard and loyalty program as of majority of what we see on the market today.
And I would be honest, the same thing for us in ECCO. We're rolling out of ECCO Club loyalty program today, but this is a mix of monetary and non monetary benefits. Our consumers love that, but they love it for a reason. They, There is a monetary benefit that is attached to that. So it's a no brainer, of course.
But at the same moment, how to turn it into community is very interesting. I cannot say a lot because in you will see a lot coming from ECCO next year. But, uh, one insight I can share is that we are running a very interesting um, uh, kind of like pilot projects this year in United States. Um, I was never a big believer that a DTC brand needs a [00:24:00] mobile app.
I always thought, don't we have already enough of those apps in our phones? Like I, I don't even know what, what apps do I have in my
phone? It's too much. And then when it's a fashion brand, what is the frequency of purchasing in this fashion brand? Who needs a mobile app of a fashion brand? But, the insight for me was
that we tried it this year.
We have rolled out ECCO mobile app. If you're listening to us and you're in the United States, go to, um, uh, any of the or mobile app, um, stores and type in ECCO ECCO, you will see our mobile app downloaded and you will see the app. Uh, Turns out that this is not only a commercially successful thing, if executed correctly.
There is also endless possibilities to engage with your consumers through
push notifications and some specific offerings that you provide to your consumers. And this is an analogy that we use. It's like a magnet for loyal consumers. Because yes, there will
always be consumers to whom your product or service is a commodity.
You want, you know, [00:25:00] good quality and comfortable shoes? Yeah, you choose the brand, but, you know, how big of a fan are we of every brand that we use along life? um, but, um, in the app, you will have most loyal consumers. The conversion rates are higher. There, The retention rates are higher. Their average checks are higher.
They're All of the commercial metrics are better in the app than they
are on the website. There are reasons for that. The app is just user interface and experience is just better in the app than it will be on any kind of website on a mobile device because the app is more native to your phone when it's done correctly.
But at the same moment, the
retention is also better. So there is endless possibilities. And I think that our brands, as well as many other brands are, um,
Jessica Quillin: thinking a lot about building a community and what to offer over there. To
Philipp Labkovskiy: keep the interest between the purchases.
for frequency rates is, you know, one, two, three purchases a year, a couple of purchases a year, then how do you maintain top of mind?
How do you maintain [00:26:00] interest, uh, in your consumers between those purchases. That's, that's, That's an interesting question. And there are many ways to do that. And we're going to drill, drill down and explore those options next year in the coming years.
Jessica Quillin: No, I love that, and I see so many retail brands doing that, and I think there's so many for having been dismissed for so long. I think the mobile app can in some ways offer, um, much richer opportunities for sort of more localized storytelling. Um, you know, I see, uh, you know, Zara experiment. Okay. They have a lot of issues with their app.
I mean, they still, they went from sort of having this exposed taxonomy to having sort of a more functional. Navigation, which is fine, but they do a lot of really innovative kind of behind the scenes storytelling in there and collection launches and things like that. And I think you're quite right when done, right
if you're already a loyal consumer, it can be a way to kind of draw people in. Um, It's just, think it puts less demand on the user to really kind of, they already know they love your brand. So that that's not a question anymore. And it's really just a matter of, of experience and, and kind of, you know, conversion becomes more of a, just, you know, how do we sort of provide build value.
So I love that you're building value because I think that that's, um, very amazing. Um, Just in terms of technology and, and kind of all the, the different elements you've been talking about for e comm, um, just to take it back up a level, I'm just curious how, from your perspective, how can other brands effectively navigate the challenges of global e commerce, you know, both from the sort of cultural nuances of, you know, product localization [00:27:00] and regionalization and all of that, just the logistical complexities of, getting things, you know, from where they're made to where they need to deliver, um, you know, any, any tips you can have in terms of things that brands should think about to sort of navigate this sort of very complex global ecosystem.
Philipp Labkovskiy: Um, It is complex. And I think that if in IT world, luckily, things become less and less complicated in, in, in the recent years. So, uh, It's easier to create a website. It's easier to start your e commerce
business where in logistics world, even though we have three PLs and we have companies who will do everything, uh, as, as one offer for you, it's still quite complex to navigate and to and it's, it's quite complex to maintain that part of the business because it's a lot of calculations, it's a lot of accounting, it's a lot of financial work and, uh, and, and, and those dusty boxes, uh, going back and forth.
So, um, Um, I would say that, um, globally, if you want a global, uh, setup and a global business, of course, one of the key challenges is where do you place your stock if your stock is in the US, but you want to sell globally. [00:28:00] How do you maintain the same, um, level of service, uh, that is expected somewhere in, in Europe, for example, if, if you need to ship it here, but then the local competitors can ship next day and it will take you a week, then you always choose the, the, the levers you want to pull.
Maybe you're building such a, such a, um, uh, good brand that people are okay with waiting for, for a week to receive your product, uh, because well, you're you're you're the best and the competitors are nowhere near but at the same moment if uh, if you are really uh in a battle with competitors and your consumers have a choice
Um, it's it's it's it's complicated and it will require you to Um,
first have the stock available to deliver the SLA, have the local needs met, for example, I can give you one example in Japan.
It's, It's a common thing that, um, uh, older people in the community, uh, will ask to be delivered fashion products
to try it on at home before actually purchasing [00:29:00] it. So it's a try on before a purchase and that's a very common thing. A lot of Japanese, it won't be a huge percentage based on, of course, the numbers and the brand.
It won't be a huge percentage of your sales, but you're expected to provide this service. And in some other countries, people go to, for example, in Korea, people will go to 7 Eleven to pay. So they will order something online and then will physically go to 7 Eleven. They will physically pay with cash money over there, and that's when it's paid.
And, uh, your accountant will ask you many questions about how this will actually work, uh, and how this will be executed. And then you can, And the list goes on and on and on. So in every single region, in every single country, there are specific, um, requirements. And if you only provide, uh, one option for payments, uh, of course, that again, if your brand is very strong, you will maintain a certain level, but if your brand has already grown and now it's the battle for percentages and you want to beat the competitions by percentages You need to think about those incremental improvements and those functionalities And it becomes very complicated. Um There [00:30:00] is no easy solution.
There is no easy choice There is no one provider that you can sign a contract with to to become full global and all questions are removed. Um, But it's, uh, it's a question worth answering because for a global brand, this will really help you grow, help you improve.
Jessica Quillin: No, I love that focus on both, I think, service and localization, because I think that that's where you get that sort of important differentiation for your brand. Um, What other strategies do you think are most effective for sort of bridging that gap between the sort of physical retail expectations people have for shopping versus the digital commerce kind of divide there?
Because I love that sort of cultural divide you were mentioning for sort of Korea and Japan with a sort of try on at home, but then you pay elsewhere or you buy. I mean, it's just, um, it's, It's a divide and I'm just curious what other strategies you think are like work best for sort of, you know, getting people to shop online or both or, or meeting that need where they are.
Silence.
Philipp Labkovskiy: but Still you go into every brand and they still, uh, discuss the fact, okay, how do we make sure that our inventory is visible throughout any touch point?
And then it can be ordered and can, and their replenishment [00:31:00] works, et cetera, et cetera. So it's a century old, uh, and it still is a topic to, to, to, to focus on to actually provide the access to all of the inventory of the company in any touch point. And so talking about people standing in the store and giving them an opportunity to order a color or a size.
That is not present in the store to be delivered within this store within another store to the to to their home It's it's it's um, it's a big question. Think about any of your recent experiences when you
went into the stores. How present was that to you? How? How were you presented with those options. And then, you know, If we, uh, I, I'm sure that many people, uh, from, from retail listening to us from, from the brands, uh, saying, oh, come on, what are you talking about
philipp? We have already implemented this a decade ago. It all works, in our company. Everything works. Yeah, it does work. Uh, guess what? In our company, it also works, but still the, the, the question is you are always on the mercy of store assistant when they're doing their job. [00:32:00] Great. They will communicate those options.
But how do you actually communicate it well? How do you make sure that those options are
used by both the store assistants and the clients? How many of those opportunities are you missing because it's not communicated? So the art that we are all faced with now, even though we have implemented in the recent decade, all of those processes in our ERP systems and order management systems, how to actually make sure that people use those now?
So let's be honest look in your excel spreadsheets Look in your percentages of orders and stores and things like this and be honest about what percentage of your revenue that is and somebody might be a champions in this somebody might say that no we have a room for improvement If you're a global brand, then you might see that in some regions.
It will be better in some regions. It will be worse okay, so how to improve it in the worst regions. So there is still a lot to be gained and a lot to be improved
uh, by the retailers, even though we think Omnichannel is a thing [00:33:00] of the past. It's not.
Jessica Quillin: Not to toot my own horn, but sort of our, our take on this, you know, I, I run a content strategy agency, which, you know, isn't really exactly a thing yet in fashion and retail, even though we're trying to make it that, but, you know, we take this very expansive definition of content as anywhere your target audience is encountering your brand messaging, both sort of, you know, In IRL and digital and, you know, sort of this, this taking a holistic lens on content and putting content strategy in front of that, I think for things like sort of customer experience and, you know, online shopping and all of this, you know, sort of taking that for us, that content first approach, you know, sort of allows you to sort of build guidelines, build sort of rules and processes that sort of cover sort of customer interactions, both in person and digitally and allows sort of both sales associates and even your sort of online help not chatbots, obviously, but even chatbots and feeding all of that but this need for think consistency and really for us it's this need to ensure that brand storytelling feels the same and appropriate kind of touch point by touch point so that in person experiences feel personal but it also feels like ECCO when people are interacting with ECCO there, and then it feels the same online, but, you know, attenuated to the channel.
And, you know, I'm not saying that a content strategy can do everything [00:34:00] together, but I think it's so powerful on top of, say, that same kind of integrated data approach you're already taking to think more holistically about where your customers are and what they need from you at these different touch points and really trying to step back and figure out, okay, what do they need in that moment?
What kind of pieces of, you know, You're talking communications, but it's It's content in a way, right? It's, you know, how do the sales associates need to talk about our brand? You know, What products should they present now? What are the other options they have? And there's this sort of whole kind of mapping you start to be able to do, um, from a content angle to ensure that you at least have this body of information that you can, you know, put in front of customers and then, you know, track data by data kind of, I mean, track the data touch point by touch point. So, you know, That for us is super important. what I'm writing a book about and this is the work our agency does, but I think for what you're saying, there's still, I mean, we talk omni channel a lot, but so much of it from our standpoint, at least is, is that every brand in a sense needs to take, make omni channel their own thing. So, So your brand is everywhere, which is great, but you need to kind of find the right technologies for you for the right channel and, you know, kind of that meet your brand, your products and your, your sort [00:35:00] of, um, customers.
So I love that you're, you're you know, kind of talking about that journey because so much of the time when I think you're talking technology, people talk about it as like fix. We're all on the channel now. It's like, actually, no, this is always constantly evolving. And I love that you guys sort of have that mindset because that's the growth mindset you have to have because, you know, it's it's survival of the fittest, right?
So,
Philipp Labkovskiy: Yeah, exactly. And then there are different types of omnichannel. So you might be
operationally omnichannel, but at the same moment you go on the website of the brand and it's one picture, you go into the store and then you want to talk content. You miss all of the content that you see on the website. So
this is one experience using the product description page.
This is a different experience of actually holding the products in your hands in the store.
And I think that one of the interesting, um, uh, like tasks to solve in the coming years for retailers will be, people will expect more and more that content that they are used to when shopping online will be somehow represented in offline as well because
I [00:36:00] recently checked out the report from Klarna where they said that 40 Something 42 or 48 percent of consumers when they shop in offline they use their phone to assist the shopping experience. And of course, we understand that many of those are actually using Amazon to see if there is a better deal or check out nutrition facts if this is fmtg and this is some kind of grocery store, but at the same moment It just tells you that, yeah, people want this.
Uh, People are so used to this experience of having the product description and rich content product description, uh, available to them. That we're sometimes lacking this in the store. You stand there, you look at this shelf with dairy products and you're like, Oh, okay. How do I choose? Or
you're looking at the granolas and you're like, fantastic.
So you use the packaging for the full extent. But now I need to spend 20 minutes to read all of the packagings and I don't have time for that. How, How can I just compare and make an educated decision, but do it really fast. [00:37:00] And it's not solved so far.
Jessica Quillin: No, and I so agree with that, and I do the same in store when shopping. I mean, I pull up my phone and I'm, but I want to research, you know, how the product is made, where it is. I'm a content person, so I'm always concerned about like the story and the heritage and all of that, but also just simply like, you can only tell so much from a label, right?
For, for things, um, you know, and. I'm very picky about what goes on my feet as well. So there's that whole thing, but I love that sort of attention to detail because I think it shows where digital can support in person shopping and then vice versa in this sort of more senuous type of relationship. Um, Just to sort of finish up, I'm, I'm just curious from sort of a high level, um, Any any parting thoughts on sort of the future of digital, uh, e comm and sort of key trends you see, um, you know, kind of being important for brands, um, moving forward.
Philipp Labkovskiy: uh, yeah, so You know, I I would name AI if you want to talk about the trends because this will impact everything that we do uh so much um, but um there is many ways how this might develop. And of course, use of artificial intelligence is very important and it will be used in different ways, um, across, uh, different, uh, areas of your business.
Um, I think that we discussed a little bit about, uh, mobile apps. I would say just in [00:38:00] general, the mobile first approach, uh, still a topic, uh, still important, and even though we, all of our websites are now adaptable and we are mobile first and every fashion retailer will tell you that 70%, 60% of their traffic is mobile
traffic these days.
So. Of course we focus there, but how can we actually, uh, connect the realities and make this mobile first and offline environment, et cetera, et cetera. So taking the next step is also very interesting. Um, I think that order management systems and systems that help retailers and e commerce companies manage the operational side of things that is still a more complicated area than the software area will also be very interesting to look at um, and just giving given the economic situation globally, I think all of the promotional activities even though it might sound that is something.
Okay. We all do promotional activities. So what? um You So I think that it [00:39:00] will become more and more interesting. The word promo code is already one of the most googled words, when used together with any brand name. The word promo code, the word discount, and people are searching for those deals, all of the marketplaces are happy to provide those.
This is just, They already build it into their margin. All of the marketplaces already have that in their financial
strategy. And then of course, brands, uh, many of the brands have it too, but then how to actually implement it, how to, to do it in a smart way, uh, all of those shopping days and how to participate it on the marketplaces, but also do it in DTC
while maintaining an omnichannel pricing strategy is kind of an important task, uh, for, for, for, for many brands. Um, yeah. And we, we talked a lot today about omnichannel. So I think that it's still a topic, but then the next step after you've executed the operational side of the things, how to make this experience, uh, being, you know, seamless, uh, across the channels, that's also a big one.
Jessica Quillin: Amazing. Thank you so much for your time today. Um, we really appreciated your insights.
Philipp Labkovskiy: Thank you. Thank you very much. Uh,
Jessica Quillin + Bryce Quillin: Thank you for joining us for [00:40:00] another great discussion as part of FSW Conversations. For deeper analysis and insights, please visit Fashion Strategy Weekly at fashionstrategyweekly.com, a media publication of strategy agency It's a Working Title. For questions, comments, and concerns, please reach out to our media team at info@itsaworkingtitle.com. This podcast is available on Apple Podcasts, Spotify, and all of your favorite podcasting platforms.