Retail

How personal shopping is giving retailers vital customer data

Key Points
  • There is now a wave of new businesses seeking to take advantage of personal fashion advice
  • Online personal styling service Stich Fix announced in October its intention to enter an IPO
  • Providing personal shopping advice is still mostly seen as a high-end service
Leonard Mc Lane

Personal shopping is becoming increasing popular and a key tool for retailers seeking to know more about how people shop.

The trend is global and there is now a wave of new businesses seeking to take advantage of personal fashion advice.

"H&M, for example, could produce a dress and not know why it's not selling. The dress goes through various rounds of discounts and still remains in store without H&M understanding why. We can change that," Sophia Matveeva, founder of the Style Counsel, told CNBC over the phone.

Style Counsel, an iPhone app, provides fashion counseling to people who aren't sure whether to buy a certain item or wear a particular outfit for a specific event. Basically, it's personal shopping available on your iPhone.

"Users themselves tell us why a certain product isn't working. They're the ones saying, 'Oh it's too revealing for work,'" Matveeva said, arguing that this data — helping retailers identify what is, and what's not, working — is one of the biggest advantages of her business.

Online personal styling service Stich Fix announced in October its intention to enter an Initial Public Offering (IPO). The company believes that consumers will be too busy to do any shopping, and that its service can gain ground by finding and then delivering the items each customer wants.

"We've seen startup businesses focused on personal shopping as their business, but also premium brands taking advantage of this service," Michelle Wilson, retail analyst at Berenberg, told CNBC over the phone.

"Personal shopping helps retailers to better understand their customers. While many retailers can gain an understanding of customer needs through data analysis, forming a direct relationship with the customer gives the retailer access to incremental information about the customer, enabling a truly personalized experience," Wilson said.

This researcher notes changes in European shopping habits
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This researcher notes changes in European shopping habits

However, providing personal shopping advice is still mostly seen as a high-end service that is not associated with traditional high street brands.

"Traditional retailers who have already saturated their market share opportunity through their stores, now must operate across two different channels and it is therefore hard for them to invest into personal shopping," Wilson said.

"Online and new retailers, with customers of a higher income, tend to use and benefit from personal shopping the most," she added.