VOGUE BUSINESS | MAGHAN MCDOWELL
A few dominant platforms, plus some new players, have emerged as primary providers of digital wholesale technology. While designers are grateful for the chance to do business, platform proliferation is presenting problems.
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The adoption of online showrooms and virtual trade shows, fuelled by the pandemic last year, is turning existing platforms into dominant players as they rush to meet demand, introducing newfound opportunities and challenges into wholesale buying.
To cater to demand, digital wholesalers have rapidly added features that build on existing e-commerce-style interfaces: NuOrder, used by Nordstrom, Saks Fifth Avenue and Bloomingdale’s, added a payments service that lets retailers both purchase immediately and pre-book to avoid cancelled orders. Wholesale marketplace Faire raised $170 million in October at a $2.5 billion valuation and added live stream and on-demand video. Joor, a digital wholesale platform used by Kering, LVMH and Richemont, launched a new offering in May called Joor Passport, which hosted 17 global digital events (including London Fashion Week) in 2020. Shopify introduced its wholesale marketplace in October, called Handshake, and virtual events company BrandLive — which powered President Biden’s campaign events — spun off a video showrooming product called Showrooms at the request of fashion clients who wanted an alternative to Zoom.
Still, there are complications, aside from the obvious sacrifice of touch and feel. The fashion industry, initially hesitant, has started to adopt it after considering it a more temporary solution, but even eager adopters experience a learning curve. For some brands or buyers, even after investing in a new platform, duelling providers often mean managing multiple platforms to reach certain retailers or brands.
NuOrder, founded in 2011, has experienced 125 per cent new business growth during the last 12 months, especially in Europe and the UK. Meanwhile, Joor facilitated 500,000 new connections in 2020. In Kering’s earnings call last week, chairman and CEO Francois-Henri Pinault said that the move toward virtual showrooms, which had already been underway in all of the group’s houses, was accelerated by the pandemic and that platforms were “here to stay”.
For emerging brands, it’s worth the effort to make it as easy as possible for retailers to place an order, says emerging designer Marc Keiser of Keiser Clark. This season, Keiser showed at New York Fashion Week from his home in Los Angeles, through Runway360 and Joor, instead of travelling to Paris. “As much as people have a disdain for the digital aspect, there is also a benefit to how instantaneous it is. Instead of sitting in an Uber trying to find an address, running late to another appointment — those headaches and stress are eliminated.”
In the past year, traditional global trade shows have either paused, pivoted to digital or held hybrid events, often partnering with tech platforms to provide digitisation. Magic, for example, held a limited-capacity event in Orlando in February, in addition to a digital-only event. New York's Coterie and Paris's Première Vision have each pivoted to digital for the time being. NuOrder has partnered with Informa Markets, the company that runs Coterie, Magic, Micam and others, to provide the underlying tech, which has been a lucrative method for the company to attract new brands, says Heath Wells, co-CEO and co-founder of NuOrder. Going forward, experts predict the industry will adopt a hybrid model in which digital wholesaling is a key component, and the competition between platforms to be the dominant provider will intensify.
The dominant players — among them Joor, NuOrder and Le New Black — are around to stay unless there are mergers, says Robert Burke, luxury retail consultant. “It’s very important for brands to be a part of these sites.” He says that they could operate in the market side-by-side, in the vein of UPS and FedEx or Netflix and Hulu. “It can be a lot for the brands, but it’s the price they are paying for getting the exposure with the different stores.”
While consolidation is possible, each of the major platforms has its niche, says consultant Corey Hartwyk, who works with luxury fashion agency Axiom. “In most industries, there will be one platform that will become the winner or the incumbent, and others will create new technology or edge that allows them to take market share.”
Convenience and access
Digital wholesale platforms increase access to data, helping retailers avoid discounts and brands forecast inventory, says Wells of NuOrder, which works with 3,000 brands and 500,000 retailers. Before Covid-19, Laura Camargo, who is now sales manager at genderless New York-based label Bobblehaus, frequently travelled to Paris and New York; since digitising via NuOrder, the brand participated in both the Copenhagen International Fashion Fair and New York’s Coterie simultaneously, and sometimes makes sales using digital-only samples.
Joor, Le New Black and NuOrder all apply the e-commerce approach to wholesale ordering. Brands can customise the look and functionality of brand pages (like Nahmias's, seen here), and let buyers search and categorise by tags. © Joor, Nahmias, NuOrder
Democratised access can be especially helpful for underrepresented designers. This month, Joor, which works with 300,000 retailers, gave free access to 25 Black-owned brands. Retailers have wanted help discovering new brands, says Kristin Savilia, CEO of Joor, which also offers recommended brands similar to those buyers are browsing. One multibrand e-commerce retailer, for example, found 13 new brands by attending Joor's fall shows. In June, Faire, which offers lower-priced, independent brands for 150,000 small retailers, launched a Black-owned businesses collection, resulting in a 250 per cent increase in the sales volume to these businesses. Faire’s recommendation engine enables buyers to specify categories such as “women-owned” or “sustainable”; its most commonly used is “not available on Amazon,” says CFO Lauren Cooks Levitan.
New complications
Despite the convenience of filters, algorithms and uploads, attracting buyers online is challenging, designers say, to say nothing of getting a feel for the brand and products.
“The way we select product does not change, [but] not being able to touch something is a big challenge,” says Tiffany Hsu, fashion buying director at Mytheresa. Additional challenges include the length of time that digital appointments take and the quality of line sheets and images, although brand presentations and imagery have improved in the past year, she says. She also prefers short video presentations instead of waiting for models to change.
Camargo, of Bobblehaus, likens it to online dating, in which impromptu meetings are a relic of the analogue world. “At an in-person trade show, if you don't have an appointment, you might get the chance to reach out and say ‘hello’ to a buyer who walks by. With digital platforms, it is face value — like a Tinder profile — and the buyer is either going to swipe right or left, and you only have your one profile to show your whole identity.”
As digital platforms proliferate, management stands to get increasingly complicated for luxury brands. For example, Nordstrom exclusively uses NuOrder, so a brand that primarily uses another platform might also feel compelled to pay to be on NuOrder in hopes of signing with Nordstrom. “Brands are having to use multiple platforms, as one retailer may write orders on NuOrder and another writes orders via Joor, and a brand may love the aesthetic of Le New Black,” says Hartwyk. “The key here is that brands need to make it as easy as possible to get an order from a partner, and that means providing the ability to write orders on these different platforms.”
Brands who use Joor as their primary wholesale management platform may work manually with others by downloading their Joor data and images to share and then importing data back into Joor, but Joor remains their system of record, a company spokesperson said.
Menswear designer Doni Nahmias doubts if it makes sense to be on multiple platforms, the way a brand might have appeared in showrooms in multiple fashion capitals because the virtual destination is location agnostic. Camargo says that asking retailers to create an account just to view products is tough.
Additionally, Hartwyk doesn’t put much stock in virtual trade shows; instead, he says that as brands are “fighting from the ropes to keep their heads above water”, they should concentrate online brand discovery efforts through means like social media, influencers and word of mouth, to ultimately drum up brand awareness. “In the end, retailers are dying to get back to the normalcy of seeing products in person during market in physical showrooms or trade shows.”
Technology upgrades
Going forward, wholesale technologies are evolving in the same way that e-commerce platforms have — with the addition of features such as live streams, 360-degree imagery, more data science and virtual reality. In addition to filling in gaps in experience, these stand to increase the competition between existing and emerging providers.
Faire's virtual trade shows include live streams that aim to replicate the social and interactive aspects of floor demos, and let hosts answer live questions from buyers. © Faire
Fashion tech firm BrandLab360, for example, just introduced a VR platform that allows multiple users to interact within a replica of a showroom; additionally, a new “assortment builder” tool allows buyers to add specific items from various collections to a virtual rail to visualise them together. These features will debut at virtual trade show “Brandlab 360 Live” starting 4 March. Exhibitors will have access to e-commerce style analytics such as who is coming to their stand, what they are viewing and for how long.
Showrooms, the video platform from BrandLive, originally offered tools for brands to show product and training videos to internal teams. Now, luxury fashion brands have asked the company to adapt the tools to be used in wholesaling and public relations outreach, says Sam Kolbert-Hyle, CEO of Showrooms, which is used by Nike, VF Corp and Tapestry. The company is working on building out 3D showrooms with augmented reality and VR that allow viewers to walk around the pieces.
Videos have helped show movement or details on the product, says Lana Todorovich, president and chief merchandising officer of Neiman Marcus, although Autumn RTW has been more challenging based on the importance of fabric weight, hand feel and more complicated classifications. Fabric swatches also help, she says, and many brands co-ordinated models in virtual showrooms in which the designer walked through the looks.
Many anticipate an eventual hybrid of physical and digital interactions. Paul Lee, CEO of NHN Global, the parent company of wholesale online marketplace FashionGo, says that the technology developed for the company’s online trade shows could ultimately be used on the trade show floor. For example, FashionGo lets buyers search by item or trend using visual search (such as finding similar-looking pieces as to one seen on Instagram), plus it shows best-sellers and has introduced vendor live-streams. At a physical show, he says, buyers could use these search tools to find booths on the trade show floor.
Until then, brands will approach digital showrooming as a necessity. Of course, when the tech fails, or buyer and seller are on mismatching platforms, there’s another way to make a sale, Camargo says: “There’s always the old-fashioned email reach-out with line sheets and products.”