If your business could be doing better, try looking to the fashion industry – which takes high profit margins to an entirely new level – for tips. Have you ever thought about how much those $15,000 dresses really cost to make? No wonder it’s a trillion-dollar industry.
These companies might make a significant amount of money every year, but it’s definitely no accident. They have been working hard for longer than you’ve been alive, coming up with effective business tactics. Here are a few that could possibly spark new life into your company.
1. Collaborate with rising stars
This is something you can see in the film industry, too. Collaborations in business are nothing new, but collaborating with people who already have an established brand won’t necessarily produce better results.
Ideally, you want to catch a wave while it’s still thundering towards the shore. Rising stars will have a rabid following, and you’ll keep more of the profits. A recent big example in fashion was the collaboration between Tommy Hilfiger and Gigi Hadid.
2. Repeat customers on overdrive
Every business knows the main driving force behind huge growth is repeat customers. It’s why Apple comes out with new models every year and businesses selling nothing but wallets won’t set the world on fire. Even Apple can’t compete with the fashion industry.
Designers come out with multiple lines every year, so they’ll get customers coming back even though the clothes they just bought are perfectly fine. If you can drive a customer back quicker, you’ll make more money.
3. Tell customers what they want
There seems to be a big thing today about asking potential customers for their opinions on future products. In reality, they don’t know what they want and you’ll get bad advice. While gurus sound smart when they recommend tapping consumer feedback, you should be inventing the future and only asking people how you can improve things. The fashion industry leaders nail this because they don’t follow trends. They make them up, and loyal fans go crazy for them no matter what they are.
4. Focus on building accessories
When you wear a suit, you’ll need a pair of cufflinks to go with it. A little black dress isn’t complete without a cute purse. Fashion brands have learned that the amount of extra money they can bring in selling accessories is astronomical.
Some industries actually get this right, but they don’t execute it correctly by making the accessories indispensable. Most companies don’t even bother to provide customers with the opportunity to spend more money, so they’re leaving it all on the table.
5. Be faster than the competition
Although Zara is a decent clothing company, it’s never going to compete with a powerhouse like Gucci. It decided to break into the industry a bit differently, by developing the ability to be quicker to market than the competition.
If the large fashion houses would show off their new lines months in advance, Zara would produce similar looking clothing within a short timeframe. Similarly, companies with phone case businesses might manufacture products as soon as they’ve got new phone specs.
It works in other industries, too
Business owners spend far too much time stuck in their own ecosystem. It’s good to know what is going on in your industry, but you need to look around to pick up the best ideas, ones that your competitors haven’t caught onto them yet.
Are you looking to improve your customer engagement? Read about How To Win Customers In Today’s Digital World.