TFG online taps into consumers’ desires

Diversified apparel retailer TFG is using digital infrastructure to launch new brands and measure consumer desires as it deepens its e-commerce business.

Robyn Cooke, TFG’s head of e-commerce, said: “We need to look at the opportunities that online gives us that brick-and-mortar doesn’t.” And one of those opportunities was that retail needed to be customised.

Online allowed “you to launch a new brand and test the market. If our merchandising team want to see if there is customer appetite for a particular type of product, they can put it online without having to incur much costs and see how the market responds to that,” said Cooke.

Through its online channels, TFG was able to measure consumers’ desires, he said.

“We do quite a lot of demand measurements online. We look at if we have sold out on a particular product, are customers using the functionality that allows them to say: e-mail me when this product comes back in online.

“We may not have had merchandise in a bricks-and-mortar environment because it’s sold out.”

Getting smart

Cooke said TFG used platforms for online pre-orders, which allowed customers to evaluate a product for a week before they decided whether or not they wanted to buy it before everyone else could.

“And what that allows us to do is either sell out before we go live, or if we are smart about it we can end up stocking more appropriately, depending on pre-order demand.”

Currently, TFG’s e-Mall consists of the mainstay brands including Sportscene, Markham, Relay Jeans, @Home, Fabiani and Foschini, new brands such as Anatomy, and exclusively online brand Archive.

According to Cooke, around 75% of TFG’s brick-and-mortar customers come through the online channel and 2% of the group’s total sales are done on the online platform.

Steinhoff International has the biggest market share in the apparel and footwear category in South Africa, with 18.6% in 2016, while Mr Price came in second at 11.2% and TFG at 9.1%. The market size of e-commerce among apparel and footwear specialist retailers in 2017 is R120.184-million, according to Euromonitor.

The market research house said that South Africa’s internet retailing continues to generate strong positive growth, recording a double-digit current value compound annual growth rate in the process. Sales in internet retailing increased by 23% in 2016 to reach R8.1-billion.

Shifting strategy

Combining the infrastructure that stores offer with the convenience of online is at the centre of TFG’s shifting strategy, giving customers the option to shop outside of traditional trading hours while using shops as collection points for online orders.

Cooke said TFG had invested in making sure that 175 stores around the country could act as collection points for customers who wanted to collect their online orders, rather than have them delivered.

TFG, like many other South African retailers, has made online payments easier by offering an EFT payment system to consumers who don’t have credit cards.

“South African retailers are more likely to succeed if they listen to their customers and adapt, swiftly, to their changing needs and retail patterns,” said Cooke. “In that way, there is much we can learn from international retailers and adapt to our own retail environment. We also know we should be adopting unique practices in South Africa, tailored to our specific environment.”