PROFIT
Profit is a pivotal cornerstone in the world of fashion: like many other industries, it is driven by pursuit of profit and financial gain. A blend of creativity and commerce, the industry is valued at $1.7 trillion dollars (McKinsey) ,this involves multiple products including clothing, fabric and accessories.
With the effects and uncertainty of COVID-19 still lingering in the financial world, we are in a time where consumers aren’t confident due to this fragility – this has affected the various sectors of the fashion industry. Sectors include from haute couture, streetwear, luxury brands to fast fashion, each having their own dynamics and individual growth. Luxury fashion is expected to grow 9-14% in China, the US are projected to grow between 5-10% and Europe at the lowest only at 3 and 8% whilst amidst a growing crisis (McKinsey, 2023). Fast fashion has struggled more due to consumer awareness of sustainability. For example, Zara has closed 3,785 stores worldwide with many other fast fashion shops, due to the digitalisation of shopping and understanding of fast fashion brands’ need for adoption of ethical practices.
So how can brands appeal to consumers in uncertain economic times? In crises like currently, innovation and adaptability is crucial – brands should prioritise environmental and sustainable approaches, including low waste products, environmentally friendly materials and paying a suitable wage for workers. Another way brands can compete in uncertain times is through a secure digital presence. With the increase of online sales and mobile use, brands can adapt to consumer behaviour through online marketing and e-commerce.
Creative directors are hugely responsible for these ideas by bridging the gap between creativity and commerce. Tasked with the commercialisation of art into collections and ensuring they resonate with the market – it is important to push the creative boundaries of the brand while making sure financial needs are met. An example of a creative director who managed to successfully do this is Virgil Abloh, pioneer of streetwear into high-fashion – the CEO of Off-White and Artistic Director of Louis Vuitton effectively adapted to consumer demands making luxury brands relatable to a younger and more diverse audience. When appointed Creative Director of Louis Vuitton, Abloh revived the brand’s image to captivate youth with his unique designs of deconstructed looks while still respecting the heritage of the brand.
To summarise, the fashion industry is a huge force, with huge contributions to the economy in its multitudes of sectors with ranges of performance. To maintain security, brands should innovate and adapt to the new generation while still maintaining a flow of creativity and commerce.
References:
Yokta, S. (2018). A Brief History of Virgil Abloh’s Meteoric Rise, Vogue.
McKinsey & Company. (2019). The State of Fashion 2019. McKinsey Global Fashion Index
The state of fashion 2023: Holding onto growth as global clouds gather (2022) McKinsey & Company
Peiyu, W. (2020). Analysis on the Different Response of Fast Fashion Brands and Luxury Brands to the Epidemic. Atlantis Press.