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CLASS NOTES ON STATE OF FASHION - GLOBAL ECONOMY

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CLASS NOTES ON STATE OF FASHION - GLOBAL ECONOMY

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McKinsey questionnaire - consumer confidence and appetite to spend is now the number one worry, geo political instability is now second

Luxury vs non luxury international growth - all quite low numbers except china is showing decrease in luxury growth

Super Winners - Nike drops to 3, inditex to 2,

Differentiation in 2025

Localization in different ways from marketing differences and product

Friend-shoring - trading in balance with political alignment

Near-shoring - NEAR

Global Economy

asias new growth engines

china deceleration

new challenges with domestic competition but international is still growing due to localization

outdoor brand growth is still quite large

Luxury shaming could show growth in quiet luxury and shift in class chinese consumer goods

india focus for growth

up 54 pts on growth

expected to become 4th largest economy in the world by 2027

non luxury is pushed by middle class who are open to international brands

young population

fastest growing ultra high net worth population as well

challenges

infrastructure - high quality realestate, last mile delivery

local consumer dynamics - cultural influences on fashion making it important to localize - can be a pain, overall local branad preffference with consumers still

regulatory requirements - regional taxes

japaaaan

Growing market because of tax free and that the yen is really cheap

The Gaisho

GLOBAL ECONOMY SUMMARY -

Biggest takeaway - just because there isnt growth, doesnt mean that it is less important. This is seen in China and many places. Everything is coming back to home land as well, this is clear with geo political issues. Overall slow down and more conciousness, with quality, quiet luxury, usable pieces, and just less in general. Time to get smart. Consumers are becoming more aware, and countries are getting more tight with their globalization.

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CLASS NOTES ON STATE OF FASHION - CONSUMER SHIFTS

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CLASS NOTES ON STATE OF FASHION - CONSUMER SHIFTS

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DISCOVERY REINVENTED

consumers say there is toooo much volume of choice and also that online search is a barrier to purchase rather than a tool - starts with consumer behavior and strategy adjusts from there

brands responding by narrowing offer

using generative AI to tailor to consumer for PRODUCT DISCOVERY

AI assistant searching and personal helper

in China its called wenwen

New industry innovations

Daydream - highly specified search engine

capsule - image searching with 99% effectiveness

constructor - another tailored search engine

Social commerce

tiktok will be big on social

Pinterest will start

SILVER SPENDERS

birth rates dropping, people getting older

it will get harder for brands to drive growth from just younger consumers as they have less and less spending power

priorities

experiences

not trend driven

practicality

shop in store - multibrand retailers - not department

multi-generational marketing

understanding visible, psychological, and lifestyle ages as different things

how to connect to all of them simultaneously

AGE INCLUSIVITY

VALUE SHIFT

trading down

going for the more affordable option, even within dupes etc

search for the cheapest price

resale and pre owned

not even just economic pressure but they are logically thinking smarter with spending on fashion

think about all those tiktok alternative videos

Getting much more specific overall, more niche and specified after so much overload on information

Generation Alpha

Normalizing buying fakes

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Global Economy

Europe - overall optimism for the economy

https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/an-update-on-european-consumer-sentiment

which would signify increase consumer spending

USA

Expected increase in consumer growth as 30% of americans say they're better off financially

https://finance.yahoo.com/video/consumer-spending-grow-6-2025-170335818.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAANHlBPGKq8NeShqIIVrzPwlJf8-3meC940IgvjDtMcJ7kKcHgStzAooAZ9e3wuA1dsmlKgJIwcb0TLpN8805AHQkDGhm4B7QpcyI7bHHTOiRfFyeBXY22LmjIeF-8pLcB_ejpFQxk6kmZOARu6r1OL8m1bqL2nuTTIFn3tFji2yF

main downside risks are middle east complications and the election

https://www.oxfordeconomics.com/resource/the-us-consumer-will-remain-a-pillar-of-strength/

https://nielseniq.com/global/en/news-center/2024/nielseniq-mid-year-consumer-outlook/

China

demographic change with aging creates economic worry

India

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Consumers in Europe reported mixed feelings about the economy in August. Those feelings manifested into a range of behaviors-for example, price became a more important factor in purchase decisions. A greater emphasis on the omnichannel experience, as well as health and environmental considerations, also characterized European consumer behavior in the third quarter of 2023. The following six charts highlight findings from our latest ConsumerWise research in five European countries: France, Germany, Italy, Spain, and the United Kingdom.

This snapshot of the European consumer reflects the complicated world around them, one in which uncertainty lingers. The survey results indicate that value may become a more important purchase consideration, but certainly not the only one. European consumers are open to new experiences and to discovering brands across a variety of channels, creating valuable opportunities for consumer goods and retail businesses across the region. Check out our ConsumerWise page, and contact us for more information and additional insights.

To save or to splurge? That is the question confronting European consumers, who have the most optimistic economic outlook they have had in at least a year, in the face of continuing price increases. For some, the answer is "both." The following five charts highlight findings from our latest ConsumerWise research survey, conducted in May 2023 in five European countries: France, Germany, Italy, Spain, and the United Kingdom.

The snapshot of the European consumer today reflects the tension between intending to spend and save under the pressure of higher prices, albeit with more nuance than one might find in a typical economics textbook. These sentiment data indicate that value may become a more important driver of purchases-but certainly not the only one.

Check out our ConsumerWise page and contact us for more information and additional insights.

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An update on European consumer sentiment: Uncertainty lingers

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Is European consumer confidence growing in the face of recent global economic challenges? Find out in our latest ConsumerWise research survey.

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AI incorporated design

High x Low pyramid level brands collaborating

Artists with brands

Celebrity focussed creative directors

Supporting any type of diversity/lgbtq, making sure all ground is covered

Sustainability and material innovation

in-store technology

pop-ups/experiential marketing

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With this trend, I am explaining how production is coming back to the brands origin country. This is also called reshoring and is the opposite of globalization. I will cover why this is happening due to macroeconomic factors and political tension.

Definition of localisation of manufacturing: and why

https://www.researchgate.net/publication/257495764_Localization_of_Manufacturing_-_A_Systematic_Framework

The article defines manufacturing localization as the strategic decision to situate manufacturing operations close to key markets, suppliers, or innovation hubs. This contrasts with globalization, where production is spread across various low-cost regions.

Reasons a company might localize manufacturing, based on the article:

To reduce lead times and improve responsiveness to local markets.

To better align with regional customer needs.

To mitigate risks in global supply chains.

To meet local content regulations or sustainability goals.

RESHORING

https://www.theinterline.com/2025/03/07/reshoring-fashion-can-geopolitics-move-the-needle-where-sustainability-didnt/

Talks about how reshoring is unclear and isnt scalable but how geo politics might force it

https://www.pwc.com/m1/en/publications/documents/2024/localising-supply-chains-and-its-impact-on-performance.pdf

Performance impact

https://www.theguardian.com/business/2022/aug/06/uk-manufacturing-fashion-boss-champions-reshoring

Interview with uk brand owner talking about his journey and benefits on production reshoring to the UK especially during the pandemic and what it does for the local economy and job creation

https://www.voguebusiness.com/companies/fashions-reshoring-rush-why-now-and-for-how-long

PVH chief supply chain officer on reshoring due to sudden political impacts on production in ethiopia

“Three-quarters of fashion companies surveyed by McKinsey see shipping disruptions as the greatest threat to flexibility and speed. Seventy-one per cent say they are looking to increase nearshoring by 2025 — bringing manufacturing sites closer to their consumer market — and 24 per cent say they are planning to reshore manufacturing to the same country of operation as the brand, according to McKinsey.”

SUPPLY CHAIN FACTOR INFLUENCE

https://researchportal.northumbria.ac.uk/en/publications/rethinking-the-fashion-value-chain-how-reshoring-can-create-a-loc

Support economical growth

https://www.circularonline.co.uk/insight/why-we-need-localised-and-community-led-supply-chain-networks-for-clothing/

Sustainability contribution and circulization

https://iuk-business-connect.org.uk/wp-content/uploads/2022/03/Reshoring-UK-Garment-Manufacturing-with-Automation-Thought-Leadership-Paper-final-2.pdf

What needs to happen for the future especially in the UK and what support is needed to make reshoring successful

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The Human Side of Sales

Adds to the experience

adds to brand loyalty and community

what needs to happen

retail staff incentives and opportunities to grow

workshops and chances to empower sales tools

training in new crm technology like apps to help increase client relationship

also can pay on the spot to make a seamless transaction

RFID - inventory management, seamless experience, self checkout, replenishment, counterfeiting

blockchain - product tracking and transparency

Marketplaces disrupted

online marketplaces are seeing difficulties due to saturation

need on and off line

Sportswear showdown

its no longer the big 4 brands

new brands are taking significant market share

growth - supposed to grow twice as much as luxury

trend of health and wellness

collaborating and blending of fashion and activewear

its now accepted and obivously way more comfortable

increase in particpation and sports tourism

inventory excellence

addressing excess stock and stock-outs

technology to make more agile - can adjust

producing to demand is the key although its harder to predict towards demand because trends change so quick now

unpredictable seasonality - who knows what the weatehr is gonna be

lengthy supply chains - complex routing of goods because touchpionts makes diffierent flexbility

product and channel complexity - omni channel also means that u need products in more places at once than ever

platfforms

aso9, nextail, blue yonder all atomate prodcesses from demand forecasting to inventory allocation

dynamic open to buy adjustments

test and react / on demand enable mid season buying to tailor inventory

Sustainability collective

fragmentation of suppliers and brands

disconnect between consumer actions and values

behavior attitude gap

https://corporate.zalando.com/en/our-impact/sustainability/sustainability-reports/attitude-behavior-gap-report

reporting

uptream and downstream scopes

fuel and eenergy related activities (scope 3) is most difficult

fail to involve suppliers in sustainability intiiative

brands are doing less for sustainabilty because consumers dont care as much

https://learn.istitutomarangoni.com/ultra/courses/_557782_1/outline/file/_16799591_1

need to

consolidate and partner on strategic commitments

embrace long term commitments to suppliers

collectively address - everyone has to or nobody will due to natural competition

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All informations about „Attitude-Behavior Gap Report“ at Zalando Corporate, Current information about Zalando SE

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This is focused on the factors of why the trend of simply buying less as a consumer is growing, and how brands are picking up on this in their production and marketing. This is not a new concept, and its history will be covered as well, with specific examples like Patagonia and their “Don’t buy this jacket ad campaign.” This trend will be divided into the consumer and the brand perspective, macroeconomic factors, and external and internal reasons.

1. History of degrowth and definition

https://degrowth.info/en/history#:~:text=This%20organisation%20has%20since%20then,is%20discussed%20in%20international%20media.

In summary, the degrowth movement has evolved from a French intellectual concept into a global interdisciplinary initiative, challenging traditional economic paradigms and advocating for sustainable and equitable alternatives.​

2. Bigger mcro economic lens of degrowth and why -

https://www.imk-boeckler.de/data/downloads/IMK/FMM%20Konferenz%202023/v_2023_10_21_pessoa.pdf

“The concept of degrowth has emerged as a response to the inherent unsustainability and inequities of the growth-oriented economic model. It advocates for a reevaluation of societal values, a reduction in material consumption, and the promotion of social and ecological well- being (Bergh, 2011; Kallis et al., 2018)”

3. Degrowth in fashion intro -

https://www.voguebusiness.com/sustainability/degrowth-the-future-that-fashion-has-been-looking-for#:~:text=US%20retailer%20Toward%20lets%20customers,a%20sort%20of%20degrowth%2Dlite

What is Degrowth in Fashion?

A shift away from fast fashion's overproduction and overconsumption.

Focuses on repairing, swapping, upcycling, and producing fewer, longer-lasting garments.

Encourages more custom, locally made, and purpose-driven designs.

Why It Matters:

Current fashion practices vastly exceed planetary boundaries.

Advocates like Kate Fletcher argue fashion needs to reduce its impact by a factor of four to become sustainable.

Examples of Degrowth in Action:

Toward limits customers to 12 purchases a year.

Asket pauses new product releases to focus on timeless collections.

Toast offers free repairs, clothing swaps, and has reduced its annual collections.

Gucci Vault and Upcycled by Miu Miu promote reuse and upcycling

Infrastructure and Policy Needs:

Support for local production and co-creation (e.g., The Trampery’s decelerator programs in London).

Legislative frameworks like reduced working hours and emissions-linked tax incentives.

Public support exists, but political will is lacking.

A Broader Social Shift:

Degrowth isn't about recession—it’s a planned transformation.

It involves systemic changes in ownership models (like B Corps or cooperatives), and more democratic, community-led fashion systems.

4. MACROECONOMIC things that  change-

https://www.fashionrevolution.org/degrowth-in-the-fashion-industry/

GDP Limitations: The article argues that Gross Domestic Product (GDP) is an inadequate measure of societal progress, as it emphasizes economic growth without accounting for environmental and social well-being.​

Alternative Focus: There's a call to prioritize human well-being and ecological sustainability over mere economic expansion. Research indicates that beyond a certain point, increased consumption does not lead to greater happiness or fulfillment

Policy and Infrastructure: Implementing degrowth strategies requires supportive policies and the development of infrastructure that facilitates sustainable practices, such as repair services and circular fashion models.​

Cultural Shift: A broader cultural change is essential, where society values sustainability and well-being over material accumulation. This involves redefining success and progress in terms of quality of life rather than economic output.​

5. Transparency issues

https://www.voguebusiness.com/sustainability/fashion-is-making-little-progress-on-transparency-when-its-the-bare-minimum?utm_source=chatgpt.com

A significant challenge is the lack of transparency in production volumes. Only a small percentage of major fashion brands disclose their product quantities, making it difficult to assess and address overproduction effectively

6. Barriers to degrowth

https://slowfashion.global/2024/08/31/understanding-degrowth-in-fashion/

Economic Structures: The current economic system is heavily reliant on growth metrics like GDP,

making a shift to degrowth counterintuitive to prevailing economic policies.​

Consumer Behavior: Changing deeply ingrained consumer habits and perceptions about fashion and consumption requires significant cultural shifts.​

Industry Resistance: Fashion brands may resist degrowth strategies due to fears of reduced profitability and market share.​

Policy Gaps: Lack of supportive legislation and incentives for sustainable practices can impede the transition to degrowth models.

7. Great example of a brand going towards degrowth

https://www.voguebusiness.com/sustainability/early-majority-fashions-first-degrowth-brand#:~:text=She%20says%20the%20brand%20will,brand%20and%20its%20affiliated%20communities.

Early Majority adopts a degrowth model, aiming for a managed reduction in economic activity to stay within planetary boundaries.

The brand focuses on producing fewer, high-quality items designed for longevity and versatility.​

The initial collection comprises seven modular pieces, including outer shells and capes, designed to be layered and adapted for various activities and life stages.

Features like removable hoods and adjustable zips cater to diverse needs, such as accommodating different hairstyles or pregnancy.​

Early Majority plans to generate revenue through membership fees, fostering a community that values sustainability and shared experiences over frequent purchasing.​

The brand opts for an all-black color scheme to avoid trends, promoting timelessness and reducing the likelihood of garments being discarded due to changing fashions.​

Early Majority faces the challenge of aligning investor expectations with its degrowth model, which prioritizes environmental and social goals over rapid financial returns.

The brand serves as a case study for how fashion companies can implement degrowth principles, potentially influencing industry practices towards sustainability.

8. Op ed take on the downsides and considerations mandatiyr for degrwoth

https://www.mmu.ac.uk/news-and-events/news/story/fashion-sustainability-and-problem-degrowth#:~:text=In%20the%20fashion%20industry%2C%20increasing%20garment%20lifetimes,what%20about%20the%20impact%20on%20the%20millions

Dr. Perry emphasizes that while degrowth presents a viable pathway toward achieving net-zero emissions and mitigating climate change, it must be approached with careful consideration of its socio-economic implications. An industry-wide shift to a slower and smaller fashion system requires collaborative efforts to ensure that environmental objectives do not come at the expense of vulnerable populations.

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Use this framework to complete trends.

Trend Brainstorm

Sourcing coming back local

Due to geo political conflicts

Trade barriers and supply chain disruption

Increase in chinese production and huge increase in transportation

Naershoring has remained flat in US and europe since 2019 due to manufacturing capacity capabilities

But this will change due to investments and government incentives

Term 2 class 1 presentation

SOURCING TRENDS

Geo political

Consumer preference

OVERALL - bringing things home

From global to local due to socio - political

Focus hiustory globalisation

Conscious consumption - from sustainable to just cutting back on

Localisation from consumer side - consumer preferences, political impacts

Localisation from business side -

Reshoring - bringing production home

Nearshoring - supply chain strategy - having things faster, mitigating risks

Degrowth - consumer skepticism, conscious consumption, not as much emphasis on sustainability but rather just buying less

FINALIZED TRENDS:

LOCALISATION OF COMMUNICATION

LOCALISATION OF PRODUCTION

DEGROWTH IN FASHION

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TREND 1 RESEARCH: LOCALISATION OF COMMUNICATION 

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TREND 1 RESEARCH: LOCALISATION OF COMMUNICATION 

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With this trend I am trying to get at the fact that brands most localize their marketing strategies more than ever before to specific places and cultures in order to attract new customers. Using bigger, international names is not working as well and we need this sort of niche, personal connection.

Although consumer optimism is predicted to rise, spending in the fashion industry is still stagnant, therefore making it even more important to personally connect with the consumer. With high predictions for the indsutry to grow, it is important to make these personal connections now to take advantage when the growth is here:

https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion#/

"To reach these consumers, executives told us they will localize their go-to-market models"

https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/an-update-on-european-consumer-sentiment

Ad overload and its turnoff for the consumer:

https://es.rokt.com/blog/unlocking-the-joy-of-online-shopping-the-power-of-relevance/

1. Slow down of performance marketing with more funding going into brand marketing, specifically storytelling and consumer connection:

https://www.businessoffashion.com/articles/marketing-pr/the-state-of-fashion-2024-report-brand-marketing-strategy-community-building/

2. Pursuing individuality in menswear to connect with specific consumers:

https://www.businessoffashion.com/articles/marketing-pr/the-state-of-fashion-2024-report-brand-marketing-strategy-community-building/

3. Size and assortment integration is the topline (this has great examples):

https://www.datasciencecentral.com/the-importance-of-assortment-localization-and-size-localization-in-fashion-leveraging-data-science-for-fashion-localization/

4. The deeper connection need is cultural integration and understand the appropriate way to communicate a brand to specific audiences

https://locaria.com/global-marketing-and-localization-trends-in-2024/

5. Highlight on consumer expectations through the drum survey respondents: 65% expect local messaging from major size companies

https://www.thedrum.com/open-mic/why-national-brands-need-a-new-approach-to-local-marketing#:~:text=3.)&text=With%20people%20feeling%20more%20connected,its%20messaging%20and%20engage%20consumers.

6. Emphasis on community and the flywheel as put by mckinsey:

https://www.mckinsey.com/capabilities/growth-marketing-and-sales/our-insights/a-better-way-to-build-a-brand-the-community-flywheel

7. How luxury companies are doing this:

https://croud.com/en-gb/resources/the-power-of-localisation-for-luxury-brands/

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Brand-building isn't what it used to be. After years of leaning heavily on instantly trackable performance marketing, the fashion marketing landscape is shifting. A convergence of factors, including pressures on discretionary spend, is sharpening consumer appetite for entertaining brand storytelling that captures their aspirations and interests, well beyond the products on offer. Spurring this change are the increasing costs of performance marketing alongside new data privacy regulations restricting customer targeting, forcing marketers to find different ways to engage with shoppers.

Many fashion leaders now plan to reprioritise marketing spend. According to the BoF-McKinsey State of Fashion 2024 Executive Survey, 71 percent of executives plan to increase brand marketing spend in 2024, while 46 percent intend to do the same for performance marketing. This marks a fundamental shift for many fashion companies, including direct-to-consumer labels that have built their brands using the trackable, targeted performance-marketing playbook.

While brand marketing by its very nature doesn't enable the same depth of trackable insights as performance marketing, it does offer other benefits - notably, done effectively, it can help brands to stand out in an increasingly saturated media world. Brand marketing is also proving to be pivotal in transforming a label's market position, while often helping it capture entirely new customer bases.

Identity Revamp

Effective brand marketing needs to employ a multi-pronged strategy over time, rather than one-off moments. Sustained, holistic brand marketing can transform brand images, as several recent examples show.

Germany-based Hugo Boss launched an image reboot with heavy investment in brand marketing that aimed to attract young consumers. With newly differentiated branding for "Hugo," aimed at Gen-Z, and "Boss," aimed at Millennials, it updated its logo and other visual cues and enlisted ambassadors like Hailey Bieber, rolling out a star-studded web and out-of-home campaign and hosting events including see-now-buy-now fashion shows and sponsoring sporting events to feature its new streetwear-influenced looks. In March 2023, the company announced the first full-year results since the rebrand, attributing record sales of €3.65 billion ($3.85 billion) in large part to the "momentum" throughout 2022 it gained from the new-look Boss and Hugo brands.

Italian luxury house Ermenegildo Zegna Group began a refresh of its Zegna menswear brand in the run-up to its initial public offering in 2021. The brand streamlined and modernised its image, dropping "Ermenegildo" from its name and condensing three sub-brands into one modern, slick Zegna-branded umbrella. The company also collaborated with luxury streetwear label Fear of God to tap into a broader, younger audience as part of a wider casualisation campaign, which expanded Zegna's brand authority from tailored suits to luxury leisurewear for the modern quiet luxury consumer. Zegna's full-year 2022 sales rose 16 percent year on year to €1.5 billion ($1.6 billion).

Meanwhile, New Balance has used collaborations as a part of its broader strategy to elevate the brand and drive demand. In addition to targeted inventory allocation across channels, product drops and marketing investments, the sneaker brand leveraged tie-ups with image-driving partners, such as JJJJound, Miu Miu, Joe Freshgoods and Aimé Leon Dore, while tapping ALD's Teddy Santis to be creative director of New Balance Made in USA. These actions have reinforced New Balance's brand positioning, with it ranking as one of the best-selling brands on sneaker resale platforms Goat, StockX and Flight Club.

The Brand Marketing Toolkit

As consumers crave greater connection and authenticity from brands, marketing efforts will home in on brand storytelling and emotional affinity through multiple avenues.

One way this can be done is by leveraging the personalities behind a brand, such as the founder or creative director. Think Miu Miu ( Miuccia Prada) or Loewe and JW Anderson ( Jonathan Anderson) or Jacquemus ( Simon Porte Jacquemus) - labels that featured in the recent quarterly Lyst index of fashion's most prominent brands. Underscoring how many consumers gravitate towards the people who personify and drive a brand, organic content can be created around these personalities in authentic, personable ways.

However, there are other ways to build communities that don't rely on a brand's stand-out personality. In the case of Nike, bold ad campaigns featuring high-profile athletes have over the years created a perception around the brand for focusing on social causes. Meanwhile, as heritage luxury brands have shown, there's plenty of scope for storytelling that pivots around other aspects of their brands' unique qualities. Hermès, for example, has long employed deep brand stories that evoke a history of craftsmanship. At Tiffany & Company, the brand was revitalised after its acquisition by LVMH, balancing established brand stories and new campaigns with stars like musicians Jay-Z and Beyoncé to access a new generation of consumers.

There's also a brand marketing opportunity by creating memorable shopping moments. Connecting emotionally with consumers has become increasingly difficult in a world of ever-shortening attention spans. However, by meeting consumers in the real world with activations that span channels, brands can capture attention and build a more pervasive presence in customers' lives. Immersive stores, featuring visually striking spaces and interactive, multisensory experiences, can be employed here. A range of brands have already been experimenting with boldly designed pop-ups which often have the additional benefit of serving as ideal backdrops for shoppers' social media posts. Examples include Jacquemus's handbag vending machines, Chanel's perfume-themed diner, H&M's immersive collection launches and Pretty Little Thing 's themed influencer showroom.

Melding marketing strategies with adjacent industries such as music, film and sports, is also helping fashion brands remain relevant with customers. In 2024, brands may consider investing further in cross-industry collaborations, joint ventures and sponsorships. LVMH announced its "premium" sponsorship deal of the 2024 summer Olympic and Paralympic Games in Paris, with plans for individual brands to make standout contributions in the run-up to the games. Following on the heels of LVMH's news, Kering-owner François-Henri Pinault announced that his family's holding company Artémis had closed a multi-billion-dollar deal to acquire a majority stake in Hollywood talent giant Creative Artists Agency, perhaps a precursor to fashion players inking more cross-cultural deals.

Creating Long-Lasting Affinity

Succeeding as a brand in 2024 may require a shift in priorities - selectively using brand-building tools to develop compelling brand stories, supported by a long-term strategy and underpinned by the right talent and channel investments.

Chief marketing officers and their teams will need a laser-sharp focus on customer perception and cross-funnel strategy, working with creatives and brand specialists as well as data, finance and strategy leaders to form a cohesive brand story. After years of focusing on performance marketing, CMOs must now invest in hiring and training teams to bolster brand marketing capabilities, ensuring that the marketing department contains both brand and performance marketing specialists that can work closely together. Indeed, more companies may hire chief brand officers as brands take a more holistic view of their storytelling and marketing efforts.

Undergirding this is a focus on the long-term story. This will require a mentality shift, with impact measurement focused on longer-term, strategic horizons, rather than instant return on investment - while blockbuster marketing campaigns can generate immediate buzz, maintaining consumer attention thereafter is a challenge. Consumers expect to see brand stories that are consistent and authentic; the success of purpose-led brands such as Patagonia are proof points. Brand marketing may need to be maintained with consistent storytelling throughout consumers' day-to-day lives, from large-scale events to touchpoints on social media. However, 2024 won't be about generating more and more content, or perpetually refreshing brand identities. Now, the focus needs to be on "less is more," with carefully crafted storytelling that amplifies a brand's clear, coherent personality.
This article first appeared in The State of Fashion 2024, an in-depth report on the global fashion industry, co-published by BoF and McKinsey & Company.

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The Year Ahead: Why Brand Marketing in 2024 May Reclaim Its Glory Days

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The State of Fashion 2024 explores the potentially elevated role that brand marketing will play as competition for consumer attention and loyalty intensifies across the fashion industry.

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TECHNOLOGY

SUPPLY CHAIN

SUSTAINABILITY

INDSUTRY CHALLENGES

MARKETING

shift into simplicity, but striking deeper in individuality

https://www.businessoffashion.com/articles/marketing-pr/why-menswear-needs-a-marketing-refresh/

INDIVIDUALITY

creative storytelling over performance

https://www.businessoffashion.com/articles/marketing-pr/the-state-of-fashion-2024-report-brand-marketing-strategy-community-building/

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Generative AI:

Different than regular AI, regular just simultes human intel and problem solving

Generative AI creates new content and ideas, conversations, stories, images etc

language modeling

making predictions based on language

In the fashion chain

mood boarding, research, concept idea generation

sizing and fit issues for e-commerce - minimizing returns

virtual assistance

product description writing

operational and organisational through front and backend

MARKETING

focussing on BRAND instead of PERFORMANCE

due to the consumer need to feel an attachment with the brand due to tight spending

includes anything emotionally bonding - influencer, sport partnership, collaborations

creative director selection

includes experiential

BULLWHIP EFFECT

changes in consumer demand escalate across the value chain

slight changes get larger down the operation chain

production effects

demand volatility leading to reshoring or neashoring - production is coming home baby

not cheaper but safer and more sustainable

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With clouds brewing on the horizon, recent years might provide a sense of how the fashion industry will ride out 2024.

The industry has shown its resilience in recent years, having achieved more than double the levels of economic profit in 2022 than in all the years between 2010 and 2020 except for one, yet by 2023 the industry was facing challenges that were both persistent and deepening. On a regional basis, Europe and the US experienced slow growth throughout the year, while China's initially strong performance decelerated in the second half. Though the picture for luxury was more positive than the rest of the market in the first half of 2023, consumers' appetite to shop for fashion was diminishing across the board by the second half, leading to slowing sales and uneven performance. Even luxury began to feel the heat after a lengthy period of growth that benefitted the entire industry.

Looking to 2024, fashion leaders are anticipating further headwinds and are uncertain about prospects for the year ahead.

Looking to 2024, fashion leaders are anticipating further headwinds and are uncertain about prospects for the year ahead. Indeed, the word most often mentioned by executives in the BoF-McKinsey State of Fashion 2024 Executive Survey was "uncertainty." Consumer confidence will remain fragile, although for different reasons in key markets of the US, Europe and China. As a whole, the fashion industry is predicted to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024.

Aside from economic challenges, one pressure point that cannot be ignored in the year ahead is the climate crisis. After numerous extreme weather events in 2023, leading companies are likely to bolster their resilience to climate impacts in 2024. Inaction is no longer an option: extreme climate events are already placing the lives and livelihoods of fashion workers in danger and could put at risk an estimated $65 billion of apparel exports by 2030.

How should fashion companies prepare? With cost-saving tactics mostly exhausted, the focus is expected to be on growing sales, underpinned by new pricing and promotion strategies, rather than volume increases - across the industry, net intent to raise prices is more than 50 percent, according to the BoF-McKinsey Executive Survey. Cost pressures are predicted to abate, with less than 20 percent of executives expecting the cost of goods sold and selling, general and administrative expenses to rise more than 5 percent.

In 2024, the industry is expected to bear the impact of fluctuations in demand that have punctuated the past few years. It is during such times that supply chains experience a "bullwhip effect," in which small sales variations cause high levels of volatility, leading to factory underutilisation, layoffs and delayed infrastructure investments. To navigate these challenges, fashion brands should consider investing in developing more transparent and collaborative relationships with their suppliers.

Meanwhile, fashion supply chains could be under increased scrutiny amid incoming regulations on several fronts. This includes new sustainability rules in the European Union and the US, which will require brands and manufacturers to double down on initiatives aimed at cutting greenhouse gas emissions and waste, while building business models that protect and preserve natural resources. The fast-fashion industry, which has already been buffeted by a cohort of companies like Shein and Temu that are not only faster and cheaper but also fuelled by big marketing budgets, may be particularly pressured by these new regulations.

When seeking to identify growth levers, one area that respondents to the BoF-McKinsey Executive Survey said they are homing in on is generative AI, where there is significant potential in creativity-focused use cases in design and product development. Some 73 percent of executives expect to prioritise gen AI in 2024, but many may face a talent gap, given that just 5 percent said they are ready to make best use of the technology.

Marketing is another area of focus. After years of relying on performance marketing, brand marketing may increasingly take centre stage in the year ahead, with 71 percent of executives planning to spend more on brand marketing than in 2023 in a bid to cultivate emotional connections with customers. At the same time, brands may find consumers are more demanding when it comes to authenticity and relatability, leading to a shift towards influencers who are more quirky, vulnerable and less-polished. Forward-looking companies should consider leaning into this new wave of content creators to enhance their brand stories.

As consumers travel with renewed enthusiasm in the year ahead, fashion companies may need to revamp how they engage with consumers who are shopping abroad. For the first time since the Covid-19 pandemic, travel levels in 2024 are projected to exceed those in 2019. Chinese travel to overseas destinations is expected to reach between 70 percent and 100 percent of pre-pandemic levels in 2024. As these shoppers return, there is a growing desire for brand experiences and traditional shopping trips in both tourist destinations and second-tier cities. Alongside a return to travel, there is also a shift to spending more time outdoors, which will likely drive up demand for outdoor wear in 2024, further blurring the lines between functionality and style.

All told, executives are bracing for a strategically challenging year ahead. Fashion leaders need to plan carefully for a range of different scenarios, become better equipped to manage pricing and get ready to accelerate when the storm begins to clear.

The 10 fashion industry themes that will set the agenda in 2024:
1. Fragmented Future
In 2024, the global economic outlook will likely continue to be unsettled. As new and ongoing financial, geopolitical and other challenges weigh heavily on consumer confidence, fashion markets in the US, Europe and China are facing differing headwinds, requiring suppliers, brands and retailers to bolster contingency planning, among other measures.
2. Climate Urgency
The frequency and intensity of extreme weather-related events in 2023 mean the climate crisis has become even more visible, leaving the fashion value chain especially vulnerable. With climate risks worsening across continents, the fashion industry can't hold off any longer on building resilience into its supply chains and helping to abate emissions.
3. Vacation Mode
Consumers are gearing up for the biggest year of travel since before the pandemic. But a shift in values means travellers have a different set of expectations, even as shopping remains high on the agenda. Brands and retailers should consider refreshing distribution and category strategies to meet travellers wherever they are.
4. The New Face of Influence
It's time for brand marketers to update their influencer playbooks. A new guard of creative personalities is gaining brands' attention, winning trust and fandom among key audiences. Working with these personalities in 2024 will require a different type of partnership, an emphasis on video and a willingness to relinquish a degree of creative control.
5. Outdoors Reinvented
Technical outdoor wear has been propelled by consumers' post-pandemic embrace of healthier lifestyles as well as "gorpcore," and is likely to accelerate even further in 2024. More outdoor brands will likely launch lifestyle collections while lifestyle brands embed technical elements into collections, further blurring the lines between functionality and style.
6. Gen AI's Creative Crossroad
After generative AI's breakout year in 2023, use cases are emerging across creative industries, including fashion. Capturing the value of this transformative technology in 2024 will require fashion players to look beyond automation and explore its potential to augment the work of human creatives.
7. Fast Fashion's Power Plays
Fast-fashion competition will likely become even fiercer in the year ahead. Challengers, led by Shein and Temu, are changing tactics around price, customer experience and speed. Success for disruptors and incumbents will likely hinge on their ability to adapt to evolving consumer preferences, while navigating regulations that may impact the industry.
8. All Eyes on Brand
Brand marketing will likely be back in the limelight in the year ahead as the fashion industry confronts a shifting landscape in which performance marketing no longer reigns. Consumers' emotional connections to brands will likely be critical as fashion marketers reorientate their playbooks to emphasise long-term brand-building strategies.
9. Sustainability Rules
The era of the fashion industry self-regulating sustainability is drawing to a close around the world. Across jurisdictions, new rules could have a widespread impact on both consumers and fashion players. Brands and manufacturers need to revamp business models to align with the changes ahead.
10. Bullwhip Snaps Back
Changes in consumer demand have resulted in the "bullwhip effect," where cuts to orders increase in magnitude at different parts of a supply chain, putting pressure on fashion's suppliers. Now, if supply is to keep pace with anticipated renewed demand, brands and retailers should consider focusing on transparency and bolstering strategic partnerships.

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The State of Fashion 2024: Riding Out the Storm

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The eighth annual State of Fashion report by The Business of Fashion and McKinsey & Company reveals an industry navigating deep uncertainty. Download the full report to understand the 10 themes that will define the industry and the opportunities for growth in the year ahead.

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9. Can fashion last without growth - for the EVOLUTION PART - look more in depth at this one

https://www.nytimes.com/2022/11/17/fashion/degrowth.html

The article suggests that while degrowth presents a compelling framework for achieving sustainability in fashion, it requires a fundamental transformation of industry practices, economic structures, and consumer mindsets. Balancing environmental goals with social and economic considerations remains a complex but necessary endeavor.​

10. What implementations must take place - essentialism

https://www.theinterline.com/2023/11/06/the-challenge-of-degrowth-fashions-only-solution/

The article suggests that embracing essentialism—prioritizing meaningful, high-quality items—can be a viable strategy. Brands like LESTRANGE exemplify this approach by focusing on timeless designs and encouraging consumers to buy less but better.​

However, for degrowth to become a widespread reality, it requires:​

Policy Interventions: Governments must implement regulations that discourage overproduction and incentivize sustainable practices.​

Industry Commitment: Brands need to re-evaluate success metrics, shifting focus from volume-based profits to value-driven models.​

Consumer Education: Raising awareness about the environmental impact of fast fashion can help shift consumer preferences towards sustainability.

In essence, achieving degrowth in fashion is a multifaceted challenge that demands coordinated efforts across policy, industry, and consumer behavior to redefine the industry's relationship with growth and sustainability.

11. How a fashion brand can still be economically successful

https://www.nssmag.com/en/fashion/40053/luxury-crisis-degrowth-fashion-economics-sustainability

1. Emphasize Exclusivity and Controlled Production- Brands like Hermès exemplify this approach by producing limited quantities of products, such as the Birkin and Kelly bags, which are not readily available to all consumers. This scarcity enhances desirability and allows for premium pricing, enabling profitability without mass production.

2. Adopt Circular Business Models - Implementing resale, rental, repair, and reuse programs can create additional revenue streams while promoting sustainability. These models extend the lifecycle of products and align with consumer interest in environmentally responsible practices.

3. Shift Focus from Product Volume to Consumer Relationships - Transitioning from a volume-based sales model to one that prioritizes customer engagement can be beneficial. By offering personalized experiences and content, brands can build loyalty and encourage repeat business without increasing production. ​

4. Invest in Sustainable and Durable Products- Focusing on high-quality, timeless designs that require less frequent replacement can reduce environmental impact and resonate with consumers seeking long-lasting value. This approach can justify higher price points and foster brand trust. ​

5. Redefine Success Metrics- Moving away from traditional growth metrics like quarterly sales increases, brands can adopt alternative indicators of success, such as environmental impact reduction, customer satisfaction, and brand reputation. This holistic view supports long-term sustainability goals.

12. What consumers can do from their side

https://www.fashionrevolution.org/degrowth-in-the-fashion-industry/#:~:text=For%20consumers%2C%20degrowth%20focuses%20on,shop%20second%20hand%20or%20vintage.

“For consumers, degrowth focuses on extending clothing lifecycles. Reducing clothing waste and slowing down consumption starts the shift towards a green economy; one that values people and the planet over profit.

If you want to bring degrowth into your wardrobe, shop second hand or vintage. Question yourself before you buy anything. Slow down your consumption rate. Re-wear and repair your clothes to get as much wear out of them as possible. Increasing garment lifetimes is one of the most effective means of reducing their environmental footprint and slowing down consumption.

Our Loved Clothes Last movement advocates caring for and mending your clothes, to ensure they last a long time. Create a meaningful relationship with your wardrobe by shopping mindfully. Learn how to properly care for your clothes, and repairing and re-using old clothes that need a bit more love. We have a whole collection of resources to help you on our Loved Clothes Last Pinterest board.”

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Euromontior

Healthspan Plans

people are spending and investing more in things that improve longevity and future self

Applied to Fashion

wellness, beauty, and health

multifunctional brands with a psychical activities component

hoka, lulu, alo etc

digital health accessories