The evolution of the fashion sector in the post Covid-19 era and its digital transformation. All the details in our post.

The fashion sector in the post Covid-19 era.

In this past year, supply chains were disrupted due to the advent of Covid-19, causing the closure of hundreds of stores and leading to historic losses for all sectors, also for the fashion sector. The sector suffered its worst year in history, with almost three quarters of the listed brands posting losses and a decrease in turnover of approximately 90% compared to the previous year.

Experts pose two possible future scenarios, a more optimistic one, in which the industry would return to 2019 activity levels by the third quarter of 2022, and a more pessimistic one, in which sales would return to 2019 levels by the end of 2023. What is clear is that, for the fashion industry, the past year 2020 changed everything. Although many brands had already begun to be aware of a new, more engaged and digital way of looking at the industry, the healthcare crisis has brought home the need for an entire paradigm transformation. In addition, the healthcare crisis brings with it a global economic crisis and those brands that do not adapt to this new situation will not survive.

Although there is no standardized strategic manual, in this post we will review how fashion consumption habits have changed in recent months and how the industry must deal with these changes.

How is the fashion industry one year after the arrival of the coronavirus?

Fashion is the mirror of society and if society changes, so will its wardrobe. Anyone who thinks that, with the arrival of the vaccine, everything will be the same again is mistaken. The way we relate to fashion is changing and the sector is facing an irreversible metamorphosis:

– Loss of relevance. Confinement and subsequent social restrictions have caused us to become aware that it is not necessary to have so many clothes in our closet. Now, we give priority to buying other products and we have “disengaged” from the sector.

– Comfy trend. During confinement, sportswear and pajamas became our uniform. Now, our homes have been transformed into makeshift offices and comfortable, functional garments that adapt to our new needs are here to stay.

– E-commerce explosion. If there is a clear winner of the pandemic, it is e-commerce. In April, 97% of fashion spending was made through the Internet, compared to 3% in the physical channel. Restrictions and fear of contagion forced many to buy online at the time, and it seems that the industry has found in e-commerce a crucial ally for the future.

– Flexibilization of supply chains. As a result of this crisis, brands have realized that they need to be much more adaptable to cope with any adverse juncture. Flexibility and operational resilience are shaping the new supply chains of fashion companies today.

– Sustainable future. The coronavirus has further heightened social awareness and experts place sustainability as a strategic axis of the industry in the coming years. We are buying less and less “trendy” clothes and want to invest more in quality garments. Buy less, but buy better.

Where are we headed?

The pandemic has triggered new dynamics and has increased others that were already underway, such as digitalization and slow fashion. But how should the industry’s marketing and communication adapt to this new situation:

– Two collections. Faced with the fear of overstocking that may result from the progressive reduction in demand, brands seem to agree to return to the traditional calendar to produce only two collections a year, one spring/summer and one fall/winter. However, this raises a question: how to attract consumers’ attention for six months? The solution proposed is to have a permanent collection of the brand’s classics (which attracts new customers) to which other garments are added (which builds loyalty among customers who already have all the brand’s classics).

– Phygital events. Events are an indispensable component of the industry and will continue to be so. However, they will be neither digital nor face-to-face, but will have a hybrid format. Fashion weeks are already embracing this format, which combines face-to-face fashion shows with very small capacities and audiovisual pieces. In this sense, the fashion film format is more relevant than ever.

– Influencer marketing yes, but with authenticity. Now that consumers are increasingly aware and disengaged from the “buy for the sake of buying”, an influencer who only uploads posts with products does not generate any impact on them. Consumers will only engage with an influencer who tells an authentic story and engages with their followers.

– Reframed in-store experience. The rise of the online channel poses the rethinking of the physical store experience. The trend is for stores to evolve into interactive spaces where they interact not only with the product, but with the entire space, generating unique experiences.

How digital transformation can help the industry

As we have already mentioned above, with the current crisis derived from the Covid-19 all companies have been affected and practically forced to reinvent themselves in order to survive; and in the fashion world it has been no different.

Nobody expected this pandemic, so it has exposed the equipment and digital knowledge or digitization that each company had. These factors have been key when facing this situation and the impact it has had on them.

With the digital transformation, the fashion industry can gain competitive advantages and strengthen its business and positioning in the face of the new normal. These digital advances, which have been implemented so quickly, are going to remain in time and in the new normality, as it is an insurance for companies and brands in terms of sales, as well as savings in structure and supply costs, so it starts to be a central element in business strategies.

In addition, digital marketing tools will increasingly help this industry. With these they will be able to differentiate themselves and thus capture new market niches and consumers reaching, for example, through social networks and big data to these new potential customers.

Some success stories

Within fashion, being such a changing and complex environment, the brands that have adapted best to the new needs of customers and external circumstances are the ones that have come out of this crisis the strongest.

Some brands, such as H&M, have made it possible to pay in installments for purchases in their online stores, as this is a great option for consumers, thus encouraging the purchase of products as it is a simpler and more flexible way.

Mango, has also adapted to the circumstances and new demands, so they launched capsule collections with more comfortable and versatile collections, which were adapted to the new way of dressing due to the increased time spent at home and teleworking. These could be purchased online, which led to a large growth in the number of sales, and therefore, an increase in new digital customers.

Another clear example is the clothing chain Lefties. This low-cost fashion giant was a long time without income due to the closure of physical stores, so it finally opened an online clothing store, in order to compete and adapt to new shopping trends.

El Corte Inglés also had to transform and adapt in order to remain competitive, so it launched a flat rate shipping for 19.90€ per year.

Youtube: How Does The Most Beloved Video Channel Work?

At a dinner among friends in 2005, an idea emerged that would turn the audiovisual media ecosystem upside down. Specifically, three young people who met while working at Paypal had some videos of a party and wanted to share them, but doing so via email was unfeasible, as they were too heavy. This gave rise to the idea of creating a website to share and watch videos, what we know today as YouTube.

The year after its creation, YouTube was sold to Google for 1.65 billion dollars and, since then, this platform has not stopped growing. In May 2006, YouTube had already reached 2 billion views per day and was number 10 among the most visited websites in the United States.

Today, either because of the wide variety of content it covers, or because of the possibility of choosing what content to view, or because it is free, YouTube has become the second most visited website in the world, only behind Google, and many people have decided to turn this platform into their workplace, the already well-known youtubers. In Spain alone, the most famous youtubers exceed one million subscribers and the channel with the most views is close to 10 billion reproductions.

These stratospheric data make Youtube a very powerful professional tool and, in this post, we will tell you how to make this tool an ally that cannot be missing in your communication strategy.