How Calvin Klein and Showpo are Winning in New Global Markets

As global consumer demands evolve, brands are continually accelerating their efforts to respond to pressure to localize their global ecommerce sites. However, recreating a localized shopping experience for international consumers is difficult and can be resource-prohibitive, even for the most established brands. Challenges like managing international taxes and tariffs, partnering with the right payment providers per country, creating an efficient logistics network, and preventing fraudhave kept many out of the global arena. ESW’s U.S. President, Cynthia Hollen, sat down with Janelle Spatz, Director of Ecommerce Operations at CalvinKlein and Jane Lu, CEO & Founder of Showpo, at NRF to talk about how each of the brands are answering some of these challenges to reach shoppers wherever they live. We have summarized the main points below:

When Calvin Klein launched their global microsites, they wanted to focus on ensuring the customer had a fully branded experience from start to finish while meeting their local needs. Since they are both a wholesaler and a retailer, they wanted to make sure that a customer had the same experience shopping their Canada site as they would in a department store in that region. Most importantly, Calvin Klein made sure that prices were standardized no matter the channel. They went with a flat rate price model in the local currency, inclusive of all duties or charges, so there would be no surprises. They made sure the returns and loyalty programs were seamless no matter where the shopper was located. Some of these measures have a margin impact, but Calvin Klein feels that the customer experience and loyalty far outweigh the cost. Their customers are responding favorably to their efforts, helping them achieve higher AOVs and repeat purchases and driving customer retention. Showpo emphasizes the importance of offering local merchandise. Being based in Australia, it’s important that they carry items that would be relevant to someone trying to dress for winter in another country and that those items are front and center when appropriate so shoppers are more likely to convert.

What do you want to be the same from country to country, and what do you want to differ?

Takeaway: Keep branding the same; differentiate with payment methods, SEO terms, and merchandising.

It’s important to tell a consistent brand story. Things like imagery and UI experiences should remain consistent from site to site or country to country.

Look at the region before launching a new site—for example, some payment methods have higher penetrations in certain markets over others. You want to make the transaction as easy as possible for the customer.
It’s important to differentiate content for SEO purposes. For example, in the US we call a winter hat a knit hat or beanie, but in Canada they call it a tuque. You’ll want to make sure you have a way to get that into your product catalog and descriptions so you can maximize search and SEO effectiveness.
If possible, you’ll want a different merchandising strategy by location. Even starting simply with merchandising a site differently from region to region will help drive sales.

How can you have a competitive advantage in global returns in 2019?

Takeaway: Try to be as flexible as possible.

As a global business, flexibility to adapt your business model to the ever-changing global landscape when things like tariffs are out of your control, is always on your mind. ESW, who are experts at navigating the global minefield of tariffs and regulations, takes a lot of the headache out of it for Calvin Klein.

Aside from great vendor partnerships, a business can start by creating the groundwork to allow for order orchestration around multiple inventory warehouses or even bonded warehouses. Ramp up your order management to be as nimble and ready as possible, so you can press “go” in case you do need to start shifting inventory locations or creating hybrid models.

There is a tipping point when a business can see the benefit of going towards a multiple location fulfillment model vs. the operating costs. When you do hit that number, there is great benefit from a customer experience perspective when you talk about the speed at which the customer will get the order as well as reducing margin drain.