Research Korner: E business

RYANAIR CASE STUDY ANALYSIS

1.  Strategy of Ryanair Overview of the Company             Ryanair started in year 1985 with only 57 staff members and with one 15 seater turboprop plane from the south of east of Ireland to London-Gatwick which carried 5000 passengers on one route (Harrison, 2002). In 1986, inspired from the story of David and Goliath the company go after the big guys for a slice of the action and end up smashing the Aer Lingus or British Airways high fare cartel on the Dublin-London route. The staff increased from mere 57 to 120 staff members and the plane carried for about 82,000 passengers on two routes. In 1989, the company employed 350 staff and their average maximum passengers increased to 600,000. In 1990-1991, the company has 700,000 passengers. However, despite of the increase of passengers, the company is not so good in managing cost that the company has lose its money. A new management team is brought in to sort it out and re-launch as a “low fares or no frills” airline, closely modelling the Southwest Airlines model in the U.S. And in 1994, Ryanair bought its first Boeing 737 aircraft which carried over 1.5 million passengers. In 1995, Ryanair is the biggest passenger carrier on Dublin-London route, the largest Irish airline on every route being operate and carried 2.25 million passengers in the year (Harrison, 2002). In 1997, the EU air transport deregulation allowed the airline for the first time to open up new routes to Continental Europe with over 3 million passengers on 18 routes carried. Ryanair launched services to Stockholm, Oslo, Paris and Brussels and took time out to float Ryanair plc on Dublin and NASDAQ Stock exchanges. The company was awarded as Airline of the Year in 1999 by the Irish Air Transport Users Committee. In 2000, they announced the launch of 10 new European routes for the summer 2000 after much deliberation and watching others burning money. The company has also jump onto the internet with the launch of their new online booking site and in just 3 months the site is taking over 50,000 bookings a week. By 2001 there are more than 1500 employees working for Ryanair and more than 10 million passengers are carried to 56 cities in 13 European countries. The company has opened Frankfurt-Hahn in 2002 as their second continental European base and announce a long term partnership with Boeing which will see the company acquiring up to 150 new Boeing 737-800 series aircraft over an eight year period from 2002-2010. The booking in their web accounts have increased to 94% which has probably has something to do with opening another 26 routes. In year 2003, the company is characterised by rapid expansion and the start the year by announcing that the company has ordered an additional 100 new Boeing 737-800 series aircraft to facilitate the rapid European growth plans (Binggeli and Pompeo, 2002). They acquired Buss from KL M in April and re-launched 13 buss routes in May. In February they opened their first base in Italy at Milan-Bergamo and launched their Stockholm Skavsta base in Sweden with six new European routes. In all 60 new routes are added throughout 2003 to bring the company a total of 127 routes. By 2004, the company is named as the most popular airline on the web by Google and they launched their 10th and 11th bases in Rome Ciampino and Barcelona Girona and continue to add more routes to their already extensive network. The company has also passed out British Airways to become the UK’s favourite airline in United Kingdom and throughout Europe (Binggeli and Pompeo, 2002). Critical Success Factors             Although the company had encountered different problems, specifically in line with its cost structures, the company had been able to survive and grow in the marketplace.  Ryanair implement different marketing strategy to make the company survive in the competition and to be able to gain competitive position in the airline market.  It is said that the company was regarded recently as the most punctual airline between Dublin and London. And because of the strategy of the industry, Ryanair is now recognised as the second largest airline in United Kingdom and Europe’s largest low-fares airline having a network of over 57 routes in 11 countries and served by a fleet of 31 Boeing 737-200 and -800 aircraft with over 1,400 staffs and personnel. In order to position itself in the marketplace the company continuously concentrates on driving own its costs to offer the lowest fares possible and remain profitable.  In addition, Ryanair offer minimum standards of service and very low prices for point-to-point, short haul flights.  The goal of Ryanair is to meet the needs of travelling at the lowest price.  The Critical Success Factors (CSFs) are as follows in airline industry: the strategic focus of having the lowest prices, being reliable within the marketplace, comfort and service and frequency.  It is noted that low-cost companies concentrate on this first critical success factor by trying to offer the lowest prices.  Although Ryanair has eliminated extras such as in-flight meals, advanced seat assignment, free drinks and other services, it still prioritises features which remain important to its target market. Such features include frequent departures, advance reservations, baggage handling and consistent on-time services. Cost Reduction Strategy To achieve its goal of having a competitive position in the airline market, Ryanair uses a cost reduction strategy. Such cost reduction strategy relies on five main aspects like fleet commonality, contracting out services, airport charges and route policies, managed staff costs and productivity and managed marketing costs. In terms of fleet commonality, the company used only one kind of plane which limits the cost for staff training, maintenance services and facility of obtaining spares, facility in scheduling aircraft and crew assignment.  With their purchase of aircraft Boeing 737, Ryanair has been able to gain capacity and reduces the average age of fleet which means savings on maintenance costs and avoiding the fit of European Union-conform equipment on old feet. The next factor under the cost reduction strategy of Ryanair is contracting out services.  In this manner, aircraft handling, ticketing, handling and other functions are contracted out by Ryanair to third parties. In addition, in order to limit their expenses engine and heavy maintenance are also contracted out whereas the staff of Ryanair carries out routine maintenance.  Another factor for the cost reduction strategy of the company is in terms of airport charges and route policies. Herein, Ryanair has made judicious choice of dealing with secondary and regional airports, where the traffic is not jammed and fees incomparably lower. Since Ryanair, is a true windfall for such airports, the airline company has a bargaining power which enables it getting favourable access fees. In addition, Ryanair provides only a point-to-point service, thus, it has no cost concerning connecting passengers.  Moreover, the company pays special focus to on-time departures because it means maximising aircraft utilisation. Managing staff costs and productivity is another factor used for reducing the cost for Ryanair. In this manner, the company pays its staff on modest salary but has set up a performance related pay structure which urges employees to maximise the number of sectors flown daily. This way, Ryanair both controls productivity and keeps staff costs down.  Lastly, managing marketing costs is another factor that makes the company reduces it costs. Ryanair advertises mainly on it website with its logo “Ryanair.com, the Low-Fare Airline”. In addition, it is also advertised in national and regional Irish and UK newspaper, on radio and on television. Porter’s Generic Strategy Aside from it cost-reduction strategy, Ryan has also been able to use Porter’s generic strategies to position itself in the marketplace.  Accordingly, a company positions itself by leveraging its strengths. Today, more and more people and organization are striving to be recognized in the business arena.  With this objective, these organizations had been able to competently and effectively adapt to the situation in the market place by using generic strategies that enhanced their competitiveness.  There are five different generic strategies that a business can choose.  These include cost leadership, differentiation, focused cost leadership and integrated cost leadership/differentiation.  Each generic strategy helps the company to establish and exploit a competitive advantage within a particular competitive scope (Hitt, Ireland & Hoskisson 2003). By applying these strengths, three generic strategies are resulted: cost leadership, differentiation and focus (Johnson & Scholes 1997).  The strategies used by the company include cost leadership, differentiation strategy and focused differentiation. Cost leadership strategy is based upon a business organising and managing its value-adding activities so as to be the lowest cost producer of a product within an industry (Campbell, 2002). Cost advantage may achieve in terms of how product or services is designed or in terms of its quality. Differentiation strategy is based upon persuading customers that a product is superior to that offered by competitors (Campbell, 2002). The value added by the uniqueness of the product or services may allow the company to charge a premium price for it. However, the danger associated with differentiation may include imitation by competitors and changes in customer tastes. Focus-differentiation strategy is aimed at a segment of the market fro a product rather than at the whole market or many markets (Campbell, 2002). The successful way using focus strategy is to tailor a broad of product or service development strengths to a relatively narrow market segment that they know very well. The risk may include imitation and changes in the target segments. In the case of Ryanair, these three generic strategies had been utilised. First, the company offers the lowest cost of fare than its competitors in the airline. On the other hand, Ryanair has also become a focuser because it concentrated on a narrow customer segment which include Irish and UK business people or travellers who could not afro to fly major airlines. The main goal of the company is to provide a no frills service with low fares designed to stimulate demand. At the time, it did not aim to offer the lowest fare on the market.  However, the company expanded to continental Europe and had to focus on critical success factors to survive. Nowadays, it can be said that Ryanair has shifted generic strategies to become more of a cost-leader not only in terms of passenger volumes but being the lowest cost operator in the airline industry.             Ryanair has restyled itself and shifted from a full service conventional airline to the first European low fares, no frills carrier. In 1985, it provided scheduled passenger airline services between Ireland and the UK. By the end of 1990 and despite a growth in passenger volume, the company had experienced some trouble and had to dispose of five chief executives, recording losses of IR£20 million. Ryanair had to fight to survive and the new management team, headed by Michael O’Leary, decides to restyle the company on the model of successful American Southwest Airlines. Indeed, when one considers Porter's original framework, Ryanair's generic strategy used to be unclear: it situated itself somewhere between a cost leader and a focuser, although we can consider it was closer to a focuser. The problem with such niche strategies is that they involve a number of risks, the most obvious being that the niche can get saturated and competitors invade the segment. As long as Ryanair was the only European no frills airline, it did not have to distinctly define its strategic position. It used to try and mix focus and cost leadership and was muzzy about which one it wanted. But as soon as competitors started blooming, it had to decide which strategy it would stick to. This was the very strategy of Michael O'Leary: he decided to ruthlessly pursue cost leadership. This strategy was a success and by 1997, Ryanair was floated on the Dublin Stock Exchange and on NASDAQ. Expansion strategy is another factor that enables Ryanair to position itself in the marketplace. The company has been known to be an airline which launches new routes since its operation begins. In addition, under the expansion strategy, company acquires Buzz in February 26, 2003. Such acquisition enables Ryanair to gain immediate access to11 new French regional airports and makes the company the largest airline operating at London Stansted Airport.  In addition, the company continues to expand by opening two new Continental European bases with low-fare flights from Milan Bergamo and Stockholm. In the year, 2003, the company has been able to launch 73 new routes and carry over 2 million passengers in one month (July). In addition, the company website has been able to make the company position itself in the global market. 2.                  Strategic Options The case study has provided the problems and issues encountered by the Ryanair, in spite of its strategies.  One of the problems is in terms of handling customers or target market. In addition, another problem is assuring quality service. In this manner, the strategic option that can be used by the company for satisfying both internal and external customers and marketing environment is the use of total quality management. The industrial competitions in airline industry worldwide are at brisk, making companies in this field across the globe search for extensive strategic management procedures that would keep them in on the business world.  The tasks of crafting, implementing, and executing company strategies are the heart and soul of managing business enterprise.  A company’s strategy serves as the game plan management and is use to stake out a market position, conduct its operations, attract and please customers, compete successfully, and achieve organizational objectives.  Thus, TQM as a strategy is certainly appropriate for such situation.              Total Quality Management is a philosophy of management that is driven by the constant attainment of customer satisfaction though the continuous improvement of all organizational processes (Robbins, 1998).  It is a management philosophy that seeks to integrate all organizational functions such as marketing, finance, design, engineering, production, customer service, and others to focus on meeting customer needs and organizational objectives (Hashmi, 2000). It is known that every organization’s primary purpose is to stay in business, so that it can promote the stability of the community, generate products and services that are useful to customers, and provide setting for the satisfaction and growth of organization members.  From this perspective, it can be said that TQM strategy for achieving its normative outcomes is rooted in four interlocked assumptions: quality, people, organizations, and the role of the senior management (Wageman, 1995).    Total Quality Management is a planned procedure for satisfying internal and external customers and suppliers by integrating the business environment, continuous improvement, and come through with advancement, growth, and safeguarding the cycles while changing organisational culture. Furthermore, TQM is an array of management system throughout the organisation, geared to ensure that the organisation to continuously attain or surpass customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement (McNamara, 1999). Moreover, Total Quality Management is infinitely variable and adaptable. Although originally applied to manufacturing operations, and over the years only used in that area, TQM is now being recognised as a standard management instrument, just as applicable in service and public sector organisations like the airlines industries (Hashmi, 2004). The Total Quality Management (TQM) philosophy of management is customer-oriented. Hence, the airline operations must be developed in order to steadily deal with the improvement of their operation through the ongoing participation of all employees in problem solving efforts across functional and hierarchical boundaries. TQM incorporates the concepts of service quality, process management, quality assertion, and quality perfection. Consequently, the airline company must be able to control all transformation processes with regards to their operations and services to better satisfy customer needs in the most economical way. In order to apply the TQM to Ryanair especially to be used in its airline operations and services, the management of the airline company must be able to accept the whole concept of the improvement, which means that all the people of the airline company must agree that there is a need for a total transformation especially for the quality of operations and services that the industry will be offered.  Furthermore, the management should be willing to participate to all the improvement, value each and every ones opinion in order to achieve total quality management and provide a total quality operations and services to satisfy their customers. Managers and experts disagree about how to effectively implement Total Quality Management to their organisations.    Eventually, customer satisfaction has always been regarded as the driving force behind quality improvement; others suggest quality management is achieved by internal productivity or cost improvement programs. In other applications, Total Quality Management is regarded as a technique to introduce the context of participative type of management (Schlenker, 1998).  Thus, the management should be more straightforward to provide the potential role of applying the Total Quality Management to their operations and services. In addition, since Total quality management is based on internal or self-control, which is embedded in every element of the work system (technology and people), the employees or the people behind the operation and services being offered to the passengers and customers of the airline must be able to determine the problems beforehand, to anticipate its occurrences. Pushing problem solving and decision-making down in the Ryanair especially to their operations and services may allow people who do the work to both assess and take remedial action in order to deliver an operation or service that meets the needs of their customer.   In applying total quality management to airline operations, they must be able to combine it with the core strategy of the industries; this does not mean that such airline companies must have total changes. It is important that in application of the Total Quality Management to the Ryanair operations and services they must also consider that an appropriate strategy should be used in order to employ a total quality operations and services that would satisfy all clients and customers.

RYANAIR CASE STUDY ANALYSIS

1. Strategy of Ryanair Overview of the Company Ryanair started in year 1985 with only 57 staff members a...

Synopsis: Impact of the Internet retailing

Synopsis: Impact of the Internet retailing     Accordingly, the advent of the internet has been able to revolutionize the business environment. The use of the internet as part of business marketing and retailing is changing rapidly. It is said that the internet provides the retail market a new market model which cater not just for cloths, books and music but almost every products or service buyable and sellable. Among the most recognized brands and products sold in the internet retail are books, drugs, apparel, and electronic and technological gadgets.  Accordingly, the use of internet retailing has been able to create virtual communities which assure better communication and larger profits for the company. The latest techniques associated with internet retailing enables the company to gain competitive advantage as internet served as a platform for advanced technology and applications which allows the retailers by having better recognition both in the national and international level. In addition, internet retailing marketing techniques also has the ability to gain competitive advantage because of its availability in the internet market 24/7 with fewer or most of the time unlimited geographic boundaries. The internet approach also has interactive two-way communication, automation, personalization or customization, search facilitation and most of all knowledge or information sharing. Such abilities are known to create advantage, attract, and satisfy consumers from any walks of life globally as well as increase profits.  As customers’ convenience is indulged by a wealth of personalized information services and availability, they can enjoy shopping (Mandel & Hof, 2001). The Internet also brings an easier integration of past business models and functions such as data collection and sharing.  Wang and his colleagues put the idea simply that the Internet is combined communication medium and distribution/transaction channel, which is quite different from traditional marketplaces allowing simple to multiple tasks to be performed at the same time and at the same environment. In addition, the internet retailing also allows the company to gain good customer relationship easily because of their ability to create customer participation and customization among other wide-ranged access to services.  Consumers are granted powers that traditional markets limit (primarily due to the presence of intermediaries, the lack of speedy processes, cost-effectiveness, integration, and combination the Internet medium can provide).  With capabilities such as this, it is inevitable for retail markets adapt to the Internet set-up, as a new marketplace and a new marketing tool, quickly.  Customer value has become the centre of all business models online.  Wang et al recognize however that not all e-businesses survive due to the turbulent and competitive nature of the Internet and the fact that studies regarding consumer behaviour must continue to be conducted. In such a turbulent and competitive arena, it has been a common goal for all firms and organizations into internet retailing for this matter to create and above all, maintain value for its customers, suppliers, and manufacturers.  The assurance of returning customers is what keeps internet retaining sites alive.  This is performed through shopping deals created through customer loyalty. The key for internet retailing to sustain itself in the market is to be convenient in the best of its ability and this will be performed once a firm is able to adapt to the customer’s many selective tastes best.  Not only will this allow them keep a competitive edge, this will allow its brand to emerge as a dominant web presence.  What’s unique with Internet retailing is how it does not limit itself to a certain industry.  Traditional retail stores, or the so-called brick and mortar type stores, are greatly limited by shelf spaces and cannot thus; attempt to cross sell newly released or related products (that would win consumers). Brick-and-mortar stores put the baby products in one place, health care in another, and vitamins for pregnancy in another area.  Therefore, everything is split up in the brick-and-mortar store, whereas with online solution retailing, all these items can be bundled together as a ‘new mother’ shelf (Harrington & Reed, 1996). The web’s flexibility allows it to cater to various other opportunities that will truly boost sales, serve to the customer’s further appeal, value and not to mention, loyalty, by giving them a wide variety of products to choose from in a one-stop shopping manner.  The customer’s preferences are thus even more customized to his/her personal liking.  Internet retailing brings cross-category selling opportunities, not just in grocery, but in sporting goods and everything else. In this regard, internet retailing can really be considered as one of the most powerful business approach to be considered if the company would want to be known in the global market.   Reference Harrington, L. & Reed, G. (1996). “Electronic Commerce (Finally) Comes of Age.” The McKinsey Quarterly, 2, 68 . Mandel, M., & Hof, R. (2001, March 26). Rethinking the Internet. Business Week, 116–141.

Synopsis: Impact of the Internet retailing

Synopsis: Impact of the Internet retailing Accordingly, the advent of the internet has been able to revolutionize the bus...

Speech Writing Essay on Electronic Shopping in the World

Electronic Shopping in the World             As of now, the world is facing different big changes, primarily in different process that involves marketing and business transactions. Because of the advent of the Internet and bandwagon of globalization, electronic shopping was born and it is considered as one of the most popular way of purchasing wide varieties of products for the consumers, at the same time, one of the most effective way of communicating, selling and offering products and services for different individuals and groups that are involved in business.             According to Nielsen Company, in 2008, over 85% of the entire population of online users in the world is using the Internet to make purchase, and 50% of the said population has already purchase more than once. Nielsen Company also listed the top 5 countries in electronic shopping which are: South Korea, United Kingdom, Germany and Japan. It can be observed that all of the countries came from Europe, which is considered as a developed region, and Asia, which is considered as a promising region.             It is important to take note that each country has their own way of accepting the electronic shopping, and it will be based primarily on the different political and economic status or condition, that primarily depend on the effort of the national government regarding the telecommunications infrastructure of national broadband networks. It can be observed that those developed nations that have already invested in the telecommunication infrastructures have helped to make the Internet services widely available to the entire population. As a result, more people will be aware of the advantages of electronic shopping.  Aside from that, developed nations are more dependent on services that involved larger discretionary income as a result of higher per capita income.             In the end, it can be observed that the status of electronic shopping in a given nation can be describe or analyze by looking at the current economic status or knowing whether a country is a develop or developing country. Product and Services to be Sold on the Internet             The Internet had become the primary weapon of different individual and organizations that are into business in terms of connecting or communicating with their target customers, from different part of the globe. As of now, more and more businesses that are jumping in the bandwagon of online selling in order cater to infinite number of possible customers.             However, it is important to consider that although there are some products that are suitable to be sold online, there are some that remains to be more saleable and suitable in traditional trading like those products that have low value-to-weight ratio and those that require the sense of smell, taste and touch in order to ensure good quality.             Currently, the most famous products being sold in the Internet are: books, digital products, computer hardware and software, autos and parts, apparel, accessories and footwear, cosmetics and fragrances, pet supplies and clothing. On the other hand, financial transactions, travel services and subscriptions are the most popular services that are being offering in the Internet.             So what are the reasons why all of the said products are more likely to be sold in the Internet? First is that the said products are homogenous, thus they can be compared in terms of price in different providers, and not highly tailored to individual need. However, it is important for the consumer to first understand the different features and expectations towards the products and service before the purchase. In addition, these products are subject to price elasticity in terms of purchasing decisions, that’s why consumers are expected to purchase the products due to cost advantages. Above all, consumers can review or even experience the products in retail stores, before they can purchase them, more cheaply by electronic means.             In the end, the cost is considered as the primary reasons why these products are more effective to be sold in the Internet.

Speech Writing Essay on Electronic Shopping in the World

Electronic Shopping in the World As of now, the world is facing different big changes, primarily in different process that i...

Development of Online Fashion Stores in Hong Kong Case Study of CCT Fashion

Development of 		Online Fashion Stores in Hong Kong 	 	 		 		 		Case Study of CCT 		Fashion 	       	 		 		  		 		  		 		  	   Abstract   Online fashion shopping is now a living phenomenon, and the growth of such is fueled by satisfying the ever-changing demands of the consumers. Online fashion retailing, however, has special requirements compared to other online retailing sectors. In Hong Kong, online fashion shopping was developed following the lead of Western countries including its British lineage. However, before it became a booming industry in Hong Kong, traditional retailers are disinclined to consider the Internet as a new and viable retail channel. One of the reasons for this is that there are many reasons as to why local consumers will not buy items online including complicating ordering procedures, bad quality as seen on pictures, fallacious promises and issues on security.   Come CCT Fashion which operates to respond to these reasons by offering long-life fashionable clothing. CCT Fashion constantly innovates its product offerings by widening the product categories and by having own photo taking team and models. Limitations of the online fashion store, however, are having no online chat support, lacking in price range search, purchase guidelines and discounts and rewards pages and low levels of interactivity, all of which are requirements of modern online fashion shopping.   Recommendations include offering options to use other payment systems, precise size information, color information and fabric details, how to take care of the clothes page and accurate delivery procedure and easy returns policy.      Table of Contents    TOC \o "1-3" \h \z \u Abstract PAGEREF _Toc239668905 \h 2 Acknowledgements. PAGEREF _Toc239668906 \h 3 Table of Contents. PAGEREF _Toc239668907 \h 4 Introduction. PAGEREF _Toc239668908 \h 5 Brief review of literature. PAGEREF _Toc239668909 \h 7 Global fashion industry. PAGEREF _Toc239668910 \h 7 Fashion retailing. PAGEREF _Toc239668911 \h 8 Online fashion retailing. PAGEREF _Toc239668912 \h 9 Online fashion retailing in Hong Kong. PAGEREF _Toc239668913 \h 11 Main findings. PAGEREF _Toc239668914 \h 12 Discussions. PAGEREF _Toc239668915 \h 16 Conclusions and recommendations. PAGEREF _Toc239668916 \h 20 Table 1 Distribution of Buyers of Fashion Items According to Gender (2001) PAGEREF _Toc239668917 \h 26 Table 2 Distribution of Buyers of Fashion Items According to Age Bracket (2001) PAGEREF _Toc239668918 \h 26 Table 3 Reasons for not Buying in the Internet (2001) PAGEREF _Toc239668919 \h 27       Development of Online Fashion Stores in Hong Kong: Case Study of CCT Fashion   Introduction   Online fashion shopping is now a living phenomenon, and the growth of such is fueled by satisfying the ever-changing demands of the consumers. Thereby, the fashion industry must find resources and avenues to continuously do so. A new industry had emerged, one which basically draws from the opportunities technology is providing. As such, the Internet is gaining more and more importance especially that most of the product categories today like garments/clothings can be traded today online. The fashion industry is attempting to change the landscape of marketing and selling its produce through making good use of the Internet, giving birth to online fashion shopping.   Although the development of online shopping industry in Hong Kong is not yet even explored, the New York Times (2008) already remarked that online fashion shopping industry is in its maturity. One proof of this is that fashion is now second only to books when it comes to shopping online, as according to the latest Nielsen Global Online Survey. About 36% of Internet users said they had brought clothing, accessories or shoes online in the three months before the survey. Geographically, further, South Korea had the highest percentage where 99% of Internet users say they have shopped online.   Online fashion retailing, however, has special requirements compared to other online retailing sectors. What is good about online shopping is that it provides the shopper the freedom, flexibility and convenience. For one, it is not restricted on geographical boundaries and access is relatively easy. With the Internet, options are limited as well, enabling shoppers to compare products, prices and even stores. In this way, shoppers are acquiring the best value for their money. Online shopping sites do not only provide shoppers with information about the items but also include hottest trends, garment care and fashion horoscope.   Nevertheless, although it provides shoppers all of these benefits, online shopping stores have special requirements. Display quality is the most fundamental feature of an online shop, and it needs to be realized at a high level in order to achieve broad customer acceptance. It was also said that online shoppers are keen on how online retailers align online activities with the in-store experience.   In Hong Kong, the traditional brick and mortar clothing retailers are evidently reluctant to embrace Internet technologies. There are at least 7 legitimate online fashion stores, and CCT Fashion is one of them. These online fashion stores had helped to stimulate an awareness of the Internet’s potential for selling clothing in an online environment. Various reasons are pointed as motivations to start an online shopping store including apparent competition in Hong Kong local markets from lower end to medium-sized fashion-led and entrants of international label brands that are performing well in competition, jeopardizing the value of Hong Kong and other Asian fashion products.    An avenue to keep pace with the changing competitive landscape in Hong Kong fashion industry is represented by the Internet. This was perceived to be significant in a multi-channel strategy to achieve sustainable competitive advantage. CCT Fashion understands that in an era wherein people are giving much importance to Internet and convenience, having a web presence is an imperative. It is a gamble though because, as a pioneering company, the value of fashion retail trading over the Internet is not known whether it is going pay off or not. CCT Fashion sticks to the philosophy that the Internet is global hence retail operations are able to penetrate a wider marketplace.   In brief, CCT Fashion was established in 2002 and mainly focuses on selling Japanese and Korean ladies fashion. It is the goal of the company to provide a wide range of trendy products and one-stop service to worldwide wholesale companies and retail shops.  CCT Fashion has its own professional photo-taking team and models and which ensure that customers are able to see the products more clearly before purchased and the products to be exactly the same as in the photos when received. CCT Fashion claims to be an experienced and leading fashion wholesale company. The reason behind this is that the company always insists to render trustful and high quality services to their customers.   Like other international online fashion retailers, CCT Fashion is also motivated to provide a convenient online shopping experience. CCT Fashion provides 24-hour service so that a customer can place orders whenever they feel like it. The company is also well-aware of the value of time saving. Customers of CCT Fashion choose when they want to shop and how long they want to spend doing such. In this way, customers can buy quickly online to save time for special shopping in the stores. CCT Fashion also provides customers the choice, a comprehensive selection that is one can see almost instantly online. Finally, CCT Fashion offers a value for money through its wholesale strategy. Prices are matched with the quality of the goods.   It is the aim of this study to outline the development of online fashion retailing in Hong Kong considering the case of CCT Fashion. The project specifically attempts to explore the motivations of establishing online stores and how these online stores could achieve and sustain their competitive advantage. The requirements of establishing such and what should be done to maintain a customer-friendly online store will be also explored. If time will allow, the study will also dig deeper into customers’ requirements and expectations of an online store leading to satisfaction.   Such aims and objectives will be carried out by means of conducting primary and secondary research. Key informant will be contacted wherein representative(s) from CCT Fashion will be interviewed. An open-ended interview schedule will be designed for this study. In case that interview will not be consented, I will contact the company through their online chat support. Findings will represent the primary data of the research which will be analysed qualitatively. Further, the literature review will serve as the secondary data of this descriptive research.   Through CCT Fashion, the history of establishing the online store, the reasons and requirements, how an online store should be maintained to draw customer attention, what should be done to make the online fashion store successful is explored in this project. Likewise, information on competitiveness of CCT Fashion is discussed. This is important to decide whether there will be a niche market for online shopping in Hong Kong in the future or whether online shopping stores already represent a niche industry today.     Brief review of literature   At this stage, a literature review will be conducted pertaining to the development of online retailing and in particular in Hong Kong. There are three main subtopics that this review will focus on: fashion retailing, online fashion retailing and online fashion retailing in Hong Kong. Fashion retailing is increasingly becoming a complex business with competition between retailers due to intense rivalry in capturing market share. Nevertheless, the Internet, as a new avenue for trading fashion finds, gave birth to online fashion retailing. Online fashion retailing is also now becoming popular in Hong Kong although there is no single study that traces the development of online fashion stores in the region.    Global fashion industry Azuma and Fernie (2003) claim that fashion is perceived to be one of the most essential parts of civilization as it reflects the great culture of the past. Likewise, fashion exemplifies the changes within a given society over time. The authors also maintained that the materialization of global fashion transformed the way fashion was perceived in the modern world, changing the focus on standardization and low-cost advantage. Through fashion globalization also, the migration of fashion production offshore as well as the resultant dependence on non-traditional ethos of fashion designing imposed threat to domestic small fashion players. While also, the condition impedes them from ‘creating intrinsic fashion on a small but sustainable scale. As said by Yarwood (1992), fashion is a more accurate barometer because of its inherent universality attribute whereby fashion affects everyone. Fashion too characterizes the personal expressionism of life at a given time and place.     For the purpose of satisfying the ever-changing demands of the consumer, the global fashion industry must find resources and avenues to continuously do such. Fiore, Lee and Kunz (2004) affirm that a new industry must emerge, one which basically draws from the opportunities technologies could provide. Online fashion retailing, as Tseng and Piller (2003) figured, possesses special requirements compared to that of other online retailing sectors. Fashion visualization necessitates the existence of virtual catwalk, user interface and client/server architecture (p. 482). In order to respond to the dilemmas on online fashion retailing such as the lack of customer consulting and the accuracy of high three-dimensional display quality, online retailing for fashion products need to realized at a high level so as to achieve broad customer acceptance (p. 477).    Fashion retailing According to Yarwood (1992), fashion is claimed to be a more accurate barometer because of its inherent universality attribute; fashion affects everybody. Fashion, as well, represents a personal expression of life at a given time and place. Today, the world of fashion has witness a dramatic shift since it is now considered more of a retail material rather than a medium of artistic expression of ideas. Even so, the decline of the fashion sales over the years necessitates the fashion industry to resort to new possibilities to satisfy the demands of the customer, making way for the emergence of a new industry – online fashion retailing.    Lewis and Hawksley (1990) assert that competitive advantage in fashion retailing industry is achieved by targeting not limited to demographics but also in terms of lifestyle and attitude to fashion. The authors also relate that creating a store image congruent that of the target market could be another key in gaining the competitive edge. To wit, quality is one of the most important, if not the most important, attribute in fashion retailing while others are price, selection and staff. Achieving competitive advantage then in fashion retailing requires that firms shall analyse customer decision-making. According to Birtwistle et al (1998), consumers choose where they will purchase fashion finds based on their perceptions and trade off of the four attributes. However, decision making also depends on store image and market positioning.   Marketing capabilities is one of the functions very critical in fashion retailing. Image differentiation, promotions, external market knowledge and customer service and how they impact the performance of the firm are all measures of the relative success in this industry.  Moore and Fairhurst (2003) mention that intense competition and short product life cycles in fashion retailing are just some of the challenges when it comes to effective marketing. Surviving in this industry therefore means to develop and leverage core marketing capabilities particularly image differentiation and promotional capability. Positioning strategies, specifically, is imperative for fashion retailers. This is because it implicates patronage especially when stores could mirror well-established associations between clothing choice, personality, self-concept and personal values (Thompson and Chen, 1998).   For Bridson and Evans (2004), a conceptualisation and operationalisation of brand orientation within the context of fashion retailing is critical. The four elements of brand orientation that fashion retailers should consider are distinctiveness, functionality, value adding and symbolic. The idea is simple: the more brand oriented the fashion retailer, the greater its retail offer advantage over competitors. Thompson and Chen (1998), moreover, assert that retail store image has been shown to play an important role in store patronage, and it is widely accepted that psychological factors have a significant role in store image formation. Hedonic values of “enjoyment and happiness” and “quality of life” were found to be the terminal values most sought by consumers in association with store image. Such values were also linked through the consequence “nice feeling” to the tangible attributes of “price”, “quality” and “reputation”.   Moore (1997) also noted that what has been dominant in the fashion retailing scheme is its internationalisation. Such internationalisation is evident in the way fashion retailers’ motivation to penetrate wider markets as well as their methods of entry in retail fashion sector. Fashion retailers intend to take a more proactive approach to cross-border expansion while also emphasizing the importance of wholesaling and master-franchising to fashion retailer market entry. Moore et al (2004) identified the problems that may arise from fashion retailers international relationships. It was discovered that these relationships face significant tensions that are apparent in strategy non-compliance, perceptual disagreements and demarcation in decision-making responsibility.   Online fashion retailing Goldsmith and Goldsmith (2002) investigated online and offline buying behaviour and found out that there is generally no difference between the two. This is because buyers are both motivated by how cheap the buying process will be as compared to the overall enjoyment of the shopping experience. Demographic variables of sex, age and race were, nevertheless, unrelated to online apparel buying. Goldsmith and Flynn (2005) also found that consumer who shopped more and spent more for clothing is very particular with all three shopping modes of brick and mortar, online and through catalogs. Online shopping was more highly related to buying by catalog that it was to buying in stores. As such, the most successful retail companies are those who are able to add and build Web sites.   Profiling the Internet fashion shoppers means to determine their classification by fashion lifestyles. Sung and Jeon (2009) distinguish such as economical shopper, recreational shopper, fashion/brand shopper, fashion follower and individualistic shopper. Fashion/brand shoppers are the most frequent purchasers while the fashion followers are the less frequent buyers. Goldsmith and Flynn (2005) also noted that online fashion shoppers are heavy buyers of clothing, were more involved with fashion and more fashion innovative. Search for product information via online store was the strongest predictor of consumers’ purchase intention (Kim and Park, 2005).   Phau and Lo (2004) defined fashion innovators as the he chief buyers of fashion at the introductory stage but having significant influence on the product at the later stages. The authors investigated if fashion innovators will purchase impulsively online from Internet stores. Fashion innovators have a unique self-image as they are more excitable, indulgent, contemporary, liberal and colourful. Fashion innovators generally exhibit impulsive behaviour. They might be able to expand their scope of fashion knowledge through the Internet, not just merely through fashion magazines. However, there is no difference between fashion innovators and non-innovators in Internet purchase. Despite this, the Internet can still be used as an advertising tool to appeal to the innovators.   Spijkerman (2008) provided an overview about fashion retailers’ use of Internet sites and appreciation of apparel e-tailing. It appeared that fashion retailers complement their retailer internet developments with brick-and-mortar shop retail channel strategy. Age and gender effects are not critical in online fashion retailing but the inhibiting factors must be acknowledged by the fashion retailers. These inhibiting factors include security worries about payment, privacy and delivery. On the other hand, customers shop online because of expected reasons as fun and product information while fit, feel and look were considered less important. While online fashion retailing is a significant distribution channel, there are specific issues that adversely impact the level of patronage like the Web page design, for instance. Siddiqui et al (2003) contend that retailers and consumers differ in perception of fashion Web sites wherein retailers are satisfied with their offers online but generally lacks in an understanding of consumer needs. For consumers, on the other hand, areas of concern include overall Web page design, level of interactivity, absence of information about fashion trends and inconsistencies across Web sites.   Branding is important in traditional brick-and-mortar strategy but online branding is equally significant. Rowley (2009) explored online branding and in what specific ways the online channel is being used to support brands. Most top “non-value” fashion retailers offer transactions through their web site, offering extended opportunities for brand engagement and experience. Fashion retailers achieve consistency of visual identity between the online and other channels although their use of the online channel to communicate brand values is limited hence the promotion of brand relationship is considered underdeveloped.   Online fashion retailing in Hong Kong Sum and Hui (2009) found out that in a traditional retail environment of brick-and-mortar in Hong Kong, repatronage intentions, word of mouth intentions and satisfaction are driven by salesperson sales quality. The dimension of service quality which eventually leads to customer loyalty is coupled with other elements such as price level and customers’ demographic variables. Empathy dimension of salesperson service quality is the most important customer loyalty in Hong Kong’s fashion chain stores but the empathy dimension of salespersons' service quality in fashion retail stores could not be affected by these two retail environmental factors. Furthermore, the salespersons' service quality in the reliability dimension is significantly impacted by the customers' demographic characteristics, but not by price level set by fashion chain stores.   Law et al (2004) explored the why a fashion style/trend was spread to the mass market especially in an existing market that is complex and difficult. There is a relative difference on the way fashions are consumed and rejected while fashion changes. The authors found out that the interaction of being fashionable, perceived fashionability and system participation affects the ultimate decision on fashion consumption. Forecasting the fashion consumptions also moves along with the degree of fashion acceptance among consumers. When it comes to online fashion retailing, Hong Kong residents’ consumer attitude and behavioral intention to use internet-based e-retailing is greatly affected by social factors. Easily accessible local retail market and risks concerns in the virtual environment relatively affect Hong Kong residents’ attitude and behaviours towards e-retailing (Liao and Shi, 2009).     Main findings   Hong Kong seemed to embrace the Internet as an additional fashion retail channel especially that most of the developed countries are already into fashion e-tailing. Discussion of the main findings will be based on the items in the interview schedule purposely designed for this study. Representatives of CCT Fashion are contacted by email and telephone.      From CCT Fashion’s perspective, how does online fashion retailing developed in Hong Kong? It started when Hong Kong residents regarded computers and Internet connection as indispensable components of the household. Despite the dot com bubble that resulted in the decline of public confidence on business-to-consumer markets, more and more Hong Kong residents are doing their shopping online but not necessarily on Hong Kong-based online fashion retailers. During 2000, a portion of the total population, about 3.5%, had shopped online at least once. Survey results conducted by Hong Kong Census and Statistics Department and Office of the Telecommunication Authority showed favorable results for marketers and fashion retailers in Hong Kong to resort in Internet retailing.   There are two situations that were faced by Hong Kong retailers during the time of 2000 to 2001. On the one hand, there had been the continuous shutdown in Hong Kong retailing websites such as AdMart and ezVan and losses such as Hongkong.com, leading to filing bankruptcy, and even then breaking even was impossible. This situation resulted in pessimism about how technology and particularly the Internet could aid market development. However, Internet retailing trends had been also incessant basically because of global competition. This put pressures on several traditional retailers in Hong Kong to increase their competitiveness. One way of doing such is creating strong Internet presence. Evidently, Hong Kong retailers considered websites as a potential marketplace.      Online apparel retailing in Hong Kong had followed the lead of international fashion retailers that promotes their clothing products through their own websites. Online malls and shopping portals were also booming especially in Europe and in United Kingdom in particular. What makes this a viable channel is that it can reach and can gain access on millions of potential customers. Hong Kong was one of the leading countries in Asia that devoted itself in the development of online apparel retailing. Hong Kong-based manufacturers and retailers created own websites such as Bossini, Giordano and Esprit to serve as an avenue for direct marketing and sales, advertising and customer relations. Nonetheless, this has not been without difficulties especially since online sales performance did not achieve the expected revenue it should generate.     One of the challenges that the development of online fashion stores in Hong Kong faced was that residents prefer traditional shopping than shopping over the Internet. Considerably, Hong Kong is a city country wherein everything could be bought in nearby fashion stores. Back then, there were impressions that online stores have negative record when it comes to delivery service and secure payment schemes, with the latter as it involves high commission charges. Residents also viewed online shopping stores as inappropriate when bargain hunting is to be considered especially since unfamiliarity still prevails. Trustworthiness of online fashion retailers was another concern for reluctance.   Further, there were also product-related issues before, and still do so, that obstructs online stores of today including realistic representations of apparel hence restricting the kinds of products that could possibly marketed on the Internet. Deficient pictures and inadequate product information and selection were other reasons why apparel online purchasing has a limited appeal. Judging the product quality over the Internet is one major hindrance to purchase. Inadequacy of product choices and lack of post-sales services also add up to the challenges, resulting to declining levels of satisfaction of the consumers.     How does the development of fashion e-tailing in Hong Kong led to the development of CCT Fashion online store? Therefore, if there is an online store that could meet all the demands of the online shoppers, what would happen? This is perhaps a question that leads CCT Fashion owners and developers to develop such a company that will meet all the requirements of the customers in a reasonable and effective manner. CCT Fashion materialized with offering substantial advantage compared to their traditional retailer counterparts as its main aim. CCT Fashion was developed mainly to cater to Hong Kong nationals – to bring to their awareness Korean and Japan fashion. Simply, the goal is to give Hong Kong residents the freedom to choose and widen their perspectives about Asian fashion.   CCT Fashion also researched on what could be the most important factor in establishing an online store. Basically, CCT Fashion conducted market survey of Hong Kong residents prior to establishing the garment company including gender- and age-related distribution of buying fashion items online and reasons why they will not buy fashion clothings in the Internet (refer to Appendices section). Internet usage of Hong Kong residents and their consumption pattern of clothing as well as their attitudes on Internet shopping were some of the details that CCT Fashion searched for. Notably, Hong Kong residents are the primary target markets particularly because during early 2000s Japanese and Korean fashion was increasingly becoming popular in Hong Kong especially to the females. Although it is also the goal of the company to market the products abroad other than Hong Kong, the target market at this experimentation stage is Asian fashion enthusiasts and with Hong Kong as the priority.     What sets CCT Fashion apart from its leading competitors? Competitors for CCT Fashion are Onatoko and Causeway Mall. There are three elements that are distinct to CCT Fashion: long-life fashion, wholesale and women’s wear. When we say long-life fashion it means long-lasting clothing lines. CCT Fashion hopes and works for thriving to flawlessness through selecting clothings to sell that could show little signs of wear. At CCT Fashion, we believe that long-life fashion is very desirable today therefore texture, pattern and fitting must all appeal and continue to satisfy the owner of the items.   Further, CCT Fashion defines wholesaling as having quantifiable orders at affordable prices and selling to retailers for resale. CCT Fashion is relatively a small online garment company therefore it would be helpful for the company if there are customers who can contribute ideas, feedback and figures to the company. This scenario enables CCT Fashion to provide and offer greater evidence of successful styles and later predict the changes in customer requirements and expectations. Not only that wholesaling is a proactive approach but it also drives market intelligence for CCT Fashion.   For CCT Fashion, women’s wear is both a choice and a priority. One of the reasons is that women are inherently into fashion and the other is that women buy clothings more often than men. Younger women most especially are very keen on their image that they often resort in updating their wardrobes. Since women are more accustomed on using and navigating the Internet, CCT Fashion founders thought that it is only right that the company should concentrate on this broad market segment.     How CCT Fashion achieves and maintains its competitive advantage? One way by which CCT Fashion is able to maintain its competitiveness is through constant innovation in product offerings. Aside from our very own CCT and CCT style brands, accessories and bags, for example, were launched in 2006 to cater to the demands of the client. This is also in line with CCT Fashion’s aim to be a one-stop online store by providing a wide range of trendy products. Perhaps, what makes this advantageous is that the products of CCT Fashion are globally-dispersed because our main clients are wholesale companies and retail shops. As such, product inventories within CCT Fashion happen almost monthly.   To continue, CCT Fashion’s products include various categories such as blouse, jacket, dress, skirts and pants and with available items on small, medium, large and extra large sizes. Fall and winter (F/W) is also a staple in the category list. Apparel is offered in every available color and with designs and fabrics that are essentially comfortable and stylish. New arrivals are updated monthly as well so that new items will be prioritized. An online catalogue is also available for the clients (www.fashion-catalogue.com). CCT Fashion opts also to manufacture customer-provided designs.   Another aspect that makes us achieve our competitive edge is our own professional photo taking team and models. For every online fashion store, this must be a priority because it is the answer to the common complaint that clothes in actual do not looked exactly of that of the pictures. Because CCT Fashion is very particular with product quality, we can ensure our clients to view their products first before the actual purchase and to know that the products are exactly the same as the photos when delivered and received.   What are the limitations of CCT Fashion online store and how it can be improved? As already mentioned, there are two websites where products of CCT Fashion could be found. The difference is that the catalog website is a selling kit which features all updated items. However, it does not include a comprehensive price list unlike the main website. In this way, we can get the clients to click and visit both websites especially when they intend to make a purchase. E-selling is generally done in the main website though it requires membership; membership has no charge. Online shopping is enabled by a shopping cart and a basket list.   The CCT Fashion website includes the description of the company (about us) and frequently asked questions (FAQ). Fashion items are classified into 12 main categories on the right side of the website. This presentation is consistent with the presentation in the catalog website although the latter also features measurement as a value-added service. The main website, however, is equipped with language, search and currency features. Other services in the website include terms and conditions, shipping cost, payment method and contact details.   Admittedly, when I compared the main website to other Hong Kong-based online fashion retailers, CCT Fashion’s online store is lagging behind because of several reasons. First, although we have the contact details to exchange ideas with the clients, the website have no online chat support. Perhaps, this could respond to the queries of the customers in real-time unlike the email support which takes about 24 hours before replying to the client. An online chat support could also be used as a platform to exchange informations with the clients that better suit their needs thus better customer relationship management.   Second, when it comes to product-related concerns, CCT Fashion online store lacks in price range search, purchase guidelines and discounts and rewards pages. CCT Fashion main competitor also features custom-friendly details, legitimizing trading between manufacturers and suppliers and retailers. Yet another online store has a page devoted in making customers informed on how to use PayPal. PayPal is the main mode of payment for CCT Fashion. All of these are being seriously considered particularly because it can drive customer satisfaction.        Lastly, more advanced online stores, mainly Western-based online stores, for the purpose of minimising the dilemma of buying wrong-sized apparel, have virtual avatars and virtual catwalks. Likewise, browsing an online catalog and being able to do mix and match of clothing items are also in demand. Extent of interactivity is increasingly becoming the yardstick of online fashion stores wherein online shoppers are enabled to visualize in full view a model corresponding to their body measurements with their desired clothings.        Discussions   Apparently, online fashion retailing is a Westernized practice acquired by Hong Kong traditional fashion retailers considering the wealth of opportunity that online retailing provide. Such ongoing trend faced issues about quality, speed-to-market, flexibility, innovation, networks, customer service and customisation. Fashion retailing in Hong Kong was not an exemption as it embraced online fashion retailing as well as the issues and how to respond to these to some extent. Other than just being information-only websites, Hong Kong online fashion retailers strived into becoming transactional which means that purchasing clothings online was enabled. Hong Kong online fashion retailers learned from their Western counterparts to exploit the virtues of the Internet. As Baker and Hart (2007, p. 298) put it, the Internet was heralded as a powerful tool in communicating with consumers and perceived to be a significant avenue for marketing products and services.   Matthews, Lui and Lao (2001, p. 148) maintain that online fashion retailing penetrated Hong Kong in time of rapid pace of economic development. That is why despite the problems pre-imposed by the dotcom bubble major fashion retailers gambled in producing own corporate websites that will also serve as their online stores. Basically, the attitudes of Hong Kong nationals impede the immediate adaptation of online shopping in the region. Price and product quality are the main concerns of online fashion shoppers. Newman and Patel (2004) emphasize that online fashion retailers should adapt quality marketing orientations since satisfying the market through effective marketing strategies is equals to displaying high levels of confidence in the merchandise proposition. The willingness of the consumers to use online stores needs to be considered together with products and/or services; services considered are mainly technically-oriented such as the usability of online fashion stores. Customer’s perceived value of a product or service consists of three basic elements – the content of the clothing products that online stores are offering, the context of how online stores are offering the clothing items and the infrastructure that enables the transaction to occur (Nemati and Barko, 2003, pp. 924-925).   To wit, online fashion stores in Hong Kong are keen in providing clients/customers with product informations that drive brand trust and security. Moore (1995) stresses that branding strategies should set apart a brand in an environment with little generic differentiation. Fashion own-branding has emerged as the cornerstone of the marketing strategies of the major online fashion retail companies. It is therefore significant for online fashion stores to seek to identify the mechanisms by which fashion brands are created and maintained. This is in part a solution for the concern of lack of exclusivity, which is an integral concept in fashion retailing. Online fashion shoppers yearn for exceptionality, explaining why product information should include not just availability but also stock counts and hence inventory. Customisation was favoured by mainly because it allows minimal risks for the shoppers. Bruzzi and Gibson (2000, p. 53) blatantly states that the fashion system is based on change and women’s fashion, in particular, never fully adopted the methods of mass production.       Online fashion customisation, furthermore, is increasingly becoming a staple for fashion retailers. This is a micromarketing strategy which makes clothing manufacture and retail so efficient that customers are enabled to order custom-made clothes for the cost of ready-to-wear. What is good about this customisation is it is based on body measurements of the customer and so wrong-sized ordering will be reduced while also allowing them to choose from their style options. Bruzzi and Gibson (2000) termed this ongoing trend as personalised clothing and at the same time capitalizing on the advantages of tailoring. Growing complexity in ready-to-wear clothing signaled and stimulated greater fashion change that opposes large-batch production of fashion products. Faster distribution through online stores also means the fast-paced adoption of new styles.   Hines and Bruce (2007) also declares that the overall look of the online store, just a traditional fashion retail store, must combine and use different design concepts to conceptualise and construct an online retail space that contributes to the total shopping experience. Online fashion store designing that reflects fashion advocacy and realistic shopping environment should be upheld by online fashion retailers. This is visual merchandising which combines product, environment and space is created to stimulate and engage display to encourage sale of the products (Easey, 2008, p. 232; Pundir, 2007, p. 232). Visual merchandising will benefit online stores via communicating a cohesive brand image, differentiating the offer from the competition, integrating promotional effort and increasing availability of the Internet to facilitate the process. Visual merchandising becomes an indispensable practice since it educates the customers, creates desire and finally augments the selling process. For online stores, virtual merchandising is tactical as it projects carefully chosen clothing merchandises that will entice visitors to explore the product offerings and thus the website.   Moreover, Hong Kong is much on the periphery of global fashion system during the introduction of online fashion retailing in Western societies. Fashion, however, serves a fundamental function in sociality of modernity since it requires movement and change while also celebrating the virtues of newness (Matthews, Lui and Lao, 2001, p. 150). Such newness or simply innovation is termed fast fashion in the fashion world. Moore and Murphy (2000) also related that fashion product innovativeness must motivate online fashion retailers to segment their products according to the needs of the consumers perhaps through market extension and development. Online fashion stores must well-understood the underpinnings of going online which is constant generation and introduction of new product ideas in the fashion marketplace for the survival and continued existence of the ‘fashion’ world.    Digging deeper on Asian fashion, Niessen, Leshkowich and Jones (2003, pp. 1-2) emphasise that it was during the 1990s when Asian fashion became a noticeable global trend, changing the way people inside and outside Asia think about and practice dress. What constitute the globalisation of Asian dress are stylized images of Asian modernity and ethnicity that the rest of the world embraces. Chua and Iwabuchi (2008, p. 33) seconded the idea by saying that what the world is now seeing is the increasing visibility of Asian popular culture particularly of fashion. Increased marketing prowess of media and new media enabled the borrowing of fashion icons or the most significant or representative figures. Such an exchange between the Western and Eastern fashion movements reflects how culturally relevant fashion outputs are to the people who consume them. Online retailing of fashion garments was once deemed inconceivable but it is now a reality through the Internet.   In Hong Kong context, the fashion system is considered to be associated with desirability and social distinction. Asian-style clothing is growing in terms of its appeal although Western-style clothing is already available in Hong Kong then when the first Internet garment company was launched (i.e. CCT Fashion). Sustainable positioning is an element of fashion marketing that is critical for fashion marketers as this will determine the range of marketing activities that are aligned with fashion consumers (Newman and Patel, 2004). It is in this sense that Hong Kong online fashion retailers were able to treat the Internet as a retail distribution channel. Going online for these retailers meant to become virtual e-tailers that either have traditional operations or have online catalogues or both. There are also Hong Kong retailers that that are more focused on having online catalogues and online virtual stores (Marciniak and Bruce, 2007, p. 261), and CCT Fashion falls under this category. Product focus rather than market positioning is also one essential factor that makes Hong Kong online stores different from other Westernized virtual fashion stores.     Online shopping stores are basically adhering to the trend of designing and manufacturing quickly and cheaply for the purpose of allowing mainstream consumers to take advantage of current clothing styles at a lower price. However, in online fashion environment, designing is not limited on the clothes alone but also on the online fashion store itself. Online stores resort to visual merchandising wherein new product categories will be featured in the main page of the websites. Frequent visits are also because of new clothing items available on that online store (Barnes and Lea-Greenwood, 2006, p. 337). Virtual catalogues is considered one of the key drivers for online fashion store viewership. Catalogues enabled online fashion stores like CCT Fashion to offer an almost unlimited range of products in breadth and depth that no physical store could match in terms of capacity. The increased convenience of online catalogues allows shoppers to browse and buy at the privilege of their own choosing (Dent, 2008, p. 233).      Online fashion shopping decisions of Hong Kong residents are directly affected by their online shopping attitudes and their virtual shopping experiences. Wong (2000) mentions that when it comes to fashion shopping, the customers’ behaviours and attitudes are commonly influenced by economic, cultural and aesthetic dimensions. Convincing power then must be inherent to online fashion marketers in order that people should be persuaded to what they think are trendy and fashionable (Goldmsith et al, 1999). Generally though, the presence of promotional offers had a positive effect on online fashion shopping intentions and these intentions vary greatly for different product categories (So, Wong and Sculli, 2005). Consumer buying decisions online specifically for apparel move along with online shopping expectations and requirements and even purchasing trends. Online fashion stores and their operators must then understand the motivations that influence customers to the evaluation process, the process by which online shoppers assess the products and even the value-added services.     As such, certain products and services appear more suitable for online sales while others remain to be more appropriate for traditional trading. Products which are less saleable over the Internet are those which have low value-to-weight ratio and those that generally require smell, taste and touch component as well as color integrity requirement. One such product category is apparel wherein Hines and Bruce (2007, p. 152) noted that for an online fashion store to sell, the appearance of the product categories, for instance, must matched with the attitudes, experiences and hence expectations of the Hong Kong consumers. It is not only the distinctness of fashion that makes online fashion stores appealing but also the properties of the garment involved that are important. Reasons that relate with fit, feel and garment labeling hinder shoppers to go online, and these are directly related to fashion products sold online. Apart from the fact that there is also the general aversion in Internet usage, fashion reasons dominant for not buying online should be altered so that online fashion shopping will become even more appealing. Getting used to the "touch and feel" barrier could enable retail shoppers to browse and purchase online.      When it comes to the properties of online fashion stores more profoundly, there are basic details that must be integrated. Best websites will give a customer or visitor clear and easy categories and information such as delivery, returns and contact info right on home page, fastening up the process of searching for the perfect product. Notably, put value on the services of online fashion stores must mean higher site usability which tells how easy is it for the customer to click round the online store and get to the products they are looking for and how quickly they can get information. Adequate information on the products and clear, viewable images of the products also count under site usability. Product range, price range, delivery area, based, express delivery option and returns procedure are other basic features of an online fashion store (Davidson, 2007).     Conclusions and recommendations   From the results, it can be concluded that online fashion shopping in Hong Kong moves along with the changes in developed countries, especially since Hong Kong has been a British colony hence patterns of online retailing could be traced from its British parentage. Hong Kong nationals were hindered by doubts about ordering procedures, delivery procedures, payments systems, customer service and Internet usage in general. Consumers in the region also regarded the Internet as a source of information rather than be used for transaction-related activities such as shopping.   The study reflects the social changes in Hong Kong that welcomes new fashion trends from its neighbouring countries. One theme is apparent, nevertheless, although there are non-buyers of fashion clothings online, there is a significant portion of the population who embraced the new retail channel. CCT Fashion was born in time when consumers are becoming fully aware of the detriments of online fashion shopping and capitalise from this through responding to the issues. Consumer experience optimisation is what CCT Fashion is after as evident by its long-life fashionable clothing.   Suggestively, online fashion retailing in Hong Kong developed within the premise of clear strategic fashion marketing that is both geographically-dispersed and boundary-less. Co-designing whereby consumer and producer collaborate to create a design is also becoming a trend, a strategy that advents the online fashion store to cultivate ideas from external sources while also maintaining standardised production. With this also, online fashion stores strikes a balance between addressing individuality and collectivism within a schema of fashion market.    When searching for highly personalised fashion, an ongoing trend is also evident in initiatives of online stores to offer customisation services. Aside from making the online stores inviting and appealing, specifications that are coming from the customers' side is becoming profitable. Such a development is the direct opposite of mass customisation wherein co-makership elicits a promise to strive for real fit and tailors.   Apparently, the number of Hong Kong-based fashion online stores is rising based on the observable intensifying competition. Possible explanations emerging from the discussion could be that traditional fashion retailers are looking at web selling as a complementing feature of their physical retail stores. They are strategizing by means of advertising products on online stores hence attract customers and generate traffic while also selling via their respective online stores. Stronger presence on online environment is the key in understanding online consumer experience.   Another theme that is evident is the fact that when people are doing their shopping online, their first motivation is convenience. The convenience of online shopping which is even made more convenient by an easily navigated fashion website is perceived to be one of the best developments in terms of retailing. Time-saving is the second especially when the online fashion store offers the customer not just want they need to buy but also what they want to buy. Choice is yet another motivation that is why it is important for online stores to have properly segmented and/or categorised product offerings and with accompanying product information. Comprehensive selection is what sets an online store to another online store as it mirrors the extent by which the online shopper can practice freedom to choose and decide. Finding good prices also entices online shoppers to do their shopping online.   The use of multiple channels online also proved to be significant in online fashion retailing today as it could possibly reduce perceived risks with online transactions in terms of garment fit, style, colour, feel and quality o fabric. Visitors of catalogue websites are also the visitors of online fashion stores and vice versa. Online fashion stores should also take note that online shoppers are interested in fashion innovation hence making fashion products available in all possible channels online is plausible. A strong online store environment also encourages online shoppers to visit the catalogue and the stores more frequently. Visual appeal must be then considered especially since this comes in package for product evaluation that online shoppers engage in.   Online fashion retailers strategically use websites hence the basis of competition is the difference between types of online fashion retailers and components of their websites. Competition among online fashion stores is based upon how and what information is provided. Fashion retailing business is far from being saturated specifically Hong Kong because Hong Kong fashion retailers who are operating online such as CCT Fashion are continuously developing strong brand identity and good product mix. Hong Kong online fashion stores understand that their consumers are very fashion conscious hence there is the necessity of continuous development.   For CCT Fashion and other online fashion stores, it would be plausible if there these stores will offer options to use other payment systems than credit card and PayPal while also using accepted technologies of payment systems. This will allow online shoppers to use their own familiar codes and procedure to make the payment. This process not only prevents worries about payment but also build confidence on security protection of online stores. Online fashion stores should also offer precise size information, color information and fabric details. Perhaps, what will set apart CCT Fashion from its competitors is that it can provide a page that discusses how online shoppers will take care of the fabric and their clothes. Offering an accurate delivery procedure and easy returns policy must be also considered by online fashion stores.   Lastly, CCT Fashion should conduct a materiality analysis so that they can define their priorities and work from there. A materiality analysis will allow the garment company to decide which among the recommendations would be prioritise and would be viable for the strategic objectives of the company. The facilitation of creativity, collaborative activities and sharing among its users would be the next best thing for CCT Fashion. CCT Fashion must strive not for just retrieving product information but on interactive processes, allowing owning of data and exercising control over that data for online shoppers.     Bibliography   Azuma, N. & Fernie, J. (2003). Fashion in globalized world and the role of virtual networks in intrinsic fashion design. Journal of Fashion Marketing and Management, 4(4): 413-427. Baker, M. J. & Hart, S. (2007). The Marketing Book. (6th ed.). 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(3rd quarter) 		 		 		Yes 		 		 		267 		 		 		65 		 		 		332 	 	 		 		 		  		 		 		No 		 		 		89 		 		 		54 		 		 		143 	 	 		 		 		Do you buy fashion 		items on the Internet? (4th quarter) 		 		 		Yes 		 		 		251 		 		 		38 		 		 		289 	 	 		 		 		  		 		 		No 		 		 		44 		 		 		87 		 		 		131 	 Table 1 Distribution of Buyers of Fashion Items According to Gender (2001)   	 		 		 		Age 		Class 		 		 		 		Number of Buyers 	 	 		 		 		12-17 		 		 		11 	 	 		 		 		18-27 		 		 		221 	 	 		 		 		28-37 		 		 		67 	 	 		 		 		38-47 		 		 		43 	 	 		 		 		48-57 		 		 		25 	 	 		 		 		57 and above 		 		 		28 	 	 		 		 		Total 		 		 		395 	 Table 2 Distribution of Buyers of Fashion Items According to Age Bracket (2001)   	 		 		 		 		Reasons for not buying 		 		 		  	 	 		 		 		1 Unsafe payment 		and delivery 		 		 		ü 	 	 		 		 		2 Unsafe personal 		data 		 		 		ü 	 	 		 		 		3 Lacking in 		product information 		 		 		ü 	 	 		 		 		4 complicated 		ordering procedure 		 		 		ü 	 	 		 		 		5 Would not be 		able to see if garments will fit 		 		 		ü 	 	 		 		 		6 Would not be 		able to see how I will look like 		 		 		ü 	 	 		 		 		7 Bad photographs 		 		 		ü 	 	 		 		 		8 Easier on 		shopping malls/department stores 		 		 		ü 	 Table 3 Reasons for not Buying in the Internet (2001)

Development of Online Fashion Stores in Hong Kong Case Study of CCT Fashion

Development of Online Fashion Stores in Hong Kong Case Study of CCT Fashion ...