Step 4 – Start promoting your fashion brand on social media at least 3 months in advance
Stop expecting an overnight success
This is another mistake I see very often when working with emerging fashion brands. You tend to start promoting your launch too late.
Please understand that people are not queuing in line at your front door. There is no overnight miracle success. You need to be prepared and connect with your audience at least 3 months before the official launch of your clothing brand.
Which social media should you focus on?
It depends on your target audience but generally I’d say you should be on Instagram and Facebook. If you target a younger audience, Snapshat can be a good option as well. Pinterest can be another interesting option to interact with a more mature audience.
Understand what digital marketing can do for your fashion brand
SOCIAL MEDIA GIVES YOU A DIRECT CONNECTION TO YOUR TARGET AUDIENCE
This is a very valuable information. Social media will give you access to your direct customers.
Don’t be salesy. Don’t be the sleazy brand that will bore your viewers stiff with repeated ads.
Social media isn’t magic. There are still human beings sitting at the other end of a smartphone, expecting to be entertained and enchanted.
So stop behaving like a door-to-door encyclopedia salesman from 1982.
Instead, get to know your audience. Build relationships. Listen. Watch. Learn. Exchange.
LET YOUR BIO, YOUR FEED AND YOUR STORIES BE A REFLECTION OF YOUR LIFESTYLE
Again, cohesion is key.
Social media is an ideal platform that can immediately show what your brand is about. Don’t lose this opportunity. Give your audience more than an online shop. Too many designers still content themselves with photos from their online store.
Take your fashion brand identity and think of a translation on social media. Your social media should bring another more lively angle to your fashion brand. Tell people stories. Tell us how your fashion brand lives and evolves.
Social media – especially Instagram – enables to target your audience efficiently
This is a very cool feature that you can use social media for – especially Instagram.
If you’re interested in organic reach, Instagram hashtags related to your fashion style enable to rapidly identify the people who would connect with your brand. This is one of the fastest organic way to gather a tribe around your fashion concept.
A cool way to get social proof
Interact with your audience. Exchange. Share. Encourage product reviews. Ask for reviews and testimonials. When people talk about your fashion brand, it’s an easy way to collect social proof and build trust.
Let the digital marketing techniques serve your fashion brand. Not the other way around
Here as well, drop the ego. Don’t focus on vanity metrics! You don’t want to be like Arii, this Instagram influencer who couldn’t sell 36 T-shirst in spite of her 2 Million followers!
Build trust. Build a community. Interact. It’s called social for a reason. If you go there, you need to be social and socialize in order to win this game.
The number of followers doesn’t matter. What matters is the quality and the solidity of the relationship you have with your followers. Be thorough. Be authentic. Share what inspires you. Share meaningful thoughts to start the dialogue, keep it about your philosophy and what your brand stands for.
It’s no use having millions of followers if you don’t have any contact with them.
Therefore focus on building a quality relationship with your audience so that you can easily convert to sales once you do sell something.
Step 5 – Finalize your fashion business plan
Read this if you’re not a number person
If you are a pure fashion creative, you are probably getting uncomfortable at this moment. Maybe you wonder whether this last step is truly necessary. Plus you’ve worked very hard on each stage already…Do we reaaaaally have to do this now?
Maybe you’ve even reassured yourself by giving into the belief that business plans are no longer useful these days. Some people say fashion business plans are useless because it doesn’t correspond to reality anyway…
Let’s get into that right now!
Imagine you have to drive 10,000 km away from where you are now. Imagine you decide to drive there without GPS. Instead you will just follow signs and ask people to guide you. Do you think you’ll get there? How fast do you think it will take?
I think if you trust the signs and ask for direction, you’ll get there at some point. One day. But without GPS it’s very difficult to evaluate how long this will take. Besides, you’ll have no idea how much gas you’ll need to arrive there. It’s okay if your funds are infinite but if you’re on a budget, I’m sure you’d prefer to know in advance how much you’ll end up spending.
It’s the same for your fashion business plan. If you don’t have one, it doesn’t really matter to the rest of the world: our lives will go on.
However, for your own comfort and peace of mind, it’s better to have an idea of the road you’ll take and to know in advance how much time and money you’ll more or less need to get where you want to go. That doesn’t mean that things will go exactly as planned but at least you have a plan and you know where you’re heading to.
This is the first function of the fashion business plan.
You can also use the fashion business plan to explain your strategy to potential partners/investors.
For those of you who don’t feel confident with figures, remember this: a fashion business plan is nothing more than a numbered summary of all the strategies and actions you plan for your fashion brand.
All you need at this stage is a roadmap that makes sense and is 100% cohesive with your fashion brand identity.
Summary of the information needed at this stage
Don’t do things in the wrong order. Make sure to have a final decision on all the main strategic topics before drafting your fashion business plan. At this stage you should know exactly:
- what your fashion brand is about and which audience you sell to
- how much you want to sell each year for the next three years.
- the size of the collection you are going to start
- the sales price per item
- how you are going to sell and through which distribution channel
- how you are going to promote your fashion brand
- what additional services you need to buy and which people you need to hire in order to reach your objectives
- the kind of events you are going to organize
- the maximum production costs per item that you are willing to pay. Calculate the maximum percentage of production cost per item (production cost divided by sales price)
- your social media strategy and your approximate daily ad budget
Each line should make sense and be cohesive with your fashion branding. Cost each line. If you don’t know how much it costs, ask third parties to send you quotations in order to complete your estimate.
Sales is good, profit is better
As a fashion brand owner, you are responsible for the continuity of your fashion business. It means that whatever happens, you need to keep your business afloat.
What will keep your fashion business alive is profit.
Profit represents what’s left of the sales you made once you’ve subtracted all the expenses and taxes. You can calculate how much sales you’ll need to make in order to be profitable. This number is called the break-even point.
Here’s how to assess your break-even point. For an entire year:
- Add up all your budgeted expenses,
- Add yourself a salary and the related social security costs
- Divide the amount obtained by 100% minus the maximum percentage of production cost per item
You’ll get the amount of sales that you’ll need to achieve in a year to be profitable.
- Imagine all your budgeted expenses amount to $80,000
- Let’s say you want to pay yourself a yearly salary of $40,000. The related social security costs your company owes amounts to 7.65% of your yearly salary (be careful to check how much the percentage is in your own country) so you’ll pay an additional charge of $3,060. In total you have a salary costs of $43,060 (salary + social security cost).
- The total charges including salary amount to $123,060 ($80,000 + $43,060).
- Let’s say the maximum percentage of production cost per item equals to 14%. 100% minus the maximum percentage of production cost per item equals to 100% minus 14% which equals to 86%.
- If I divide the total charges of $123,060 by 86%, the minimum sales you need to reach in a year to be profitable amounts to $143,093.
Okay, you now have the break-even point. You know how much you need to sell to be profitable with your fashion line.
So what? Now you need to go back to your sales strategy and evaluate if it’s feasible.
- Calculate the average sales price of all the products you sell. Divide the minimum amount of sales obtain by the average sales price. This approximately gives you the sales volume for a year.
- Then decide how many days in the year you are going to work.
- Divide the yearly sales volume by the number of days of work. This will roughly give you the daily sales volume to reach.
Let’s continue our previous example, let’s say that the average sales price equals to $250.
- The yearly sales volume amounts to $143,093 divided by $250 = 572. You’ll need to sell roughly 572 items to reach your minimum sales goals.
- Let’s say you are going to work 50 weeks in a year for 5 days per week. You’ll work for 50 x 5 = 250 days in total for the entire year.
- To get the daily volume, you need to sell at least 572 items/250 days = 2.3 items a day. So you’ll need to sell roughly 3 items at $250 per day.
With that information, assess if the sales strategy you’ve built is strong enough to support that kind of sales. If you think you won’t be able to make it, then you’ll need to lower some costs. The first easy position you can decrease is your salary. Play with the costs and redo the exercise with your new costs.
By the way, I have an entire Excel calculation tool that can help you with this exercise. Click here to download the calculation tool.
When budgeting your expenses ask yourself: will it serve or hurt your brand?
Your point of reference to make decisions
Your brand identity is your most significant asset.
Hence when you budget an expense, you need to make sure it serves your brand identity. You need to protect your brand DNA.
For example, if you are a couture fashion brand and you need to choose between renting a space in a popular district that you can afford and paying a professional fashion photographer to do your photos, go for the professional fashion photographer. As an emerging couture brand, if the space you rent is not located in an upscale district where your target customers spend time (it’s highly probable that people who buy couture won’t hang out in popular district to find their ideal dress), just don’t rent it. If you do, it won’t add up and you’ll need to spend an extra budget to get your target customers cross the whole town just to visit your shop. Make it easy for your customers.
Plan your cash flow properly
Apart from prioritizing profit and expenses that protect your brand identity, make sure to plan your cash flow cautiously. Cash inflows and outflows should be planned month by month for the first year. To avoid bankruptcy, the cash left at the end of each month should always be positive.
Negotiate smartly with your customers and suppliers. If you do wholesale, always try to get an advance in order to cover for production costs. Unless you know the people, as a beginner in the fashion industry, the suppliers will probably ask you to pay everything upfront. It’s not usual in every cultures but you can always ask if you can have a discount if you pay early.