Week 4 – Profit

“Profit” is typically associated with a monetary benefit or advantage and this element is what allow the business sector of the fashion industry stand out. This is because working in the business sector requires the analytical process of brainstorming marketing and pricing strategies for the company to attract consumer and drive economic activity.

Based on Smith’s (2023) research, the revenue of the fashion industry is founded to be at 1.74 trillion U.S. dollars and is expected to rise until 2027. Especially for the luxury sector as brands like Loewe, Prada , Versace and other high end brands are determined to be”Fashion’s Hottest Brands and Products Q2 2023″ on the Lyst Index (2023). This is due to hyperinflation as it has affected spending habits of consumers and they have become more cost-conscious and has to cut-down their spendings, whereas people with high-income would not be as affected by the changing living cost and would continue spending (McKinsey,2023).

During recessional period, brands should concentrate on making strategic changes, which would include altering their content after examining customers’ behaviour and understanding the competition.  It’s crucial to keep the idea of opportunity cost in mind when making such adjustments as brands need to be cost efficiency and contemplate how to maintain loyal customer while adapting to new consumer trends to attract new customer. For example, a recent BCG study suggest that company that focused on shifting their team structure and improve the diversity among the team displayed better innovation and also showed a positive chance in financial performance (Lorenzo, 2018). Since gaining insight from varied perspective allow brands to be more versatile. Besides, during COVID-19, a lot of fashion brand have leverage the technology and social media by making fashion shows go virtual, this has allowed “a potential reduction in emissions from flying” (Fleck, 2023), and “opportunities for cross-industry collaborations”, reaching to a range of audiences in an innovative approach (Basu, 2020).

In order to bridge the gap between creativity and commerce,  the role of creative director is vital, because being a creative director requires strong insight and leadership. By understanding their task they are in charge of commercially design a event, merchandising display or idea in unexpected and unique ways while maintain the brand identity and colour, presenting the DNA and story to the audience in a creative way.

Biblilography

Basu, Ritupriya . “As COVID-Era Fashion Shows Go Virtual, New Opportunities for Designers Emerge.” Eye on Design, 30 Nov. 2020, eyeondesign.aiga.org/as-fashion-shows-go-virtual-in-the-covid-era-new-opportunities-for-designers-emerge/.

Fleck, Anna. “Infographic: Digital Catwalks? Most Think Fashion Shows Should Go Online.” Statista Daily Data, 3 July 2023, www.statista.com/chart/30311/should-fashion-week-go-digital/.

Lorenzo, Rocío. “How Diverse Leadership Teams Boost Innovation.” BCG Global, 23 Jan. 2018, www.bcg.com/publications/2018/how-diverse-leadership-teams-boost-innovation.

McKinsey. “State of Fashion | McKinsey.” Www.mckinsey.com, 29 Nov. 2022, www.mckinsey.com/industries/retail/our-insights/state-of-fashion#/.

Smith, P. “Revenue of the Global Apparel Market 2012-2025.” Statista, 23 Nov. 2022, www.statista.com/forecasts/821415/value-of-the-global-apparel-market.

“The Lyst Index: Fashion’s Hottest Brands and Products Q2 2023.” Lyst Insights, www.lyst.com/data/the-lyst-index/q223/.