[an error occurred while processing this directive]
July 2008
Research Briefs
Leveraging Virtual Communities of Consumption in the Fashion Business

Online communities can provide valuable insight into fashion consumers' needs and preferences.

by Hye-Shin Kim and Sharron J. Lennon

A virtual community (or online community) refers to a network of people with shared interests communicating with each other electronically. Using bulletin boards, chat rooms, e-mail lists, blogs, and virtual spaces, the Internet provides creative ways for different forms of real or imagined communities to exist. A virtual community can offer resources and social opportunities for a wide audience because it transcends geographical and spatial boundaries. Today, virtual community members self-select into the electronic social networks for on-demand information and resources. In addition, members join virtual communities for social support, share stories, exchange ideas, and conduct commerce. Through electronic communication and interaction, members develop bonds and authentic personal relationships.

In many virtual communities, people share their enthusiasm for and knowledge of a specific consumption-related activity. Consumption activities or products are used to identify members of virtual communities with each other in a symbolic and meaningful way. Devoted or loyal users of a product/brand form an environment within the virtual community where consumption of the product/brand is socially reinforced and encouraged.

In fashion, a wide variety of virtual communities can be seen. For example, individuals can discuss and check out popular looks on ShareYourLook and MyStyleDiary. Stardoll and BarbieGirls allow girls to integrate fashion into their fun and entertainment. Independent handbag designers and aficionados can share information on Handbagdesigner101. Wet Seal offers a fashion community where members can share and purchase outfits. Popular online community sources such as YouTube, MySpace, and Facebook provide a forum for members to share a plethora of topics related to fashion. And finally, some apparel businesses (e.g., Giorgio Armani, American Apparel) have even set up shop in the online fantasy world of Second Life, where users can create and outfit an alter ego (i.e., an avatar).

An important discussion topic among consumers belonging to virtual communities is information concerning particular products or brands. Research shows that such information conveyed through word-of-mouth communication is more trusted and perceived to be more authentic and credible than marketer-generated communication. In a large market research study undertaken by PowerReviews of more than 1,200 shoppers who spent around $500/year online, customer reviews were cited as important or very important by 70% of respondents, while another 65% said they look for and read product reviews before purchasing always or most of the time. Many consumers find the reviews to be useful. Also, connecting to other consumers and expressing themselves make the feature more interesting and useful. A study by Shang, Chen, and Liao (2006) published in Internet Research found that both posting and reading information were associated with trust, while reading information was associated with brand loyalty.

Currently, very few fashion online retailers provide an online forum on their Web sites where consumers can share product and brand information with each other. The inherent characteristics of fashion provide a strong basis for which retailers and consumers alike may benefit from virtual communities. For many consumers, fashion is a creative outlet where clothing is used to express one’s ideas and style and create a “look” from a unique mix of apparel items. In this way, fashion exists in a social environment where what is "fashionable” is determined by a group of consumers and not by one individual. Virtual communities, which include fashion leaders, connoisseurs, enthusiasts, and followers, engage in lively exchange of communication on all topics related to products (including colors, style, fit, and quality), brands, and other fashion related topics. Moreover, the hedonic and experiential nature of fashion allows members to find entertainment and fun from discourse among members in the social network.

From a business standpoint, virtual communities offer a tremendous opportunity for companies to understand their customers and foster a sense of loyalty to the product or brand, thereby improving profitability and brand value. Virtual communities of this nature can provide benefits for both companies and consumers. First, for the company, useful information traditionally acquired from communication between the consumer and the business can be derived from the dialogue among consumers. Marketers are able to analyze how their brands are perceived and whether they meet consumer expectations. Second, consumers form bonds with each other that stem from their interest in brands and products, resulting in a brand community that serves as an important word-of-mouth marketing tool. Members become influential in changing and shaping other members’ consumer decisions. And finally, the consumer community becomes a rich resource for solving product related problems and a breeding ground for creative ideas leading to new product or service opportunities.

Advantages of Online Consumer Discussion of Products

For Retailers
For Consumers
  • Seen to be authentic and credible, especially if the review contains a mix of positive and negative comments

  • Reading reviews leads to brand loyalty

  • Affects profitability and brand value|

  • Can be used to improve customer service

  • Can be used to identify customer needs

  • Can be used as text for marketing communications

  • Can be used to develop new product or service opportunities

  • Allows a customer to become a product or a brand advocate
  • Enjoy the opportunity to participate

  • Perceived to be useful when buying a product or brand

  • Considered an important source of product or brand information

  • Provides a chance to connect to others

  • Provides an opportunity to freely express opinions