The Status Quo
Today’s shopping experience in stores and online at most larger retailers is focused on Style first. You walk into a massive store or go online and then hunt around for things that match your style. Only then do you evaluate whether the item fits you. In stores, this can be a lengthy physical try-on process in the fitting rooms. Once you find out the items selected don’t fit, you try again until you get both the style and fit right. Online, it’s mostly guessing or buying multiple sizes and dealing with returns.
This customer journey leads to all sorts of inefficiencies for both the customer and the retailer. On the customer side, the burden is on them to hunt through merchandise, 90% of which doesn’t work for them. This is inefficient and frustrating not to mention the annoying, inconvenient fitting room and return experiences. On the retailer side, it requires massive store footprints which are expensive to rent or buy. It also creates major inventory issues because they need to ensure they have every size of every garment or item at each location. This excess inventory often means lots of leftovers which leads to aggressive markdowns and the need for off-price operations (e.g. Nordstrom Rack).
eCommerce adds efficiencies from centralized distribution but often leads to a huge return issue – often 30-50%. Returned items can’t always be resold with only about 76% suitable for resale, 15% going to outlet stores, 7% donated to charity and 1% returned to manufacturers. The reason for all of these returns is driven by poorly fitting items. Poor fit contributes to ⅔ of returns, with returns and reverse logistics costing $100B each year.
It’s no wonder why customers are shifting to brand-specific stores that are smaller and where they don’t have to hunt around as much or more personalized shopping experiences that simply mail a bunch of items to your house like StichFix and TrunkClub. But even this experience can be very inefficient when the items don’t actually fit.
The industry generally doesn’t have enough information about each customer to know which items will fit them which results in billions of dollars wasted marketing the wrong products to the wrong people.
The Proposal: Start with Fit!
We believe the future is a fit first, style second experience. Fit is the most important non-price related criteria for shoppers, 30% more than style.
Just imagine shopping and everything that doesn’t fit you magically vanishes. The vast quantity of items shrinks to a manageable size. You then add in your style preferences and easily narrow down the choice to only a few select items to try-on. Using AR try-on can even take the pain out of the physical try-on experience both in store and online. What you purchase will fit which wild drastically cut down on returns.
It’s an efficient discovery process that makes it easy to find the item you want to purchase. It also provides retailers with more data so they personalize your experience in stores and online. Retailers can use this data to send you information only the items that fit you and match your style preferences so you don’t get spammed by every new arrival.
This is the inevitable direction of shopping and it’s starting now.