Digital Business Strategies and ASOS Company Analysis Report

This report provides an executive summary of ASOS's digital business operations, highlighting the company's success as a leading online fashion retailer. It explores key digital technology trends such as connecting customer experience, data-driven business, AI, and facial recognition payments. The report outlines the advantages of digital technology for ASOS, including improved data collection, employee skill enhancement, and increased profitability. It also addresses the implications of digital technology in managing virtual business in a global environment. Furthermore, the report identifies key digital business issues faced by ASOS, such as lack of customer care, shipping costs, competition, technological changes, and ethical considerations. It evaluates new business models like e-commerce and subscription-based approaches to solve these issues. The report also examines collaborative relationships, strategic alliances, and the application of digital business theories within ASOS. Finally, it outlines e-commerce principles and ethical considerations relevant to the company's operations.

DIGITAL BUSINESS

EXECUTIVE SUMMARY
This report has been covered the importance and advantage of the digital business with
the help of which the ASOS company became one of the most popular and in trend digital
business creator. This report has been stated that online platform is one of the key trends with the
help of which the company can connect with the large number of customer and with their
experiences. And the impact of which they get to know the taste and preferences of the
customers and offer them personalized products which suits their body and skin type. This report
has been also stated the impact of AI and Facial recognition payment trend which help the
company in managing all the business operation i.e., from raw material procurement, processing
to payment from customers online. The companies which operate their business via digital
technology is going to expand their business more easily and quickly as compared to the other
companies which operated offline. The report has been concluded that the companies such as
ASOS have around 6.5 million followers on the Instagram channel where they can post new and
unique cloth and beauty products images and advertisement.
These online platforms help the company in improving its data collection and analysis
and use this advantage for the purpose of achieving the profit maximization objectives of the
company. Further, the report has been described the implications of the digital technology which
helps the business in identifying the issues and difficulties the customer faces while selecting the
best products. This helps the company’s marketing team to analyse the data related to the
customer buying decision journey and mould their products as per the customers journey and
buying capacity. This report also has been identified the key digital business issues which faces
by the ASOS company during their business operations. This includes lack of customer care,
additional cost of shipping, increased competition, technological change and ethical issues.
Furthermore, the report state that these issues create difficulty for the company to manage and
improve the consumers and society trust over the company authorization. So, in order to deal and
cope up with such an issue the report has been also recommended the best and suitable new and
emerging business model such as E-commerce business and subscription-based model. These
two models help the ASOS in dealing with the customers issue and providing the best service to
the customers.
This report has been also concluded the collaborative relationship and strategic alliance
with the help of which the ASOS can expand and develop its business into the international

market and reduces unnecessary cost. This report has been also stated the application of the
suitable digital business theory such as Segment of one and Relationship marketing theory in the
ASOS business. At last, the report has been stated the E-commerce principle which help the
company in understanding the digital business importance and its ethical consideration. For this
the report has been covered four principle such as Mastering user experience, personalizing the
shopping experience, FAQ section and different payment options principle.

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Key trends of Digital Technology for ASOS company.........................................................3
1.2 Advantage of digital technology to ASOS company.............................................................4
1.3 Implication of digital technology for managing virtual business in the global environment 5
TASK 2............................................................................................................................................5
2.1 Key digital business issues face by the ASOS company.......................................................5
2.2 Critical evaluation of new and emerging business model to solve digital business issues. . .6
TASK 3............................................................................................................................................7
3.1 Evaluating the impact of new collaborative relationship and strategic alliance through
digital technology........................................................................................................................7
3.2 Application of relevant digital business theory within ASOS company...............................8
TASK 4............................................................................................................................................9
4.1 E-commerce principles uses by ASOS company..................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Digital business are the businesses which uses the information technology to manage its
internal and external operations. The report will be based on the ASOS company that is one of
the most popular British online fashion and cosmetic retailer. The company was founded in 2000
and now became the favourite fashion e-commerce across the globe. Not only that, in the year
2020 the company got 5th rank in fashion and lifestyle category all over the world. The estimated
monthly visitor on the ASOS website is around 33.75 million and the target customers of the
company are young adults. At the present time, ASOS sells around 850 brands from clothing to
beauty product in more than 196 countries including UK, US and EU via using their online
channel and shipping service (Ziginov, 2021).
TASK 1
1.1 Key trends of Digital Technology for ASOS company
The ASOS company currently have their own websites name asos.com from which they sell
thousands of products to the local and international customers at their doorstep via online
delivery. The customers of the company include men and women in their 20s. The company also
uses the Twitter, Instagram, YouTube, Google+, Facebook, Pinterest and other digital channel to
reach large target audience (Cullinane and et.al., 2019). The key trends of digital technology
which is uses and adopted by the ASOS company in enhancing the experience of the consumers
and also spreading the awareness of their products quality. These trends include:
 Connecting the consumer experience: The company form a link between the
experiences of the consumer and their websites in order to provide them personalized
beauty products and also the clothes as per the current trend including their taste and
preferences. It is because around 74% of the consumers around the world think that the
digital business understands their expectations and needs (Sturiale and Scuderi, 2017).
 Data-Driven business: The ASOS company also unlock and analyse their customers
data on their website in order to work according to the customers. By putting their data
on work the company can quickly launch new cloth and cosmetic products as the demand
in the market.
 Artificial Intelligence and Machine learning: This is also one of the key trends of
digital transformation which is uses by and help the ASOS company in provide unique

and best-quality products and services to the consumers. And for this the company need
to do invest in AI tools which help them in increasing their productivity by reducing the
human bias (Alexander, 2018).
 Facial recognition payment: This is the most important trend of the digital technology
and also uses by the ASOS company in order to provide different payment facility to
their customers. Here, the company provide the QR code payment and also online
payment using various bank cards such as debit, credit etc. This trend is slowly gaining
the popularity all around the world.
1.2 Advantage of digital technology to ASOS company
The digital technology provides various advantage to the ASOS company and make them the
most popular online fashion channel around the world. This advantage includes the following:
 Encourage digital culture: The company have more than 6.5 million followers on
Instagram channel which help the company in easily communicating with their
consumers and also identify their expectations and needs (Xue, Parker and Hart, 2020).
 Enable digitalisation of products and services: The digital technology helps the
company in getting touch with the consumers and the impact of which the company is
easily get updated with the news regarding the new trends and idea for the cloth and
cosmetic (Ralarala, 2020).
 Improve data collection and analysis: The use of broadband helps the ASOS in
transferring and accessing the large amount of data and information across the web. With
this the company also able to increase their customer base by making and uploading the
various product advertisement videos and audios in real time (Yli-Viitala and et.al.,
2020).
 Improve the skills of employees: The advance technology also helps in improving the
skills of the employees of the ASOS with the help of which they can easily adapt
themselves with the changing technological environment (Tanga and et.al., 2021).
 Increase company profitability: The digital technology also helps the company in
increasing their profits as the orders of the ASOS products increases year on year which
is around 80000 orders in the year 2020 (Jakosuo, 2019).

1.3 Implication of digital technology for managing virtual business in the global environment
As the global environment is dynamic in nature and changes over the period of time and at
that time managing the virtual business is quite challenging. Because of the covid-19, many other
offline retail business faces lose in their sales as they don’t know about the use online channel
and digital technology. But ASOS company with the help of their digital aspects not only
manages its virtual business but also accelerate its business growth. The implication of digital
technology provides the ASOS company an opportunity of expanding the business in more than
196 countries and also help the company in providing the fast delivery service to their local and
international customers (Saravanan, 2019).
And for this the company incorporated the marketing software automation which defines
the process of the business in clear manner. The ASOS company manages its industrial return on
investment of 13% by using the online delivery service to the local and foreign customers. Not
only that the company also apply the customer relationship management system within their
premises in order to manage the existing and potential customers (Aggarwal, Bhardwaj and
Arora, 2020). And for this the company always try to communicate with its customers in order to
know their issues and concern.
TASK 2
2.1 Key digital business issues face by the ASOS company
Beside of being a king of digital marketing, the ASOS company also faces various challenges
because of having only online business. This challenges and issues include:
 Lack of customer care: As the online stores apps of the company are unable to provide
the 24 hours helpline service to their customers and the impact of which they need to
depend upon the FAQ and product description. And not only that sometime the customer
also not able to see and read those description.
 Additional cost of shipping: As the company provide the goods and services to their
consumers on free delivery basis which cost them around 100 million pound every year.
And around 30% of the customers of ASOS return their products to company which also
increase their shipping charges and this result them high shipping charges is the digital
issues face by the company (Biswas, 2019).

 Increased competition: The company have faced the increase in the competitors because
of various new entrants. They also face difficulty in their pricing strategy as their
competitors try to low their price and also offer the products to the customers via both
online and offline. This result to the decrease in the company’s customer base.
 Technological change: Despite providing various opportunities to the ASOS company,
the continuous changes in the technological innovation creates cyber security issue for
the company. The customers are also concerned about their payment security when they
purchase goods via paying over internet (Aiolfi and Sabbadin, 2019).
 Ethical issues: As the company operates in various countries, that why they face the
difficulty in understanding and following all countries rules, regulations and ethics at a
particular point of time.
2.2 Critical evaluation of new and emerging business model to solve digital business issues
The ASOS company currently have the multi-sided business model by using it they can put
their focus on the overall customer experience. The four main factor which influence the ASOS
business success is people, proposition, products and purpose. In order to solve the key digital
issues, the ASOS company can adopt the various new business model and with the help of which
they can also able to take competitive advantage in the market. The new business model
available to ASOS company are:
 E-commerce business model: This is a model with the help of which the ASOS
company are able to connect people with their online ready to use clothes and beauty
products. This model is basically use by the Amazon company. ASOS can understand the
demand of their customers and also provide them best and unique products online
products. The E-commerce model is best for the company that have only online presence
because it eliminates the needs of physical stores. By adopting this model, the company
can able to provide 24/7 online facility to their customers issues and concern. The
company can also need to adopt the proper pricing strategy in order to deal with their
competitors’ product (Lehdonvirta and et.al., 2020). But as the implementation cost of
this model is high though it is important for the ASOS to use their finances carefully and
eliminate the unnecessary wastage of financial resources from the company.

 Subscription based-model: In order to solve the issue of additional charges of shipping,
the company can use the subscription-based model. In this the company need to launch
free delivery service to the only person that subscribe for the annual premium. And along
with that the free delivery service is also available to the customers that buy the products
more than specific value. For example, if the customer buys the product more than $100
than only the free delivery service available to them rather than above $40 which was
their previous strategy. By using this, the company can able to identify its loyal customer
base and also able to increase their sales if they provide on day delivery service to their
premium customers (Casella and Formenti, 2019).
TASK 3
3.1 Evaluating the impact of new collaborative relationship and strategic alliance through digital
technology
Collaborative Relationship
The collaboration and strategic alliance between the various companies is must in this
digital world if they really want to grow their business to large extent. The strategic alliance and
partnership help the ASOS company to enter the various new market and also able to understand
their products demand without taking risk of losing the market. Here, the different company can
share their resources with each other in order to achieve their similar goal and objective. For this,
it is advisable to the ASOS company that they must collaborate with the many cloths, fashion
and beauty product manufacturing company. The impact of this collaboration is that the
company is able to provide on time delivery of the unique products to their customers located in
around 200 countries (Subiakto, 2021). Here, the ASOS have to work as an intermediary
between the manufacturing company and final consumers. The partners in strategic alliance must
have common goal of customer satisfaction than only they are able to increase their loyal
national and international customer base.
Strategic Alliance
The strategic alliance through digital technology helps the ASOS and other companies to
concentrate on the activities in which they higher expertise and also which best match their
capabilities. This allow the company to access the global market and one more thing is that here
they need not to invest their funds on the research and development. It is because in international
strategic alliance each partner of each country shares all the information related to their country’s

rules, regulation, ethics and customer expectations. By sharing the information with each other
the all-companies partner including ASOS are able to speed up their market and also able to take
competitive advantage over their local market. They can also easily deal with its competitors but
as sometime this strategic alliance leads to the corporate culture clashes and independence which
further lead to loses to the company (Lehdonvirta and et.al., 2020). That’s why it is advisable to
the company that they must try to eliminate the misunderstandings by incorporating the best
communication strategy.
3.2 Application of relevant digital business theory within ASOS company
The current digital business concept of the ASOS company is that they provide the on-
demand and culture-based clothing and fashion products to their local and international
customers having the age group of 20s. The main aim of the company is to increase their
customer base and market share. And in order to do so, it is advisable to the company that they
must apply the relevant theory of digital business. The digital business theory is as follow:
 Segments of one: In this theory, the company need to divide its market segmentation on
the basis of their customers age, culture, believes etc. For this, the ASOS company have
to extend its age group from 20s to all in order to increase their customer base. The
company have to provide cloth and beauty products to all age group from child, teenager,
adults to old people (Fernandez-Lanvin and et.al., 2018).
 Relationship marketing: Another theory of digital transformation which need to be
apply by ASOS is relationship marketing as it helps the company in building the
customer loyalty. The company also need to add more product range by launching new
products and services in their current range. And this is done by the company by forming
a better link and relation between the company and customers (Oh, Lai and Woo, 2019).
TASK 4
4.1 E-commerce principles uses by ASOS company
The e-commerce principles use by the ASOS company in order to became the world’s
leading digital business are as follow:
 Mastering user experience: The ASOS websites design and structure is quite easy as all
customers are able to access it properly and also easily navigate and find information

regarding call of action. Placing the order from asos.com is simple and initiative for the
customers and also, they easily place return and cancel order in case any issue arises. The
company also uses the various channel such as own websites, mobile apps, webs, other
social media platform etc. to allow customer to shop from anywhere and at any time. The
marketing automation technologies helps the company streamline, automate and measure
their various marketing activities and flow (Fernandez-Lanvin and et.al., 2018). For
example, with this technology the ASOS company manages its advertisement and
sustainability campaigns in order to aware the customers that their cosmetics do not
contain any chemical and are natural.
 Personalizing the shopping experience: The company in order to personalize the
shopping experience of the customer use the images and videos content. Here, the
website of the ASOS content various images and videos related to clothing and beauty
products which gives a lot of information without using a single word. Along with that
the customers also able to share that picture and video to their loved ones (Subiakto,
2021). But they also need to understand that this may create challenge of customers data
security to company and for this they have provided the access authority to only
trustworthy personal. By following this principle may cause conflicts among the
customers that don’t want to waste their money on subscription. That’s why it is
advisable to the ASOS that they must provide the real and best benefits to their premium
customers so that all customers buy their subscription. By recommending the customer
with the products they have searched many times on websites and apps have increases the
chances sales increment of company.
 FAQ section to address users needs: The apps and website of company have the FAQ
and description section where the customer places their question and the company and
other users answer that question. This increases the trust of the customers toward their
product quality and also increases the sales revenue of the company. The company also
uses the surgical robots, drones, warehouse pick-and-place robots for moving goods from
one place to another and this also help them in detecting the frauds. The implication of
digital technology also helps the company in managing and improving the lead
generation, customer retention and return on investment etc (Aggarwal, Bhardwaj and
Arora, 2020). This FAQ section must be structured in a simple and concise manner so

that the consumer able to identify the solution of their issues. That’s why in order to solve
this issue the company have to provide the proper information regarding the order
placement, cancellation and returning.
 Different payment option: The company also provide different payment options to their
customers such as debit card, credit card, cash on delivery so that each customer pay
according to their conveniency. The company also use email marketing to generate
revenue (Aggarwal, Bhardwaj and Arora, 2020). The chances of hacking the customers
personal information from their websites by the hackers is one of the issues which affect
the company more and more. This principle and safety measures help the company in
providing the confidential information to authorized personal. The ASOS company
always try to collect the consumers data in order to deliver the relevant and correct ads
and for making this trend they use the brand hashtag and show off their clothing designs
and products.
CONCLUSION
The report concludes the strategy and e-commerce principles uses by the ASOS company
which is one of the most popular digital business in the UK. The report also concludes and
recommend the strategies, theory and business model which further help the company in
increasing their customer base and also help them in coping with their digital issues. The report
further concludes the impact of strategic alliance through digital technology over the ASOS
business performance and how this helps the company in accessing the global market and
sharing other company’s resources.