Growth Beyond Limits.
“You can move mountains with a new merchandise assortment and great web interface, but if you can’t provide great customer service and fast delivery, nothing else matters.” —Margy Bloom
Fashion and apparel have long been the vanguard for online brand-building and e-commerce innovation, as well as a means for facilitating consumers' personal style and expression. But what happens when one of the world's biggest multi-unit apparel companies pushes the boundaries of its vast presence geographically, culturally, and digitally?
When I joined Uniqlo as Vice President of Customer Experience & Engagement, Global E-commerce, the brand was already the world's fourth largest apparel company. Within the year it would surpass H&M and the Gap to become the world’s second largest apparel company. A multi-decades growth strategy yielded thousands of stores in Japan and China, but there were already signs that consumer behavior was shifting. While stores held prestige in the company DNA, the real under-the-radar retail phenomenon was happening online.
A Path to Tailoring Engagement
Recognized for its casual wear and high-low design collaborations, Uniqlo is still a relative novelty in the West having arrived in the US in 2005 and UK in 2007, but consumers have long been connected to the brand whether on premise or online. Uniqlo.com appeals to savvy shoppers looking to stock up on quality essentials and snap up the next limited release collaboration with culture- and design-led capsules from the likes of Pixar, Kaws, Minecraft, Jil Sander, Marni, Christophe Lemaire, JW Anderson, Marimekko and many more. At a time when e-commerce accounted for 6% of total US retail sales, Uniqlo was already capturing more than 20% of its US sales online. Could the lack of physical proximity be a bellwether for a more connected customer?
Connecting the Channels.
With a track record of successful growth oriented toward the mass market, a reliable operating playbook emerged and could be redeployed again and again as the network expanded. Yet then and now, Uniqlo continually pushes itself to evolve with elements of uniqueness and personalization bubbling up in-store, such as "UTme" design your own shirts on-demand, custom monogramming, and tailoring.
Stores would gradually become connected in more ways with the advent of "buy online, pick up in-store" and free in-store returns. But it was clear that continuing to produce industry-leading growth would require going beyond the physical store.
"The future of retail is no longer how many stores you build, but how many customers you serve." —John Fleming, former CEO Uniqlo Global eCommerce
With a commitment to putting customers first and to self-disruption, it was time to rethink the customer experience itself. Starting with proof of concept, I led teams in Tokyo and San Francisco to scale and operationalize Uniqlo’s mass personalization efforts for Japan, then quickly assembled a team to deliver a plan to impact the US market.
How It Works
On the success of a pilot in Japan, one-size-fits-all communications were diversified to include trigger-based, personalized communications for all Uniqlo customers. Enabling one view of the customer spanning their activities in-store and online, we could begin to tailor what we say (based on how customers shop) and when we say it (driven by customer cues). With each step, we built foundational campaign processes and enabled smarter decisioning. We were connecting the channels.
Change starts with a shift in mindset, and CRM, by its nature as facilitator of marketing strategy and customer contact, is a driving voice for Uniqlo's transformation.
Proof in performance established credibility within the company by giving insight to real people that we could get excited about, and in turn, serve. We discovered stylish shoppers who valued designer collaborations, utility shoppers who sought Heattech and Airism, family buyers, value-seekers, and more. Equipped with insights from connected customers, we began to weave threads across the customer journey. If a first purchase of men’s socks correlated to a future purchase of denim, what could we inspire if we included free socks with new orders?
We could also examine our default decision-making, working with store managers in new markets to optimize the merchandise mix and product placement based on the e-commerce order history for the region. For the grand opening in Denver, for instance, it was easy to assume that the high altitude and climate warranted Uniqlo's favored Ultra-Light Down Jackets. But our e-commerce analytics indicated that consumers favored active wear. In a market already saturated by high performance jackets, active products could be enjoyed in Denver’s 300+ days of sunshine. It’s a good example of paying attention to the data you already possess while empowering frontline managers with insights from real customers.
Earned Secret
The store is a customer relationship radiator.
With a narrative grounded in direct experience, our “why” took on real dimension and we could begin to harness the power of the frontline operations to drive deeper connections with our customers on a much larger scale. While technology can facilitate experience, people can help make strategies more effective by bridging a trust and confidence gap when adopting new modes of engagement.
With a few incentives and some friendly competition, we encouraged store managers to build a customer connection that could continue beyond the store, supercharging our customer acquisition and identification through paperless receipts and the mobile app. And now with more advanced automations and analytics on the backend, we could deliver personalization in a way that had never been possible before, while building connections between visits and across channels for more enduring relationships.
Reflections
One of the biggest challenges for large companies is how to invest in something that won't move the dial for a significant period of time, but the sooner that we can accept that change happens at different speeds in different parts of the company, the sooner we can make an impact that mobilizes the greater whole.
Technology is often sold as the solution, but the real wins come from leveraging internal partners to reprioritize towards the customer experience and maximize our functional improvements.
Success or failure lies in the operational dynamics. When we orient the intelligence of the organization toward a more comprehensive view of customer behavior—in concert with transactions and products—we animate different ways of seeing, thinking and working that maximize possibilities for greatness.
