Photo by Laura Chouette on Unsplash
The e-commerce landscape in Poland and Central and Eastern Europe (CEE) is always evolving. Companies like CCC Group, Answear, Allegro, and Empik are all competing to capture market share and build customer loyalty. A common belief in the e-commerce industry is that to be the market leader, you need to target the widest range of customers with the largest selection of products. However, MyTheresa, a German-based luxury online fashion retailer, has proven this assumption wrong. Despite a global e-commerce slowdown, MyTheresa has thrived by taking a very different approach: focusing on a specific customer segment. This success story offers valuable insights for e-commerce platforms in Poland and the CEE region.
MyTheresa's Focused Success Story
MyTheresa is an online luxury fashion retailer known for its carefully curated selection of high-end apparel, accessories, and footwear. The company caters to consumers who value exclusivity and top-tier fashion. The key to their success is a clear focus on a specific customer group and a commitment to offering an exceptional shopping experience.
Target Customer Profile
MyTheresa’s target customer is the time-poor, professional woman who loves luxury fashion. About 80% of its clients fit this profile, focusing on building their wardrobes with high-quality, ready-to-wear pieces. MyTheresa CEO Michael Kliger noted in a 2021 interview with WWD, “There are customers that buy a bag and won’t buy any luxury piece again for one-and-a-half years...But we decided we want to have the wardrobe-building customers. Customers that buy a lot of ready-to-wear. Our biggest category is ready-to-wear. This is a customer that is driven by occasion. They update their wardrobe as they have new occasions and we extended that from women’s wear to men’s to kids. This focus carries advantages in the business model,” he said. “The customer that repeatedly comes back has maybe a higher customer acquisition cost, but a higher lifetime value.”
Lessons for CEE E-commerce Platforms
1. Focused Product Offering
MyTheresa’s success starts with its product assortment and buying. Instead of offering endless choices, MyTheresa curates a select range of high-quality items. This approach appeals directly to its core customer group. It simplifies the shopping experience, making it easier for customers to find what they want.
Heather Kaminetsky, Head of U.S. Operations for MyTheresa, explains it well: “Nobody has a lot of time. They don’t want 400 options when searching for a white button-down shirt. They want to see just the best 10 or 20 items so they can move on with their life. We do that, and they come back time and time again.” By offering only the most relevant products, MyTheresa ensures an easier and less demanding shopping experience that resonates with its target customers.
What CEE Platforms Can Do:
Curate the Product Selection: Instead of trying to be everything to everyone, CEE platforms should focus on specific customer groups. Offering a curated product selection that meets their needs can set them apart from competitors and build stronger customer loyalty.
2. Focused Brand Experience
MyTheresa excels in creating a brand experience that’s aligned with its core customers. The company offers personalised shopping services and tailored recommendations. This high-touch, exclusive service mimics the experience of a luxury boutique, making MyTheresa stand out in the online retail space.
Focusing on a consistent, high-quality brand experience builds strong brand loyalty. Customers know what to expect from MyTheresa. They know they’ll receive personalised service and access to exclusive products. This consistency keeps them coming back.
What CEE Platforms Can Do:
Enhance Customer Experience: CEE e-commerce platforms can benefit from developing a focused brand experience that appeals directly to their chosen customer group. Targeted product imagery, well planned customer journeys, or loyalty programs can make a difference.
3. Focused and Efficient Performance Marketing
MyTheresa’s focused strategy extends to its marketing. With a clearly defined customer segment, MyTheresa tailors its marketing campaigns to speak directly to the interests and preferences of its core customers. This focused approach ensures marketing spend is optimised and leads to a higher return on investment.
Many CEE e-commerce companies spread their marketing efforts too thin, trying to reach a broad audience. This leads to inefficiencies and lower conversion rates. MyTheresa shows that focusing on a specific customer group can lead to more effective and efficient results. When a company knows exactly who it is targeting, marketing messages can be crafted to resonate deeply, driving higher engagement and loyalty.
What CEE Platforms Can Do:
Targeted Marketing Campaigns: To improve marketing efficiency, CEE platforms should focus their performance marketing efforts on specific customer groups. Understanding the core customers and tailoring marketing messages to appeal directly to them can result in higher conversion rates and better customer retention.
Leverage Data and Insights: Using customer data to create highly targeted marketing campaigns allows platforms to reach their audience more effectively. Investing in analytics tools that provide insights into customer behaviour will help platforms tailor their marketing strategies and allocate budgets more wisely.
Competitors Spread Too Thin
While MyTheresa has thrived by focusing on a clear customer segment, many competitors have struggled because they tried to cater to too wide an audience. This approach often dilutes brand identity and stretches resources thin. When economic slowdowns occur, these companies find themselves vulnerable, as they lack a compelling value proposition to retain customer loyalty.
MyTheresa’s success demonstrates that a focused strategy can be more effective than trying to appeal to the masses. By knowing exactly who their customers are and tailoring their product offerings, brand experience, and marketing efforts to meet those customers' needs, MyTheresa has built a strong, loyal customer base that continues to support the brand.
Expanding While Staying Focused
MyTheresa’s expansion strategy is another key element of its success. Instead of broadening its product range to attract a wider audience, MyTheresa has remained focused on its core customer group. The company’s growth has come from targeting similar customers in new geographic markets. As CEO Michael Kliger explains, “Future growth is not by expanding the portfolio or looking for a different type of customer, but by staying focused, by going global. We were successfully serving wardrobe-building customers in Germany and Europe. And we felt there’s so much more market share, so many more customers to be gained in Asia, in the U.S. and at the same time we benefited from even more consumers moving their purchasing from brick-and-mortar to online.”
By entering new markets while maintaining its focus, MyTheresa has successfully attracted similar customers abroad without diluting its brand. This strategy allows MyTheresa to build a consistent brand identity across different regions while tapping into new customer bases.
Adapting MyTheresa’s Focused Strategy to the CEE Market
MyTheresa’s success in the face of a global e-commerce downturn offers valuable lessons for Polish and CEE e-commerce platforms. By focusing on a specific customer group, offering a curated product selection, delivering a tailored brand experience, and implementing targeted marketing efforts, local platforms can strengthen their market positions and drive sustainable growth. MyTheresa has proven that sometimes less is more, and a focused approach can lead to greater success.
As the e-commerce landscape continues to evolve, companies that adopt these focused strategies to meet the needs of their unique markets will be well-positioned to thrive. By learning from MyTheresa’s success, Polish and CEE e-commerce platforms can not only weather economic challenges and shifts in market conditions but also emerge stronger and more competitive in the long run.