Eloquii CEO Mariah Chase recently shared her thoughts on the state of digital commerce, where digital commerce will be in five years, and how her company is using Custora to bridge the gap.
Eloquii is a vertically-integrated fast fashion e-tailer that caters to women who wear sizes 14 and up. Launched as a spinoff of The Limited more two years ago, Eloquii was conceived as a way to engage a group of customers that is “wildly underserved” despite representing over two-thirds of American women.
In a recent conversation with Custora, Eloquii CEO Mariah Chase gave her take on the current state of digital commerce and outlined her vision of where digital commerce is headed in the months and years to come.
What Were We Thinking?
As is often the case, hindsight has given us a radically different understanding of the digital commerce landscape circa 2011.
On the one hand, some of the most promising trends of the day ended up flaming out fairly quickly. For instance, as Chase reminds us, Facebook was supposed to be the next great e-commerce channel. Needless to say, that didn’t exactly pan out. Similarly, while “flash sales” were everywhere at the beginning of the decade, they’re now thought of as rather passé.
On the other hand, many of the defining features of today’s digital retail landscape were barely on anyone’s radar eight or nine years ago. For example, the “curated box” model was just starting to trickle into the mainstream in 2011, but now the average consumer could easily fulfill all their shopping needs through retail subscription services alone.
Similarly, while the “app race” was definitely already ramping up—even then, most brands felt compelled to invest in a good iOS/Android app—no one could have guessed just how central app-based purchases would soon become.
Perhaps most strikingly, at the start of the decade, the average retailer’s perception of the value of big data and data analytics was characterized by confusion, if not all-out frustration. What should they do with so much data? What questions could they ask of the data? What was a meaningful signal in the data and what was just noise? Most retailers had yet to achieve enough analytical sophistication to answer these questions.
Digital Commerce Today
One of the most notable features of today’s digital commerce landscape is how fast it’s changing. Digital retail change is no longer evolutionary—a slow process in which you can see shifts coming from miles away—but revolutionary.
One need only look as far as Amazon for a case in point. At the beginning of the decade, the e-commerce giant accounted for roughly 7% of the apparel market; by the end of the decade, this figure will likely surpass 20%.
What’s more, thanks to platforms like Uber, Seamless, and Postmates, nearly every product or service imaginable is available on-demand. Consumers’ clear preference for orchestrating their entire lives from the palm of their hand has also fixed mobile optimization and retail apps at the top of every retailer’s list of priorities. Eloquii, for instance, has seen the share of its revenue that comes from mobile jump from 38% to 55% over the last 30 months alone.
As digital commerce has become increasingly mobile and on-demand, the traditional trend cycle has been compressed dramatically. Thanks to the fast-paced saturation enabled by social media, a single viral runway show can launch a trend literally overnight.
Companies that want to tap into these short-lived spikes in demand need to place a premium on nimble, responsive processes—say goodbye to months-long quarterly or seasonal design and production cycles.
Chase also points out that the equalizing power of the digital medium has made it easier to foster positive societal values like tolerance and inclusion. More people and communities are finding platforms to tell their stories than ever before.
“We as a population are becoming more aware, more enlightened, more empathetic,” says Chase.
The digital revolution may have put us all behind screens, but effective digital storytelling has actually given us unparalleled access to others’ humanity.
The Short-Term Outlook for Digital Commerce
In Chase’s eyes, as digital commerce professionals, “it’s our responsibility to think about and look around the corner for what’s next.” During the course of our conversation, Chase made predictions in three broad categories: pricing, content, and mobile.
Chase believes the way we talk about pricing will change significantly in the next five years. In a world where customers are able to check multiple other retailers’ prices in a matter of seconds, retailers’ pricing power is beginning to erode. Chase suggests that “dynamic pricing” could be one way for retailers to reclaim the power of the price tag.
Customers already expect variable pricing when shopping for air travel, concert tickets, and hotel rooms, and Chase is curious as to what would happen if this approach to pricing was introduced in other retail categories like apparel.
At Eloquii, they openly talk about “FOSO” (Fear of Selling Out) with their customers, roll out limited runs of products, and drive brand equity through product scarcity—all in an effort to lay the groundwork for dynamic pricing.
These days, nearly every retailer is producing video content. But as Chase asks:
“What happens with video content down the road? Do we need incremental streams of revenue to offset digital’s erosion of pricing power?”
Once again, Amazon is a good model here, as it has already started financing a robust library of original video content. According to Chase, it may be time for other retailers to start thinking about entering the content game in a much more meaningful way. “What if the next Modern Family was produced by Kohl’s or Target?” she asks.
To be clear, Chase isn’t talking about a branded piece of advertising, just good entertainment. That said, “next-gen bookmarking” will allow customers to instantly identify and seamlessly purchase products that appear in their favorite television shows and streaming movies. Some online video platforms already support this kind of passive advertising, and Chase believes this kind of seamless, experiential approach to e-commerce could be retail’s next blockbuster.
When it comes to the revolution of mobile, Chase is particularly intrigued by “conversational commerce”—the idea that customers should be able to communicate with retailers via text about customer service issues, logistics, and more.
Brands like Everlane are already experimenting with conversational commerce, and the wide availability of platforms like WeChat and Facebook’s Messenger App means that any retailer should be able to follow suit quite easily.
How Eloquii Uses Custora
If there is one overarching takeaway from Chase’s forecasts, it’s that new (and ever-evolving) technology will continue to be the driving force of change in the retail space. For their part, Eloquii has partnered with Custora to drill down into their customer data in ways that not only answer questions but inspire them to ask new questions.
Among other things, Eloquii has managed to become a more customer-centric brand through its use of Custora. Eloquii is now able to answer a wide range of questions for each individual customer, from “What are her affinities?” and “How much of a churn risk is she?” to “What is her lifetime value to the business?” and “Where is she in her customer journey?”
But for Chase, the most exciting part of working with Custora has been gaining access to predictive insights. “The proverbial crystal ball,” as she calls Custora’s predictive analytics, allows Eloquii to gauge what actions a given customer is most likely to take in the future, how frequently they will take such actions, and how they might respond to various “nudges” along the way.
For example, Eloquii has already leveraged the predicted lifetime value of their customers to validate their buyer model and inventory plans.
Additionally, Eloquii used Custora to figure out that many of the brand’s one-and-done customers were buying dresses, whereas their highest-lifetime value customers had an affinity for skirts and blouses.
After talking to a number of their dress-buyers, Eloquii discovered that these customers thought of the brand primarily as a place to buy items for special occasions. Armed with this insight, Eloquii was able to convert a higher number of one-and-done customers into repeat buyers simply by communicating that many of their products were designed to be worn as “everyday apparel.”
For more on the future of retail, check out Mariah Chase’s full presentation here.