With digitization, the popularity of offline boutiques has faded away. Most entrepreneurs prefer opening online boutiques to reach a broader market and reduce operational costs. Today, if you do a quick Google search of online boutiques, you’ll be awed by the thousands of results you get, but does this mean there’s an oversaturation of online boutiques?
Online boutiques are oversaturated. As a result, there is stiff competition in the market, and most upcoming boutiques are losing the game to established fashion icons. However, if you have clearly determined your niche and marketing strategy, your online boutique can still succeed.
This article covers 10 questions you should answer in order to gain a competitive edge in the online boutique industry. Therefore, if you’re thinking about entering such an oversaturated space, make sure to keep reading until the end.
What Is the Current State of Online Boutiques?
It’s undeniable that the outbreak of coronavirus in 2020 brought a boost to e-commerce. During the lockdown, you could only add to your closet by scrolling online, placing an order, and having it delivered to your door.
To continue making sales and remain competitive, most offline stores had to create an online presence to reach their audience. This trend has crossed over to the post-coronavirus era because of the flexibility of an online business and the ability to get a sizable market globally.
Last year, 2021, the fashion e-commerce market was worth $700 billion, and the value is expected to increase by the end of 2022. Despite the promising growth, the market has become saturated, and most stores are now closing down due to stiff competition.
Though a competitive market may sometimes be unhealthy for a business, it shows plenty of demand for your product. It also forces you not to be complacent, keeping you innovative and at the top of the game.
If you’re planning to start an online boutique, do not despair because there is a market oversaturation. There’s plenty of room for growth, but you should know the following to cut through the market noise and stay competitive:
Who Is Your Target Market?
When you’re starting an online boutique, it’s essential to know who your target market is. If you’re targeting everyone, you’ll end up appealing to no one.
So who is your target market? Men aged 18-35 who are interested in fashion and trendy items? Women, who are career-oriented and want versatile pieces to wear to work and then out on the town?
Defining your target market helps you streamline your brand, enabling you to give your customers the best experience.
When you identify your target market, you can start crafting a message that will resonate with them. You’ll also be able to understand better what kinds of items they’re likely interested in.
How To Define Your Target Market
- Do market research to identify an underserved niche: Conducting market research helps you know niches and sub-niches with gaps. It also gives your brand a purpose or mission by stating which problem you’ll solve.
- Develop a customer profile: After identifying your niche, the next thing should be segmenting the market based on demographics and psychographics. Demographics describe characteristics such as age and gender, while psychographics look into behaviors, personality, and lifestyle.
What Makes You Unique?
To succeed in a competitive market, you must find something that distinguishes your business from others. Your unique selling point or product differentiation communicates your relationship with your customers, which is why they’ll want to flock to your online selling space.
Maybe it’s your unique selection of products, or maybe you focus on eco-friendly fashion. Whatever it is, make sure your customers know about it by delivering it better than anyone else.
And don’t be afraid to be quirky and different. Your differentiator should not be complex or intricate. In fact, it can be extremely simple so long as customers find it satisfactory enough to meet their needs. So be free to show your personality in everything you do, from branding to customer service.
What Is Your Pricing Strategy?
Price is the number one factor most buyers check when buying a product online. Sadly, most new boutiques set low prices to attract customers without having a pricing strategy in place. This positions them poorly in the market by making their offerings appear uncompetitive.
A pricing strategy solidifies your market position by helping you build customer trust and meet your business objectives. It should also give you the flexibility to adapt to your business growth. Below are some pricing strategies you should consider:
- Cost-plus strategy: This is the best pricing method for a new online boutique because it ensures you make a profit on each sale. It involves adding a markup or a percentage profit on the cost of an item.
- Competition-based pricing: When your business gains a firm footing in the market, you can shift to this method to attract more customers. It requires you to compare your competitor’s price and set the fairest price while maintaining a profitability hedge.
- Value-based pricing: This method focuses on the quality you’re offering customers. In most cases, customers who look for value would be willing to pay any amount as long as the product is of the best quality.
Are You Prepared To Scale?
Scaling does not only mean growing our business. It means handling an increase in output and sales cost-effectively and responsibly. When opening a boutique, you should consider how you’ll deal with growth without neglecting some areas.
To avoid premature scaling that could financially hurt your business, you should set growth phases as a roadmap. Once you achieve one milestone, you can proceed to the other without leaving loopholes. Maintaining performance metrics could be helpful in this area.
Another element you should consider is the availability of funding. Will you plow back profit, or will you borrow from investors? Your motivation shouldn’t always revolve around scaling but also around preparing in advance to keep your business operational.
What’s Your Risk Tolerance?
All online businesses face some level of risk, such as a cyberattack. Unfortunately, most are unaware of the risks they bear, making it impossible to bounce back when an anticipated event occurs. So when running your online boutique, it’s crucial to evaluate the threats you’re exposed to.
When establishing your risk tolerance, you should list all the possible threats and their impact on the business if they materialize. Then rank each in a category such as low, medium, high, or catastrophic.
This knowledge helps you align efforts to business needs and appropriately allocate resources. While setting your risk tolerance, you should emphasize these two key elements:
- Your goals: Your financial and scaling goals are the primary indicators of your risk appetite–the higher your goals, the higher your risk. But, when starting your boutique from scratch, your risks should be minimal and increase as your business grows.
- Compliance requirements: Each state has its unique laws for regulating businesses. If you have many compliance requirements and access to customers’ personal data, you should look for ways to reduce non-compliance and cybersecurity threats.
What’s Your Marketing Strategy?
Developing a blog and a social media strategy is crucial when starting an online boutique. Why? Because that’s where your customers are going to be hanging out.
Your blog content should offer solutions to your target audience’s problems and, in return, drive more traffic to your store. It should also communicate your brand story and what it stands for to make it more personal for your target audience.
Social media is also perfect for connecting with your customers and creating a community around your brand. You need to be on all the major platforms—Facebook, Twitter, Instagram, Pinterest, and LinkedIn.
However, don’t just blast your customers with sales pitches and product shots. That’s not going to get you very far. Instead, think about ways you can connect with them on a personal level.
Share interesting content, post behind-the-scenes pics, and run contests and giveaways. Customers are more likely to buy from you if you make it possible for them to connect with you.
How Will You Take Good Quality Photos of Your Products?
When running an online boutique, you cannot overlook the importance of quality photos. Buyers who cannot see the actual item need as many details as possible to gather the necessary information. So, if you settle for mere snapshots, the bounce rate on your store may be high and cost you a loss of potential customers.
Quality photos also fit into your marketing mix by:
- Strengthening your SEO efforts: Most shoppers in the apparel and jewelry industry use search engine images to find suitable products. A good photo with an Alt tag and a link to your online store can help you increase conversion.
- Helping your products appear on shopping feeds: Google and other shopping engines have strict rules on what products appear on the shopping feed. Taking quality photos according to the set standards helps your product rank first on searches, increasing traffic to your store.
- Representing your brand: Photos act as brand ambassadors by making your brand more recognizable.
Today, you don’t have to invest in expensive cameras. You can use AI photo generators to make model photos of your products.
The best AI photo generator is ZMO.AI. All you have to do is take an image of your product, and the software will generate unlimited on-model quality images in less than ten minutes. Using it significantly reduces costs, as you don’t have to book models, photographers, and studios.
How Will You Handle Your Customer Care Services?
When running an online boutique, customer care is one of the most important things. After all, your customers can’t touch or feel the products you’re selling, so you must provide excellent customer service to ensure they’re happy with their purchase.
If you cannot offer 24/7 customer support, you might consider a third-party solution like Zendesk or LiveChat. These tools allow your customers to get help whenever they need it, and they also provide transcripts of all conversations, so you can track any issues that might arise.
Here are a few tips for providing excellent customer care:
- Make sure you have a contact number and email address on your website.
- Respond to emails and queries as quickly as possible.
- Be polite and friendly in all your communications.
- Offer refunds or exchanges if the customer isn’t satisfied with their purchase.
- Stay updated with the latest fashion trends and inform your customers about new arrivals and sales.
Moreover, you can ask customers to give genuine feedback on your site to help other prospective buyers know how it is to buy from your store.
How Will You Ensure Fast Delivery or Shipping?
Whether you run a small or a large boutique, the speed you deliver packages greatly influences the customer experience. Today, two-day shipping is the minimum expectation for many shoppers.
To ensure you can meet this expectation, you must partner with a reliable shipping provider. There are several things to remember when choosing a shipping provider, such as prices, shipping times, and delivery options.
Here are a few tips to ensure fast delivery and shipping:
- Use a courier service that offers same-day or next-day delivery.
- Offer free shipping on orders over a certain amount.
- Ship orders from a warehouse near your customers.
- Make sure you have a sound system in place for tracking orders.
- Respond to customer inquiries quickly.
Where Will You Source Your Products?
The supplier you choose significantly influences the success of your online store. A good supplier will ensure you don’t run out of stock, have products on time, and are up-to-date with the recent trends. You should also consider costs, minimum order quantities, production time, shipping, and more.
There are a few ways to find suppliers. You can search online directories, attend trade shows, or contact the manufacturer directly. Once you’ve found a few potential suppliers, you must do your due diligence to ensure they’re reputable in their service delivery and fit for your business.
Although there’s an oversaturation of online boutiques, there’s still room for growth. You can start and grow a successful online store with proper planning and execution. Just be sure to consider some of the essential factors that will affect your business, like the ones discussed above.
- Statista: Global fashion e-commerce market value 2025
- Whola: How to Find a Niche for Your Clothing Store in 5 Steps
- BDC: How to Find Your Unique Selling Proposition (USP)
- CSO: How to Establish Your Business’s Risk Tolerance
- ZMO: On Models Images, Photography For Fashion Brands
- HubSpot: How to Create a Great Social Media Strategy Plan in 2022