How the fashion industry shaped up in 2018
We will first look at what changes in focus have occurred for the fashion industry over the recent months. With the introduction of e-commerce, shopping through social media, and a rise in technology-driven customers in recent years, the fashion industry has experienced a shift. So, what are some of the main issues of the sector today?
There have been a number of changes within the industry, as outlined by The State of Fashion 2018 report:
·The ability to personalise products — More customers are looking for products that no one else has through customisable, unique or limited-edition products.
·Customer demands — Customers are becoming more demanding based on what they want from fashion retailers — convenience, quality, values orientation, newness, and price.
·Social media influence — With the use of social media still prominent, customers are becoming more influenced by what they see and read online. They readily share peer-to-peer information, reviews, and opinions. In fact, 55% of consumers purchase decisions are influenced by online reviews and 74% of customers’ purchase decisions are influenced by social media.
·A fall in loyalty — As the ability to compare brands becomes easier, customers are less loyal than they once were. One statistic reveals that among millennials, two-thirds are willing to switch brands for a discount of 30% or more.
As well as striving to meet the needs of their customers, brands are also working much more on their environmental image. But what else is taking up fashion brands’ time?
·Faster supply chain — Retailers in the industry are running at an accelerated pace, as they try and reduce the time taken for a garment to go from design to customer. The digital consumer is becoming accustomed to next-day deliveries and instantaneous access to product ranges online — and brands must find a way to keep up.
·Fast fashion — One topic that’s on the lips of members of the government and eco-conscious individuals is ‘fast-fashion’. This is where consumers purchase a low-cost fashion item, wear it once or twice and then throw it out. Often, these garments are not recycled, and this is a growing concern.
·An emphasis on sustainability — Clothing retailers now realise their responsibility to be eco-friendly. With the growing problem of ‘fast-fashion’ becoming a widely discussed issue, it’s important for brands to make changes. We can expect sustainability to become an integral part of the supply chain and operations planning systems in the coming years too.
There’s also the matter of premium retailers starting to expand further into the online world, something they have been a little reluctant to do. To extend their reach further, premium brands are collaborating with alternative platforms and broadening their target market online.
Meanwhile, lower-priced brands have so many online-only stores that it is difficult to keep track! These differentiate through celebrity endorsements, unique product categories, and through social media. In this sector, customers are less focused on the brand and more on the price — in fact, evidence shows that customers are less brand loyal than they once were, and low-cost fashion brands know this too well.
What different strategies do both types of brand deploy when building their customer relationships?
Luxury brands require a long-lasting relationship with their customer base. They do this by taking the time to understand their audience. Premium denim retailer of brands such as Citizens of Humanity UK, Trilogy Stores, say: “An important part of our business is truly understanding our customer through the one-on-one relationships they have with our stylists. This allows us to tailor new brands towards their needs and develop our premium ranges further in relation to what we know about them. For example, our 'Only at Trilogy' designs are designed in partnership with our best brands to create exclusive styles to us in the UK. This keeps our customers brand loyal”.
Premium brands tend to have more of a physical presence than an online one. Therefore, they must understand the importance of customer service and experience. Often a tailored service is provided, with employees offering a personal shopping service for those who visit and taking the time to understand what the customer is looking for. Premium customers often enjoy a sensory experience too. An example of this is Rolls Royce who diffuses a blend of mahogany wood, leather, and oil for their cars. When potential buyers sit in the model, they’re overwhelmed with the nostalgic smells.
Lower-cost brands require a more short-term connection with their customers. This is done through social media influencers and celebrity endorsements. These marketing techniques bring the brand onto the customer’s feed without them fully realising it. However, the same influencer could promote another brand’s clothing after six-month and this could lead to the customer’s loyalty to stray. One of the main things that these brands compete on is price, and they must be innovative in how they present this to the customer. For example, one online womenswear retailer offered a ‘minimum wage’ category where everything was £7.50 to appeal to their younger market.
The fashion industry has certain been shaken up in recent years. Premium and low-cost fashion brands must keep in mind that, although they operate in the same industry, the way that they connect with their customers is entirely different.