PROFIT
One of the most vital pillars within the fashion business industry is the pillar of ‘profit’. In economic terms, profit is the amount of financial benefit any company receives after selling a good or service (Hethorn and Ulasewicz, 2015) – which could hold monetary or asset-based value.
Even though the COVID-19 pandemic brought about 2 annum of “disruptions” (McKinsey, 2021), it played a monumental role in empowering companies to market their products to satiate the hunger within their consumers for goods and services (inside the fashion industry). Due to this, around “75% of fashion executives believe that better trading conditions” will increase profits immensely now (McKinsey, 2021). Before the pandemic, globally, the entire fashion industry’s joint revenue was close to 1.5 trillion Pounds (Fashion United, 2021). And while it may have fluctuated during the pandemic, it still accounts for one of the largest profit-gaining industries in the world (Fashion United, 2021).
Whether it be economic recessions or the COVID-19 pandemic, brands need to remain competitive under various unprecedented economic times. Below is an illustration of how companies feel during such times. But brands can still try to stay competitive by focusing on the consumers who have already shopped with them. Since consumers are more likely to remain loyal to a brand they have already tried, chances are they would do the same during an economic recession, too (Forbes, 2020). Moreover, since there is less cash influx, consumers would not want to try new brands with which they do not share any previous experience. In the COVID-19 pandemic’s case, the brands could have focused on building more strategy and not be afraid to try out new advances and technology that might have helped them to create a better user experience for their homebound consumers (especially in the case of application building and the smooth running of online shopping).
Although creativity and commerce usually do not merge well with each other, most companies and their creative directors have to make sure that they are bridging this gap as much as possible in order to create products that have a high demand as well as design qualities to it. One easy way to achieve this is by the method of collaboration and working to see what areas each aspect of a company lacks (Business of Fashion, 2021). Working on resolving both such issues can help bridge this gap.
REFERENCE LIST:
Clausen, E. (2020) Marketing rules to follow during Uncertain Economic Times, Forbes. Available at: https://www.forbes.com/sites/forbesagencycouncil/2020/04/03/marketing-rules-to-follow-during-uncertain-economic-times/ (Accessed: October 23, 2022).
Hedrich, S. (2022) State of Fashion 2022: An uneven recovery and new frontiers, McKinsey & Company. Available at: https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion (Accessed: October 23, 2022).
Hethorn, J., & Ulasewicz, C. (eds). (2015). Sustainable Fashion: What’s Next? A Conversation about Issues, Practices and Possibilities. New York: Bloomsbury. Chapter 7.
Sherman, L. (2021) At gap, how Community Culture Powers Creative Output, The Business of Fashion. Available at: https://www.businessoffashion.com/articles/news-analysis/at-gap-how-community-culture-powers-creative-output/ (Accessed: October 23, 2022).
Vazzana, C. (2021) Global Fashion Industry Statistics, FashionUnited. Available at: https://fashionunited.com/global-fashion-industry-statistics (Accessed: October 23, 2022).
IMAGES
Gonzalo, A. et al. (2021) Fashion’s digital transformation: Now or never, McKinsey & Company. Available at: https://www.mckinsey.com/industries/retail/our-insights/fashions-digital-transformation-now-or-never (Accessed: October 23, 2022).
horizonmarketing_co (2022) The value of marketing in Uncertain Economic Times , Horizon Marketing. Available at: https://horizonmarketing.co/the-value-of-marketing-in-uncertain-economic-times/ (Accessed: October 23, 2022).