From the downfall of traditional branding and the ever-increasing rise of luxury brand ambassadors to the embrace of mono-product brands and brands that rely largely on the sales of “it” accessories to a look at the potential tax evasion haven created by fashion’s endless practice of gifting, here are just a handful of the fashion business-oriented features we published in 2017.
1. Fashion’s Paradox: Garments Do Not Sell but Accessories Do. Belgian design force Dries Van Noten reflected last year on the business model of his privately held brand, including the role of the runway show. In an interview for Rolex’s The Talks series, he said: “For me [producing every single look from the runway for retail] is absolutely necessary.” His comment sheds light on the big paradox in the fashion industry: Many brands – especially big name ones – do not really rely on the sale of garments to derive the majority of their profits.
2. Is Fashion’s Endless Gifting a Potential Haven for Tax Evasion? In light of large-scale tax evasion probes that have targeted Dolce & Gabbana, Valentino, Prada, and now Gucci, smaller instances of tax side-stepping could be happening with some regularity in fashion in connection with the incessant practice of gifting.
Given the oft-meager paychecks that come with working in fashion and media; given the “excess, like wrong sizes mindlessly sent over, or just the overflow of product in general that no one’s held accountable for;” and in lieu of company policies (at many publications) prohibiting editors from selling these gifts, that is just what industry insiders have taken to doing. Off-loading the gifts and pocketing the profits.
3. Models v. Actors: Fashion’s Ambassadors of Choice Have Changed. Are we sick of celebrities? Old Navy thinks we just might be. And the mass-market retailer is not alone. The recent re-embrace of models is something of a contrast to the pushing out of catwalkers in favor of celebrities as the faces of ad campaigns and magazine covers over the past few decades.
4. What are Brands Really Paying Ambassadors to Do? Whether it is latest it-girl or an Oscar-nominated actress, fashion brands love to have famous faces represent them. While posing for ad campaigns may be the most obvious iteration of these ambassadorships, a lot more goes into these contracts than meets the eye. The question is: What do these partnerships entail and what exactly are brands paying for when they enlist these stars to represent them (i.e. what – exactly – are brands expecting of their stars)?
5. Just How Successful Is Your Favorite Fashion Brand … Really? Most fashion brands are privately held companies exempt from required public disclosures of revenue and profitability. As a result, it is difficult – if not nearly impossible – to gauge which brands are thriving (à la Thom Browne, which recently made headlines in connection with its burgeoning business) and which are on the verge of a “hiatus,” as Hood by Air so poetically worded its shuttering in April.
6. Un-Branded: How Consumers Outgrew Traditional Branding. Not all brands are marketing themselves with bold logos. At least a few brands are taking the opposite approach, and banking on the appeal of un-branded or at least, less aggressively branded products. And while this approach may seem to be completely at odds with what consumers are demanding, it is not necessarily so outlandish.
7. The Rise of the Mono-Product Brand. For many years, designers were pushed – even expected – to build out fully-fledged lifestyle brands, ones that not only offered garments for one gender but for both and with accessories, sometimes even home goods, to go along with it.
This pattern of over-expansion is beginning to change, though, as indicated by a wave of younger brands that are shunning the lifestyle brand movement in favor of specializing exclusively – and building their brands – on one core product or a few core products that they perform really well.
8. What’s in a Logo: Why Brands Re-Brand. Ask any company owner how difficult it is to create a brand that resonates with consumers, one that that becomes synonymous with its products, ethos, and general business. In fashion, companies spend decades – even centuries, in some cases – building themselves into luxury brands (or better yet, houses) that can demand upwards of $3,000 for a purse (and even more, in many cases, for garments) and not have consumers blink an eye because they are so intrinsically synonymous with luxury, exclusivity, and well, fashion.
9. Meet EssilorLuxottica: The Biggest Player in the Luxury Eyewear Game. A new European eyewear giant worth more than $52.5 billion is slated to make significant waves in the fashion industry. It is the result of the merger of Italy’s Luxottica – which maintains a brand portfolio that includes practically every well-known brand, such as Ray-Ban, Persol, and Oliver Peoples, as well as the rights to design, manufacture, and distribute eyewear of luxury brands including Burberry, Prada, Chanel, Miu Miu, and Versace – with French lens manufacturer Essilor.
10. The Bella Effect: How Instagram’s Favorite Models Impact a Brand’s Bottom Line. Ever doubt the actual value of an endorsement from one of the fashion industry’s favorite Insta-models, as they have been coined? Fannie Schiavoni doesn’t. You might not know this Sweden-born, London-based designer’s name but chances are, you have seen her work … thanks, at least in part, to Bella Hadid.