- The New Rules of Retail Engagement: How to Reach Conscious Consumers
By Brooke Blashill (Class of 2015)
Senior Vice President, Ogilvy Public Relations Worldwide, and Director of The Boutique @ Ogilvy
For brands to be successful in the future, they need to align value with “values.” That was the resounding sentiment at last month’s major trend conferences: Copenhagen Fashion Summit, the preeminent global forum for sustainable fashion, and WGSN Futures, the London event predicting retail trends in 2030.
While there was talk of artificial intelligence, multi-generational workforces and the impact of the sharing economy, it was a new shift in the sustainability dialogue that dominated conference discussions. Once seen as a supply chain issue, the topic of ethics and responsibility spanned product design, retail strategies and buying approaches.
Spurred by the next generation of high-powered, conscious consumers, retailers are addressing the business functions where quick and impactful changes can be made – such as marketing – while other parts of the business play catch-up.
Nike, for instance, said that sustainability is an innovation challenge that begins with its design team – tasking designers to make a product with the least environmental impact, setting the goal to cut their carbon footprint by half while doubling production.
Other brands, such as Selfridges and H&M, are changing the way they communicate with their customers about environmental issues by putting sustainability messages at the forefront of dedicated campaigns, in-store experiences and digital content. In years past, these types of stories would only appear around Earth Day or timed to the launch of special collections.
According to Nielsen, 2.5 billion “aspirational” consumers are becoming increasingly interested in, and making decisions based on, the environmental and social impacts of their purchases. This move isn’t about altruism – it’s driven by the consumer desire to make choices that represent who they are and what they believe in.
For retailers, that means authentically realigning a brand with the values and beliefs of their customers by being transparent and helping shoppers make smarter and more informed purchase decisions. For some brands, this could be as simple as communicating existing eco-efforts that have been taking place behind the scenes, or collaborating with credible partners to bring broader awareness to these issues and help redefine the industry conversation.
“Good design is sustainable design.” Imran Amed, Founder and CEO of The Business of Fashion, made this statement in Copenhagen when debating media’s role in evolving the sustainable fashion dialogue. Media and marketers have a responsibility to unite this conversation using their creativity to “make sustainability sexy,” says Vanessa Friedman of The New York Times.
So how does one use these creative powers of persuasion for good? I had the opportunity to talk with a variety of industry leaders during these two trend conferences, and here are some examples of how brands are applying these important principles across areas such as retail strategy, advertising and digital:
Retail Strategy – Selfridges has demonstrated that eco and luxury can live in harmony through its award-winning campaign, “Project Ocean,” creatively integrating messages about ocean protection into the store experience from the window displays to the food hall. The department store has also hired its first Director of Sustainability and taken a new approach to buying, ensuring brands meet standards on ethical trade, while championing new brands with a sustainable focus through its “Bright Young Things” project.
Advertising – The trend in repair wear, or mending an item so it can last longer, is now spanning luxury retailers to mass market brands. WGSN says this concept, which they call “Brand Immortality,” is what big industry players, including Barbour and Brooks Brothers, have been doing for years in the form of added-value services. Now, the difference is that brands are making this a central part of external marketing campaigns and gaining customer loyalty as a result. For example, Patagonia took out an ad in the New York Times during Black Friday with the headline, “Don’t Buy This Jacket,” following up with a “Better than New” cross-country road trip to fix customers’ old coats. Nudie Jeans, the indie denim label, has opened 20 stores globally that include a repair shop offering free mending and alterations for all their jeans.
Digital – Transparency has become the new buzz word, and Zady, the online eco-retailer, sets the example for the industry with its business model. Named by Fast Company as one of the most innovative retail companies in the world, Zady’s editorial approach to e-commerce and social media allows customers to see what country their clothes were made in and who makes them. Costs transparency is also gaining popularity among consumers, and is likely to become a new industry standard. Brands including Everlane and The Reformation have dedicated platforms on their e-commerce sites to list production and sourcing costs. Similarly, new luxury menswear company Boga publishes details about the materials and textile houses it uses under The Know section of its website.
The common thread between these companies is that they made the concept of a socially responsible purchase decision part of a desirable lifestyle through consistent brand stories that both inspire and educate. While some of these initiatives are not completely new, retail experts at both conferences predicted these approaches will be the business standard in the next three to five years. As the trend in mindfulness and conscious consumption becomes more mainstream, the most successful brands will be those that lead by example and authentically reflect the values of their customers.
Brooke Blashill is a Senior Vice President at Ogilvy, the award-winning global marketing agency, and a recipient of PR Week’s esteemed 40 under 40 award. Blashill founded and leads The Boutique, an international retail division dedicated to helping clients develop creative and effective communications strategies with a focus on campaign development, product launches, brand experiences, designer collaborations and influencer engagement. Core areas of expertise include luxury, apparel, accessories and home. http://www.ogilvy.com/. Twitter @brookeblashill
- GFM Joins Cardozo Law Students for Conversation with John Idol, CEO Michael Kors, and Lee Sporn, Kors General Counsel
On February 17, Global Fashion Management students attended a fundraising event for Cardozo School of Law’s newly launched Fashion, Arts, Media and Entertainment Law Center (FAME) which was created to train law students for jobs in New York City’s creative industries. Cardozo’s collaboration with Global Fashion Management to provide legal council to GFM’s “clients” for the capstone course is part of this curriculum.
John Idol, CEO Michael Kors, and Lee Sporn, General Counsel of Michael Kors, discussed the evening’s topic, “The Intersection of Luxury and Law” through a series of questions from moderator Leslie Fagan, Senior Partner at Paul Weiss. Mr. Idol pointed out that at Kors, knowing the law is very much part of doing business, and protecting the brand, and employees, is under constant review. The relationship between a CEO and general counsel was described as “complex,” where business expansion and innovation were inevitably balanced by legal obligations.
When asked about how the company deals with counterfeit products, both executives agreed that no brand can be completely protected because it’s simply too easy for a violation to occur, especially through online sales. Mr. Idol also commented on the unending challenge to protect the brand in every country in which you do business, and where legal protection is subject to broad interpretation.
Regarding intellectual property in design, Mr. Sporn believes that the law provides enough protection, although many in this country and around the world may not agree. Mr. Idol said, if you have to ask ‘where is the true innovation,’ it could be a difficult case to prove, adding that less law often results in pressure to always do better as a designer.
On the question of licensing, Mr. Idol said that while owning your own business is for him, preferred, it’s also necessary to work with those with expertise in, for example, fragrance and eyewear. He stressed the importance of a stable working relationship, and one that you have confidence will work from the start.
John Idol and Lee Sporn, who have worked together for twenty-five years, were clearly in tune on the demands of balancing the functions of a CEO and general counsel in managing a wildly successful public and global company. In addition to his position as general counsel (which at Kors, includes a considerable list of additional responsibilities) Mr. Sporn teaches Cardozo’s fashion law practicum course with Global Fashion Management.
- Hong Kong Seminar 2015: The Innovative Chinese Company
Edwin Keh’s lectures are always among the most anticipated of the Hong Kong seminar. As the CEO of the Hong Kong Research Institute of Textile and Apparel, he works with business leaders and academic researchers to develop technology for Hong Kong’s competitive and creative apparel industries. Edwin is also a lecturer at the University of Pennsylvania’s Wharton School, where he teaches the Global Supply Chain Management in China course, with Marshall Fisher, author of The New Science of Retailing: How Analytics are Transforming the Supply Chain and Improving Performance.
He knows a lot about sourcing and logistics. Until 2010, Edwin was chief operating officer and senior vice president of Wal-Mart Global Procurement, and prior to that, held executive positions for Payless Shoesource International, Donna Karan International, Country Road, and Abercrombie & Fitch. He remains active in charities and advises social enterprises.
Edwin’s lecture is profoundly optimistic, but not maudlin; pragmatic, but not rigid. He makes cutting-edge technological trends such as waterless industry, energy efficiency, a new generation of green materials and recycling technologies, self-cleaning treatment, and plant-structure fabric seem within reach, without minimizing the challenge of ambitious research and development. Political, scientific, and sociological facts inform his worldview, as he discusses the importance of Nixon’s visit to China in 1972 and its impact on trade.
This observation is followed by questioning China’s ability to continue to create value from manufacturing, and points to the Kuznet curve economic hypothesis that suggests that a society will no longer tolerate the downside of manufacturing—such as pollution—as it reaches maturity. As China quickly approaches this turning point, the country is just as rapidly entering an era of innovation.
Those of us fortunate enough to hear from China experts on a regular basis, have become familiar with the results of economic shifts that accompany large-scale immigration to urban areas. As Edwin points out, these shifts include higher energy consumption, breakdown of family structure, demand for a higher level of education, and a longer life span—and all heavily influence consumer demand, product creation, and the supply chain. Edwin asks, “Where does the American company end and the Chinese company begin?” He points out that personalities and talents are absorbed from one, two, or more cultures, and product production and adaptability will quickly follow. In turn, the supply chain itself must be reengineered because the one we’re using is unsustainable.
“Good Baby” illustrates Edwin’s example of a hugely successful Chinese company and a radical departure from the stereotypical low-wage labor factory. This company’s core capabilities lie in research and development, with eight development centers throughout the world. Operations and production are localized, making it possible to cater to cultural and lifestyle demand for strollers, children’s car seats and furniture. Timbuk2 is another example. This designer and producer of messenger bags is based in San Francisco. With quality production in Guangdong province, Vietnam, and Indonesia, the focus on sourcing all materials within proximity to the factory is central to the company philosophy of lowering energy consumption in transit, and the importance of promoting a transparent supply chain.
The world’s supply chains for apparel and beyond, could do much worse than to adopt Edwin Keh’s vision of the future.
- Hong Kong Seminar 2015: The Connected Chinese Consumer
Within all aspects of Global Fashion Management education—from lecture event to panel discussion to informal conversation—the focus often turns to the demand and purchasing power of the Chinese consumer. According to the Sourcing Journal, China-based consumers’ online spending for American brands in 2015, is seven times higher than in 2014. But while Chinese consumers are aware of American brands, they’re often not available in China. Jingming Li, U.S. President of Alipay, China’s third-party payment platform, writes that growth will be exponential as logistics and localized payment options improve for cross-border purchasing.
Our intensive seminar in Hong Kong provides GFM students the perfect venue to hear the very latest on e-commerce, digital commerce, and social networks from those who know it best—local experts, colleagues, and consumers—and to gain insight on how the future might unfold.
Anson Bailey, Principal, Business Development for KPMG in Hong Kong, has spent a good portion of his career in China, and has the consumer-technology expertise to deliver a fresh perspective on the contemporary Chinese consumer. Anson says, “Asia will be the story going forward,” and he backs up this claim with a few trends:
- Peer to peer, mobile and cognitive technologies will continue to strengthen, especially as new digital consumers in third and fourth tier cities in Mainland China turn to e-commerce.
- Among consumers in first and second tier cities, 2008 marked a turning point when buying incentive shifted from status seeking to self-reward and purchasing from a more individualist incentive. Heightened by an educated knowledge of country-of-origin when buying luxury, Chinese consumers have less concern for price, and focus more on accessibility.
- Among Chinese consumers surveyed by KPMG, 45% buy online. Among the 54% that make up the middle to upper class, this group has the greatest influence on consumer purchases.
Anson went on to describe the evolving innovation of Chinese tech companies in creating disruptive technologies, consumer convergence, more adaptable mobile devices (such as OnePlus), and aggressive accelerator programs such as AIA. Regardless of how much we may read about the connected Chinese consumer, there’s nothing quite like being on site, and among the experts, to get a first-hand perspective.
- Paris Seminar 2015: News from Fashion Industry Leader Didier Grumbach
Didier may not be a household name, but in the international fashion industry, he’s a legend. It’s been GFM’s great fortune to hear him speak about the history of the industry and his unique place at the center of it, when he opens the Paris seminar every year.
Co-founder of Saint Laurent Rive Gauche, colleague to Givenchy, chairman of Thierry Mugler, and Chairman of the Fédération Français de la Couture, du Prêt-à-Porter des Couturiers et des Créateurs de Mode, and of the Chambre Syndicale de la Haute Corture, Didier has also served as Director of Studies and Dean of Professional Staff at Institut Français de la Mode since 1985.
His History of International Fashion – recently translated into English – is the ultimate authority on the history of haute couture, leading to the origin of ready-to-wear and manufacturing, and finally to the internationalization of the industry as we know it today. Didier hasn’t written a history of fashion, and his lecture to GFM students doesn’t follow that narrative. Instead, he discusses designers as instigators of society-changing concepts; for example, Chanel’s disruption of structured garments through the introduction of new fabrics and silhouettes; the Christian Dior business model and the start of licensing in the U.S.; and YSL’s brilliant creation of ready-to-wear collections inspired by couture. Didier has the remarkable ability to rise above the often-repeated stories of glamour and indulgence (although he’s familiar with those as well) to describe businesses devoted to beauty and high fashion but starved for cash, and opportunistic governments that use the apparel industry as economic protection. There are very few in the apparel industry – anywhere in the world – who have the comprehensive knowledge and experience of Didier, and even fewer who have the generosity to share it.
“This book . . . aspires to be the story of the creation, the evolution, and the implosion of the fashion trade and to offer perspectives on a profession that, like any other social body, defines itself by its origins as by its current economic context.” – Didier Grumbach
Please see “Seminars” on the Global Fashion Management website for more information.
- Paris Seminar 2015: News from Luxury Industry Leader Guillaume de Seynes, Executive Vice President, Hermès International
During each New York, Paris, and Hong Kong seminar, Global Fashion Management students meet to work in intercultural teams to analyze a business with the goal of recommending strategy in finance, marketing, or retail, for large companies or entrepreneurs. This process would be challenging enough if you were familiar with your teammates, their expertise, and their negotiating techniques. But GFM students seldom have this advantage. In the first seminar, they work across cultures with those they’ve never met to come to consensus, relying on their colleagues’ skills in merchandising, product development, finance, retail, design, marketing, or any number of specialties required to operate successful companies.
These skills were tested at the Paris seminar in April, when Hermès came to Institut Français de la Mode to present the history of their extraordinary brand and the challenges they face. As demand increases for their products and the experience it offers around the world, the company came to GFM to seek advice on how they might deliver the highest standard of customer service on a level that’s consistent with the expertise required to develop the products themselves.
Lead by Guillaume de Seynes, Hermès International Executive Vice-President; Corinne Feneon, Hermès International Group Retail Activities Director; and Thibault Hesse, Hermès International Customer Experience Manager, students received a thorough history of the family and the brand, leading to questions such as, “what does luxury mean to a contemporary – and younger – consumer?” “How does a digital strategy fit into the future of an historic and revered luxury brand?” And, “how do you identify and create a profile for a new consumer, and deliver the highest standard of customer service?”
Prior to arriving in Paris, and in their respective countries, students conducted primary interviews, collected data from database and digital sources, and most importantly, experienced the Hermès store experience themselves in cities throughout the world, to better understand the brand values and culture. As students collected data, they communicated among themselves in advance of meeting at the beginning of April, comparing notes and setting expectations for their first meeting in Paris.
The seminar’s lectures added depth to several topics within the case study, and a final coaching session helped to sharpen the focus to the recommendations. In the final debriefing session at the close of presentations, Hermès executives praised the teams for their insights and perspectives that were sometimes surprising and sometimes verified their assumptions, but ultimately made a valuable connection between the retail experience and the expectations of a digitally-engaged and global consumer.
From FIT students’ point of view, the following quotes:
“Working with one of the most iconic luxury brands such as Hermès provided an enriching perspective on French industry dynamics.”
“Fascinating study on luxury with an international group. Always interesting to observe the initiative to make changes, yet the blindness to acknowledge what truly exists.”
“It was a ‘one time in my life’ experience to give a presentation in front of executives from Hermès.”
“Overall, it was a great learning experience working with people who understand and value luxury and customer service in different ways.”
“Experience and practice are needed to understand and deal with these cultural differences.”
“Having access to the thoughts and strategies of top executives from Dior, Chanel and especially Hermes helped inform the concepts our group put forth to assist in moving the luxury customer experience into the digital world. It was impressive to hear how important the customers are to these brands, and they all approach their interactions with consumers in unique ways.”
Please see “Seminars” on the Global Fashion Management website for more information.
- Paris Seminar 2015: News from Luxury Industry Leader Sidney Toledano, Chief Executive, Christian Dior
“True luxury is only meaningful when rooted in authentic tradition,” says Toledano, reflecting on his knowledge of the luxury industry at the Paris Seminar for Global Fashion Management students.
A recent New York Times article describes Dior’s management under Chief Executive Sidney Toledano as among the best training grounds for luxury executives. On April 8th, when Mr. Toledano addressed Global Fashion Management students from FIT, Hong Kong Polytechnic Institute, and Institut Français de la Mode on their Paris campus, his remarks were less about his management style than a reflection of his depth of knowledge of the luxury industry in general, and Dior in particular. Mr. Toledano channeled Christian Dior through his quote, “true luxury is only meaningful when rooted in authentic tradition,” before he went on to describe Dior’s evolution of designers and iconic garments and accessories, noting the importance of a thorough understanding of the brand DNA among creators.
Mr. Toledano began his presentation by describing the company’s licensing business after World War II and the effort to finally bring it under control. He commented on the early career of Bernard Arnault, and Yves Saint Laurent – Christian Dior’s assistant – all leading up to the extraordinary success of the company today. Commenting on the skill of the design and production teams, he said, “The Dior atelier is unique in Paris and at the height of complexity,” as Global Fashion Management students who have had the privilege to visit, will no doubt agree. Questions from students followed, asking about Dior’s digital commerce strategy, expanding into emerging markets, and the creative decisions behind the iconic brand.
“Even when there are no more secrets, fashion remains a mystery.“ – Christian Dior
Please see “Seminars” on the Global Fashion Management website for more information.
- NY Seminar: No Sleep till Brooklyn
GFM students took a break from lectures at the SUNY Global Center in Manhattan during the recent New York seminar to spend a day exploring the rapidly evolving and consistently inventive retail environments of Williamsburg and Greenpoint, Brooklyn.
These neighborhoods –transformed from their origin as industrial, manufacturing centers, and home to thousands of immigrants who moved to the area from Manhattan’s lower east side in the early 20th century – were rezoned for development along the East River in 2005. The zoning ordinance allowed for light manufacturing, making it possible to continue apparel production. The new “creative economy” has provided Williamsburg and Greenpoint with an energy that is beginning to attract mainstream Manhattan retailers. But the neighborhoods’ small retailers are keeping their edge as local customers have given them permission to indulge in “slow” fashion and reward them for their courage. Two of our favorites are In God We Trust and Kai D. Utility.
Shana Tabor, In God We Trust: Shana’s Greenpoint store serves as her jewelry and garment production studio, as well as the retail store for In God We Trust; her other retail locations are in Williamsburg and Soho. Shana’s collections are reminiscent of her New England heritage, infused with attitude and style, sung to Veruca Salt and Joan Jett, and made in Brooklyn (and Manhattan). Trained as a jewelry designer, Shana believes in the importance of detail and the integrity of quality.
. . .
Kai D., Kai D. Utility: As a disciple of the less-is-more philosophy, Kai D.’s shop is a panorama of rich organic neutrals dyed into high-quality natural fibers; woven in historic Italian mills; sung to Bob Dylan, Brother Yusef, and Billie Holiday; and cut and constructed in Manhattan. A gifted designer, his ideology, “refined for the modern artisan and built to last,” is visible in every garment. Kai D’s working knowledge of tailoring and fit, and the construction details which set his garments apart from the accepted standard, are alone worth the trip. For Kai D., this is personal.
- GFM NY Seminar: Priceless
By Elka Gruenberg (Class of 2016),
Northeast Account Executive, Simone Perele
If you were walking down East 55th Street one afternoon in early October, you may have happened across dozens of giddy adults pouring out onto the street; visibly elated, exhausted, chattering non-stop in half a dozen languages, and making a beeline for celebratory drinks. What you would have seen would have been students from FIT’s GFM Program – with their colleagues from IFM and HKPU – emerging from the New York Seminar after delivering case study presentations.
To be fair… we were warned…. multiple times…by all of our professors, advisors, and older students…“Be prepared not to sleep” and “You’re going to work harder than you’ve ever worked before.”
Yet we eagerly dove into the seminar, enthusiastically meeting our new colleagues and forming our case study teams. What followed was ten days of unremitting learning. Nights were spent continuously working and re-working angles of the case study.
Our days, however, were spent being lectured by some of the retail industry’s most influential and accomplished players.
I won’t lie; it felt a bit like a commercial…
Metro Card. $2.50.
Morning double latte. $4.50…
Asking advice from Anna Bakst, who launched Michael Kors Footwear and Accessories and built it into a multi-billion dollar business…Priceless.
While I’m sure she could have easily picked twice as many speakers, Pamela Ellsworth, Chair of GFM, assembled a group of experts who covered the entire span of the retail horizon.
Kevin Ryan – founder of Gilt Groupe – walked us through how he launched the luxury flash sale site. He challenged us to ask, “Why will people use this product,” at every point in product development. He also reminded us that while ideas are great, “The idea is only moderately important. Execution is everything.”
We learned how securing private equity is like dating; how manufacturers are positioned to become direct conduits to retail; and in this day and age every company is a tech company.
All of the speakers pushed us to expand our understanding of the retail experience.
Today’s consumer is more global, more tech savvy, more environmentally conscious and more demanding than ever before. To keep up, we need to be constantly aware of what is happening around the world. Luckily, all I have to do to keep up is Skype with any of my case study teammates in Paris, Casablanca, Geneva, or Hong Kong.