Innovation no longer an option for most fashion companies

Often in times of crises, many companies slip into obsolescence. But during these same trying instances, many others come out on top stronger than before. One of the key make or break differentiators boils down to their openness to innovate and future proof time tested business models.

One particular sector, the fashion industry, has seen shockwaves up and down its spine and is currently forced to put this theory to the test. With its complicated and often archaic supply chains, long-term brick and mortar leases and inflexible and expensive fashion shows, fashion companies are facing a stark wake up call.

During the last decade and change, fashion companies have seen some of its best days. Some of the biggest conglomerates that own most of the world’s largest fashion houses have grown tremendously, largely in part due to acquisitions and increased demand from wealthy Asian consumers. LVMH, for example, has enjoyed its stock price reaching nearly $100 per share in early 2020 up from $10 during the Financial Crisis. Competitors such as Richemont and Kering have also witnessed astronomical growth.

However, in moments of struggle, these same companies are often the first to suffer, as their manufacturing partners pause production, fashion shows halt and storefronts close its doors. Its times like these that disruptive ideas that have remained on the backburner begin graduating to the main event and become an actual reality. Once distant strategies such as online fashion shows, digital showrooms and livestream purchasing act as plug to keep the sinking ship afloat.

Those that come out most successful are those that embrace new technologies and innovate, and inadvertently the most successful dictate the future norm of the industry. New strategies that have proved successful will be more widely adopted both by consumers and also competitors. Fashion companies thereby need to innovate to stay competitive by:

1. By utilizing 3d and AI technology and digital sampling, the minimum number of days of production will decline, leading to quicker production.
2. Digital showrooms will reduce the requirement to travel for appointments and tradeshows, thereby saving time and money for all players in the industry.
3. VR technology can create an experience similar to physical fashion shows at a fraction of the cost and increased efficiency.
4. With physical stores closed, brands and consumers are forced to shift all sales channels online, indoctrinating ecommerce as the default mode of shopping moving forward.

With many startups and smaller brands unable to stay afloat, we’re in a flip flopped world where the biggest brands are now the ones innovating. For these new strategies to stick, these large incumbent players must dedicate ample time and resources towards seeing them through. As it goes with trends, the rest of the market will then follow.