First Evolution, Now Revolution
The Covid-19 pandemic has had an outsized effect on fashion retail. Almost overnight, retailers were forced to re-focus most of their business online.
Up until that point, total online sales only accounted for approximately 10-20% of most retailers’ overall sales. This doesn’t mean that the remaining 80-90% of business was done in brick & mortar—it was likely a conglomeration of many channels or layers of channels. And this omni-channel approach mitigated risk in any one channel, especially e-commerce.
But, all of the sudden, online was the only way customers could shop, and had to be everything to everyone.
And while e-commerce, and digital engagement overall, has largely driven retail innovation in the past 20 years, not all multi-channel organizations had taken the time, or invested the money needed to fully optimize or take advantage of online as a sales channel. They didn’t fully understand that digital shopping, in effect, changes how we shop in general, or even how we engage with brands.
In today’s world, there are myriad customer/brand touch points—and each channel has strengths and weaknesses to consider when considering the customer journey.
Those brands that weren’t prepared to move expressly online, or brands who hadn’t considered this more complex approach to the client experience, were left exposed to the pandemic. A slew of bankruptcies have already riddled the marketplace, and will continue to do so, as the pandemic persists. With sales at an all-time low, there isn’t much time or cash to turn a business around.
In many cases, this an accelerated “right sizing” of the market—something that would’ve happened over a longer period of time anyway. Neiman Marcus, Lord & Taylor, The Men’s Warehouse, J.Crew—they were all struggling long before March 2020. But this is also starting to have an effect on brands who are in a stronger position.
In the short-term future, these fashion retailers must focus on digital retailing as the key entry point for all omni-channel retailing operations, and then innovate how other channels—especially brick and mortar—support online. Re-thinking what stores are—whether it’s their footprint, or their service offering—will need to be multi-dimensional, localized and thoughtful.