AFTER COVID-19, WHAT AHEAD FOR THE INDUSTRY?
Five points that will mark a new path
This arduous road will come to an end, the advances in the fight against Covid-19 must yield results at some point, the question is, what will the outlook be once the storm that has changed the world calms down?
Our perception is based on five main points…
- The survival route
It is inevitable to intuit that once the pandemic is over we will have a market in recession, which will force the main protagonists of fashion to increase planning and adapt their operating models to a new reality. Companies that survive the immediate crisis will have made bold and swift interventions to stabilize their core business before seeking new markets, strategic opportunities and future pockets of growth in a global fashion industry undergoing dramatic transformation.
- discount mentality
As deep discounts plague retailers for the remainder of 2020, the buildup of a decade of bargain-buying culture will be exacerbated by a rise in anti-consumerism, excess inventory and cash-strapped consumers who seek to negotiate downward or shut down -Price channels. To reach increasingly sober and disillusioned consumers, brands will need to find inventive ways to recapture value and rethink their broader business mission.
- Rise to digital
Social distancing has highlighted the importance of digital channels more than ever and elevated digital as an urgent priority across the entire value chain, but unless companies scale up and bolster their digital capabilities in the recovery phase of the crisis, will suffer in the longer term. Consumers will continue to demand more in this space, and brands must move quickly to deliver.
- shake and changes
The crisis will shake the weak, embolden the strong, and accelerate the decline of companies that were already struggling before the pandemic, triggering massive waves of consolidation, mergers and acquisitions, and insolvencies. To secure their future, companies will need to adapt to the new market environment by evaluating investment and acquisition opportunities to strengthen their core and capture the white spaces that arise from reorganization.
- imperative innovation
To cope with the new restrictions, mitigate the damaging impact of the pandemic, and adapt to consumer and economic changes, companies will need to introduce new tools and strategies across the value chain to future-proof their business models. Fashion players must harness these innovations and scale up the ones that work to make sweeping and lasting changes to their organizations and the industry as a whole once the storm subsides.