Is ASOS’s reputation for innovation under threat?

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Way back in 2017 the Drum very aptly described eCommerce giants ASOS as the retail brand that has ‘revolutionised the online shopping experience, helping shoppers emulate celebrity trends to become a trendsetter in its own right’. With the online fashion space becoming increasingly crowded over the past decade as consumers eschew traditional high-street browsing for doing it all on their smartphone, ASOS has paved the way in how to make this transition for people as seamless as possible.


Seamless online shopping experience

Their seamless cross channel experience makes browsing their wares easy, pain-free and consistent across devices, putting them on a UX pedestal unmatched by most of their rivals. Their video feature allows you to view a model cat-walking the product and see how they look and fit in real-life. And even if the items you’ve ordered aren’t up to scratch, ASOS boast arguably the most customer-centric return policy in the business, one which they’ve recently extended to a very generous 45 days.


Harnessing the power of their target market

One of the keys to ASOS’s success over the past few years has been how well they understand who their target market is, and how they structure their website and marketing collateral accordingly. Few factors have been more integral to this than their AsSeenonMe campaign, which allows ASOS customers to exhibit their new glad rags on social media, via a hugely popular hashtag followed by millions globally. ASOS regularly picks its favourite fashionistas, sharing their photos on their own website and Instagram account, providing people with that coveted moment in the Social sun. They are in effect getting their customers to promote and validate their products for free, which represents a triumphant hat tipping to the power of social proofing and helps maintain the brand’s trend-setting reputation. Last year we did plenty of musing over the power of Influencer marketing, and ASOS are currently harnessing it as well as anyone.

 

But are they running out of ways to innovate?

A drastic 38% slump in their share price in December served as a stark warning to ASOS and other online retailers that they aren’t immune to the wider malaise triggered by weakening consumer confidence. With so much of its success over the past two decades driven by simple UX and customer service innovations, it will be interesting to see how they evolve. In April last year they made serious commitments to investing in AI, while augmented reality and the ability to virtually try on clothes seems like a natural evolutionary step for them to own.

But they face more competition now in the race for online innovation, from retailers such as East London start-up, Thread, whose USP is built on the premise that they assign every customer a ‘personal stylist’ that uses your style and brand preferences to recommend complimentary attire and ultimately make you a snappier dresser. Thread’s success represents a major triumph for AI in online fashion, and symbolically, an area ASOS have been outfoxed. It could be argued that this kind of service is the natural next step for those clinging onto the ASOS generation, who value the more personalised approach over being directed towards whatever brand, or vogue, is currently on trend. But it’s hard to imagine ASOS viewing it this simply, and it will be fascinating to see how they respond to these growing threats to their innovation reputation.

Alex Cass - Research Manager

Annabel Gerrard