Have you ever heard of “reverse showrooming”? Probably not, but now is the time to become familiar with it because Fabletics is making a splash in the electronic fashion market employing “reverse showrooming”.
Many brick and mortar stores are losing money. Particularly irksome is the habit of many shoppers to visit stores to try on clothing they are considering, select what they want, and return home to make the actual purchase online, often from a competitor. This is “showrooming”; customers using the store only for fit and style, but making the cash register ring online.
By contrast, Fabletics began as a direct electronic business based on a membership model. To hook the new business, Fabletics uses bait composed of a high-end fitness outfit offered at an impressively low price. The customer is reeled in by the associated membership. All customers who purchase the introductory offer must agree to become VIP members.
VIP members, among other advantages, receive a curated fitness outfit each month for which they are charged $50 more or less. However, unlike many membership models in the past that grew to irritate their customer bases, Fabletics offers a generous return and refusal system.
Each month, within the designated period, VIP members may log into their accounts to forestall shipments. They may do this for several months consecutively if they wish. This gives them the impression that unlike so many membership programs, Fabletics wants them to be pleased with their purchases and does not want to hard-sell them.
Further supporting this interest in long-term customer satisfaction, Fabletics has a generous return policy. Customers may return entire outfits or partial outfits for store credit or, for a small processing fee, refund.
The membership model is maintained by customization. Unlike your grandmother’s old book club membership, the entire nation does not receive the same shipment each month.
When customers register for membership, they complete a short questionnaire that seeks to understand their athletic habits and clothing preferences. This data, combined with their purchasing history, supplies Fabletics with the basis of information that they use to select custom orders for each member each month. The longer customers continue with the program, logic dictates, the more accurate the monthly shipments become.
Having established a customer basis through membership, Fabletics is now opening a small number of physical stores. The customization is carried into these stores as well as it is through the membership program. For example, if an area targeted for a store has a local membership that prefers to purchase matching tops and bottoms at once, that store features such clothing. Other area stores have stock based on the preferences of their neighborhoods.
By offering a more intimate, custom, electronic shopping experience, Kate Hudson and Fabletics are taking a bite out of that 20% market share that Amazon has been commanding. Maybe Amazon.com does not yet need to schedule a major restructuring because of Fabletics, but they would do well to learn a few tricks from the new gal on the block.