Fashion Expectations in 2020
Fashion Expectation in 2020
TAASDIGITAL
December 11, 2019
Fashion in 2020
Recently, McKinsey & Company, in cooperation with Business of Fashion, published and generously shared a comprehensive overview of "The State of Fashion 2020."
The in-depth report sheds light on the significant shifts happening within and around the Apparel industry, listing the significant trends, influences, and innovations shaping the apparel industry's transformation in 2020.
The major themes that will color the fashion change in the upcoming 2020 show that the apparel industry is heading towards slower growth in 2020 compared to the previous year. The success of fashion companies will depend on their ability to adapt, respond, and maneuver through the increasingly unsettled global markets. The technologically savvy younger consumer will dictate how fashion is made, consumed, and discarded.
Demand for a more sustainable clothing-making process and fashion digitization is gaining more traction. Consumers, especially new generations, are not shy about expressing their concerns and opinions about sustainability and the environmental perils caused by fashion production practices.
Their voices are quite loud, clear, and viral. It is no secret anymore that the apparel industry tops the charts as the biggest polluter on this planet, right behind the oil and gas industry!
GLOBAL ECONOMY AND FASHION
Today's global economy is quite unstable, and it is causing a deep wave of pressure and uncertainty for fashion industry leaders. "Fashion Darwinism" is emerging, and only the best and most adopted will survive.
The change is happening fast, and if apparel companies and retailers are not ready to adapt and adjust, they will be driven to obscurity or vanish.
Sustainability and digitization are taking center stage when considering transformation in how fashion operates. According to the McKinsey report, innovation is the next big opportunity for the apparel industry. The big corporations have the resources to embark on this exciting journey. However, small and medium-sized companies are slightly less enchanted by the opportunity, as they will need to plan for the sized investments to face upcoming challenges. Resiliency will be the key to staying relevant. Luxury markets are doing fine and are on the way up to increasing their market share.
China is a robust market for fashion brands and will remain a leader in the global fashion industry. However, competition is getting tougher as too many fashion brands are fighting for the same market pie.
There are other market opportunities on the rise, such as in India, especially for fashion brands that can compete with pricing. India is still considered one of the fastest-growing economies. The prediction is that the Indian clothing market will be valued at 53.7 billion in 2020 (McKinsey FashionScope data).
Other potentially active markets across southeast Asia are Indonesia (possibly the largest modest fashion market in the world) and the Philippines, where some consumers have a high affinity for Western fashion trends (The State of Fashion 2020, pg.24).
" International fashion media has mostly overlooked Russia's fashion scene." Yet Russia's clothing market is valued at close to $30 billion annually and is the ninth-largest in the world, according to data from McKinsey FashionScope. Growing tourism (especially from China) will significantly add to the attractive opportunity of this market.
Brazil is another area with high potential, as consumer confidence is rising (McKinsey's 2019 Global Sentiment Survey). Despite the high tariffs for textiles (23.2 percent, according to the World Trade Organization), many brands are exploring the option of entering the Brazilian market.
The Middle East, especially Gulf countries, still plays a significant role in the fashion market. According to a McKinsey report, although much smaller in population size than China, the market is given "an outsized role among international fashion markets" as the "average consumer in the UAE and Saudi Arabia spends over 6 times and 2 times as much on fashion as the average consumer in China." (McKinsey analysis, based on Euromonitor data).
SHIFT IN CONSUMER'S SENSIBILITY-SUSTAINABILITY FIRST
The well-known (or not) fact that the fashion industry is hugely wasteful is beyond alarming. Overproduction and the natural result of it, overconsumption, is the primary culprit. The truth is that approximately 73% or more of produced clothing is burned or in a landfill! (Ellen Macarthur Foundation)
Some progress has been made in advancing the thought of making the apparel industry more sustainable. However, the fashion industry generally did not take "environmental responsibility seriously enough. Next year fashion players need to swap platitudes and promotional noise for meaningful action and regulatory compliance while facing consumer demand for transformational change."(The State of Fashion 2020, McKinsey, page 52).
Now, sustainability is at the top as the biggest challenge facing the apparel industry. Simultaneously, this challenge presents itself as an opportunity if executed the right way.
There is a caveat to sustainable fashion execution. Currently, there is no such thing as a 100% sustainable clothing-making process or sustainable brand. Potentially, some brands might incorporate parts of the somewhat sustainable process. However, to make fashion sustainable, 100% will take some significant capital investment and drastic changes in the current supply chain model! There will be no guarantee of returns, as the general public is still unwilling to pay the higher price for sustainable clothing.
It is difficult to bypass the fact that, at the core, the change in consumer behavior needs to happen and to do that, clear information must be communicated to the consumer.
Much " greenwashing " is going on, and sustainable terminology is used quite often for marketing purposes rather than the actual practice. "Consumers are unsure what "sustainability" means or how to identify sustainable brands" anymore.”. (McKinsey and BOF report State of Fashion 2020, page 53)
On the positive side, general awareness of more sustainable ways of producing and consuming fashion is rising.
These challenges are not easy for the fashion industry, as it pushes them to finally take a more in-depth look at internal issues that have been plugging them for decades! The hard "push for sustainability" forces many fashion brands to take a hard look into their business model and eventually change them.
Responsible business practices are in high demand nowadays. Newly formed younger fashion consumers expect enhanced services, on-demand fashion, and exciting virtual experiences within the retail environment. On the other hand, most fashion executives do not necessarily understand the sentiment of Generation Z, which is rising to the most significant global customer segment.
To stay relevant, fashion brands will need to take a really good look at the upcoming risks and the steps they need to take. The risks are significant as there will be a high cost in disrupting the way clothing is designed and sampled, the supply chain set up, and many other components of the daily fashion-making business.
Source: Ellen MacArthur Foundation
CAN THE FASHION SYSTEM CHANGE?
It is the 21st century, and technology still has not been fully utilized to improve how clothing is made and leverage its advantages. 3D virtual sampling as a part of the solution to transform the way industry functions right now is still "being considered." The interest is growing, and larger companies adopted various 3D technologies in an attempt to, at least partially, unify fragmented supply chain systems, speed up products to market, and reduce waste along the way.
Not too shabby, considering the mentality of the industry. Change is always an issue. With the move, other long-forgotten issues will surface very quickly. It is challenging to deal with all of them at once.
However, planting the idea and changing the mindset is a colossal undertaking. Once that happens, all other changes will fall into place naturally.
THE NEW FASHION CONSUMER-GENERATION Z
A static image displaying a product with a model or influencer will no longer cut it forward. Industry executives believe that the top trend shaping the fashion industry within the next 12 months will be a rise in the importance of "storytelling" and marketing strategies that resemble media productions.
Authenticity will be the driving selling force rather than just influencers promoting the product. (BoF-McKinsey State of Fashion 2020 Survey).
The harsh reality is that it is increasingly hard to excite and inspire audiences who are overwhelmed and overstimulated with the platitude of instant digital information.
Established social media platforms are becoming "boring" to new and upcoming consumer generations. The more modern platforms are emerging and are far more dynamic than the traditional ones. However, fashion brands are generally not that quick to increase their marketing spending habits on new platforms such as TikTok, the most significant emerging social media platform. The moving image content is sourced globally by artificial intelligence. Short video streaming is taking over. Static photos are on their way out, at least as a way to appeal to the newest fashion consumer.
Another exciting twist for fashion consumption lies in the gaming industry. 3D virtual fashion is taking off. Popular games such as Fortnite and Tencent's mobile game Hour of Kings are becoming embedded in young culture. Fortnite is a free game with 200 million users. The company makes a good buck by selling avatar skins (fashionable outfits for avatars). Watch for the 3D fashion rise!
Source:tubefilter.com
Generally, traditional social media platforms are ineffective. Static ads are uneventful for a new consumer wave. Fashion brands will have to understand which social media platform is the best to reach and engage with their customers in a dynamic and personal way. The region and demographics require specific care if they want to stay relevant at all.
For example, TikTok (Douyin) is extremely popular with young people. They just launched a game-changing in-video search function through which users can zoom in on clothing, or other items in the video, link through to related content, and even directly purchase products — all from within the app. These are not videos that are actively selling or promoting products, but somewhat regular user-generated content — any post from anybody could become a potential sale." (McKinsey and BOF report State of Fashion 2020)
The concept is genuinely lucrative. Now it is up to fashion brands to devise a smart approach to leverage such an opportunity.
NEW GENERATION OF SOCIAL MEDIA SOCIETY
What is the future of social media? The prospects are dizzying. If you want to take a peek into the future, Asia would be a place to look.
According to McKinsey and BOF report, "Global fashion brands are still learning how to leverage powerful apps like WeChat and TikTok, but Asia's digital ecosystem has already hatched the next generation of social platforms. With hundreds of millions of users ready to be converted into consumers, brands need to invest now."
It is apparent that the notion of the "social new" sparks the interest of the general younger population, and they all embrace it without hesitation.
It seems that brands need to adjust their strategies accordingly and become quite agile when it comes to social media evolution.
Brands will have to find creative ways to maximize the efforts on various platforms to "connect with their audience," as it is increasingly evident that soon, social media platforms might soon be the only way to reach a vast customer base.
The nature of transiency as the new norm of obtaining knowledge or any information is staggering. The possibility and probability of arbitrarily manipulating data and casually delivering it as truthful and factual information is becoming way too easy.
Consequentially establishing the new "norm" of the truth, which might be factually false and speculative, is scary.
There is a need for authenticity, transparency, and ingenuity. Some of us transpire an instinctual longing to return to "basics" and preserve the legacy of authentic and genuine knowledge. We all intuitively strive for it.
Connect with us to learn more about fashion technology, sustainable practices within the apparel industry, and 3D digital pattern making.
