THE EMPIRE’S NEW CLOTHES: A REBOOT
Fashion was broken before the pandemic. A do-over could be just what it needs
Fashion — as a business — has been a beautiful, intoxicating, unsustainable lie. Not all of it, but much of it. It didn’t start that way, but ultimately that is what it became.
The economic fallout from the coronavirus pandemic has made this truth plain.
“They always say this is an industry of smoke and mirrors,” says Gary Wassner, chief executive of Hilldun, a financial services company that caters to fashion businesses. “Now we’re left with nothing but dissipating smoke and broken mirrors.”
For years, designers spun whimsical garments that tantalized the imagination but mostly didn’t sell. It was their more pragmatic styles that made the cash registers sing. Brands burnished images redolent of old wealth and aspirational extravagance while their bottom line was little more than red ink and magical thinking. Success was a fabulist tale of prepaid celebrity endorsements and social media impressions. Even the vision of the industry as a place of open-minded tolerance was wishful thinking.
The thrill of this creative Shangri-la was enough to woo investors who ended up with portfolios of fool’s gold.
Brick-and-mortar retailers opened outlet after outlet, e-commerce expanded its reach, all while discounting merchandise customers refused to buy until it was discounted even more, because most everyone had learned to shop by the mantra: Never pay full price.
“The industry needs to be fixed,” says Julie Gilhart, president of Tomorrow Consulting and a former Barneys New York executive. “We’ve known this for a while. It was still moving, even though it was broken.”
Now that the fashion cycle has come to an abrupt halt, the industry is trying to suss out what needs to be discarded and what can be salvaged. Retailers, designers and other industry players have been spending hours in Zoom video conferences engaging in a kind of group therapy: discounters anonymous, debt denial, top-line growth withdrawal. They’ve written manifestos and published open letters.
And then, Black Lives Matter protests erupted after the killing of George Floyd. Designer Aurora James launched the #15Percentpledge that challenges large retailers to dedicate at least 15 per cent of their shelf space to products from majority Black-owned companies.
The civic upheaval has added racial justice to the challenges facing an industry trying to right itself.
To whom are designers addressing these pleas for reform? To themselves. Some big-picture remedies under consideration include reducing the number of runway shows and the sheer volume of clothing that’s produced, delivering garments to stores in-season rather than months early, marking down merchandise only in June and January and even ... abolishing Black Friday, that malignant discounting feeding frenzy.
The fashion industry has been spinning this web of fibs, obfuscations and misdirection for years. The problems facing the industry are most often caused by shortterm fixes instead of long-term strategies, the belief in quantity over quality and ego and inertia.
Designer Rachel Comey has asked herself: “What kind of growth do you need in this business? What if I didn’t have to grow, from a dollar point of view, and I spent the rest of my career just doing what I love to do at a size that can support my team’s lifestyle?”
Most agree that after the 2008 recession, the industry was never the same. When the economy tanked, Saks Fifth Avenue took the lead in frantically discounting merchandise, and other stores followed.
“We broke the natural cycle of when things arrive and when they go on sale. I don’t think we’ve ever gotten out of that,” says Christophe Desmaison, who runs a wholesale showroom in New York, representing Nina Ricci, Vanessa Bruno, Mugler and others. “Then there was the internationalizing of Black Friday as websites got bigger and bigger and more influential.”
For consumers, the upheaval meant that winter coats arrived in the summer heat, were discounted before the leaves turned crimson and mostly gone by the first snowfall.
Instead of brands creating a single spring collection and a fall one, they were producing pre-fall and pre-spring, resort and cruise, special collections, one-offs, drops and drips and mounds of boring bits.
Design houses began putting those wonderfully accessible clothes on the runway and inviting the media — and listening to the media even though fashion editors have a different agenda than merchants. Soon the garments weren’t so commercial. The shows became costly marketing events. And the merchandise that was in stores became ever more out of sync with what customers wanted, when they wanted it and how much they were willing to pay for it.
All these seasons, all this merchandise was in service to department stores, Comey says, and now that they’re failing, they’re bringing down designers with them as they leave a trail of unpaid bills.
“The next year is going to be rough. It’s going to be tough because we’re going to have to change the way we do things,” says Gilhart, whose company advises fashion brands. “I think the thing that’s most positive is people are talking to each other and trying to figure things out because there’s a lot at stake.”
Runway shows have been slashed from the international calendar because of production delays and because it’s simply too dangerous for crowds to gather. Retailers who would normally travel to Europe in June will buy collections virtually.
Brands including Saint Laurent and Dries Van Noten have announced that they won’t be mounting live presentations in September and are reconsidering the whole premise of them. Pyer Moss is subbing in a documentary on the making of previous collections. Gucci designer Alessandro Michele posted a dear-diary treatise on Instagram indicating that he was reducing the brand’s current roster of five shows to two seasonless ones. And industry organizations in New York and London that oversee each city’s fashion week schedules have strenuously urged designers to simply make less clothing.
Some of these changes are proactive. Others are reactive as losses mount: Ralph Lauren quarterly revenue is down 15 per cent. Neiman Marcus is in bankruptcy.
Fashion’s largest luxury conglomerates, LVMH and Kering, as well as Chanel and Hermès, essentially determine their own destiny. They are their own ecosystems complete with production facilities and boutiques. It’s the rest of the fashion industry — those with big footprints and tiny ones — that’s linked, and when one element is squeezed, everyone feels the pain. Indeed, it was designer brands’ foolhardy attempt to mimic the steady volume of merchandise produced by fast fashion companies such as H&M, the Gap and Zara that helped put them on such a nonsensical, destructive course. A $900 shirt is not throwaway fashion; no one needs to replace it every 12 weeks.
Those best positioned for the future, if they can survive the present, may be the independent shops and the most nimble brands.
“(Customers) may find the shop around the corner is fine for retail therapy. Or they’ll go online,” Gilhart says.
“I’m always an optimist,” Wassner says.
“Every day you make a decision about what to wear. You’ll always want to be the creator of your own story.”
What if I didn’t have to grow, from a dollar point of view, and I spent the rest of my career just doing what I love to do?