retails-cas

GYMSHARK LONDON STORE: A MASTERCLASS OF SPORTS RETAIL ERA

Fri, 14 Jun 2024 14:13:08 GMT

GYMSHARK LONDON STORE: A MASTERCLASS OF SPORTS RETAIL ERA

At 19, Ben Francis started Gymshark in a garage in Birmingham, UK, with a sewing machine, a screen printer, and a lot of ambition. He probably didn't expect that his company would grow to be worth over £1 billion and have a global revenue of £554 million by 2023, just twelve years later.

From its origins as a small online retailer in the UK and Europe, Gymshark boldly expanded its reach to the US and entered the brick-and-mortar business.

In a move that showcased its rapid growth and adaptability, it opened its first store on the iconic Regent Street in London in October 2022.

Following the success of the Regent Street store, the company will open a second store in London, Westfield Stratford shopping centre, this summer and a one-year pop-up store in New York.

But what have been the levers of such success for the London flagship store?

Interestingly, Gymshark's London flagship store stands out in the sports retail for its unconventional approach.

It's not about the size of the selling space, which is considerably smaller than its competitors, or the broad range of categories, selling only training apparel and accessories. Even the layout is unique, with fitting rooms placed exclusively on the first floor and a large stair at the entrance, followed by a juice and sandwich bar.

The leitmotiv of the store conception is Gymshark's purpose: to unite the community of athletes, employees and followers who work out to pursue their personal goals.

The company has built up a large community of members, growing to a remarkable 18 million social media followers in a few years. Gymshark's Instagram account has 7 million followers, compared with 8 million for Under Armour or 29 million for Adidas performance.

Then, designing a space for the Community to engage and experience together is one of the levers for the store's success.

Community features:

A variety of free daily group training classes in-store can be booked using the Gymshark App.

Free run club for different types of runner levels.

Open events are held for everyone and shared and streamed on social media. The space can quickly become a real gym thanks to the movable fixtures system and the flooring specification.

Authentic embracement of diversity and inclusion with in-store training classes and

Pride Month for the LGTBQ+ community with a permanent slogan and exclusive products.

As a consequence of this community space creation, the store

Differentiates itself from competitors in the area.
Enhances Gymshark advocates that will promote and defend the brand online.
Visiting consumers become ambassadors and will invite their network to the community.
It makes the employees feel part of the community and enhances their motivation.
It increases footfall, with an expected potential boost in Sales.

The second relevant lever for the store's success is the Experience element. The store has been designed for the whole community and to attract new members by experiencing the Gymshark purpose.

Experience features:

Several training spaces, including specialised equipment for workouts, like the sweat room and the pro bench studio.

A locker room for the community to provide a convenient area for personal belongings while training.

1to1 training consultations are available to be booked at the Gymshark App.

1to1 personalised shopping is available in-store and through the App.

A “Joe and the Juice” bar, open to anyone who wants to grab a shake or a sandwich.

Fitting rooms with a switch to call for assistance and others to create perfect lighting for your convenience, playing for your favourite pic to post (funny message signs included).

As a result of the implementation of these experiential areas, the store

Creates a unique space for gym fans in the centre of London.
Enhances the retail space and the shopping experience beyond a transaction process.
It increases the willingness of consumers to return to the store and boosts customer loyalty to the brand.
It allows employees to develop skills other than the sales associate and be more productive.
It raises consumer satisfaction, reflected in the net promoter score.
Boosts the conversion rate, potentially increases the units per ticket in the basket, and definitively sales growth.

Conclusions

Undoubtedly, the Gymshark Regent Street store has set the path for what brick-and-mortar in sports retail needs to be to make a company investment and a brand statement.

From the perspective of a retail professional, questions need to be answered regarding the level of service cost, CAPEX investment, profitability, etc. From a marketer's perspective, there is probably a balance between ROI and brand impact, engagement, and global reach.

However, from the consumer’s perspective, the store is brilliant! There is nothing comparable in London, and GEN Zers consumers are outnumbering other visitors in the store—there is such a desire for other competitors.

Acknowledges: While the Gymshark store's financial results are not publicly available, and the company's annual report only mentions that the store’s sales have been above expectations, this analysis provides insights from on-site visits during different periods since the store opening.

The insights and conclusions presented are not intended to guide other retailers toward the Gymshark store. Conversely, it is upon any company's brand culture and strategy to decide on the best design and set-up for their Flagship stores. Nevertheless, the Gymshark Regent Street store represents the future of brick-and-mortar: Phygital, Experiential, and linked to the Community.

Ismael Gonzalez - Founder and Managing Director

ARE THE LEADERS OF THE GLOBAL SPORTS RETAIL MARKET, NIKE AND ADIDAS, LOSING GROUND?

Thu, 23 May 2024 09:45:26 GMT

ARE THE LEADERS OF THE GLOBAL SPORTS RETAIL MARKET, NIKE AND ADIDAS, LOSING GROUND?

The sporting goods market is on an accelerated growth path, with a projected compound annual growth rate (CAGR) of 3.9% over 2021-2026. This robust growth trajectory is expected to propel the market to a value of $222 billion by the end of 2026. Geographically, the market is dominated by Asia-Pacific (41%), followed by Europe (29%) and the United States (25%). These regions are pivotal for future expansion, serving as critical battlegrounds for market share.

Nike Inc. and Adidas AG , the two giants of the global sports retail market, have long been at the forefront of this industry. Nike , in particular, has maintained its unassailable position, with its business revenue surpassing the monumental $50 billion mark in the last financial year (2023). This figure dwarfs the income of its closest competitor, Adidas , which reported €21.4 billion for FY 2023. Despite recent signs of a performance slowdown, Nike’s market position remains robust and largely unchallenged.

Despite a 5% revenue decrease last year compared to 2022 (0% on a currency-neutral basis), Adidas is optimistic about its future. The executive team projects high single-digit growth of 8%-10% for 2024, a potential rebound that could mark Adidas’s best performance in four years. This positive outlook, however, would still fall short of Adidas's 2019 performance, which saw revenues of €23.6 billion, underscoring the challenges it faces in regaining its previous position.

In contrast, Nike’s Q3 2024 financial results revealed a modest 2% year-on-year growth. Investors and markets have noted that this growth falls short of expectations, marking the lowest performance in the last four years. Additionally, considering Converse's 13% year-on-year decline, a brand within Nike Inc.'s portfolio, the group’s overall growth in Q3 2024 would be flat.

The underperformance of Nike and Adidas can be attributed to various factors . These include strategic distribution decisions with wholesale retailers, excess old inventory, and global geopolitical and economic conditions such as currency fluctuations, high inflation, supply chain challenges, and the ongoing conflict in Ukraine.

It is important to note, however, that other players in the sports market have faced similar global challenges without experiencing the same level of impact, highlighting the unique challenges faced by Nike and Adidas and the need for a nuanced analysis of their performance.

A critical analysis suggests that some underlying reasons for Nike and Adidas's slowdown include a lack of product innovation, limited new product development, diminished local community engagement, and a failure to connect deeply with new generations, such as Gen Z, compared to their competitors. This failure to resonate with younger consumers is particularly concerning, given this demographic's increasing purchasing power and influence.

Conversely, leading sports wholesale retailers, such as the UK-based JD Sports and the US-based Dick’s Sporting Goods , have demonstrated consistent growth in recent years. JD Sports achieved a notable 12% growth in 2023, reaching a total year revenue of £10.1 billion for the first time. Meanwhile, Dick’s Sporting Goods reported a 5% year-on-year growth in Q3 2024, with a 52-week outlook projecting a final growth of 6%, achieving a revenue milestone of $13.1 billion.

The impressive performance of these wholesale retailers can be attributed to their robust and balanced brand portfolios. These portfolios include not only Nike and Adidas but also other emerging and established brands such as Puma, Asics, Lacoste, BOSS, On Sports, and Gymshark , among other relevant players in the sports and lifestyle markets. This diversification has enhanced their growth and mitigated risks associated with consumer product trends and brand momentum.

Moreover, while Adidas and Nike remain critical to these retailers' sales, other sports and lifestyle brands are gaining market share, particularly among Millennial and Gen Z consumers. For instance, Puma , the other giant German-based sporting goods manufacturer and third global brand leader after Adidas, grew by 1.6% in 2023 (6.6% on a currency-neutral basis).

Puma experienced double-digit growth in EMEA and Asia (especially China), compared to Nike’s low-digit growth and Adidas’s zero growth in these regions. Given that Asia and Europe hold the first and second ranks in the global sports market share, these regions serve as significant brand trends and consumer preference indicators.

Another excellent sports brand performance to follow is the Switzerland-based company ON Holding AG . Established in 2010 as a sportswear and running focus brand, On saw a total revenue of approximately $2Bn (1,8Bn CHF) in 2023 , representing a growth of 46,6% vs 2022 (55% on a currency-neutral basis). Following the analysis review of Puma's regional performance, On experienced a sales increase of 35% in EMEA, 96% in Asia-Pacific and an extraordinary 61% in the Americas.

While On 's room for growth is not comparable to mature and consolidated brands like Adidas and Nike, its performance indicates consumer trends, specifically in footwear, the most relevant category at On. This category saw a revenue increase of 47%. One of the most critical features of On's success is its product innovation and creative design in footwear.

In conclusion , while Nike and Adidas continue to lead the global sports retail market, they are undeniably facing significant challenges and increasing competition. Their current trajectories indicate that relying solely on past strategies will not suffice in maintaining their market dominance.

Both companies must prioritise innovation, enhance product development, and deepen their engagement with local communities and new generations to remain at the forefront. The rise of other brands and wholesale retailers' robust performance underscores the market's dynamic nature and the necessity for continuous adaptation and strategic agility.

Nike and Adidas must address their internal inefficiencies and proactively engage with evolving market trends and consumer behaviours. This approach will be essential for sustaining their leadership positions and driving future growth. As the market continues to grow, the ability to innovate and connect with consumers on a deeper level will determine success in the competitive landscape of the global sports retail market.

Ismael Gonzalez - Founder and Managing Director

THE CONSUMER ROLE FOR A SUSTAINABLE FASHION INDUSTRY

Fri, 12 Apr 2024 11:43:31 GMT

THE CONSUMER ROLE FOR A SUSTAINABLE FASHION INDUSTRY

Consumers are relevant stakeholders in the fashion industry and, consequently, in the CE model transition. Consumers have an essential role in the behavioural change towards a sustainable lifestyle.

Despite their increased attention to sustainability issues, the pressure to shift consumers’ consumption has not relied upon them (UNEP, 2023).

Research in consumption theory reveals an encouraging trend: the increasing influence of environmental and sustainable factors on consumers' decision-making process.

This is evidenced by a significant rise in their willingness to pay a premium for products with a green trust, marking a positive evolution in consumer behaviour.

The paradox gap in young consumers

According to a global survey of consumers' perspectives on sustainable fashion consumption carried out IN 2019 by the Consulting firm KPMG, 80% of participants were concerned about environmental issues, and two-thirds of themselves supported the idea of sustainable fashion.

Following the study's findings, participants considered sustainable fashion with high-quality and durable products as primary features, followed by products free of hazardous chemicals. In contrast, ethical and fair trade/labour is considered a crucial element in a sustainable fashion.

However, the willingness to pay more for sustainable fashion remained low. This shows that in the consumers’ decision-making hierarchy, the environmental factor is below other relevant purchase factors, such as price, quality, value, and convenience of purchase, among others. Sustainability is relevant, but economic factors and opportunism are still more significant.

Therefore, it is imperative to bridge the gap in sustainability impact on consumer consumption behaviour, elevate the importance of environmental factors in their decision-making, and foster a more sustainable fashion industry.

Urban Millennials and Gen Zers consumers, the generations born in the eighties and mid-nineties, are more environmentally conscious and could enhance a consumption behavioural shift towards sustainability fashion priorities once they reach the age and income level to apply their eco-values to their purchase decisions.

Despite the increase in sustainability knowledge and eco-values by younger generations, green fashion covers less than 10% of the entire market. One reason for this performance is the affordability of fast fashion products, which influences the purchase decision of young consumers, and the lack of confidence in the industry's sustainability claims.

Wiederhold and Martinez (2018) have defined this paradox between the increase in the acceptance of sustainable fashion and the low levels of purchase behaviour towards it as “ the attitude behaviour gap ”.

Acknowledging the complexity and variety of consumers, who are clustered in different segments and targets and cover distinct needs, motives, and geographical differences, is essential. In the linear model, all these differences and complexities have been answered by fast fashion selling new clothes, including features like the latest trends, colours, styles, and low prices, leading to low utilisation rates.

The increase in sustainability consciousness by the young generations can be perceived as an essential driver for the industry to implement circular business models. However, the industry can use the paradox gap to slow the transition process.

Steps to move forward

Promoting a circular economy and taxation policies that enhance local consumption can become an essential tool for influencing consumers towards sustainable fashion over fast fashion.

Additionally, fashion companies should assume responsibility for their environmental impact and take steps to mitigate it. By bridging the gap between environmental protection and green consumption, conscious consumers can play a pivotal role in breaking the paradox.

The Ellen MacArthur Foundation (2017) suggests in the report “A New Textile Economy. Redesigning the Fashions Future” that a new Textile industry based on the Circular Economy model needs to implement a diversity of sales and services to satisfy a variety of consumers' clothing needs while ensuring higher utilisation rates (article photo).

Reducing the paradox between consumers' attitudes and behaviours towards sustainability requires taking concrete steps. To achieve this, industry stakeholders such as public and non-governmental institutions must initiate campaigns to promote sustainable practices.

Ismael Gonzalez - Founder and Managing Director

RESETTING RETAIL: THE PARADIGM SHIFT IN RETAIL TOWARDS PHYGITAL AND EXPERIENTIAL SHOPPING.

Thu, 29 Feb 2024 10:55:25 GMT

RESETTING RETAIL: THE PARADIGM SHIFT IN RETAIL TOWARDS PHYGITAL AND EXPERIENTIAL SHOPPING.

In today's ever-changing retail landscape, adaptation is a survival strategy and a necessity for success. Once dominated by brick-and-mortar stores, the traditional retail model has undergone a remarkable transformation in recent years.

This metamorphosis is driven by the fusion of physical and digital realms, known as " phygital ", and an emphasis on “ experiential shopping ”.

This paradigm shift represents a seismic change in how retailers engage with consumers, creating immersive, interactive, and personalised experiences that transcend the boundaries of traditional shopping.

The heart of this shift lies in recognising that consumers seek more than just products; they look for memorable experiences and seamless integration between physical and digital touchpoints. #Phygital retail seamlessly merges the convenience of online shopping with the sensory engagement of physical stores. It recognises that the lines between online and offline shopping are becoming increasingly blurred, with consumers expecting a cohesive brand experience across all channels.

One of the key drivers of this shift is the proliferation of #digital technologies . From augmented reality (AR) and virtual reality (VR) to artificial intelligence (AI) and the Internet of Things (IoT), retailers have a plethora of tools at their disposal to enhance the shopping experience. For instance, AR allows customers to visualise products in their space before purchasing.

At the same time, AI-powered chatbots provide personalised recommendations and assistance around the clock, to mention some of the possible features of these technologies. These technologies not only streamline the shopping process but also add an element of excitement and novelty, turning mundane transactions into memorable experiences.

#Experiential shopping goes beyond the transactional aspect of retail and focuses on creating immersive environments that captivate the senses and evoke emotions. Whether it's through interactive displays, live demonstrations, or themed pop-up events, experiential retailers aim to foster deeper connections with their customers and differentiate themselves in a crowded market. By curating unique experiences that resonate with their target audience, brands can foster loyalty, generate buzz, and drive foot traffic to their physical and digital storefronts.

A prime example of successful experiential retail is the rise of concept stores and flagship locations. These spaces serve as showcases for brands to express their identity, values, and aesthetics while offering customers an immersive journey into their world.

From themed installations and interactive exhibits to workshops and live performances, these stores transcend the traditional retail paradigm and become destinations in their own right. They blur the lines between commerce and culture, inviting customers to participate in a multi-sensory exploration of the brand's universe.

Well-known examples of these brand’s experience spaces are @ Hamleys , the toy store, the @ Microsoft store , and the brand-new flagship of @ Gymshark , all in central London.

Moreover, experiential shopping is not limited to physical spaces but extends to the digital realm. Online retailers leverage innovative technologies to create virtual experiences that mimic the excitement of in-store shopping. For instance, live-stream shopping events allow customers to interact with hosts, ask questions, and make purchases in real time, simulating the thrill of discovering new products alongside fellow enthusiasts. Similarly, gamification techniques, such as scavenger hunts and rewards programs, engage customers on digital platforms and encourage repeat visits.

However, while the shift towards phygital and experiential shopping offers myriad #opportunities for retailers, it also presents #challenges that must be navigated carefully. One of the primary concerns is maintaining a seamless omnichannel experience across multiple touchpoints.

Consistency in branding, messaging, and service becomes paramount as consumers increasingly switch between online and offline channels. Retailers must invest in robust technology infrastructure and data analytics capabilities to track customer interactions, preferences, and purchase history across channels and deliver personalised experiences at scale.

Furthermore, the rise of experiential shopping raises questions about # sustainability and # ethical consumption. As brands invest in elaborate displays and immersive installations, excess and waste are risks. Retailers must balance creating captivating experiences and minimising their environmental footprint.

This entails adopting sustainable practices throughout the supply chain, from sourcing materials to responsibly disposing of props and decorations. Moreover, retailers are responsible for educating consumers about the environmental impact of their purchasing decisions and empowering them to make more sustainable choices.

Conclusions

The paradigm shift towards phygital and experiential shopping represents a fundamental evolution in how brands engage with consumers . By leveraging digital technologies and creating immersive experiences, retailers can forge deeper connections with their customers, foster loyalty, and drive foot traffic to their stores. However, retailers must navigate the challenges that come with this shift, including maintaining a seamless omnichannel experience and promoting sustainability and ethical consumption. With careful planning and execution, retailers can create unforgettable experiences that differentiate their brand in a crowded market and build lasting customer relationships.

Ismael Gonzalez - Founder and Managing Director

THE FASHION INDUSTRY: AN URGENT CALL FROM THE CURRENT LINEAR MODEL TO A CIRCULAR MODEL TRANSITION.

Mon, 27 Nov 2023 17:47:34 GMT

THE FASHION INDUSTRY: AN URGENT CALL FROM THE CURRENT LINEAR MODEL TO A CIRCULAR MODEL TRANSITION.

Fashion is the second-largest global polluter industry after the oil industry, accounting for ~5-10% of greenhouse gas (GHG) emissions (more than those globally emitted by all international flights and maritime shipping combined), 20% of industrial water pollution globally attributable to the dyeing and treatment of textiles, and relies mainly upon non-renewable resources (98 million tonnes per year) generating 73% of those resources in waste ending in landfills or incinerated, resulting in an increase carbon footprint and energy and raw material losses (Ellen MacArthur, 2017).

Like most industries, fashion has relied on a linear economic model to become one of the engines of global development and one of the largest consumer industries. The broad fashion supply chain management, located mainly in Southeast Asian countries, has focused on maximising efficiencies to achieve high production volumes at lower costs and prices to generate high margins and profits for the industry.

Moreover, due to the fast pace of consumption created by fashion, based on those low costs and prices, the industry mainly operates in the linear model. This fast-consumption model increases the waste challenges of the industry, not just in the production phase but in the pre-consumption process with the clothing sales in the different online and offline channels with defective, damaged and unsold products, and in the post-consumption process with the unwanted clothing by consumers due to being damaged or out of fashion. Fashion logistics, overproduction generated by sales forecasting errors, and overconsumption created by harmonised consumer behaviour have created a sustainable gap in the industry.

According to the Ellen MacArthur Foundation (2017), clothing utilisation (the average time consumers wear a garment until it ceases to be used) has globally decreased by 36% in this century, with China leading the decrease by 70%, creating a loss in value of USD 460 billion for consumers in clothes thrown away. Following the analysis of the Ellen MacArthur Foundation (A new textile economy: Redesigning fashion’s future 2017, p. 18) report, with data sourced by Euromonitor International on apparel and footwear global sales in 2016, the volume of clothes sold doubled between 2000-15 (50bn units to 100bn units). This number of units represents a total volume of ~50 million tonnes. If the estimated growth follows as expected, 160 million tonnes of clothes could be reached globally by 2050, mainly driven by demand from Asian and emerging markets.

Another critical point to be considered in the industry supply change sustainability is related to the social factor. The global textile, clothing, leather and footwear (TCLF) supply chain employed more than 70 million people 2022 on geographically dispersed production. It provided employment opportunities worldwide, especially to millions of young women (International Labour Organization).

The tragedy at the Rana Plaza factory collapse in Dakha, with 1135 casualties and thousands of life-changing injuries occurred in 2013, put the focus on the industry supply chain and was a breaking point for the fashion industry to the closed eyes of what happened in its manufacturing value chain (ILO, 2023b). Besides the lessons learned in the aftermath of this tragedy and the measures put in place by the most relevant actors of the industry with their manufacturers in the improvement of the working conditions of the supply chain employees, different academic studies, environmental practitioners, and regulators have identified the need for more sustainable practices in the supply chain of the industry.

Further evidence of the fashion industry's poor sustainability performance was presented in the "Pulse of the Fashion Industry 2019" report, co-developed by the Boston Consulting Group and the Sustainable Apparel Coalition (SAC). Although some improvements were made compared to previous years, the overall results were still disappointing. The report emphasised the urgent need for fashion companies to implement sustainable solutions faster to mitigate the industry's rapid growth's negative environmental and social impacts (Global Fashion Agenda, 2020).

Several factors, such as budget constraints, reduced financial support by brands and governments to implement necessary technology, and low environmental managerial commitment with the lack of knowledge of ecological professionalism, are crucial constraints for sustainability improvement in the supply chain. Besides this reality, many reputable fashion brands have worked in a coordinated way under several organisations (e.g., Zero Discharged of Hazardous Chemicals group – ZDHC, Apparel & Footwear International Restricted Substances Management Working Group – AFIRM) to support and improve supply chain sustainability, as those brands share multiple apparel and footwear manufacturers.

It seems evident from these reports that the fashion industry's current efforts to implement sustainable practices are inadequate. The industry must prioritise adopting sustainable solutions, including using environmentally friendly materials, responsible production processes, ethical labour practices and other sustainable practices that involve the implementation of the Circular Economy model.

There seems to be consensus among academics, environmentalists, government officials, regulators, and other stakeholders that substantial transformations are imperative. For the industry to sustain its relevance and contribute to the global economy, it must adopt a sustainable approach encompassing all facets of the value chain. Achieving sustainability through implementing the Circular Economy model in the fashion industry requires a concerted effort from all stakeholders, both upstream and downstream of the fashion value chain.

At Retail Consulting & Advisory Services, we work for a Sustainable Future of Retail, helping Fashion and Sporting goods brands create sustainable strategies that support their transition to a “Green Business”.

Ismael Gonzalez - Founder and Managing Director

UNLOCKING THE POTENTIAL OF THE METAVERSE: A NEW FRONTIER FOR THE FASHION INDUSTRY

Wed, 05 Jul 2023 16:28:17 GMT

UNLOCKING THE POTENTIAL OF THE METAVERSE:

A NEW FRONTIER FOR THE FASHION INDUSTRY.

The Metaverse concept has recently gained tremendous attention, revolutionising how we perceive and engage with virtual reality. The metaverse represents a vast interconnected digital space where individuals can explore, interact, and create virtual experiences.

An analysis of McKinsey (2023) estimated a global market value for the Metaverse in 2022 between $200-300 billion and is expected to reach a global value of $4-5 trillion by 2030. Following the findings of McKinsey’s analysis, the areas where Metaverse will likely create that estimated value by 2030 will be in the retail, e-commerce, education-training, gaming, healthcare, media, and professional services, among others showing a significant disruption in all these industries and an excellent potential for companies investing in this technology.

A current example of this technology is the addition of the Metaverse to the omnichannel of Direct to Consumers brands, such as Nike and Gucci, creating 3-D e-commerce channels that engage with consumers, enhance brand marketing, and create additional revenues.

This article will explore the options for the fashion industry to invest in the Metaverse, exploring how this emerging landscape can open up new avenues for creativity, commerce, and consumer engagement.

Virtual Fashion and Avatar Customisation

One of the critical areas where the fashion industry can thrive in the Metaverse is through virtual fashion and avatar customisation. In the digital realm, consumers can curate their virtual identities by dressing their avatars in unique and stylish outfits. Fashion brands can capitalise on this by creating virtual collections and exclusive collaborations with virtual designers, enabling users to purchase and showcase digital garments. These virtual pieces provide a form of self-expression and create new revenue streams for fashion brands.

Immersive Fashion Experiences

The Metaverse offers unparalleled opportunities for fashion brands to create immersive experiences beyond traditional runway shows and brick-and-mortar stores. Virtual fashion shows allow designers to unleash their creativity without physical space limitations, bringing together the realms of fashion, art, and technology. By leveraging virtual reality (VR) and augmented reality (AR) technologies, fashion brands can transport their audiences to captivating virtual environments, allowing them to interact with garments and accessories in once unimaginable ways.

Social Commerce and Brand Communities

Social commerce has increased, with platforms like Instagram and TikTok significantly shaping consumer behaviour. The Metaverse takes social interaction to a new level by creating immersive and interactive brand communities. Fashion brands can establish virtual spaces where users can shop, socialise, attend events, and engage with like-minded individuals. By leveraging the power of social connectivity, brands can build stronger relationships with their customers, foster brand loyalty, and gain valuable insights into consumer preferences and trends.

NFTs and Digital Ownership

Non-Fungible Tokens (NFTs) have gained significant attention in the digital art world, but their potential impact on the fashion industry within the Metaverse is equally compelling. NFTs can be used to establish digital ownership of virtual fashion items, enabling users to buy, sell, and trade exclusive digital garments. Fashion brands can create limited-edition virtual collections or unique digital assets with cultural and monetary value.

This new ownership paradigm opens new revenue streams and introduces a sense of exclusivity and scarcity that resonates with collectors and fashion enthusiasts. s. Nike is a successful example of these opportunities, having hosted more than 26 million visitors at Nikeland, its space in Roblox, and it has sold over $185 million of NFTs for digital sneakers and suchlike products (BeInCrypto, 2022).

Virtual Retail and Showrooms

The Metaverse allows fashion brands to create virtual retail spaces and showrooms that reimagine the traditional brick-and-mortar experience. By combining gamification and immersive technologies, brands can design virtual stores that provide an engaging and personalised shopping experience. Customers can virtually try on clothes, experiment with different styles, and receive recommendations tailored to their preferences. Furthermore, virtual showrooms allow brands to showcase their latest collections to a global audience, breaking geographical barriers and reaching consumers in new markets.

Influencer Marketing and Partnerships

Influencer marketing has become a powerful tool for fashion brands to connect with their target audience. In the Metaverse, influencers can become virtual ambassadors, collaborating with brands to create unique content and experiences. Virtual influencers, who are entirely computer-generated, are gaining popularity and can be leveraged to reach a broader audience. Fashion brands can tap into the Metaverse's viral nature and creatively expand their reach by partnering with virtual influencers and collaborating on virtual events or campaigns.

Data-driven Insights and Personalization

The Metaverse provides a wealth of data and insights that can help fashion brands understand consumer behaviour and preferences on a granular level. By analysing user interactions, purchases, and virtual fashion trends, brands can gather valuable data to inform their product development, marketing strategies, and inventory management. This data-driven approach allows for greater personalisation, enabling brands to offer tailored recommendations and experiences that resonate with individual consumers, ultimately driving customer satisfaction and loyalty.

Sustainability and Experimentation

The Metaverse presents an opportunity for the fashion industry to embrace sustainability and experimentation. Virtual fashion allows brands to explore bold and futuristic designs without the environmental impact of traditional manufacturing processes. This opens up avenues for sustainable fashion practices and encourages creativity without limitations. Additionally, virtual fashion can serve as a testing ground for new materials, techniques, and production methods, enabling brands to experiment and innovate in ways that are not always feasible in the physical world.

Conclusions

The Metaverse holds immense potential for the fashion industry, providing opportunities for creativity, commerce, and consumer engagement. From virtual fashion and avatar customisation to immersive experiences and social interaction, brands can leverage the Metaverse to redefine their presence and reach a global audience innovatively.

By embracing technologies such as virtual reality, augmented reality, and non-fungible tokens, the fashion industry can tap into the Metaverse's limitless possibilities, ultimately shaping the future of fashion and consumer experiences.

However, it is also essential to consider a few challenges when moving towards the Metaverse, such as relying on a robust technological infrastructure, intellectual property protection, ethical use of data and consumer adoption and education.

As this digital landscape continues to evolve, the fashion industry must stay at the forefront of innovation to fully capitalise on the opportunities the Metaverse offers.

Ismael Gonzalez - Founder & Managing Director

THE RISE OF GEN Z AND THEIR ATTITUDES TOWARDS SHOPPING

Wed, 28 Jun 2023 12:35:01 GMT

THE RISE OF GEN Z AND THEIR ATTITUDES TOWARDS SHOPPING

Generation Z, commonly referred to as Gen Z, represents the cohort of individuals born between the mid-1990s and early 2010s. As the first true digital natives, Gen Z has grown up in a world characterised by rapid technological advancements, widespread internet access, and the dominance of social media.

These factors have significantly influenced their attitudes towards shopping, transforming the retail landscape in the process. Retailers need to look at them as the core influencers today that have a significant impact on both Millennials and Gen Xers in terms of what they buy. In size, they will definitely reach scale in the next ten to 15 years, but their influence today is very relevant.

In this article, we will explore Gen Z's attitudes about shopping in the context of the omnichannel experience, technology, customer experience, social media, and sustainability.

The Omnichannel Experience: Seamless Integration

Gen Z consumers expect a seamless and integrated shopping experience across multiple online and offline channels. They value convenience and expect retailers to provide a consistent experience across various touchpoints. Whether they are browsing products on a mobile app, visiting a physical store, or making a purchase through a website, Gen Z expects a cohesive and interconnected journey. That shopping journey touched on brick and mortar, it touched on e-commerce online on their laptop and it touched on mobile. It’s a holistic experience.

Omnichannel capabilities such as click-and-collect, in-store returns for online purchases, and personalised recommendations based on previous interactions resonate strongly with Gen Z. They appreciate the flexibility to choose how and when they engage with a brand, blurring the lines between online and offline shopping.

Technology: Empowering the Consumer

Gen Z's reliance on technology has profoundly impacted their shopping habits. Mobile devices are central to their lives; they use them to research products, compare prices, and make purchases. Retailers who have invested in mobile-optimized websites and apps that offer a seamless and user-friendly experience are more likely to attract Gen Z shoppers.

Moreover, emerging technologies such as augmented reality (AR) and virtual reality (VR) significantly shape Gen Z's attitudes toward shopping. These technologies allow them to visualise products in real-world settings, virtually try on clothing, or experience immersive brand storytelling. By incorporating these technologies, retailers can enhance the overall shopping experience for Gen Z consumers.

Customer Experience: Beyond Transactions

Gen Z strongly emphasises the overall customer experience rather than just the transaction itself. They value authenticity, transparency, and personalisation. Gen Z wants to feel connected to the brands they support and seeks meaningful interactions with them.

There is a new and more profound resurgence of the experience of retail and in-store. We can see an increase in the number of retailers and the number of tactics they’re deploying to improve brick-and-mortar experiences. Retailers who can provide a personalised shopping experience, such as tailored product recommendations, targeted promotions, and customised communication, are more likely to resonate with Gen Z. They appreciate brands that understand their individual preferences and cater to their unique needs.

Social Media: The Power of Influence

Social media plays an integral role in Gen Z's shopping journey. They use platforms like Instagram, TikTok, and YouTube to discover new products, seek reviews and recommendations, and stay updated with the latest trends. Influencer marketing has become a powerful tool for brands to reach Gen Z consumers and leverage their social media networks.

Gen Z tends to trust peer-to-peer recommendations more than traditional advertising. They value authenticity and are more likely to purchase if they are endorsed by someone they trust. Brands that can effectively harness the power of social media and collaborate with relevant influencers can gain significant traction among Gen Z consumers.

Sustainability: Ethical Consumerism

Gen Z is the most environmentally conscious generation to date. They prioritise sustainability and expect the brands they support to share their values. Gen Z consumers are likelier to engage with transparent brands about their sourcing practices, use eco-friendly materials, and actively contribute to social and environmental causes.

Retailers prioritising sustainability and adopting environmentally friendly practices have a competitive advantage with Gen Z. From ethical manufacturing to reducing carbon footprints. Sustainability initiatives resonate strongly with this generation. Brands that can authentically demonstrate their commitment to sustainability will be more likely to win Gen Z's loyalty and advocacy.

The Future of Gen Z Shopping

Understanding Gen Z's attitudes about shopping is crucial for retailers to thrive in the ever-evolving retail landscape. The omnichannel experience, technology, customer experience, social media, and sustainability all shape their shopping preferences.

As Gen Z continues to gain purchasing power, retailers must adapt their strategies to meet their expectations. Embracing a seamless omnichannel approach, leveraging technology to enhance the shopping experience, prioritising personalised interactions, utilising the power of social media, and embracing sustainability are key strategies for retailers to connect with Gen Z consumers.

In conclusion, Gen Z's attitudes about shopping reflect their unique experiences as digital natives. Retailers that can align with their values, preferences, and expectations will have the opportunity to cultivate long-term relationships and capture the loyalty of this influential consumer segment. Retailers can succeed in the evolving retail landscape by embracing the omnichannel era, leveraging technology, focusing on customer experience, harnessing social media, and prioritising sustainability.

Ismael Gonzalez - Founder & Managing Director

REVOLUTIONISING FASHION: HOW AI IS TRANSFORMING THE INDUSTRY

Wed, 14 Jun 2023 15:51:09 GMT

REVOLUSIONALISING FASHION: HOW AI IS TRANSFORMING THE INDUSTRY

The fashion industry is experiencing a transformative shift with the integration of artificial intelligence (AI) technologies. AI is revolutionising various aspects of the industry, including customer personalisation, the buying allocation process, and design. Through advanced algorithms, machine learning, and data analysis, AI empowers fashion brands to deliver personalised experiences, optimise buying decisions, and unleash creativity in design.

This article will explore how AI is reshaping the fashion industry in these three areas, paving the way for enhanced customer satisfaction, improved operational efficiency, and innovative design solutions.

Customer Personalisation

AI has become a game-changer in the realm of customer personalisation. Fashion brands leverage AI algorithms to analyse vast customer data, enabling them to understand individual preferences, style choices, and purchase patterns. By harnessing this data, companies can tailor personalised recommendations, suggestions, and experiences to their customers.

One prominent application of AI in customer personalisation is virtual styling assistants. These AI-powered systems leverage data analytics and image recognition to suggest outfits, recommend complementary items, and even virtually try on clothing. By understanding a customer's body type, style preferences, and previous purchases, AI can curate personalised wardrobes and make relevant suggestions, transforming the online shopping experience.

Furthermore, AI chatbots and voice assistants have made customer interactions more intuitive and efficient. These intelligent conversational agents can provide instant assistance, answer inquiries, and offer personalised recommendations based on individual needs. Through natural language processing and machine learning, chatbots and voice assistants can understand and respond to customer queries in real time, enhancing customer satisfaction and loyalty.

Buying-Allocation Process

The buying-allocation process is a critical aspect of the fashion industry, determining the right inventory quantities and allocating them to different stores or channels. AI is streamlining and optimising this complex procedure. Traditionally, the process involved manual analysis, guesswork, and intuition, resulting in inventory imbalances and missed opportunities. However, AI algorithms and predictive analytics enable fashion brands to make data-driven decisions and allocate resources more efficiently.

AI-powered demand forecasting models leverage historical sales data, market trends, and external factors to predict future demand accurately. By analysing various parameters, such as seasonality, consumer behaviour, and social media trends, AI can forecast the market at a granular level, allowing fashion brands to optimise their production and purchasing decisions. This helps reduce excess inventory, minimise stockouts, and ultimately improve profitability.

Additionally, AI-driven inventory management systems can automatically analyse sales data, identify underperforming products, and recommend optimal stock levels. By continuously monitoring sales and inventory levels, these systems can make real-time adjustments, ensuring that popular items are adequately stocked while minimising the risk of overstocking less popular products. This proactive approach to inventory management enhances operational efficiency and reduces waste.

Design

AI is redefining the boundaries of creativity in the fashion industry by aiding designers in generating innovative designs and improving the design process. With the help of AI, designers can leverage vast datasets, trend analyses, and style preferences to inform their creative decisions.

Generative adversarial networks (GANs) are one of the AI techniques used in fashion design. GANs can learn from vast collections of images, such as runway looks, street style, and historical fashion archives, to generate new and unique design concepts. By combining different styles, colours, and patterns, AI algorithms can produce inspiring and avant-garde designs that push the boundaries of traditional fashion.

Moreover, AI-powered tools facilitate design by automating repetitive tasks like pattern generation, material selection, and garment fitting simulations. Designers can focus on ideation and conceptualisation while AI algorithms handle time-consuming tasks, resulting in increased productivity and faster time-to-market. Additionally, AI-powered systems can analyse large datasets related to fabric properties, sustainability metrics, and customer preferences to suggest optimal material choices. By considering factors such as comfort, durability, and environmental impact, AI can assist designers in making informed decisions during the material selection process. This contributes to the development of sustainable fashion and facilitates the creation of garments that align with consumer expectations.

Conclusions

The integration of AI in the fashion industry is revolutionising customer personalisation, the buying allocation process, and design. By leveraging AI algorithms and data analytics, fashion brands can provide personalised experiences to customers, optimise buying decisions, and enhance design creativity. Through virtual styling assistants, AI chatbots, and voice assistants, customer interactions are becoming more intuitive and tailored. AI-driven demand forecasting and inventory management systems optimise the buying-allocation process, reducing waste and improving profitability. Additionally, AI aids designers by generating innovative designs and automating repetitive tasks.

Finally, using AI in the fashion industry provides numerous benefits for marketing. From personalised recommendations and improved customer engagement to social media analysis and predictive analytics, AI empowers fashion brands to understand their customers better, deliver targeted messages, and stay ahead of trends. By leveraging AI technologies, fashion marketers can create impactful marketing campaigns, enhance customer experiences, and drive business growth. As the fashion industry embraces AI, we can expect further advancements, ultimately reshaping the industry's landscape.

Ismael Gonzalez - Founder & Managing Director

VIRTUAL REALITY: THE REVOLUTION OF FASHION RETAIL.

Wed, 07 Jun 2023 16:50:30 GMT

VIRTUAL REALITY: THE REVOLUTION OF FASHION RETAIL

Virtual Reality (VR) has emerged as a game-changer in the fashion retail industry, revolutionising how customers experience and interact with fashion products. By bridging the gap between the physical and digital worlds, VR offers an immersive and interactive shopping experience. The recent announcement made by Apple this week about its new VR gear launch, which incorporates plenty of new features that will transform the way consumers will interact in a more immersive way than with the phone, has bounced back the world’s attention to this technology.

In this article, we will explore the concept of VR, its main features, and its numerous advantages and benefits to the fashion industry. Additionally, we will showcase some examples of fashion brands that have successfully incorporated VR into their retail strategies.

UNDERSTANDING VIRTUAL REALITY (VR)

Virtual reality (VR) is a computer-simulated, realistic three-dimensional environment. VR heightens a user’s sense of being in the environment and enables the user to interact with the environment (Park et al., 2018). VR typically involves using a headset or goggles that provide a visual and auditory experience, along with hand controllers or other input devices for interaction within the virtual environment.

Key Features of Virtual Reality

Immersion . VR creates a sense of presence by immersing users in a simulated reality, effectively transporting them to a virtual environment. By blocking out the physical world and engaging multiple senses, VR provides a heightened level of immersion.

Interactivity . VR offers interactive experiences, allowing users to V. Users can manipulate objects, explore virtual stores, and interact with virtual products, enhancing the shopping experience.

Realism . VR strives to replicate real-world experiences with high levels of detail and realism. Through realistic graphics, spatial sound, and accurate physical interactions, users can experience a virtual world that closely mimics the physical one.

Customisation . VR experiences can be tailored to individual preferences, offering customisation options. Users can personalise avatars, select virtual environments, and even try on virtual clothing, providing a highly personalised shopping journey.

Advantages and Benefits of Using VR in Fashion Retail

Enhanced Shopping Experience . VR offers a transformative shopping experience by immersing customers in virtual environments. Users can explore virtual stores, browse collections, and visualise how outfits look on themselves in a highly realistic and interactive manner. This heightened engagement leads to increased customer satisfaction and, consequently, loyalty.

Overcoming Physical Constraint s. VR eliminates geographical limitations by allowing customers to visit stores virtually and try on products from anywhere in the world. This opens up new markets for fashion brands, expands their reach, and breaks down distance barriers, enhancing brand awareness.

Improved Personalization . Personalisation is a crucial aspect of the fashion industry, and VR takes it to new heights. Customers can personalise their virtual shopping experience by customising avatars, trying different styles and colours, and experimenting with accessories. This level of customisation helps customers make informed purchase decisions, be engaged with the brand and support a more sustainable process, reducing the carbon footprint on deliveries, returns and packing.

Cost and Space Efficiency . VR reduces the need for physical retail space and inventory, resulting in cost savings for fashion brands. It enables retailers to showcase their entire product range without physical space limitations, improving cost efficiency. Additionally, physical stores can use VR to enhance experiential shopping, implementing spaces to experiment with collections, pre-select purchases, and engage with gaming experiences.

(VR) RETAIL FASHION BRANDS IMPLEMENTATION

Fashion Brands embraced VR a few years ago, but more recently and boosted by the covid19 pandemic, we have seen more brands incorporating this technology into their strategic actions. Luxury firms became the most active actors in the industry in implementing it. In some cases, like Gucci, they have provided access to a virtual world of the brand. The Gucci Garden, a virtual Palazzo, offers an immersion of the creative brand’s director where visitors can try and purchase digital items.

Other brands decided to enhance the experience in their stores, like Dior. Dior incorporated VR into its retail strategy by launching the "Dior Eyes" virtual reality headset. The brand decided to create its virtual reality headset inspired to develop the immersive, thrilling, innovative experience Dior wanted. A tailor-made virtual reality headset that immerses users inside the Dior backstage by using 360 audio and video deployed in Dior’s selected points of sales worldwide.

Burberry, Ralph Lauren and Tommy Hilfiger used VR in stores to provide an immersive experience to their customers, offering experiences such as a virtual journey through their collections or attending the brand fashion shows. However, VR technology has been implemented by other non-luxury brands to enhance the customer experience such as Adidas and Nike.

To promote Terrex, Adidas’ line of outdoor gear utilised VR to simulate one of the routes of the most challenging climb in Punta du Corbi, Corsica. Through VR headsets, players could experience virtually climbing the Delicatessen summit from a climber’s point of view. It also helped educate users about best practices in rock climbing while letting them enjoy the realistic outdoor scenery.

On the other hand, Nike has created “Nikeland”, developed by the Brainiac Commerce e-commerce platform that drives scalable consumer traffic to its products. In Nikeland, Nike has also created a world with Roblox to add even more innovation and excitement for customers allowing users to program games themselves and play games that other users have created.

Conclusions

Virtual Reality will transform the fashion retail industry, offering an immersive and interactive shopping experience. By leveraging the advantages of VR, fashion brands will enhance customer engagement, extend their reach, and personalise the shopping journey. With features such as immersion, interactivity, realism, and customisation, VR has the potential to reshape the future of fashion retail. As technology advances, we can expect further integration of VR, providing customers with more engaging and immersive shopping experiences in the digital age.

Ismael Gonzalez - Founder & Managing Director

RETAIL RENAISSANCE IN CENTRAL LONDON

Wed, 31 May 2023 15:32:23 GMT

RETAIL RENAISSANCE IN CENTRAL LONDON

In mid-June 2020, the first lockdown in the UK due to covid19 pandemic ended. High streets were still relatively empty, but few consumers were brave enough to return to recently reopened retail outlets, willing to enjoy the experience of physical store shopping again beside the restrictions and safety measures. Famous high streets, such as Oxford or Regent in London, saw how many well-known brands would close later their branches, letting desolated empty buildings and retail spaces.

Last bank holiday weekend in the UK, almost three years after, high street footfall has yet to recover the numbers of the same period in 2019. However, the rise in street footfall compared with previous years following the pandemic lockdowns is constantly increasing, and we estimate that 2024 could be the year with a near-performance to the numbers seen in 2019.

Global and domestic circumstances are impacting a faster recovery, such as the invasion of Ukraine and its repercussion of high inflation and interest rates, the cost of living crisis, low consumer confidence, post-Brexit economic consequences and loss of wealth in society as the result of the international and national turmoil with the impact of the spread of social demands and industrial actions. On the other side of the retail spectrum, brands have been forced to increase prices to cope with the rise in raw materials and supply chain costs to mitigate the drop in margins and keep the competitiveness of their organisations.

With this panorama in mind, it sounds very optimistic to predict a positive recovery of the retail landscape one year from now, but there are clear visible signals of that recovery in the UK and especially in Central London:

· International brands have pointed out the UK market for their growth strategies, such as the Spanish MANGO, the French SEPHORA, the American Under Armour, the Japanese UNIQLO and the Polish RESERVED.

· The empty buildings of Debenhams, Next and House of Frasers on Oxford Street are currently under construction to be occupied with new retail offerings by 2024, and Westminster Council has urged retail unit owners to terminate or cancel Candy shops tenant contracts to revamp the street with new retailers that fit better to an international shopping high-street.

· Since the end of 2022, critical retail relocations, new openings and refurbishments in Central London’s primary shopping spots have occurred. We have seen the opening of the Battersea shopping centre, new international tenants in Westfield shopping centres and a special mention to Oxford and Regent Street landscape. Some examples of this high street revamp include the openings of Gymshark, ON, Superdry, and Uniqlo stores, followed by the relocations of Lacoste and Abercrombie and the refurbishment of BOSS stores.

· There are more investments to come next months, with the opening of Under Armour and Reserved in Oxford Street and the possibility of a new Uniqlo store in Oxford One, the large unit close to Tottenham Court tube station.

We acknowledge that the war in Ukraine will still last for a long time, as well as some of its consequences and that the cost of living crisis will extend during 2024. Still, we understand that organisations making such investment decisions are looking to the long-term considering London one of the most relevant shopping places in the world. The renaissance of Retail in Central London is now.

Ismael Gonzalez - Founder & Managing Director

RETAIL EXPERIENTIAL SHOPPING: SUCCESSFUL EXAMPLES IN FOUR CRITICAL AREAS

Wed, 24 May 2023 10:39:39 GMT

RETAIL EXPERIENTIAL SHOPPING: SUCCESSFUL EXAMPLES IN FOUR CRITICAL AREAS

In an era dominated by e-commerce and digital innovations, brick-and-mortar retailers face the ongoing challenge of attracting and retaining customers. However, some Fashion, Sports and other retailers have risen above the competition by offering exceptional consumer experiences in their physical stores. By reimagining the traditional shopping journey and leveraging technology, these brands have successfully created immersive and unforgettable experiences that keep customers returning for more.

This article will explore how exceptional consumer experiences are implemented in brick-and-mortar stores, revolutionising how we shop and focusing on four principal areas that make a difference to store consumer experience.

Creating an Engaging Atmosphere

One of the critical elements of exceptional consumer experiences in fashion brick-and-mortar stores is the creation of an engaging atmosphere. Successful retailers focus on designing their stores to reflect their brand identity and values while capturing customers' attention.

For instance, Ralph Lauren's flagship store in New York City, known as the Ralph Lauren Mansion, is an iconic example. It combines luxurious decor, elegant displays, and a historical ambience that transports customers to another era. The store's grandeur and attention to detail make it an unforgettable shopping experience.

The Food Gallery of Harrods is another example of engaging with consumers outstandingly. It is probably the most iconic and engaging grocery experience in the world, not just because of the quality and variety of its products, but because of the lightening environment, food counters style and display, the story-telling layout of the different spaces and the staff outfits that brings each visitor to the vintage childhood memories shopping in small grocery stores with an elegant and distinctive English touch.

Personalised Customer Service

Exceptional consumer experiences also involve providing personalised customer service beyond the ordinary. This is well-implemented in the luxury sector, making a difference for any visitor willing to buy exclusive, glamorous and quality products while expecting personalisation in the store experience. However, more and more brands out of the luxury sector have been implementing personalised customer service to stand out from competitors and retain customers in the last few years.

Aesop, the sustainable beauty brand, is an example representing customer services' personalisation. The stores are designed with that aim, placing space for testing products in a way that brings customers to a spa experience, and the staff is trained for this purpose. Aesop stores are created to enhance the customer experience with an engaging atmosphere and are designed to provide personalised service.

Another example of personalised customer service is in the sporting-goods sector. Like the one in Oxford Street in London, the Adidas Flagship store provides personalised service for customers willing to buy running shoes. The store was designed with a space aside from the footwear wall for a treadmill test conducted by professional runners staff members to advise the customer on the most suitable product based on a personalised running analysis.

Seamless Integration of Technology

Technology integration is essential to delivering exceptional consumer experiences in retail brick-and-mortar.

Following with examples in the sporting-goods sector, Nike flagship stores, such as Nike House of Innovation in New York City, leverage cutting-edge technology to provide an immersive and personalised shopping journey.

For instance, Nike's Nike Plus app seamlessly integrates with in-store experiences, allowing customers to reserve products, receive personalised recommendations, and access exclusive content. Additionally, interactive digital installations, such as smart mirrors and interactive screens, provide customers with product information, customisation options, and virtual try-on experiences.

The store features a Nike Speed Shop, where customers can use the Nike app to reserve items, try them on in-store, and purchase them seamlessly through a mobile payment system. Additionally, customers can personalise their shoes with custom colours and designs using interactive touchscreens, creating a unique and interactive shopping experience.

Engaging in Events and Experiences

Fashion retailers increasingly focus on creating experiential spaces within their brick-and-mortar stores, hosting events and workshops that engage customers beyond traditional shopping.

The British luxury brand Burberry is well-known for its immersive retail experiences. Their flagship store in London features an in-store theatre that showcases live performances, fashion shows, and exclusive events. By blurring the boundaries between fashion, art, and entertainment, Burberry creates a captivating and memorable experience that leaves a lasting impression on its customers.

Gymshark, a rapidly growing fitness apparel brand, excels in creating immersive brick-and-mortar experiences that resonate with its fitness-focused customer base. Gymshark flagship store in London, the only physical store of the brand, offers a unique blend of retail and community engagement. They host fitness classes, workshops, and meet-ups with influencers, fostering a sense of community among their customers. The store's design and layout reflect Gymshark edgy and modern aesthetic, providing a visually engaging experience.

Hamleys Toy Shop on Regent Street in London, probably the largest toy shop in Europe, is the maximum representation of brick-and-mortar customer events and experiences. This shop brings the experience to the theatre level on its six floors, delighting adults and kids on each visit and creating a joyful environment that can not be found at any shop in London.

Exceptional consumer experiences in brick-and-mortar stores are implementing innovative strategies to engage and delight customers. These retailers redefine the traditional shopping journey by creating engaging atmospheres, providing personalised customer service, seamlessly integrating technology, and offering exciting events. More examples could be shared in this article, which show that Retail is moving in the right direction to continue engaging with consumers in the physical stores and making steps toward a bright Future.

Ismael Gonzalez - Founder & Managing Director

CONSUMER BEHAVIOUR CHANGES & TRENDS IN RETAIL

Wed, 17 May 2023 21:39:38 GMT

CONSUMER BEHAVIOUR CHANGES & TRENDS IN RETAIL

Customer orientation, customer centricity, and customer focus are concepts overused by businesses in many industries, becoming a mantra for managers and organisations. It seems a general agreement that organisations must focus on customers, considering that markets are very competitive and non-static.

The literature in the marketing sphere has considered customer orientation one of the three critical behavioural components for an organisation’s market-oriented approach. Narver and Slater (1990) described customer orientation in the Journal of Marketing as the sufficient understanding of one's target buyers to continuously create superior value for them. In other words, organisations must understand their customers and their present and future needs to create value by developing new offerings and constantly measuring customer satisfaction. The critical question is how organisations can be customer-oriented in a changing environment, including changes in consumer behaviours.

The retail landscape has witnessed significant changes in consumer behaviour over the past few years. Various factors, including technological advancements, shifting demographics, economic fluctuations, and evolving consumer preferences, have driven these changes. This article will explore some key trends and transformations in retail consumer behaviour.

Rise of E-commerce

The growth of e-commerce has revolutionised the retail sector. Consumers have shifted towards online shopping with the increasing penetration of smartphones, improved internet connectivity, and convenience-driven shopping habits. The COVID-19 pandemic has further accelerated this trend, as lockdowns and social distancing measures prompted more consumers to turn to online channels. Retailers have responded by enhancing their online presence, investing in user-friendly websites, and optimising logistics to meet the surge in online orders.

Mobile Shopping

The widespread adoption of smartphones has also led to a rise in mobile shopping. Consumers increasingly use their mobile devices to browse products, compare prices, read reviews, and make purchases. Mobile apps and mobile-optimized websites have become crucial for retailers to engage with consumers and provide seamless shopping experiences. However, the use of mobiles for shopping goes beyond the current use, and implementing technologies such as AR will change how retailers engage with consumers and provide personalised experiences.

Demand for Personalization

Consumers now expect personalised experiences from retailers. They value tailored recommendations, customised promotions, and targeted marketing campaigns. Retailers must leverage technologies like artificial intelligence and big data analytics to gather customer insights, track shopping behaviour, and deliver personalised recommendations. Personalisation enhances customer satisfaction, improves customer loyalty, and drives repeat purchases.

Sustainable and Ethical Shopping

There has been a growing awareness and concern among consumers about environmental sustainability and ethical practices. Shoppers increasingly seek sustainable, eco-friendly products and support brands that demonstrate social responsibility. Retailers must respond by incorporating sustainable practices in their supply chains, offering eco-friendly alternatives, and providing transparency about their sourcing and manufacturing processes. Retailers aligning with ethical and sustainable values will likely gain a competitive edge and attract a loyal customer base.

Shift in In-Store Experience

While online shopping has gained prominence, the in-store experience remains crucial. Consumers still enjoy the tactile aspect of shopping, trying on clothes, and interacting with products. However, the role of physical stores has evolved. Retailers must introduce augmented reality (AR) and virtual reality (VR) to enhance the in-store experience, offering virtual try-ons, interactive displays, and immersive shopping environments. Additionally, retailers must have an integrated online and offline channel to provide a seamless omnichannel experience, such as click-and-collect services and in-store returns for online purchases.

Social Media Influence

Social media platforms have become significant influencers in consumer purchasing decisions. GenZ consumers and Millennials rely on platforms like Instagram, Facebook, YouTube, and TikTok for product discovery, reviews, and recommendations. Influencer marketing has gained traction, with brands partnering with famous social media personalities to promote their products. User-generated content and social proof have become essential to building trust and driving consumer engagement.

In conclusion, consumer behaviour has experienced a profound transformation due to various factors. The rise of e-commerce and mobile shopping has changed how consumers browse and purchase products. Personalisation, sustainability, and ethical considerations have influenced consumer choices. Physical stores have to adapt by incorporating technology and providing seamless omnichannel experiences. Social media has emerged as a powerful tool for product discovery and recommendation. As technology continues to advance and consumer expectations evolve, retailers need to stay agile and adapt their strategies to meet the changing demands of consumers.

Ismael Gonzalez - Founder & Managing Director

FOUR CRITICAL PILLARS FOR FASHION SUSTAINABILITY STRATEGY DESIGN

Wed, 10 May 2023 17:14:27 GMT

FOUR CRITICAL PILLARS FOR FASHION SUSTAINABILITY STRATEGY DESIGN

Sustainability has become a critical issue in the fashion industry as the sector's environmental and social impacts have become increasingly apparent. With global fashion production projected to increase by over 60% by 2030, the industry must take a more sustainable approach to ensure its long-term viability. Achieving sustainability in the fashion industry requires a multi-pronged approach that addresses several critical elements, including setting the strategic direction, setting clear plans and investments in scopes 1,2,3, building trust in products, and measuring and performing the strategy.

1. Setting the strategic direction.

This is the fashion industry's first critical element of sustainability. The industry must develop a clear and comprehensive sustainability strategy that outlines its goals, targets, and initiatives. The strategy should be aligned with the United Nations Sustainable Development Goals (SDGs) and prioritise the industry's most significant environmental and social impacts. For example, the industry's significant ecological effects include water usage, chemical pollution, and waste generation. Its social impacts include labour exploitation, unsafe working conditions, and human rights violations.

A clear sustainability strategy should be based on a thorough assessment of the industry's current sustainability performance and its potential for improvement. Stakeholder engagement and collaboration with suppliers, customers, and civil society organisations should also inform the strategy. Additionally, the strategy should be integrated into the industry's broader business strategy and be supported by senior leadership and management.

However, a recent analysis by Smurfit-Kappa in 2022 of more than 400 organisations in the retail and consumer products industry and an in-depth survey of sustainability leaders of some of those organisations, the study revealed six critical barriers to their organisations’ initiatives:

· Inconsistent data access.

· Lack of supply-chain data transparency.

· Weak internal alignment.

· Lack of measurable targets.

· Complexity of identifying solutions.

· Difficult funding access.

2. Setting clear plans and investments in scopes 1,2,3.

The fashion industry's sustainability challenges extend beyond its operations to include the entire supply chain, product use, and disposal. Therefore, the industry must set clear plans and investments for these three scopes, setting targets and metrics on a leadership level and cascading down to the whole organisation.

In scope 1, the industry must reduce environmental impacts by minimising energy use, water consumption, and waste generation. This can be achieved through various measures, including improving production efficiency, using renewable energy sources, and implementing waste reduction and recycling programs.

In scope 2, the industry must work with its suppliers to reduce their environmental impacts by encouraging them to adopt sustainable practices and providing support and incentives. The industry can also work with its suppliers to reduce their social effects by promoting decent working conditions, fair wages, and human rights protections.

In scope 3, the industry must focus on reducing the environmental impacts of its products throughout their lifecycle, from sourcing and production to use and disposal. This can be achieved by using sustainable materials, designing products for durability and recyclability, and promoting responsible consumer behaviour.

Following the findings of the Smurfit-Kappa analysis, the priority investments made by the organisations’ leaders surveyed are:

· Packaging innovation.

· Machinery/tools upgrade.

· Data and analytics technologies.

· Cross-sector partnerships.

· Green investments.

· External sustainability audits.

3. Building trust in products.

Consumers are becoming increasingly concerned about the environmental and social impacts of the products they purchase, and the fashion industry must respond by building confidence in its products. According to one 2022 study, more than half of consumers globally say that the Covid-19 pandemic motivated them to adopt a more sustainable lifestyle; nearly 70% are worried about climate change. And they expect brands to demonstrate similar concerns and responses. The study reveals that consumers are more likely to reward businesses that can robustly show the impact of their actions to become more sustainable – and as standards of transparency improve, companies found to be ‘greenwashing’ are likely to be punished for it.

To build confidence in products, organisations must include measures such as:

Using sustainable materials : The fashion industry can build trust in its products by using sustainable materials such as organic cotton, recycled polyester, and regenerated nylon. These materials have lower environmental impacts than traditional materials and are increasingly available from suppliers.

Communicating sustainability: The industry can also build trust in its products by sharing its sustainability efforts with consumers. This can be done through various channels, including product labelling, marketing campaigns, and sustainability reports.

Certifications and standards: The fashion industry can also build trust in its products by obtaining certificates and adhering to sustainability standards. Such certifications include the Global Organic Textile Standard (GOTS) and the Responsible Wool Standard (RWS). On the other hand, well-renowned standards are ISO 14001, EMAS or B-corp.

4. Measuring and performing the strategy.

The sector must measure its sustainability performance regularly and use this information to assess its progress and identify areas for improvement. The industry can use various sustainability metrics, such as carbon emissions, water usage, and waste generation, and social impact metrics, such as worker safety, fair wages, and human rights protections.

The fashion industry should implement robust data collection and reporting systems to measure and perform the sustainability strategy effectively. This involves gathering data from various supply chain stages, including raw material sourcing, production, transportation, and retail. Furthermore, the industry must perform its sustainability strategy by implementing sustainable practices throughout its operations and supply chain. This requires the industry to invest in sustainable technologies, train its workforce on sustainable practices, and collaborate with suppliers and stakeholders to achieve shared sustainability goals.

The proper measurement framework is critical to succeeding in this area, ensuring clarity and transparency in the metrics and reporting system. The Science-Based Target Initiative (SBTi) provides a framework and criteria for companies to set science-based targets (SBTs) for reducing their GHG emissions. SBTs are emissions reduction targets that align with the decarbonisation level required to keep global warming below 2 degrees Celsius. SBTi is a collaborative initiative launched in 2015 by CDP, the United Nations Global Compact (UNGC), the World Resources Institute (WRI), and the Worldwide Fund for Nature (WWF).

In conclusion, achieving sustainability in the fashion industry requires a multi-pronged approach that addresses several critical elements, including setting the strategic direction, setting clear plans and investments in scopes 1,2,3, building trust in products, and measuring and performing the strategy. By adopting sustainable practices throughout its operations and supply chain, the industry can reduce environmental and social impacts, build consumer trust, and secure long-term viability. With the support of stakeholders, the fashion industry can work towards a more sustainable future for all. To ensure the effectiveness of its sustainability strategy, the fashion industry must also regularly review and update it to reflect changing environmental and social conditions and emerging best practices.

Ismael Gonzalez - Founder & Managing Director

EMS: A BRIEF ANALYSIS AND BENCHMARK OF ISO 14001, EMAS & B Corp.

Wed, 03 May 2023 18:26:30 GMT

EMS: A BRIEF ANALYSIS AND BENCHMARK OF ISO 14001, EMAS & B Corp.

Organisations use several environmental management systems (EMS) to manage environmental impacts and comply with environmental regulations. The primary use of an EMS is to help organisations minimise their negative impact on the environment and prevent ecological incidents from occurring. An EMS provides a structured approach to identifying and managing environmental risks and opportunities, which can help organisations improve their performance and reduce their negative environmental footprint.

Some of the critical uses of an EMS include:

Compliance: An EMS helps organisations comply with environmental regulations and requirements by identifying legal obligations and ensuring that the organisation is meeting those obligations.

Risk management: An EMS helps organisations identify, assess, and manage environmental risks, such as pollution incidents or natural disasters, which can help prevent environmental harm and financial loss.

Continuous improvement : An EMS provides a framework for setting environmental objectives, targets, and performance indicators, which can help organisations measure and improve their environmental performance over time.

Reputation: Implementing an EMS can improve an organisation’s reputation by demonstrating its commitment to environmental sustainability and social responsibility.

Cost savings: An EMS can help organisations identify opportunities to reduce waste, conserve resources, and improve efficiency, resulting in cost savings and increased profitability.

The two most commonly used EMS are ISO 14001 and the EMAS. Additionally, the B Corp certification B Lab provides is different from a traditional environmental management system (EMS). Still, it includes many elements of an EMS and focuses on sustainability and social responsibility.

We briefly describe these three systems’ main strengths and weaknesses.

ISO 14001

Strengths:

ISO 14001 is internationally recognised, and its certification is widely accepted.
It provides a structured framework for identifying and managing environmental risks and opportunities.
It helps organisations comply with environmental regulations and requirements.
It can be integrated with other management systems, such as ISO 9001, for quality management.
It can improve an organisation’s reputation and competitiveness.
It needs to be implemented in the primary business unit to certify the whole organisation.
It needs to be implemented in the primary business unit to certify the whole organisation.

Weaknesses:

ISO 14001 certification does not guarantee environmental performance improvement.
It does not have specific requirements for environmental performance indicators.
It does not require organisations to disclose their environmental performance publicly.
It can be expensive and time-consuming to implement and maintain.

EMAS

Strengths:

EMAS requires public disclosure of environmental performance, which can increase transparency and accountability.
It requires the use of performance indicators to measure and monitor environmental performance.
It emphasises continuous improvement and requires organisations to set environmental targets and goals.
It provides recognition for good environmental performance through a publicly accessible register.
It can help organisations comply with environmental regulations and requirements.

Weaknesses:

EMAS is less widely recognised internationally than ISO 14001.
It can be more expensive and time-consuming to implement and maintain than ISO 14001. Any business unit needs to be certified.
It is only available to organisations located within the European Union.
Its public disclosure requirements may only suit some organisations, especially those with confidential information.

B Corp

Strengths:

B Corp certification requires companies to meet high standards of social and environmental performance, transparency, and accountability.
It provides a comprehensive framework encompassing sustainability's environmental, social, and governance aspects.
It includes a set of performance indicators specific to each industry and measures the company's impact on the environment and society.
It requires ongoing certification, encouraging continuous improvement in sustainability practices.
B Corp certification provides recognition and differentiation for companies prioritising sustainability and social responsibility.

Weaknesses:

B Corp certification is less widely recognised than traditional EMS certifications such as ISO 14001.
Certification can be expensive and time-consuming, which may be a barrier for small and medium-sized enterprises.
The performance indicators B Corp uses need to be standardised across industries, making benchmarking and comparisons between companies challenging.
Some companies may prioritise achieving B Corp certification over actual environmental and social performance improvement, leading to potential greenwashing.
B Corp certification may only be suitable for some types of businesses, such as those that operate in industries with low environmental impact.

Ismael Gonzalez - Founder & Managing Director

RETAIL DIGITAL TRANSFORMATION STRATEGY: CRITICAL CONSIDERATIONS TO SUCCEED

Wed, 26 Apr 2023 15:01:34 GMT

RETAIL DIGITAL TRANSFORMATION STRATEGY: CRITICAL CONSIDERATIONS TO SUCCEED

The retail industry has been transformed significantly in the last decade, with e-commerce, mobile shopping, and the increasing use of technology in-store. Retail companies must keep up with these changes to remain competitive and profitable. Digital transformation is a critical strategy to help retail companies navigate this shift in consumer behaviour and market dynamics.

Digital transformation involves using digital technologies to transform business operations, processes, and models. It aims to improve efficiency, agility, customer experience, and profitability. However, implementing a digital transformation strategy in retail companies takes time and effort.

This article will discuss essential considerations and challenges when embarking on a digital transformation journey.

1. Define your goals and objectives.

One of the critical considerations when implementing a digital transformation strategy is to define the scope and objectives of the initiative. It is essential to clearly understand what the company hopes to achieve through the digital transformation. The goals should be specific, measurable, achievable, relevant, and time-bound (SMART). For instance, the company may aim to improve customer engagement by implementing a personalised omnichannel experience.

The scope of the digital transformation should also be clearly defined, including the areas the change will cover. This may include website redesign, implementing a mobile app, introducing a loyalty program, and adopting new payment methods. Defining the scope and objectives of the digital transformation is critical in ensuring that the initiative is well-planned and executed.

2. Develop a roadmap.

Digital transformation is a journey, not a destination. It involves multiple stages, which can take time, effort, and resources. Therefore, developing a roadmap that outlines your digital transformation strategy's key milestones, timelines, and resource requirements is essential. A roadmap will help you stay on track, measure progress, and communicate the initiative's status to stakeholders.

3. Secure Buy-in from Key Stakeholder.

Implementing a digital transformation strategy requires buy-in from key stakeholders in the organisation. These include senior executives, employees, and customers. With buy-in from these stakeholders, the initiative may face resistance, which can lead to failure.

Senior executives should champion the digital transformation initiative and provide the necessary resources to support it. Employees should also be involved in the planning and implementation to ensure they have the skills and knowledge required to keep the initiative. Customers should also be informed of the changes and how they will benefit.

4. Address cultural and organisational barriers.

Digital transformation is not just about technology; it's also about people and culture. Many retail companies face cultural and organisational barriers to digital transformation, including resistance to change, lack of digital skills and talent, siloed departments, and legacy processes and systems.

Addressing these barriers requires a cultural and organisational shift, including training, hiring, and incentivising digital talent, fostering collaboration across departments, and empowering employees to experiment and innovate. Implementing a digital transformation strategy requires employees to have the skills and knowledge to support the initiative.

Retail companies must invest in employee training to ensure employees have the skills and knowledge to use new technologies and support digital transformation.

5. Leverage data and analytics.

Data and analytics are critical to digital transformation in retail. They provide insights into customer behaviour, market trends, and operational efficiency. Leveraging data and analytics requires data infrastructure, tools, and talent investment. It also requires a data-driven culture, where decisions are based on insights and evidence rather than intuition or gut feeling.

6. Embrace new technologies.

Digital transformation involves leveraging new and emerging technologies to drive innovation and efficiency. Retail companies must embrace technologies such as artificial intelligence, machine learning, Internet of Things, and cloud computing.

However, adopting new technologies requires infrastructure, software, and talent investments. It also requires a mindset of experimentation, where failures are viewed as learning opportunities, not setbacks.

7. Ensure cybersecurity and data privacy.

Data privacy and security are critical considerations when implementing a digital transformation strategy. Retail companies collect vast customer data, including personal information such as names, addresses, and payment details. This data is valuable to cybercriminals, making retail companies a prime target for cyber-attacks.

Retail companies must ensure that customer data is protected at all times. This includes implementing robust security measures to prevent data breaches and complying with data privacy regulations such as the General Data Protection Regulation (GDPR).

8. Keep up with evolving customer expectations.

Digital transformation in retail is driven by evolving customer expectations. Customers expect personalised experiences, seamless omnichannel journeys, and real-time brand interactions.

Retail companies must meet these expectations by leveraging artificial intelligence, chatbots, and augmented reality technologies. They must also invest in customer data analytics and insights to understand customer needs and preferences.

Ismael Gonzalez - Founder & Managing Director

AUGMENTED REALITY (AR) IMPLEMENTATION IN RETAIL. OPPORTUNITIES & CHALLENGES

Wed, 19 Apr 2023 15:04:10 GMT

AUGMENTED REALITY (AR) IMPLEMENTATION IN RETAIL. OPPORTUNITIES & CHALLENGES

Augmented Reality (AR ) has emerged as a game-changing technology in recent years, and it can potentially revolutionise how customers shop in brick-and-mortar stores. AR overlays digital information onto the physical world, providing customers with a seamless and interactive experience. With AR, customers can explore products in a previously impossible way, making it an invaluable tool for enhancing customer service in brick-and-mortar and online stores .

One way AR can enhance customer service is by providing customers with product information in real time . Customers often have questions about products, such as their features, benefits, and compatibility. In a traditional brick-and-mortar store, customers would have to rely on sales representatives for this information, which can be time-consuming and sometimes lack the full details. With AR, customers can access product information instantly by scanning a product with their smartphone or tablet. This saves time and provides customers with more accurate and detailed information about the products they are interested in.

Another way AR can enhance customer service is by providing customers with a more immersive shopping experience . With AR, customers can visualise products in their intended environment, such as furniture in a room or clothing on a model. This allows customers to see how products will look in real-life scenarios, making it easier for them to make purchasing decisions. This also allows customers to experiment with different options, such as trying on clothes virtually or testing different paint colours on a wall. This creates a more interactive and engaging shopping experience that will leave a lasting impression on customers.

AR can also be used to provide customers with personalised recommendations . By using data from a customer's previous purchases, browsing history, and preferences, AR can suggest products tailored to their needs and tastes. This enhances the shopping experience and increases the likelihood of repeat business. Providing customers with products makes them more likely to be interested, improving the conversation rate. AR can help to build customer loyalty and satisfaction.

AR can also be used to provide customers with assistance and support . With AR, customers can access virtual customer service representatives to assist them with their purchases. This can be particularly helpful for customers in remote locations or needing access to a physical store. Virtual customer service representatives can answer questions, provide recommendations, and even complete transactions on behalf of the customer. This provides customers with a more personalised shopping experience and increases the efficiency of the overall shopping process.

Additionally, AR can be used to improve inventory management and reduce costs . By using AR to track product inventory in real-time, retailers can optimise their stocking levels and reduce the risk of stockouts. This can help to reduce costs associated with excess inventory, such as warehousing and shipping costs. It can also help to improve the overall shopping experience by ensuring that products are always in stock and readily available to customers.

While AR has the potential to revolutionise the retail industry, several challenges must be addressed in advance to implement it. Here are some of the primary challenges:

Investment : One of the biggest challenges to implementing AR in retail is the cost of the technology. AR requires significant investment in hardware and software, which can be a barrier for many retailers and tiny businesses.
Technical complexity : AR technology is complex and requires specialised expertise to develop and implement. Retailers may need the technological know-how to develop AR applications and may need to rely on third-party developers or vendors to help them implement AR in their stores. The good news is that as the market of AR is expanded, the vendors’ options available in the market increase as it scales up for different industries and cost becomes more competitive.
Integration with existing systems : AR applications must be integrated with retail systems, such as inventory management and point-of-sale systems. This can be a challenge, as these systems were designed with something other than AR in mind. Considering this aspect of the systems’ integration in advance is a relevant task before any investment.
User adoption : AR applications require customers to use their smartphones or tablets to access the technology. This may be a barrier for some customers unfamiliar with using these devices or uncomfortable with using them in a retail setting. As with any new technology, there are faster initial new adopters, as could be expected from GenZ and millennial consumers. However, there is a question about how easily other generations could adopt AR as part of their consumption behaviour to justify the investment and short time ROI.
Privacy and security concerns : AR applications require access to customer data, such as location data and browsing history. This raises privacy and security concerns, and retailers must take steps to ensure that customer data is protected and used responsibly. However, GDPR compliance must be the top priority for any firm in a holistic business way.
Content development : AR content is currently limited, and there may need to be more content available to provide a compelling experience for customers. This can limit the potential for AR to enhance the retail experience. However, in recent years, new developments have been created by the increasing numbers of specialist vendors in this area.
Network connectivity : AR applications require a strong network connection to function correctly. Retailers must ensure that their stores have strong Wi-Fi or cellular connectivity to support AR applications. While 5G networks that support AR implementation have been developed in major cities and developed countries, it is essential to review and, if needed, improve the store’s network in advance to make any implementation decision.

In conclusion, while AR has the potential to revolutionise the retail industry, boosting productivity, customer experience and loyalty and consequently revenues, several challenges must be addressed to implement AR in retail fully.

Ismael Gonzalez - Founder & Managing Director

CIRCULAR ECONOMY IN THE FASHION INDUSTRY: CHALLENGES AND ACTIONS NEEDED

Wed, 12 Apr 2023 13:28:36 GMT

CIRCULAR ECONOMY IN THE FASHION INDUSTRY: CHALLENGES AND ACTIONS NEEDED

The fashion industry is a vital sector of the global economy, providing employment opportunities to millions of people worldwide. However, the industry's environmental impact is significant, with water pollution, carbon emissions, and waste as the most pressing concerns. As such, many fashion companies have been exploring the adoption of circular economy principles as a way to minimise their environmental impact. However, the fashion industry's complex supply chain and consumer behaviour patterns pose significant constraints for applying circular economy principles. This article will discuss the fashion industry's main limitations when using circular economy principles.

Supply Chain Complexity

The fashion industry's supply chain is long and complex, from producing raw materials such as cotton, wool, and synthetic fibres to disposing of garments at the end of their life cycle. Each stage of the supply chain presents unique challenges to applying circular economy principles. For instance, producing raw materials requires significant amounts of water, energy, and other resources, which can lead to environmental degradation. Additionally, the processing and manufacturing of these materials result in greenhouse gas emissions that contribute to climate change. In such cases, creating a closed-loop system that recycles waste and reduces the use of virgin resources becomes challenging. Besides these constraints in the supply chain, many efforts have been made by leading actors in the industry to mitigate the negative environmental impacts, such as the use of organic raw materials, new garment treatments that minimise water use and working hand-by-hand with suppliers to improve their energy efficiency consumption with renewable sources.

Consumer Behaviour

Consumer behaviour is another significant constraint to adopting circular economy principles in the fashion industry. Consumers often focus on short-term trends and convenience rather than sustainability, leading to a need for more interest in a sustainable fashion. Additionally, consumers tend to prioritise affordability, which has led to the proliferation of fast fashion. The short fashion model is based on a "take-make-dispose" approach, encouraging the rapid turnover of clothes and resulting in significant waste generation. As such, it is challenging to implement circular economy principles when consumer behaviour needs to be aligned with sustainability. However, there is a mindset change in the youngest generations, such as millennials and GenZ, towards more sustainable products that can help fashion companies to enhance a more circular behaviour in fashion consumers' consumption.

Logistical Challenges

Logistical challenges are another significant constraint to adopting circular economy principles in the fashion industry. Collecting, sorting, and transporting used garments require substantial resources, including labour, transportation, and storage facilities. These challenges are further compounded by the fragmented nature of the fashion industry, with many small and medium-sized enterprises involved in the production and retail of garments. Additionally, the lack of standardised labelling and sorting practices makes it difficult to ensure that used clothes are recycled efficiently and cost-effectively. Designing and creating clothes with a circular objective for a long-life cycle and collaborating with sustainable fashion organisations and the leading fashion supply chain and logistic companies for greener transportation would help make a more sustainable industry.

Limited Availability of Recycling Technologies

The availability of recycling technologies is another constraint to applying circular economy principles in the fashion industry. While several recycling technologies exist, they have yet to be widely adopted due to their cost and technical limitations. For instance, textile recycling technologies such as mechanical, chemical, and biological recycling are still in the early stages of development and require significant investments to scale up. Additionally, these technologies often produce lower-quality fibres unsuitable for high-end fashion products, limiting marketability. Research and expansion into new materials and technologies are vital to moving the industry into circularity, and it will need the effort of primary industry stakeholders and governments' incentives.

Lack of Incentives

Finally, the fashion industry needs incentives to apply circular economy principles. While many fashion companies have pledged to adopt circular economy principles, they often lack financial incentives. For instance, the high cost of sustainable materials and production methods can result in higher consumer prices, which may not be acceptable in a market prioritising affordability. Additionally, there need to be more regulatory frameworks and financial incentives to support sustainable fashion, which limits the ability of fashion companies to invest in circular economy practices.

In conclusion, the fashion industry faces several constraints when it comes to the application of circular economy principles. Supply chain complexity, consumer behaviour, logistical challenges, limited availability of recycling technologies, and a lack of incentives are significant constraints that must be addressed to create a more sustainable fashion industry. While adopting circular economy principles is complex and challenging, creating a more sustainable industry is essential.

Ismael Gonzalez - Founder and Managing Director

ENHANCING CUSTOMER EXPERIENCE WITH TECHNOLOGY IMPLEMENTATION

Wed, 05 Apr 2023 14:23:29 GMT

ENHANCING CUSTOMER EXPERIENCE WITH TECHNOLOGY IMPLEMENTATION

The fashion industry has always been at the forefront of technological innovation, with new technologies shaping how the industry designs, produces and sells clothing. In recent years, there has been a growing trend towards using new technologies in brick-and-mortar fashion retail as retailers seek to provide customers with more engaging and personalised shopping experiences. Here are a few ways new technologies can be implemented in fashion brick-and-mortar.

Augmented Reality (AR)

Augmented reality (AR) is a technology that overlays digital information in the real world. In fashion brick-and-mortar, AR can create interactive shopping experiences that allow customers to "try on" clothes virtually. By using AR mirrors or screens, customers can see how clothes will look on them without trying them on physically. AR mirrors save time and provide a more personalised shopping experience, as customers can see how clothes look on their specific body shape and size.

Virtual Reality (VR)

Virtual reality (VR) is another technology that will be implemented in fashion retail. VR allows customers to experience a fully immersive shopping experience, exploring different products and interacting with them in a virtual environment. VR use can benefit retailers with limited physical space, as VR can provide customers with access to a much more comprehensive range of products than would be possible in a physical store.

Internet of Things (IoT)

The Internet of Things (IoT) is a network of interconnected devices that can communicate with each other and share data. In fashion brick-and-mortar, IoT can create a more personalised shopping experience. For example, intelligent mirrors can use IoT sensors to detect when a customer is approaching and adjust the lighting and display accordingly. They can create a more immersive and engaging shopping experience tailored to the customer. Additionally, IoT sensors can be used on stores' shop floors to create different environments and be more sustainable in the use of energy supplied.

Artificial Intelligence (AI)

Artificial intelligence (AI) is another technology used in fashion retail. AI-powered systems can analyse customer data, such as purchase history and browsing behaviour, to provide personalised product recommendations. AI enhances the shopping experience and helps retailers understand their customers and preferences better. However, the critical point is the way to be implemented and used by the staff, but ultimately the personalisation of customer service will be paramount in the success of brands brick-and-mortar.

3D printing

3D printing is a technology used in fashion to create custom products. By using 3D printing technology, retailers can develop products tailored to individual customers' specific needs and preferences. 3D printing creates a more personalised shopping experience and reduces waste, as products can be produced on demand. While 3D-printed products like footwear soles have already been made on a scale by some brands, implementing this technology on a small scale in flagship stores would create experience differentiation and a reason to visit and return.

Chatbots and Voice Assistants

Chatbots and voice assistants are already used in some fashion retail applications, but we expect to see even more widespread adoption shortly. These technologies can help customers find products, make purchases, and get personalised recommendations through conversational interfaces. The use of chatbots in online retail customer service is a practice that works well in many cases, and customers are used to it. Transferring to the physical space, the learning and experience from the online chatbots with avatars can enhance the consumer experience and avoid waiting times for available staff.

Robotics and Automation

Finally, robotics and automation are expected to play a more significant role in fashion retail soon. These technologies, already implemented in supply chain management, will enhance the in-store shopping experience by providing additional customer service through automated kiosks or robots, becoming supporting tools for in-store staff. There are examples in the hospitality sector of using robots in receptions, welcoming customers, or even as waiters. We might expect to see them in retail fashion shortly as their capabilities have been widely improving.

New technologies in fashion brick-and-mortar will shortly be transforming how we shop. By providing more engaging and personalised shopping experiences, these technologies enhance the customer experience and help retailers better understand their customers. As these technologies evolve, we can expect to see even more innovative and exciting applications in fashion retail.

Ismael Gonzalez - Founder and Managing Director

CUSTOMER EXPERIENCE IN CHALLENGING TIMES

Tue, 28 Mar 2023 11:53:40 GMT

CUSTOMER EXPERIENCE IN CHALLENGING TIMES

With the cost-of-living crisis lasting for a year, the complex international environment, including the Ukraine invasion by Russia and the new set of global poles created between China and the US, followed by the uncertainty of the possibility of a recent bank crisis, it is unforeseeable in the short term the rise of consumer confidence from its current low level.

Under these complex circumstances, to maintain the #value provided to #consumers , many retailers make decisions driven by lowing prices, making special promotions or cutting costs to navigate through this tumultuous period. However, on the one hand, the increase in raw material prices has forced many companies to transfer those costs to consumers to control margins. On the other hand, a decline in consumption of non-essential products is forcing decision-makers to control costs and, in some cases, to hold on to planned investments or reduce costs, such as in training, recruitment or within the number of staff.

While we acknowledge the difficulties mentioned above, it is crucial to consider that value to the consumer is much more than the price. It relates to the whole #experience and what consumers consider worth paying. Because under these complex circumstances, what will make the difference for many brands is what consumers will experience in retail brick-and-mortar.

It is essential to consider that loyal and happy customers with a brand are a long relationship process, where consumers at some point felt in love with the brand for different reasons, such as product design and quality, the storytelling experienced when visiting a physical store, the level of service provided along the whole #consumerjourney , and so forth. Then, focusing on loyal customers and keeping the same level of their expectations is essential in this period.

#investing in staff is crucial, as they are the brands' ambassadors in the eyes of consumers and the facilitators of providing an outstanding experience. An unmotivated #staff member is a door for a bad consumer experience and a possible open window for a customer to lose engagement with a brand. This difficult period is the time to enhance your company #culture and #values in the eyes of the team, working for the best consumer experience. Investing in motivational activities, product and service training, and personal development will enhance employee net promoter scope and, consequently, the level of service provided to consumers.

To develop a #loyalty customer programme or enhance the existing one more creatively, use the intelligence #dataanalytics collected through the different channels, especially in the stores with staff feedback and other digital tools that provide you with relevant information about consumer behaviour in their visit to the stores. If there was a consideration to invest in experiential digitalisation, this is a perfect moment to do it. #understanding how consumers and loyal customers experience your brand's brick-and-mortar spaces in such a challenging and competitive environment can provide your company with better tools for making decisions in the short term and developing a differentiated and more #creative customer experience medium-long time.

Investing to seek operational efficiencies and to increase productivity in different areas of the business in crisis periods can help your company to reduce some costs to protect margins while at the same time enhancing the service provided to your customers. Examples of that efficiencies can be found in the buying or allocation processes using retail-professional AI software to reduce manufacturing cost, stock excess, and logistics allocations cost.

Finally, it is relevant to remember that customer experience is a non-stop process for adaptation and improvement in a changing environment and with competitors willing to fall in love with other brand's loyal customers.

Ismael Gonzalez - Founder and Managing Director

THE CLIMATE CHANGE TIME BOMB IS TICKING. CALL FOR ACTION

Tue, 21 Mar 2023 12:13:30 GMT

THE CLIMATE CHANGE TIME BOMB IS TICKING. CALL FOR ACTION

The 2023 Intergovernmental Panel on #ClimateChange (IPCC) was released yesterday in a press conference by Antonio Guterres, UN General Secretary. There was bad news about the reality of Climate Change progression due to increased GHG in the atmosphere and significant CO2 increase. The increase in those gasses is expected to continue due to the economic growth of many countries in large regional areas in Asia and Africa. “ Climate Time Bomb is ticking ” was the strongest statement made by Antonio Guterres.

Besides this drama realistic call to any Nation and citizen in the world from such a relevant authority, the Secretary of the United Nations gave a piece of hope in his speech about the actions and technologies that can be taken and used to meet the goals to keep the global temperatures about 1,5C over pre-industrial levels. The guiding route for this hope is written in the annual #IPCC report presented yesterday.

In summary, the report includes an urgent global action plan with a more significant financial commitment for the wealthiest countries represented in the G20 club. The extra efforts, acting as a pledge, includes a demand to accelerate the path to Net Zero by a decade for those countries from 2050 to 2040. For emerging countries, this acceleration demand was requested to move ahead to a deadline of 2050. It is important to remember that one of the largest worldwide economies, India, was committed to a Net Zero plan by 2060. Finally, Antonio Guterres called for all G20 countries to create a combined effort by their public and private sectors together with their scientific and new available technologies to achieve these new goals and agenda.

This call for action to the private sector in the wealthiest countries is relevant for any industry, but mainly for the ones that are the most significant polluters contributors. The call for action against climate change was a short-term plan, but the time is getting shorter to change things at a breakneck pace. The UN General Secretary urged fuel and Gas Companies’ CEOs to elaborate “ credible transition plans ” towards this shortened #Netzero agenda while requesting the rest of private sector leaders to accelerate the transition to renewable energies, assuming “extra efforts”. These extra efforts mentioned for all private sectors include a committed and real Net Zero target by 2050 worldwide.

Following this urgent call for action to the world Nations by UN General Secretary. Still, especially to the G20 countries, it would be desirable that the US Biden administration, EU commission, UK government and other members of the G20 club agree to revise their own Net Zero plans to assess the “what” and “How” will get the investment, regulation and subsidies to support this pledge.

Focusing on the fashion-sports goods sectors , acknowledging the positive movements that have been already done, this new call for urgent action will demand an acceleration of sustainable strategies implementations with short-medium and long-term targets to be achieved in the fastest way. CMOs will need to rethink strategic marketing to create a higher public awareness about the steps made by their companies towards this acceleration and how to persuade #consumers towards sustainable product consumption .

It is probably the time for shareholders and other relevant industry stakeholders to accept that growth and profit need to be measured with a long-term vision plan to invest for the sustainability of the sector considering the 3P model , #People, #Planet and #Profit, beyond what has been done.

Ismael Gonzalez - Founder and Managing Director

THE FUTURE OF EXPERIENTIAL RETAIL

Mon, 13 Mar 2023 16:23:15 GMT

THE FUTURE OF EXPERIENTIAL RETAIL

#experientialretail is a term that defines the character and features used in brick-and-mortar premises to create a space where consumers can #engage and experiment with memorable experiences with brands.

In the era of online shopping, virtual reality, gaming, avatars and social net, experiential retail is a must for retailers to stand out for competitors in the high street and to create footfall, conversation rate and #loyalty . Consumers are willing to discover products in different ways, connecting with feelings, #emotions , nostalgia, experiences and #belonging to something that represents themselves.

To #connect and engage with #consumers , brands need to have a good understanding and knowledge of their target and needs, be aware of the latest market trends and be #authentic and loyal to their #mission . All this said it could sound evident that for any brand to be successful, however, it is crucial to create an experiential retail space.

One successful example of the above is the LEGO Group and how they design and implement experiential shopping in their stores. Lego proves they know their consumers and stands loyal to its mission, "inspire and develop the builders of tomorrow", after 75 years of foundation, continuously innovating and considering trends in the market. Lego's flagship store in Leicester Square in London clearly shows how experiential retail is successfully implemented. The store design, reopened and enlarged last year, comprises a storytelling concept from the shop's entrance to the last point of a 360-degree experience journey.

Everything around the experiential space is based on the company mission, #inspiring from the windows with the outstanding Elizabeth Tower at Westminster, capturing your eyes towards a magnificent James Bond car where all consumers engage and take a photo, followed by many more amusement thematic areas. #digital touch points and interactive #creative machines on the first floor build part of the exciting experience for kids and adults. Additionally, a Lego history exhibition area is making a beautiful and interesting journey through the years and evolution of the company.

However, one critical thing of this experiential shopping set is the #people . Lego is a place to enjoy building, playing and being creative, so people working there have those attributes visible to any visitor. People are the essence of success, and they are when they welcome farewell visitors, assist, and play with consumers. Finally, the #product is the show's star, well merchandised and replaced, and well embedded in the storytelling.

Other brands, too, are doing an excellent job in experiential shopping, such as Gymshark , with its first established brick-and-mortar space in central London. Everything in the shop involves experience and community, creating a space to participate in the company's mission: "We exist to unite the conditioning* community. *Conditioning is everything we do today to prepare for tomorrow". Then, as simple as that, the flagship has a whole floor dedicated to experiencing the mission through practising sport.

Similarly, the Swiss sports brand On recently opened its first flagship in the UK, based in central London, creating storytelling about #innovation , #technology , and #sustainability , bringing together the ruining community. On's mission: "To ignite the human spirit through movement".

Experiential retail is much more than an innovative design and fulfilment of technology while showcasing brands' products. It is the new way of brand engagement with consumers, creating trust and loyalty and, ultimately, a sustained future.

Ismael Gonzalez - Founder and Managing Director

THE DIGITAL TRANSFORMATION OF RETAIL

Mon, 06 Mar 2023 11:54:58 GMT

THE DIGITAL TRANSFORMATION OF RETAIL

A report from Statista argues that the digital revolution with the #Internet of Things (IoT), #Virtual Reality (VR), #Artificial Intelligence (AI), etc., is forecasted to replace and perform many retail jobs by 2030 in the UK (Statista, 2022). This report also estimates that 40% of the UK GenZ will use VR for shopping by 2030. On a global scale, some analysis indicates that the retail digital transformation market is expected to reach £320 billion by 2026.

However, digitalising a company's processes and services is not a goal "per se". It has to be considered as a plan embedded in the business strategy to gain and maintain a competitive advantage in resources and capabilities. The tangible outcomes of a digital strategy implementation are improvements in efficiencies, maximisation in revenue growth, operational cost reductions and, ultimately, greater customer engagement and satisfaction.

There is a wide offer of new #technologies available in the market to implement in different business areas, and the critical decision executives need to make is the primary objective their companies want to achieve to invest their resources. For example, suppose your company needs to maximise the value of a collection production in terms of volume, sales expectations, units allocation per store, and product efficiency rotation in the whole omnichannel. In that case, specific #AI software can help you reduce costs and waste and provide excellent customer service. Additionally, you might be willing to improve your CR% by analysing your customer journey and most visited areas, what type of products stand out in their journey and what their demographics are while creating a more seamless journey experience for them; again, AI will help you to do so.

#Digitaltransformation can create unique experiential shopping, such as virtual fitting rooms, hologram mannequins, interactive AI shopping assistants, and cashless final journeys. The future of retail is now and undoubtedly will be linked to excellent engagement and experience with consumers through digital transformation and creative spaces in brick-and-mortar stores.

To implement a Digital transformation strategy, several steps will guide your company to be successful, such as understanding what is needed, aligning the objectives and decisions , being prepared for the cultural change within the organisation, creating a plan and a road map that starts for the small and follows to the more prominent, and most importantly to involve everyone in the company while being accompanied by the right partners and experts.

Ismael Gonzalez - Founder and Managing Director

CIRCULAR FASHION: RESETTING THE INDUSTRY FOR A SUSTAINABLE FUTURE.

Mon, 27 Feb 2023 10:49:34 GMT

CIRCULAR FASHION: RESETTING THE INDUSTRY FOR A SUSTAINABLE FUTURE

It is argued that the clothing, footwear, and household textiles industry are among the most contaminating industrial activities, with substantial adverse environmental impacts. Such impacts include 20% of global clean water pollution, 10% of global carbon emissions, the massive amount of water used (2,7L to produce one T-shirt) and waste in landfills (EU parliament, 2022).

The textile and footwear industry has pursued a stream of sustainable business practices in the last 20 years, intending to change this reality. The #sustainable #businesspractices could be defined as the different business models, operations processes, management systems, sustainable frameworks and models that business organisations can adopt and implement to pursue long-term social and environmental sustainability. Practices such as recycling, organic cotton use, new technologies that reduce water consumption or implementation of green energy used by suppliers have been spread along the supply chain value by many fashion and sporting goods organisations. However, #wastemanagement continues to be a critical worldwide environmental problem.

In recent years, the #circulareconomy has been presented as the panacea for the industry and the behavioural consumer change needed to impact the environment positively and create an authentic, sustainable future for the industry and society. Besides, many fashion and sporting goods brands are implementing on an early stage this sustainable business practice, such as H&M, Mango, Nike and Adidas. However, those practices must still be added to their corporate strategic model.

Collecting unwanted products from customers and transforming them into new products to be sold and used (Ralph Lauren’s new cashmere programme) or creating new products specifically to be circular since the design process (ON sports company and its circular sneaker) where the product is used but not own, are the most recent known actions put in place in the industry. No one action fits everyone, but #circularity will undoubtedly be the most foreseeable sustainable practice embedded in the strategies of fashion industry organisations in the following years.

A change in consumer consumption behaviour will be needed, and the industry will become critical in enhancing this change.

Retail Consulting & Advisory Services Ltd is committed to a sustainable future in the industry and can help your organisation to design your sustainable strategy, understand your business reality and propose the most feasible one.

Ismael Gonzalez - Founder and Managing Director

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GYMSHARK LONDON STORE: A MASTERCLASS OF SPORTS RETAIL ERA

ARE THE LEADERS OF THE GLOBAL SPORTS RETAIL MARKET, NIKE AND ADIDAS, LOSING GROUND?

THE CONSUMER ROLE FOR A SUSTAINABLE FASHION INDUSTRY

RESETTING RETAIL: THE PARADIGM SHIFT IN RETAIL TOWARDS PHYGITAL AND EXPERIENTIAL SHOPPING.

THE FASHION INDUSTRY: AN URGENT CALL FROM THE CURRENT LINEAR MODEL TO A CIRCULAR MODEL TRANSITION.

UNLOCKING THE POTENTIAL OF THE METAVERSE: A NEW FRONTIER FOR THE FASHION INDUSTRY

THE RISE OF GEN Z AND THEIR ATTITUDES TOWARDS SHOPPING

THE RISE OF GEN Z AND THEIR ATTITUDES TOWARDS SHOPPING

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REVOLUTIONISING FASHION: HOW AI IS TRANSFORMING THE INDUSTRY

REVOLUSIONALISING FASHION: HOW AI IS TRANSFORMING THE INDUSTRY

VIRTUAL REALITY: THE REVOLUTION OF FASHION RETAIL.

VIRTUAL REALITY: THE REVOLUTION OF FASHION RETAIL

RETAIL RENAISSANCE IN CENTRAL LONDON

RETAIL RENAISSANCE IN CENTRAL LONDON

RETAIL EXPERIENTIAL SHOPPING: SUCCESSFUL EXAMPLES IN FOUR CRITICAL AREAS

﻿ RETAIL EXPERIENTIAL SHOPPING: SUCCESSFUL EXAMPLES IN FOUR CRITICAL AREAS

CONSUMER BEHAVIOUR CHANGES & TRENDS IN RETAIL

CONSUMER BEHAVIOUR CHANGES & TRENDS IN RETAIL

FOUR CRITICAL PILLARS FOR FASHION SUSTAINABILITY STRATEGY DESIGN

FOUR CRITICAL PILLARS FOR FASHION SUSTAINABILITY STRATEGY DESIGN

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EMS: A BRIEF ANALYSIS AND BENCHMARK OF ISO 14001, EMAS & B Corp.

EMS: A BRIEF ANALYSIS AND BENCHMARK OF ISO 14001, EMAS & B Corp.

RETAIL DIGITAL TRANSFORMATION STRATEGY: CRITICAL CONSIDERATIONS TO SUCCEED

RETAIL DIGITAL TRANSFORMATION STRATEGY: CRITICAL CONSIDERATIONS TO SUCCEED

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AUGMENTED REALITY (AR) IMPLEMENTATION IN RETAIL. OPPORTUNITIES & CHALLENGES

AUGMENTED REALITY (AR) IMPLEMENTATION IN RETAIL. OPPORTUNITIES & CHALLENGES

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CIRCULAR ECONOMY IN THE FASHION INDUSTRY: CHALLENGES AND ACTIONS NEEDED

CIRCULAR ECONOMY IN THE FASHION INDUSTRY: CHALLENGES AND ACTIONS NEEDED

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ENHANCING CUSTOMER EXPERIENCE WITH TECHNOLOGY IMPLEMENTATION

ENHANCING CUSTOMER EXPERIENCE WITH TECHNOLOGY IMPLEMENTATION

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CUSTOMER EXPERIENCE IN CHALLENGING TIMES

CUSTOMER EXPERIENCE IN CHALLENGING TIMES

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THE CLIMATE CHANGE TIME BOMB IS TICKING. CALL FOR ACTION

THE FUTURE OF EXPERIENTIAL RETAIL

THE DIGITAL TRANSFORMATION OF RETAIL

THE DIGITAL TRANSFORMATION OF RETAIL

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CIRCULAR FASHION: RESETTING THE INDUSTRY FOR A SUSTAINABLE FUTURE.

CIRCULAR FASHION: RESETTING THE INDUSTRY FOR A SUSTAINABLE FUTURE

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RETAIL EXPERIENTIAL SHOPPING: SUCCESSFUL EXAMPLES IN FOUR CRITICAL AREAS