Even before the events of the global pandemic crisis, fashion executives were not looking forward to 2020. It was predicted already that 2020 would be a challenging year for many brands, particularly in the luxury sector, however no one could have predicted the roadblocks that have occurred. Trends in 2019 had shown that 2020 was likely to suffer slow industry growth, but brands also knew there would be significant pressure to expand their digital footprints, invest more in omnichannel and leverage new technology.
We knew there would be volatility, and many were taking steps to become more resilient through tough times, but what actually occurred, threw many unexpected barriers, which caused longer term transformation strategies to be fully tested. For those that didn’t respond or adapt quickly enough, 2020 will have unfolded as a year that many are unable to bounce back from.
Digital retailers and those brands with a strong e-commerce presence, were given an opportunity to flourish in the last 6-9 months, and those that had already a model in place to support the creation of attention grabbing content via the right platforms, for all their global markets, and seamless checkout options, were a lot more resilient than those with more traditional engagement models reminiscent of the previous decade.
The reality is it is becoming increasingly more difficult to engage consumers. Digital audiences are overwhelmed with content and ads, and social media platforms oversaturated with product imagery. The importance of storytelling and grander media productions, via celebrity endorsement or influencers, is greater than ever.
Combined with the impact of COVID-19, creating inspiring content and a memorable consumer experience was all the more challenging. None of the normal components that make in-store shopping enjoyable or even enable it, can happen the way they did before coronavirus. Consumers and brands have to adhere to health and safety guidance, including maintaining the recommended social distance, avoiding touching items or surfaces that others come in contact with, and trying on items. Some consumers, especially those who are particularly vulnerable, will never feel safe in retail environments again.
Bricks and mortar stores were already having to reinvent themselves and deploy technology to modernise the consumer experience, but with current limitations, eCommerce and point of sale integration became even more crucial. COVID-19 brought about sudden demand for an increase in mobile technology and for self service kiosks, appointment scheduling software, or instore pickup functionalities. Such technologies require robust infrastructures and scalable security networks. As such, retailers are having to make tough decisions regarding how to implement these technologies in tight timeframes to meet demand, without making themselves vulnerable.
Driving growth in such a volatile environment is somewhat forcing many brands to be more agile and accelerate their move to cloud technologies, to reinforce their e-commerce applications and deliver safe, and consistent consumer experiences. As such, the movement towards omnichannel consumer engagement was significant in 2020. The surge in online shopping, combined with the demand for swift delivery, meant supply chains were also optimised rapidly. The automation of orders, inventory checks, tracking, and delivery, while maintaining great customer service and experiences, was critical. Those that failed to adopt mobile first technologies and scale up their e-commerce strategies, were inevitably very badly hit.
This technological revolution, largely due to the explosion of e-commerce growth in 2020, can offer many opportunities for brands beyond 2021 if they expand their business models and invest heavily in online platforms. But brand loyalty is not to be overlooked, as with so many options now available online, personalisation and well thought out communication plans, will be really important for maintaining a solid consumer base. Innovation at all levels of the retail model will be required in 2021, and an exciting e-commerce evolution while inevitably be seen in the coming months, as fashion brands emerge from 2020 with more sophisticated shopping options for consumers that ever before.
Trends also predict an increased need for buy now, pay later technology, especially now given the economic downturn. Paying in installments offers a much more manageable way for consumers to purchase, particularly for early adopters within the luxury industry, opening up the sector to almost everyone. Younger consumers are avoiding credit cards, preferring instead to opt in to installment methods of payment, thus expanding the audience of those brands who introduce services such as Klarna.
In Europe, consumers have spent less money on clothes this year in general, but when they have, they have prioritised quality, and displayed a marked shift towards classic items and casual wear, shunning what now seems unnecessary party wear and formal clothing. The fashion sector in 2021 will face and conquer new frontiers and as always it will be dynamic, adapting to what consumers need. Most major retail brands have already delivered on this very quickly, offering more comfortable fabrics, casual ‘work from home outfits, mix and match lounge wear separates and luxury tracksuits in their recent collections.
The road to recovery in the next year will be uncertain for a lot of fashion and luxury brands. What is clear though, is that recovery will be largely driven by online sales. Offline sales will inevitably recover in the longer term, but it is expected that retail will only start to bounce back once a vaccine is widely available. What happens in the meantime is anyone’s guess.