What is Shein? An overview of the rising global fast-fashion retailer

Alibaba.com JUNE 24, 20218 MIN READ
What is Shein? An overview of the rising global fast-fashion retailer

Fast fashion is very popular because it allows people to get in on current fashion trends while sticking to a budget. Shein is one of the top retailers in the fast fashion industry that serves fashionistas around the world. This business is well-known for its low-cost clothing items.

Shein has been in business for a little more than a decade, and in that time, it has grown to be quite the operation. Shein's unique business model is gaining the attention of other professionals who are hoping to make it big in the fast-fashion space.

In this article, we're going to give you the rundown of Shein. We will talk a bit about Shein as a company and how it has grown over the years. We will also discuss how the shopping experience is for buyers before we take a deep dive into the Shein business model and marketing strategies.

To wrap things up, we will discuss selling fashion products on Alibaba.com.

What is Shein?

Shein is one of the top fast-fashion retailers in the world. This $15 billion company is based in China, but it ships to over 220 countries and territories from around the world.1

Shein specializes in women's apparel and accessories, but there are also some kids' clothes, men's clothes, home decor, and other odds and ends on the site. The site even features some clothes and accessories for dogs and cats.

Shein is particularly popular among Gen Zers and young Millennials. This is likely because Shein pieces often go viral on social media after they're shared by influencers and content creators.

The company's motto is "everyone can enjoy the beauty of fashion." This motto is really brought to life with the company's offering of thousands of low-cost styles. The combination of Shein's low prices with global shipping truly makes fashion accessible to everyone.

To reduce waste, only about 50 to 100 pieces are made of each style that Shein sells. This is done to avoid overstock which helps keep costs low and helps keep unpurchased pieces out of landfills.

Shein is comparable to Cupshe and Zaful. It is fair to consider Shein a budget-friendly version of ASOS, Zara, or H&M.

History of Shein

Shein was founded in 2008 by Chris Xu with the idea to make fashion accessible to everybody. It is headquartered in Guangzhou, China, and has strategic partnerships with businesses around the world.

Shein had three primary investors during its early stages, including JAFCO Asia, IDG Capital, and Greenwood's Asset Management.2

Originally, products were made in China, but now Shein works with many partners in undisclosed locations in order to keep the operating costs low.

Shein's eCommerce marketplace has both a desktop and mobile version. One impressive accomplishment of this digital storefront is that it went from 500,000 monthly visitors to over 4,000,000 monthly visitors in just six months.3

Within the past year, Shein has boomed. During the last week of September 2020, Shein's mobile app was the #1 most downloaded iPhone app in the entire world.4

As Shein has grown, the company has emphasized community. Shein has an active social media following, and the company's app has different portals and functionalities that encourage participation from its loyal buyers.

How does Shein work?

Shein's online storefront is pretty much a standard eCommerce store. Consumers can browse product offerings by collections, categories, styles, and more. The platform is equipped with a search engine, so if there is a specific product that you are looking for, you can put it in the search bar and relevant results will appear.

As we mentioned, Shein sells mostly women's wear. Some of the top categories for women's clothes and fashion items include:

  • Tops
  • Bottoms
  • Dresses
  • Bodysuits
  • Two-piece sets
  • Lingerie
  • Swimwear
  • Lounge & Sleepwear
  • Activewear
  • Denim

Within these categories, there are dozens of styles and thousands of unique products. Most products come in multiple colors and sizes. Shein sells both straight size and plus size apparel. Maternity clothes are also available.

The key to finding great items on Shein is to take a close look at the reviews under individual items. We recommend looking closely at the photos submitted by users to see how the items fit on different body types since many buyers find the sizing chart a bit off.

Checking reviews and pictures allows you to get a better feel of the quality of the product. Some Shein products are great and others are subpar, so third-party reviews will give you a bit more insight.

Just like most other eCommerce platforms, shoppers can add items to their "Shopping Bag" as they go. Once shoppers are ready to check out, they can review their shopping bags and move on to the secure checkout portal.

In the checkout, shoppers can add a shipping address and choose their shipping method. Standard Shipping takes about two weeks and costs $3.99, and Express Shipping takes about two weeks and costs $12.90. The site often runs deals that provide free shipping when buyers meet an order minimum.

Shoppers also have the option to pay $0.99 for a shipping guarantee. This "insurance" protects the order, so all items will be replaced if the package is lost or damaged.

With the shipping options selected, shoppers must choose a payment method. Shein's accepted payment methods include PayPal, Google Pay, credit card, and debit card. Shoppers also have the option to use Klarna or Afterpay to break their total into four interest-free payments.

Once the order arrives, buyers can leave a review for their products to earn points. They can cash these points in for discounts on future purchases.

Another notable aspect of buying on Shein is that the company offers 10% when buyers place their first order.

What's the secret to Shein's success?

It is estimated that Shein generates $10 billion in revenue annually.5 This is fairly impressive since Shein is one of the top-earning B2C fast fashion companies in the world.

Let's take a look at the business model and marketing strategies that Shein has put in place to achieve this type of success.

Business model

Shein is a global corporation that serves eight primary markets and ships to 220 different countries. In order to operate at this scale while remaining cost-effective, Shein has had to get strategic.

Shein uses an internet-based sales model that includes both mobile and desktop storefronts. Using an eCommerce business model allows the company to reduce costs since they don't have to pay for the overhead costs associated with maintaining a storefront.

Shein outsources some production in order to keep costs low. However, Shein keeps close tabs on all of their partners' operations to make sure that everything is up to brand standards. We'd like to point out that the company does not disclose who its partners are or where they are located.

Marketing strategy

Shein's marketing strategy uses a combined approach of paid and organic campaigns. The company is aggressive with targeted ads across many websites and social media platforms.

Thanks to Shein's innovative targeted ads, shoppers who visit their website will see the products they previously searched on a variety of platforms. It almost seems that the products follow them no matter where they turn on the internet.

Social media plays a huge role in Shein's marketing strategy. Shein has over 20 million followers on its official Instagram and Facebook pages.

Besides their own use of social media, Shein offers several affiliate programs that allow them to tap into influencer marketing.6 With their affiliate programs, influencers can make a 10-20% commission on sales made through their affiliate link. This encourages influencers to promote the Shein, which helps the brand gain more customers and grow its following.

Social responsibility statement

Many fast fashion companies have been exposed for using unethical production processes, specifically relating to how they treat their factory workers. With many of their articles of clothing being priced at just a few dollars, people speculate how they can afford to operate without cutting corners.

Shein is aware of these thoughts surrounding the fast fashion industry, and they have made it clear where they stand as a company in their social responsibility statement.7 In their statement, they show their commitment to "Fair Labor practices, environmental impact mitigation, and charitable causes.""

Some actions that they take to back these promises include offering livable wages to all employees and factory workers, monitoring factory conditions to ensure safe work environments, forbidding child and forced labor, and incorporating environmentally friendly practices where possible.

These social responsibility actions are likely to be put into place to appeal to environmentalists and other social activists that fight against fast fashion. Customers who are on the fence about supporting this sort of brand may find comfort in the company taking responsibility.

Sell on Alibaba.com

Even large fashion companies like Shein rely on partners to stock their "digital shelves."" As a fashion wholesaler, Alibaba.com creates the perfect environment to connect with fashion retailers of different types.

There are many reasons for selling on Alibaba.com. Aside from the fact that it is a trusted marketplace among buyers, the platform offers many tools to facilitate transactions. These tools include Trade Assurance, demand forecasting, smart product listing, auto-translate, auto-conversion, customer relationship management, and more.

Create an Alibaba.com account and select "Seller" as your trade role to start selling on our platform in no time.

References:
1. https://www.forbes.com/sites/markfaithfull/2021/02/10/shein-is-chinas-mysterious-15-billion-fast-fashion-retailer-ready-for-stores/?sh=442b37da6df5
2. https://startuptalky.com/shein-success-story/
3. https://startuptalky.com/shein-success-story/
4. https://www.forbes.com/sites/markfaithfull/2021/02/10/shein-is-chinas-mysterious-15-billion-fast-fashion-retailer-ready-for-stores/?sh=442b37da6df5
5. https://www.forbes.com/sites/markfaithfull/2021/02/10/shein-is-chinas-mysterious-15-billion-fast-fashion-retailer-ready-for-stores/?sh=442b37da6df5
6. https://www.google.com/url?q=https://us.shein.com/affiliate-a-427.html&sa=D&source=editors&ust=1623802895919000&usg=AOvVaw1J4AO5sd_5YrYM_EiJK7Yj
7. https://us.shein.com/Social-responsibility-a-750.htmlusg=AOvVaw1J4AO5sd_5YrYM_EiJK7Yj
8. https://www.google.com/url?q=https://us.shein.com/affiliate-a-427.https://startuptalky.com/shein-success-story/