Visiting Spain last year, I was more than intrigued to discover a double publication sold as one at a local newsstand that featured both Vogue and Vogue Business. Always thinking back warmly on my time in the corporate office of a major fashion brand located on Fifth Avenue, it was a surprise to see this magazine for the first time and not in New York.
Since then, I have followed them on social media and subscribed to their newsletter. I must say that the content is high quality, even considering the expectations one would already have trying out something by Vogue. The membership price for the insights is fairly reasonable with a starting price of $154 per year but still with plenty of material offered to users for free if they do not currently have the budget for it. For quick snapshots of relevant data and developments, the Instagram stories are worth checking out. For longer and more in depth commentary and analysis, there is a YouTube channel. Both are available at no charge.
In fact, this is how I was able to listen in to one of the webinars offered and write this update. For anyone in the industry, especially in the decision making function, I highly recommend watching the overview of the market and the changes that have occurred this year.
To start, there has been a 35% contraction in the market since COVID, with the most significant drop in purchases over $100. The US has not been as majorly affected due to the fact that the activity is mostly domestic as opposed to being dependent on tourism. Another change to note is that there is a higher demand for basic and affordable clothing compared to all of the other categories.
What have been the top opportunities for fashion companies? First and foremost, it is PPE and masks, followed by tops, bottoms, shoes, and athleisure as a separate section of items. WFH trends are projected to extend into the new normal with the popular combination of a professional top and a casual bottom here to stay. "Zoom Top" is an actual search term that pulls more than a 100 results from websites such as Lulus. The highest performing style? Quiet luxury.
About 35% of fashion merchants have added new items to keep up with COVID. Etsy has pulled in $350 million in profits from PPE and masks while GAP has added $130 million from the same in just one quarter. Agility has been shown by these companies as a great survival tactic.
Where is the spending coming from? Mostly from the extra pocket money saved through minimal travel and entertainment expenses. The focus has instead shifted to the higher quality fashion products. Frugality, in this situation, has been more about quality instead of quantity.
It is also safe to say that "online shopping has been fully accepted". More than 56% of consumers will buy online due to COVID. Only 61% will return to the physical stores and only if it verifiably safe to do so. Add to this the often considered tax differences for companies between offering items through e-commerce as opposed to the brick-and-mortar business model, and the direction becomes clearer.
Physical stores have moved to the more supporting role to online shopping and will act as a "fulfillment piece". This is to be expected, as the US market is over-retailed as it is. Before the pandemic, malls were the second preferred shopping venue. Now they are in the fifth place, according to the surveys conducted by Vogue Business. E-commerce at largest retailers has taken the top spot, closely followed by e-commerce at local shops.
What are some of the other trends that were highlighted by the presenters? Sustainable consumption is on the rise together with responsible fashion. Purchase decisions will be primarily based on the price, free shipping, and the trust towards the retailer. In fact, this can be applied to sellers in any industry, not just fashion. What should fashion brands focus on besides these recommendations? They can win if they work on brand discovery. When will they be able to get the most customer traffic? It will be during the upcoming holiday season (46% of shoppers, according to survey) and after the pandemic.
In conclusion, the key takeaways are as follows:
Absorb and adapt to consumer habits
Remain in or enter the local market
Get ready for the holiday season