Macro trends
fall/winter 2022-2023.
fall/winter 2022-2023.
MAX MARA
How to position your brand if your customer is timeless and in no hurry to follow fashion
This report is based on the successful practices of both global and local brands. It contains solutions which have allowed some companies to start recovering from a critical drop in sales earlier than others, despite the numerous restrictions, and even to compensate for their losses.
Trendsite forecasts divide market players into two categories:
Trendsite forecasts divide market players into two categories:
These collected case studies and recommendations will help companies whose customers are innovative and are first to accept fashion trends, choose the most effective business strategy.
Innovators such as ASOS, Gucci, Louis Vuitton, Jacquemus
Adopters which do not create styles but follow trends and adapt them to their customers, for example companies such as Uniqlo, Arket, Max Mara.
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WHO ARE THEIR CUSTOMERS AND HOW DO THEY MAKE PURCHASING DECISIONS?
#EXPERIENCED #SLOW #THOUGHTFUL #TACTILE #PICKY #LOYAL #BUSY
Extremely loyal - chooses a brand and stays with it
Thoughtful; they do not pursue novelty
They trust the opinions of celebrities and their peer group
They are very busy, so they want ready-made solutions
They see social media primarily as a way of communicating with family, but they are ready to interact with brands online
They prefer shopping centres and hypermarkets to small independent shops
They are willing to pay more for quality
Thoughtful; they do not pursue novelty
They trust the opinions of celebrities and their peer group
They are very busy, so they want ready-made solutions
They see social media primarily as a way of communicating with family, but they are ready to interact with brands online
They prefer shopping centres and hypermarkets to small independent shops
They are willing to pay more for quality
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Adopters
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The second half of 2022 will be associated with life gradually returning to normal and the fashion retail industry continuing its process of recovery. Many companies are already reporting pre-pandemic sales but, nevertheless, the number of well-known brands which have gone bankrupt and been forced to close suggests that the crisis has radically changed, and continues to change, the structure of the fashion industry. This was undoubtedly influenced by the shift in purchasing preferences which came about due to the forced restrictions associated with the pandemic. The shutdown of offline stores combined with the economic downturn made shoppers more discerning. Physical shopping was replaced by online shopping, and this provided buyers with an unlimited choice.
The polarization of types of buying behaviour has intensified during the pandemic: buyers-innovators are increasingly guided by technological innovations, while adopters, missing their usual way of life, strive to return to their familiar offline shopping habits as quickly as possible.
The use of technology in retail is becoming a global trend, no matter if it is about selling online or selling offline. "Over the past years, we've seen e-commerce take over traditional retail," says Greg Lisewski, Vice President of Global Products for Pay Later at PayPal. "Online and digital shopping required retailers to quickly adapt to changing shopping behaviour. And these processes accelerated significantly during the pandemic. Now, more than ever, consumers want to be in control of how they pay and are looking for hassle-free digital shopping."
The polarization of types of buying behaviour has intensified during the pandemic: buyers-innovators are increasingly guided by technological innovations, while adopters, missing their usual way of life, strive to return to their familiar offline shopping habits as quickly as possible.
The use of technology in retail is becoming a global trend, no matter if it is about selling online or selling offline. "Over the past years, we've seen e-commerce take over traditional retail," says Greg Lisewski, Vice President of Global Products for Pay Later at PayPal. "Online and digital shopping required retailers to quickly adapt to changing shopping behaviour. And these processes accelerated significantly during the pandemic. Now, more than ever, consumers want to be in control of how they pay and are looking for hassle-free digital shopping."
However, the development of new communication channels has sparked a new wave of consumer interest in environmental issues, ethical production and corporate social responsibility. The stated position and the actual actions of a company on these issues can become a motivator for buying their product as much as their designs and brand awareness. Think about which values your customers share. They should be the starting point in your search for new forms of business development.
What's happening?
The rapid digitalization of retail has suddenly presented shoppers with endless choices. But is such diversity always welcome? For adopter shoppers who have limited time and are committed to finding "the right thing," such changes are a real challenge. It is important to remember that we are dealing with a special group of people, one for whom the psycho-emotional factors associated with shopping are more important than price or the excitement of making a purchase.
It seemed that artificial intelligence and machine learning could solve the problem of infinite choice, but another problem has arisen: shoppers-adopters make unpredictable choices. It is impossible to establish patterns simply from counting the number of clicks: for this group such collections will still be random.
Help the customer make a choice
Anabel Maldonado, a fashion journalist with a degree in psychology, believes that for more accurate search recommendations, and therefore a higher conversion rate, standard algorithms need to take the psychological characteristics of the buyer's personality into account so she founded the shopping platform Psykhe, where she combines technological advances with a scientifically based five-factor personality model. This model is known as the Big Five; it is a psychological model that describes the structure of an individual's personality through five common, relatively independent traits.
Recommendations are made on the basis of a short psychological test which the customer takes during registration and take into account not only the characteristics of the product and past purchases, but also the unique characteristics of the buyer. "This personalisation of Psykhe's consumers' needs allows for a better understanding of which combinations trigger an intuitive response. Our model tries to imitate how people can intuitively look at a thing and say "this is me" or "this is not me." This level of consistency is what we measure and organise using artificial intelligence and psychology" she says.
The Psykhe platform uses the test results to generate shopping recommendations from collections connected to the online store platform. In parallel with this, the buyer can also set up filters not only by product category, but also by mood (calm, romantic, risky, etc.) or by event. Therefore, brands with a good "understanding" of what the customer feels, and how they want to position themselves within their environment, will find ready customers in a world full of faceless marketplaces.
Recommendations are made on the basis of a short psychological test which the customer takes during registration and take into account not only the characteristics of the product and past purchases, but also the unique characteristics of the buyer. "This personalisation of Psykhe's consumers' needs allows for a better understanding of which combinations trigger an intuitive response. Our model tries to imitate how people can intuitively look at a thing and say "this is me" or "this is not me." This level of consistency is what we measure and organise using artificial intelligence and psychology" she says.
The Psykhe platform uses the test results to generate shopping recommendations from collections connected to the online store platform. In parallel with this, the buyer can also set up filters not only by product category, but also by mood (calm, romantic, risky, etc.) or by event. Therefore, brands with a good "understanding" of what the customer feels, and how they want to position themselves within their environment, will find ready customers in a world full of faceless marketplaces.
Adopting brands which create products around long-term, off-season trends often have a hard time promoting their merchandise. Their competitors operate in the same market, constantly updating their collections and persistently convincing buyers that showing up in one thing several times is a fashion "crime".
The quality of tailoring and fabrics are key strengths for adopting companies but, in the age of the Internet, how can you convince buyers that the brand can really be trusted if buyers don't get to touch the goods? In the era of responsible consumption, environmentally conscious brands are in demand; they call on customers to spend money, but also reward them for wearing their clothes.
For example, Wool & Prince has been running the 100-Day Challenge program for several years. Customers are asked to wear the same $138 wool shirt for 100 days. In addition to the obvious bonus of a free new shirt if you completed the challenge, participants (and there are already more than 200 of them) noted that this turned out to be really positive experience due to the quality of the wool and the durability of the product, as well as the time they saved. The most interesting thing is that through this challenge the brand was able to attract the attention of one of the most difficult groups of buyers - adult men who are not interested in fashion trends.
The quality of tailoring and fabrics are key strengths for adopting companies but, in the age of the Internet, how can you convince buyers that the brand can really be trusted if buyers don't get to touch the goods? In the era of responsible consumption, environmentally conscious brands are in demand; they call on customers to spend money, but also reward them for wearing their clothes.
For example, Wool & Prince has been running the 100-Day Challenge program for several years. Customers are asked to wear the same $138 wool shirt for 100 days. In addition to the obvious bonus of a free new shirt if you completed the challenge, participants (and there are already more than 200 of them) noted that this turned out to be really positive experience due to the quality of the wool and the durability of the product, as well as the time they saved. The most interesting thing is that through this challenge the brand was able to attract the attention of one of the most difficult groups of buyers - adult men who are not interested in fashion trends.
Convince the customer of the quality
Another good example is the Outfit repeater challenge from the Aday brand. For two weeks the brand challenged its loyal customers to wear only their brand in different combinations. At the end of the two weeks the customer could receive a coupon for new purchases of between $25 to $75. In addition to the obvious economic benefits, 72% of the test participants noted that, following this, they changed their preferences in building a wardrobe.
At first glance the idea of inviting shoppers to make informed purchases and wear every item in their wardrobe for longer seems uncommercial. A loyal customer will reduce the number of trips they make to the store per month, but ,after making sure of the quality, they will continue to dress in the brand they wear most often. The maths is simple: an inexpensive, $30 mass produced item will often deteriorate after a couple of washes and after 2-3 months it completely loses its relevance,. On the other hand, a high-quality item $150 not linked to a particular season will work in your wardrobe for 2-3 seasons, perhaps even longer. It turns out that the cost of each use for a high-quality item is much lower than that of a low-quality item.
The efficiency of this business model is also supported by the fact that the investment arm of H&M (a group of companies specializing in fast food) has invested $ 2 million in the Aday brand. Brands which have built a marketing strategy with an emphasis on quality in the new post-pandemic reality are turning from niche into attractive investment opportunities.
At first glance the idea of inviting shoppers to make informed purchases and wear every item in their wardrobe for longer seems uncommercial. A loyal customer will reduce the number of trips they make to the store per month, but ,after making sure of the quality, they will continue to dress in the brand they wear most often. The maths is simple: an inexpensive, $30 mass produced item will often deteriorate after a couple of washes and after 2-3 months it completely loses its relevance,. On the other hand, a high-quality item $150 not linked to a particular season will work in your wardrobe for 2-3 seasons, perhaps even longer. It turns out that the cost of each use for a high-quality item is much lower than that of a low-quality item.
The efficiency of this business model is also supported by the fact that the investment arm of H&M (a group of companies specializing in fast food) has invested $ 2 million in the Aday brand. Brands which have built a marketing strategy with an emphasis on quality in the new post-pandemic reality are turning from niche into attractive investment opportunities.
In the entire history of fashion retail, stores have gone through more than one crisis. However, lockdowns and the complete transition of shopping to digital, even for a limited time, caused systemic changes in the industry. Now, many customers do not see the point in going to the store - it is risky from a health point of view and extremely tiring compared to being able to order everything on the Internet.
Doug Stevens, a futurist who studies consumption and how retail chains operate, believes that retail is at the point where brands need to offer shoppers new "radical value". Value can be created in one of four key areas: culture, entertainment, expertise and product. For offline stores, the first two are the most relevant.
The Patagonia brand is an example of radical cultural value: the brand communicates sustainability not only in online advertising but also in offline points of sale, offering the opportunity to fix the brand's items in the store and extend their lifespan. And the recently opened Uniqlo store in Yokohama is already a full-fledged family fun park in the store, which both children and adults will want to visit.
Doug Stevens, a futurist who studies consumption and how retail chains operate, believes that retail is at the point where brands need to offer shoppers new "radical value". Value can be created in one of four key areas: culture, entertainment, expertise and product. For offline stores, the first two are the most relevant.
The Patagonia brand is an example of radical cultural value: the brand communicates sustainability not only in online advertising but also in offline points of sale, offering the opportunity to fix the brand's items in the store and extend their lifespan. And the recently opened Uniqlo store in Yokohama is already a full-fledged family fun park in the store, which both children and adults will want to visit.
Bring the customer back to the store
At the same time, many brands have seriously rethought the offline sales system as a whole. For example, the Bloomindales department store chain, instead of opening ordinary points of sale of thousands of square meters, opened the Bloomie's mini-format. This is a completely new concept for such giants, which implies a more personalized approach to each customer. In such a store, there is not all the variety of a department store, but thoughtful selections are presented to simplify the selection. The buyer can not only conveniently receive and return an online order, but also chat with a stylist or just relax.
On the other hand, Sook's "flexible retail platform", based on the concept of using space without imposing long-term leases, has become increasingly popular.
Many shops in London closed down during the pandemic, even those in busy shopping areas. Sook, which is a startup, offers these spaces a new lease of life. Crucially, their concept is not about offering static pop-up spaces created specifically for a particular brand or event, but is about providing technological and design solutions with smart mobile combinations of digital screens and modular furniture. New tenants can customize the spaces and showcases for their own purposes in minutes, not hours or days, and use them for presentations and launches, as well as for brand events such as yoga classes, exhibitions and concerts.
Despite the fact that the public has repeatedly said that online has beaten offline, reality shows that, in the era of omnichannel formats, companies which have chosen to adapt and change without completely abandoning traditional sales formats are more successful.
On the other hand, Sook's "flexible retail platform", based on the concept of using space without imposing long-term leases, has become increasingly popular.
Many shops in London closed down during the pandemic, even those in busy shopping areas. Sook, which is a startup, offers these spaces a new lease of life. Crucially, their concept is not about offering static pop-up spaces created specifically for a particular brand or event, but is about providing technological and design solutions with smart mobile combinations of digital screens and modular furniture. New tenants can customize the spaces and showcases for their own purposes in minutes, not hours or days, and use them for presentations and launches, as well as for brand events such as yoga classes, exhibitions and concerts.
Despite the fact that the public has repeatedly said that online has beaten offline, reality shows that, in the era of omnichannel formats, companies which have chosen to adapt and change without completely abandoning traditional sales formats are more successful.
In a world where almost any fashion item can be obtained within a few hours, it becomes more difficult to maintain the value of the purchase and the joy of owning: the buyer either abandons what he wants in favor of a more budgetary one or uses a credit card, which also overshadows the joy of owning.
Therefore, fintech services offer customers a new, more informed shopping service called "Save-to-buy", which has become an alternative to the widely popular fintech services Buy now Pay later.
The essence of Save-to-buy is connecting the buyer's bank account to the application for automated deduction of the purchase amount. As soon as a sufficient amount is accumulated, the buyer, like in a game, has access to pay for the desired item. This is how the Cashmere and Reel apps work. At the same time, the platforms work with such well-known retailers as Selfridges, Nordstrom, Net-a-Porter, Farfetch and Vestiaire Collective. Other Save-to-buy services, for example, Hyperjar, allow the buyers themselves to choose a goal for accumulation and spend money only on the selected purchase.
The idea for the Cashemere app came to its creator, Urena Okonkwo, while shopping at Harrods, when she was in front of her dream shoes, but with a price tag of £ 600. Then she thought, "There must be another way to shop without feeling guilty or using outdated banking services."
Therefore, fintech services offer customers a new, more informed shopping service called "Save-to-buy", which has become an alternative to the widely popular fintech services Buy now Pay later.
The essence of Save-to-buy is connecting the buyer's bank account to the application for automated deduction of the purchase amount. As soon as a sufficient amount is accumulated, the buyer, like in a game, has access to pay for the desired item. This is how the Cashmere and Reel apps work. At the same time, the platforms work with such well-known retailers as Selfridges, Nordstrom, Net-a-Porter, Farfetch and Vestiaire Collective. Other Save-to-buy services, for example, Hyperjar, allow the buyers themselves to choose a goal for accumulation and spend money only on the selected purchase.
The idea for the Cashemere app came to its creator, Urena Okonkwo, while shopping at Harrods, when she was in front of her dream shoes, but with a price tag of £ 600. Then she thought, "There must be another way to shop without feeling guilty or using outdated banking services."
Similar services can be connected within the same brand for adoptive buyers. Smart, deliberate purchases are much more valuable to them than impulsive ones. In addition, with this approach, it becomes obvious that the value of the thing will not change, even after a while.
Recreate purchase value
The ecological responsibility of brands to customers is an important aspect of the development of the fashion business in the coming years. And the question is not only how environmentally friendly and ethical the technologies used in production are. It is much more important how well the processes are planned so that there is no overproduction.
Consumer experts from Euromonitor International also note the growing importance of the social and political dimension of fashion to consumers. According to a 2021 study, 65 percent of insider experts agreed that sustainability and environmental issues will influence business trends over the next five years. And this means that it will not be possible to stay away from the ongoing processes.
Low-volume designer niche brands often use stock fabrics to create collections, primarily for reasons of economy. Ordering a new fabric from manufacturers is always a minimum circulation and a long wait. But thanks to the growing public interest in the circular economy (Circular economy or circular economy - in a general sense, it is a renewable economy, an alternative to the traditional linear economy), this practice becomes part of the environmental strategies of large corporations.
In April 2021, LVMH, which owns brands such as Louis Vuitton, Dior and Givenchy, launched the Nona Source platform. It gives independent designers access to high quality fabrics, produced and unused by the group's brands, at below market prices.
Consumer experts from Euromonitor International also note the growing importance of the social and political dimension of fashion to consumers. According to a 2021 study, 65 percent of insider experts agreed that sustainability and environmental issues will influence business trends over the next five years. And this means that it will not be possible to stay away from the ongoing processes.
Low-volume designer niche brands often use stock fabrics to create collections, primarily for reasons of economy. Ordering a new fabric from manufacturers is always a minimum circulation and a long wait. But thanks to the growing public interest in the circular economy (Circular economy or circular economy - in a general sense, it is a renewable economy, an alternative to the traditional linear economy), this practice becomes part of the environmental strategies of large corporations.
In April 2021, LVMH, which owns brands such as Louis Vuitton, Dior and Givenchy, launched the Nona Source platform. It gives independent designers access to high quality fabrics, produced and unused by the group's brands, at below market prices.
Use existing resources
"We encourage creative use of existing resources," says co-creator Marie Falgera. By July 2021, Nona Source has received 1,000 fabrics from LVMH, from crepe de Chine to cotton poplin and Shetland's light wool, and plans to double the number of items featured by next year.
The Nona Source project not only pursues sustainable goals in its work, giving fabrics a second life, but also helps the design community. "This is not about profit, but about supporting creative communities," continues her colleague Romain Brabo's thought to Marie. "We sell materials for about a third of the regular price." A similar position is taken by Burberry, which announced its ReBurberry Fabric Initiative in December 2020. The brand has partnered with the British Fashion Council to create a program to donate fabrics from archival collections of unused materials to fashion students in the UK.
The Nona Source project not only pursues sustainable goals in its work, giving fabrics a second life, but also helps the design community. "This is not about profit, but about supporting creative communities," continues her colleague Romain Brabo's thought to Marie. "We sell materials for about a third of the regular price." A similar position is taken by Burberry, which announced its ReBurberry Fabric Initiative in December 2020. The brand has partnered with the British Fashion Council to create a program to donate fabrics from archival collections of unused materials to fashion students in the UK.
• HELP THE CUSTOMER MAKE A CHOICE
Use artificial intelligence and psychology to create an individual approach to each customer
What to do right now?
• CONVINCE THE BUYER OF THE QUALITY
Implement online technologies for better intuitive searches on your site: the more you understand your customers' requests, the higher the likelihood of conversion to purchases.
• BRING THE CUSTOMER BACK TO THE STORE
Give shoppers an opportunity to make an impulse purchase. With new fintech tools, your online store can attract new hesitant shoppers and increase your average purchase order.
• RECREATE PURCHASE VALUE
Use accumulative fintech tools to convince your shopper that deliberate, informed purchases will bring more joy of ownership.
• USE EXISTING RESOURCES
Avoid over-production and opt for pre-made stock fabrics for a gradual transition to greener production.