Dave Elston- Head of eCommerce- EuropeOverview of ClarksPractical experience in EuropeResearch from Asia

Virtual Trade Team

4 VM’s, 1 data analyst + trade manager

EU MCR Retail Ops + Project ManagementEU Digital Marketing team

Manager and EU Marketing ManagerVirtual Content team

FR, DE, NL, ES + Manager

2 x Webmasters

+ Dave

Team Structure

• Big challenge is communication and engagement with markets

• Periods of great collaboration and then times of disconnect

• We focus on constantly trying to engage across the teams, highlighting the positives

• Not only P&L benefit, which sits in their P&L’s – other wins such as store locator

use – good SEO results and resulting

brand visibility

• Our DC is based in Somerset! Cut off times tricky..

• URL strategy- went local. Positive for SEO but also we want to be local within our global brand

• The words are all provided by our native content editors (even in Somerset)

• Call centre is outsourced, we work with Sykes and so far been very good for us.

• Nothing new here- got to be local

• NL- Ideal• DE- don’t like credit cards!• We take ELV in DE• Also working to take

Sofort and payment by invoice

• PayPal is good across Europe

• Cliches are true• Germans are fastidious• Shop by product type- shoes/boots• Shoe Technology is very important• Planned purchases- market is

quickly into new season• They like to use internal search

and left hand nav.• Lots of calls to the call centre

about shoes purchased many many years ago

• High. Very high returns rates. Payment by invoice could make this worse.

• But we have our highest conversion rate and highest AOV from Germany.

• Paid search is important for us but is v competitive

• SEO is also very competitive, especially on generic terms

• Affiliate commission rates are very high. It has taken a while for us to build but now much more positive.

• Cliches are true• The French are much more

‘emotional’• Less internal search and

navigation, much more use of links in content/graphics etc

• Shop by end use (ie workwear). • Fashion and inspirational features

work well and get high engagement

• Purchase when need to purchase- much later start to season

• Lower conversion rates and AOV than DE, but also much lower returns.

• Price driven market online• Strong affiliate results• Sales are very different! Dates are

legal..• A lot more online retailers holding

more promo events, esp private sales

• Good SEO results for generic terms

• NL is a tough market• Much lower conversion rates as people

tend to shop around• Higher returns rates than FR• React very well to promos

– We’ve seen much higher response rates to 20% promo’s vs sale

• As per DE move quickly into new season

• NL is our highest direct load market, but also reflects on local marketing team who are more active than other markets.

• In Spain we’ve seen low conversion rates– compounded as we see a lot of traffic from

the americas though we don’t ship there

• Lots of window shopping and research• V low returns rates• Excellent, quick generic SEO results

• Device usage is behind UK, NL the most advanced.

• Partnerships/working with 3rd parties has been very positive in extending our reach

Top Level Learns

• No license to print money or substantial amount of sales to be made in

year 1 of any business plan and break even at margin level would be an

incredible performance.

• Online sales growing across Asia Pac, with Clarks shoes present for

sale across many sites

• The market for full price Clarks new season shoes is quite limited online

• The cost bases of operating Asian online businesses will be very

different to the UK and EU (Comparatively cheap marketing and

fulfilment)

Top Level Learns• The brand is at risk in all territories from a combination of

grey (parallel) imports, last seasons markdowns or fake and needs protection.

• Sales of Clarks shoes online are mostly at a substantial discount of the local retail prices

• Market places (online shopping malls) are the dominant form of consumer shopping

• The brand needs to establish a strong online presence now to exploit the opportunity when it comes. The opportunity in the next 5 years is huge as e-commerce grows. Get a foothold in the market now before the market matures and set up is more difficult.

China• The market is huge, potential of 500m consumers but the market is

currently very small for full price Clarks shoes!

• C2C, and marketplaces, completely dominates and will continue to

do so for some years.

• Chinese B2C AOV is v low and there are not many consumers able

to purchase high priced products yet

• Taobao is the dominant internet sales platform across China

(accounting for some 80% of the total retail market), and is mostly

used by consumers for C2C. Products and prices are cheap. Grey

goods and fakes are prevalent.

• Tmall is Taobao’s B2C platform and both sites are interlinked via

search. To have any ecommerce success in China you must have a

presence there.

China

• Most payment is taken by COD or via Alipay, part of the TaoBao family.

• For Brand Protection, an official brand presence on Tmall would be v useful. Currently the commercial benefit is less.

• Our nearest market competitors in China currently make circa £50k in sales a month from a presence on Tmall combined with a stand alone site.

• For Brand ‘sites’ within Tmall, sales equate to about 3 large physical stores in sales. Most of their trade is at a large discount.

China• There is increasing traffic looking for Clarks online.• We could expect potentially sub 100k visitors a week but

with a low conversion rate around 0.2% (typical for a premium western brand.)

• Search Engines are lot more disparate than in the UK and different techniques are used to acquire traffic.– ie on Baidu you can buy page 1 of search results for your

brand for a quarterly fee and add video’s, image etc– TaoBao/Tmall is the largest used search engine for

ecommerce as they do not list in Baidu• A typical sales split would be Full price 10% of mix , reduced

price 90% of mix. Returns will be around 10%

China

• A Web site set up could take 3-4 months with a local service provider. These can provide a full service offer (contact centre, website build, fulfilment & marketing). Set up fees + % sales agreement (ideally highly variable based at launch dependent on volume which is likely to be low)

• There is high availability of domestic logistics providers, but local platform providers are less prevalent.

• China requires a more localised solution to the rest of Asia as market so different

• Substantial opportunities exist in Hong Kong, Taiwan & South Korea with right business relationship

Japan• The opportunity in Japan is as big as China for the first 2 years

• 80% of the population have access to the internet, with 70% of internet users having purchased, predominately through marketplaces.

• Although younger consumers in Japan have led adoption of ecommerce over 30’s are now showing increase spend online, esp around mid-premium goods

• Marketplaces are very important in Japan as in China .– Rakuten is by far the biggest, and has lots of grey imports and last

season reductions. General Brand presence on Rakuten is low

Japan• Distribution needs to be reviewed to manage grey imports etc plus

presence on Rakutan should enable better brand protection.

• Zozotown is a brand key marketplace and represents a good brand fit.

• One service provider for platform, customer care and fulfilment across SE Asia and Japan could fulfil requirements.

• In Japan, service providers who can provide all ecom capabilities seem to be much less than China so a solution would probably require a number of partners.