The physical expansion of digital native brands. : The Decora Edit

The physical expansion of digital native brands.


Topshop is formally in the hands of fast fashion and online only retailer Asos. The race between ultra-fast fashion online leaders has extended to the British high street where digital

19.02.21

Topshop is formally in the hands of fast fashion and online only retailer Asos.


The race between ultra-fast fashion online leaders has extended to the British high street where digital native brands are finding new channels to expand their legacy.

But why digital brands are acquiring high street major brands, and what are the consequences?

The high street it is a thriving and essential part of the economy and especially in the English  Has been a symbol of the great Britannia momentum and something we, as consumers, have been part of.

Topshop flagship store in Regents Street, London has been for many a major shopping destination for the active engagement offered to the consumer – from live dj sets to special events – and the wide range of products available able to satisfy a large customer base.

Over the years, the business model promoted by super-fast fashion leaders has paid a significant role in the consumer behavioral change and, moreover, pressured competitors to adapt and always reinvent themselves to be relevant for their customer base while most often compromising ethical values.

Furthermore, as a consequence of the global pandemic and lockdown restrictions, those days are over and the flow of shoppers through the streets of central London has disappeared and the ultimate shopping destination for the latest trend fix has shifted online

The slow investment in the digital generated an even larger gap between the high street dominants and digital native companies.
DTC business model has been having an advantage in the digital space. The investments on social media and savvy marketing tactics provide a large asset of consumer data made easy for brands to fill up the gap and satisfy consumer demand. The low operational costs also play an important role in the company growth – “… own brands make a higher margin because Asos is basically going vertical and not involving a wholesale purchase,” said Bernstein analyst Aneesha Sherman.

The online growth gap of the brand across different channel is significant. Asos started selling Topshop in 2019, and it has seen a growth of 40%, compared to 4-5% growth within the own bought e-commerce.

Topshop decline was a long-time process and accelerated during the pandemic as its physical presence became obsolete.

The deal represents a market boost for Asos, after all Topshop carries a strong equity and consumer awareness which represent a great opportunity and mixed with Asos’s access to data set of 3 million customers,  can really implement product development and marketing tactics and ultimately expand the brand’s growth.

Asos has reported an astonishingly 20% increase in sales during first lockdown, other competitors benefited of the change in consumer shopping behavior too.

The pandemic has drastically changed the retail rules and digital players are the forefront and using their momentum to acquire struggling brands for cheap, while boosting their growth.

Despite the opportunities that this deal between to major names within the fast fashion landscape will bring, is the online only model going to grow despite the rising awareness on fast-fashion environmental and social impact?
And moreover, is Asos going to #payup for Arcadia’s cancelled 2020 orders?

words and visual by Giulia Mummolo

resources

Boohoo Buys Debenhams Brand for £55 Million -

Business of Fashion (Reuters)

Why Asos Needs Topshop -

Business of Fashion (Tamison O'Connor)

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Business of Fashion (Tamison O'Connor)