Velia Carboni, chief digital officer at VF Corporation, spoke to Emma Herrod about balancing global digital requirements with the needs of individual brands and regions during one of the most significant periods of transformation for the company.
From Vans to The North Face and Timberland, VF is home to a number of iconic outdoor brands. All have passionate fan bases such as owners of Vans footwear who keep old shoes because of the emotional engagement connecting a pair to a specific event or moment in life. The North Face – the climbers’ brand that incorporates a cliff face from Yosemite National Park in its logo – has expanded into clothing for hiking in the outdoors and in the urban jungle. Timberland is spearheading the group’s move to more sustainable materials and the circular economy.
They are all using digital in their own way, embracing online as a sales channel and digital technologies in store. Now, however, the supply chain is bringing the brands together under one digital project reducing the product development cycle and potentially moving customer feedback closer to the manufacturing stage.
A combination of VF’s current design software and gaming technology is enabling 3D avatars to be rendered wearing the clothing being designed. This not only shows the designers how the end product will look in the chosen fabric, but also informs the factory that’s manufacturing the items how they should drape.
The project has cut out a lot of physical travelling and materials wasted between design and prototype since everyone knows earlier in the process exactly what the finished product will look like. They can zoom in or out, move around the garment and change how it looks under different lighting conditions indoors and outside in natural light.
Because the avatar is made to a specific fit model for the business with numerous measurements ensuring that the ‘body’ wearing the clothes is correct for the brand, it can be shown on digital screens and could also be rendered as a two-dimensional image on the website or other channel without the need for additional photography. Again, speeding up the supply chain and reducing the time to market. Previously, it took six weeks to move from product design to a prototype being manufactured. Vans, Timberland and The North Face are currently using the avatars before they are rolled out to the other brands in the VF group.
The images could also be shown on social media to gain a view from end consumers before being manufactured, explains Christopher Raeburn, creative director, Timberland. This is something that the brand has tried with its Construct:10061 project, which saw designers working directly in the factory in the Dominican Republic with finished product ready for consumers to feed back on in just four days. Raeburn admits that scaling this is not easy but the business does want to move to a place where designs can be shown to consumers before they are manufactured.
The level of risk involved in the long lead times of design and manufacture of products is phenomenal, he explains, so the industry needs to work towards a more agile way of producing stock that consumers want and will have an emotional connection to.
The 3D avatars go some way to shortening those lead times. They are being shown initially in VF’s recently opened Axtell Soho brand showcase as a way for its wholesale business buyers to experience the brands and to engage with them and the product stories.
Each brand has its own floor showcasing the latest products and their environmental credentials with the brand stories being told through a mix of physical product and digital technology. Screens are everywhere.
How the wholesale business customers engage with the avatars and other technology being used to tell the brand stories in the London building will be fed back to the central digital team as part of a test and learn process. That connection between the channels “is the most important thing, and ensuring that we bring all that data back into one centralised, secure place and leverage those insights to really drive innovation – whether that’s in product or experience – is the game changer,” explains Velia Carboni, chief digital officer at VF Corporation.
VF is embracing a test and learn culture and Carboni says it has to “continue to iterate and learn quickly and then start to scale” where relevant.
The technology in London is part of the storytelling that each brand wants to get across to its end consumers, she explains, adding that “it’s the pinnacle of brand expression, of really storytelling and talking about what our products have to offer”.
Digital connectivity is going to be critical to ensuring that the same messaging is seen across all channels, she explains. “At the end of the day, it’s the same product and we should be talking about that with a consumer lens from the very conception of the product through to when we deliver it to the consumer, regardless of the channel which they are purchasing from, whether it’s our owned properties, stores or online, or whether they buy it through one of our partners. It’s still the same product.”
Carboni adds: “We have a corporate responsibility to ensure that product represents who we are as a company and that it’s truly meeting the need of our consumer.”
The digital and IT teams across the group work within a centralised framework that is decentralised physically with expertise embedded within the regions and individual brands depending on their expertise and the requirements of the region or brand. Technology – such as infrastructure, web services, mobile apps and toolkit items which can be used by the individual brands as they wish – is developed by a core team and accessible to all. The brands keep their own autonomy and are responsible for telling their own brand story and day-to-day trading.
This move of bringing everyone together under one umbrella has been very important for the business from a technology point view, says Carboni. In business today, she explains: “you can’t say ‘here’s the digital team and here’s technology’ as it’s hard to separate the two.” She says that in terms of omnichannel services such as click and collect, elements that were once thought of as back-end systems such as inventory management have to be fully integrated. “You can’t do digital without the inventory management,” she adds.
Having a single team enables the company to make the most of the technologies and knowledge from each region or brand and to use them across the group as a whole without requiring each area of the business to duplicate work that has already been undertaken elsewhere. “That’s a big cultural push that we’re doing today because there’s no reason to reinvent the wheel,” says Carboni, adding that it’s more important for the group to have ecommerce expertise in the US than in China where Tmall is the dominant channel. She believes that it wouldn’t make sense to set up ecommerce in China but there is knowledge gained – such as from mobile – that can be integrated into other parts of the business.
The important thing, she adds, is that as chief digital officer she can access the best-of-breed technology and learnings as necessary.
Carboni’s role has been made more challenging since VF has acquired a number of brands in recent years which have each brought with them their own technologies and ecommerce platforms. While it makes sense to centralise some systems – such as a product information database with shared attributes – as the company continues its move to a global product company, others have to be deployed with a local view, such as cloud or anything that is differentiated by security legislation or privacy rules.
“Our goal is to be smart about where we centralise,” she says. “We want the brands to have the tools that they need in their toolkit to be able to deliver on that brand storytelling and experience and not have to worry about this or that platform. That toolkit will be accessible to every brand in each region. What we choose to do will be very brand or region specific.”
She adds: “Centralisation allows us to scale quickly and do more things and not have duplication in the technology stack.” It also means that the corporate digital function is responsible for modernising VF’s technology stack and it is doing this by using APIs, micro services and the cloud.
VF can, therefore, stay ahead of technological changes and innovations and if necessary test new technologies in different markets or in its own digital lab without each brand having to do it itself. So in some areas, the corporate team will lead while in others the technology requirement will come from a region or brand. There is two-way dialogue and transparency between the brands, regions and corporate function ensuring that everyone knows what is being delivered and that it is what the brands need.
Technologies such as 3D and AR are all “super important” but “at the end of the day it’s about driving the engagement with the consumer”.
Carboni is excited about how data and analytics can drive the business and the insights they can deliver, especially in the areas of digital product integration and customer engagement. Footwear brand Vans, for instance, enables shoppers to customise their shoes with different colours and artwork before buying them online. The same theme being seen repeatedly highlights a product gap.
Data can be harnessed from different points, including VF’s own channels and the marketplaces through which it sells. This data can be used increasingly to drive experiences and product with consumers and with shoppers such as its existing customer base. She’s excited about what data and analytics can unlock for VF and how that will help it to increase contextual relevancy for each consumer and build relationships. “I think of it like a marriage. You have to work on these relationships; it’s not a one-time transaction,” she says.
The team is experimenting with machine learning and AI as well as having teams of data scientists working both centrally and within the regions and individual brands. She says that technology won’t replace people. It will help an assistant in store, for example, to have a more relevant conversation with each consumer, knowing who they are and educating them about what matters most about the brand.
The group is still being challenged culturally as it moves from large-scale technological projects which are quickly deployed across large parts of the business, to remaining focused on a few “really important” things in a test and learn process. As Carboni says, it’s very costly to do things in the way that technology companies did in the past. “We can do all the testing we want but there’s nothing like testing something live in a store setting or online. Getting into that framework and not getting caught up with ‘I have to get this out for everyone’. It’s ok to test and learn before we scale. That’s an important lesson for us to hold true as we move forward.”
She says that with all the new technologies “it’s like being in a buffet”. Decisions have to be made about which technology is the most important. It’s something that the industry is having to address and everyone is also having to work faster to move from test to scaling.
Digital and direct to consumer are major parts of VF’s growth plan. It is predicting an annual growth rate of between 10% and 12% for its direct-to-consumer revenue with digital across the brands increasing by 25%. This, says Carboni, will be driven by the teamwork between the brands, and corporate and regional functions working collaboratively in the consumers’ interest.
“The central team has an obligation to deliver the right tools for the business to be able to bring the brand experiences to life, and they have the obligation to tell the story about the products and ensure they have the relevant products for our consumers,” she says.
Balancing the global technological point of view with the individual requirements of the brands requires agile working. “It’s a prioritisation exercise,” she says, explaining how VF looks at the opportunity and balances that against the next opportunity in order to prioritise work.
“It’s not a dollar thing; it might be delivering a better experience that later drives dollar. It’s about focus, as we know we can’t focus on one hundred things at once. It’s about being choice full, and having a more consumer-centric model that says ‘here’s the problem or opportunity we’re trying to solve, here’s the value, the dependencies I have’, and having a methodical framework for making the decisions.”
Carboni’s mantra is ‘discipline before agility’. She says that if you have the focus and the framework in place it allows you to go a lot faster. It also allows for flexibility. And speed, agility and flexibility in a $14bn corporation with close to 20 global brands is something that many smaller retailers would envy. Added to it the authenticity, transparency and environmental credentials which many of the brands want to get across to consumers, along with the digital tools being put in place to tell those stories and the push with direct-to-consumer plus a will to close the gap between design and the consumer, and the future for VF is looking bright.
VF is 120 years old and is known mainly for its brands: Vans, The North Face, Timberland, Kipling, Icebreaker, Williamson-Dickie and Altra, among others. Its denim businesses, Wrangler and Lee, were hived off as a separate entity under the Kontoor Brands name earlier this year.
In the past year alone, VF has bought and sold 10 companies. It proves that big business can change, says VF group president EMEA Martino Scabbia Guerrini, adding that “agility and speed is what we need to do more of”.
VF is working to a business transformation strategy which sets out its ambitions for sustainability, a focus on Asia – particularly investing in China – and elevating its direct-to-consumer business by prioritising digital through to 2021. Digital marketing and consumer analytics will be leveraged to gain a better understanding of customers and “to meet consumers where they are”.
It expects that by 2021, digital will contribute more than half of the business’s total growth.
“We are ahead of the strategy,” says Scabbia Guerrini, and some brands – Vans, Timberland and The North Face – are “delivering beyond” their expected growth rates.
The UK is VF’s main market in Europe, accounting for approximately 20% (£500m) of its revenue in the territory. The target for 2021 is for it to reach 23%. London itself represents 20% of the company’s total revenue in UK with Vans leading the business.
VF operates 57 of its own stores in the UK, 20 of which are in London.
Vans is VF’s fastest growing brand. It is also the most engaged brand on social media. It will be opening a flagship store at Oxford Circus in London later this year which the brand’s creative director in EMEA Dirk Jacobs is calling a “big experiential space”.
It will bring together Vans’ focus on sport, arts, street culture and music as well as customisation through an area in which customers can gain inspiration from other people’s work, engage with staff and come together in workshops. It’s something which has been trialled already in Milan.
Digital will also be showcased in the store through screens and shoppers’ ability to access the Vans website.
The brand has always focused on giving a great customer experience, and customisation fits the way Vans started and says a lot about “how we connect with consumers, giving them the best service possible and the best experience possible,” says Jacobs. It gives consumers an “opportunity for them to talk positively about the brand”.
Ahead of the store opening, Vans has launched its Vans Family loyalty scheme in the UK, something which is already up and running in the US. This enables customers to give feedback after making a purchase, gain points and discounts, and access exclusive products and experiences – as well as engaging in the Vans CRM programme, of course.
VF’s plans for the brand centre around looking at how it can remain loyal to its roots and meaningful as the Vans brand, how it can maintain growth and how it can continue to connect with its customers and reward them accordingly.
“There will always be the foundation of people who truly care about what we do and they will be the people we focus on,” says Jacobs.