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Microsoft has launched a Web site design contest, a move that will help trumpet its entrance into the world of fashion. While most fashion companies have been shy of the Net, Microsoft hopes a little glamour will boost e-commerce and help sell its software to stores and manufacturers.
Online fashion hardly promises fertile soil. Some US$46 million worth of clothing goods will be sold through the Internet this year. Forrester Research forecasts that figure to grow to $300 million in four years, but that's still less than half of what Ralph Lauren is estimated to sell this year.
"There have been a lot of experiments out there with different types of business models, but nothing has really taken off," says Judy Dulcich, Microsoft retail industry marketing manager.
But Microsoft is forging ahead. Fashion is a very visible area of retailing, and a good Web site could help get more companies on the Web or involved in e-commerce, while piquing consumer interest, Dulcich says. No one has submitted entries since the contest began this month, but Microsoft expects things to pick up by the February deadline.
The move online comes as the company pushes its way into the fashion software market. Microsoft is pitching its e-commerce server and Microsoft NT at fashion trade shows - a surprising move in an industry where proprietary systems are as common as the color black.
Most clothing stores and manufacturers are unfamiliar with PCs and rely on minicomputers, terminals, and custom software to run their businesses. Any shift to PCs is likely to take years, and the array of software that retailers would need is not yet available on NT, although Microsoft is trying hard to woo retail developers onto the platform.
There is not much competition in online fashion - perhaps for good reason. Apparel sales account for only 5 percent of all sales online, lagging significantly behind computer, travel, and entertainment, according to Forrester. Companies that have tried online sales, such as J.C. Penney and fashionmail.com, say orders are sparse.
Industry observers blame the same old bugaboos of online commerce: Consumers prefer to touch and try on merchandise before buying, and catalog shoppers still prefer a real book, which can be read on the bus, has clearer graphics, and doesn't take time to download.
