Daily LInks
1. Undeterred By Virus, Chinese Buyers Want Luxury Liquor and Bags: The current bounce – or rebound – in the Chinese consumer demand will help global luxury-goods makers mitigate the sales hit in the U.S. and European markets as these nations continue to battle the virus. – Read More on Bloomberg
2. Fashion production’s more flexible future: manufacturers appear to be more willing to cut back collections and consider factory innovations that allow them to more easily meet consumers’ demands. That is likely to reduce revenues this year and into the next — a fact that is largely unavoidable for most brands — but could better preserve profit margins and reduce the unsustainable overflow of fashion goods that no one wants or needs. – Read More on Vogue Biz
3. Allbirds debuts its first running shoe. To succeed, it must face rivals like Nike and the challenges of a pandemic: Allbirds, known for its comfy wool sneakers made out of sustainable materials, has been working on perfecting the running silhouette for years, said Allbirds co-founder Tim Brown. Allbirds expects to release additional athletic shoes in the future. – Read More on CNBC
4. How the face mask became the world’s most coveted commodity: In the age of Covid-19, the equivalent of sensible shoes may be the simple surgical mask or the home-hemmed cloth. The gaps in their weave are big enough for the virus to pass through, but they do at least protect others from the wearer’s sneezes and coughs. – Read More on the Guardian
5. Online Fashion Sales in the U.S. Recovered in April After Tanking in March: The fashion and apparel industry took a punch from Covid-19 in March when online retail sales plummeted by 30 percent. But now, new data shows that revenue has resurrected globally this month, rising 21% higher than the same time last year. – Read More on AdWeek
6. Not fashion but telling none-the-less: Harry & David Decides Its Stores Won’t Reopen After Coronavirus. The parent company of Harry & David, the gourmet fruit seller known for its gift baskets, has decided to permanently close most of the brand’s bricks-and-mortar locations in the U.S. and focus on an e-commerce future. – Read More on WSJ
1. The new golden rule in marketing (spoiler: it’s not about you). Brands need to be asking one simple question: who is my audience, and what do they need? The new golden rule is putting consumers absolutely first. Business, and profits, will follow. – Read More on AdAge
2. How Luxury Is Reaching Consumers During Lockdown: From YSL Beauty tutorials on Instagram and Gucci’s AR-powered app to Prada’s conversation series and Loewe’s online events and workshops, here is how luxury brands are engaging with consumers while their stores are closed. – Read More on Jing Daily
3. Adidas says first-quarter profits fell more than 90 percent due to coronavirus store closures: Its first-quarter net income was $28.14 million, down 96 percent from the same three months in 2019. The company reported a 19 percent decline in net sales for the first quarter from the previous year to $5.16 billion, as 70 percent of its stores worldwide closed as a result of the Covid-19 pandemic.– Read More on CNBC
4. The Pandemic Will Change American Retail Forever: We are entering a new evolutionary stage of retail, in which big companies will get bigger, many mom-and-pop dreams will burst, chains will proliferate and flatten the idiosyncrasies of many neighborhoods, more economic activity will flow into e-commerce, and restaurants will undergo a transformation unlike anything the industry has experienced since Prohibition. – Read More on The Atlantic
5. RETRO READ: “Brands Can Do Better With a Conglomerate” Behind Them – A Look at the Consolidation of the Luxury Industry. The upper-most echelon of the fashion industry is firmly dominated by an increasingly small handful of mighty entities that have amassed collections of brands, which they have turned into house-hold names by way of eye-poppingly expensive traditional marketing efforts (complete with strong luxury-centric messaging) and the help of no small number of globally-recognized celebrities. – Read More on TFL
6. Plastic Waste Is a C-Suite Issue: From basic chemicals to high tech, from heavy industry to fast fashion, and from agricultural commodities to lifestyle brands — virtually every industry has plastic as an integral part of its products, supply chain, distribution, and customer interactions. For virtually every business leader, reducing plastic waste represents a strategic business opportunity. – Read More on HBR
1. If the First-Quarter GDP Report Looks Bad, the Second Quarter Will Be Worse: Retail sales, which make up about 25 percent of household spending, dropped 8.7 percent in March, compared with February. Stockpiling at grocery stores and online wasn’t enough to compensate for a collapse in spending at bars and restaurants and falling sales of new vehicles and gasoline. – Read More on WSJ
2. Retail in the US won’t be bouncing back like in China: While masked shoppers are lining up to return to stores in China — hoarding cosmetics and fashion — offering retailers a glimmer of hope that the same patterns will play out across America, but they rebounds will be different, in part because of high end enduring unemployment in the U.S. – Read More on CNBC
3. RETRO READ: As North Korea Continues to Boost its Imports, a Look at the Role of Luxury in the Hermit Kingdom. Despite sanctions, luxury goods continue to make their way across the border into North Korea, with China serving as the nation’s most well-established and largest trading partner. Singapore-based traders have also been linked to a “substantial amount of” imports into North Korea in recent years. – Read More on TFL
4. How Eileen Fisher became a model of sustainability in the fashion industry: “I’m much more interested in growing in what we call a circular way, like how do we grow this company in a way that it’s taking full responsibility for its impact on the environment, on the people working?” – Read More on Fortune
5. “Cool’s Over. Chic’s Over.” Balmain’s Olivier Rousteing Says, “ We have to be more spontaneous, not follow rules—we need to be more inclusive as an industry. I want to do fashion shows for different people; to open my doors to people who are not part of the system.”– Read More on Vogue
1. Experiential retail is figuring out new footing in virtual world: Shopping behavior will most likely change, but the pandemic won’t change why experiential retail is important. “The goal is community first and foremost.” – Read More on WSJ
2. With 100,000 stores set to close by 2025, mall owners face this legal hurdle next: Co-tenancy clauses. The common mall retailer clauses typically say that “if less than 80% of space is occupied at this property at any given time, or if a major, anchor tenant like a department store or a grocery store goes dark here,” the tenant is allowed a break in rent. – Read More on CNBC
3. Italy’s Fashion, Auto Sectors Set to Exit Lockdown First: Italy’s auto and fashion industries will be the first to exit the lockdown, says the country’s deputy health minister Pierpaolo Sileri. Containment measures in Europe’s original epicenter have crippled the country, especially its wealthy northern regions where the virus hit hardest. – See More on Bloomberg
4. Gap Inc. says some stores will never reopen: “Consumers are preparing for a long economic slowdown,” with 46% of consumers believing that it could take at least a year for the economy to recover, and a great majority expressing disinterest in discretionary consumption like apparel. – Read More on Retail Dive
5. Nike is poised to weather coronavirus far better than Adidas and Under Armour: “I think every company should be running two concurrent war rooms: one should be focused on how do we make sure we survive, the other should be trying to decide how we can grab share, because there will be lingering dislocation among consumer brands.” – Read More on Yahoo
1. Luxury Can Only Dream of a 2010-Style Comeback: Luxury brands have a well-earned reputation for resilience. Major labels bounced back from the 2008 financial crisis within 18 months and shrugged off political protests in Hong Kong last year. But the Covid-19 pandemic looks different and could lay them much lower. – Read More on the WSJ
2. Boohoo eyes struggling fashion brands after trading beats forecasts: The online retailer – which owns PrettyLittleThing, Nasty Gal, Coast, Karen Millen, Boohoo, and MissPap– reports 54% profit rise, as sales increased 44% to £1.2 billion for the 2019 fiscal year. – Read More on the Guardian
3. RELATED READ: How Much of Fashion’s Emphasis on Sustainability is Actually Impacting Consumer Spending? Consumer interest in sustainability is growing, and traditional fast fashion retailers are struggling, but neither of those things necessarily signals that cheap, trendy fashion is falling out of favor (yet). – Read More on TFL
4. Farfetch: High exposure to the declining luxury goods market will hurt its stock. It’s unlikely that Farfetch will become and remain profitable in the upcoming quarters and thereby it will not be able to create shareholder value in the foreseeable future. – Read More on Seeking Alpha
5. How fashion and beauty retailers can overcome the lack of touch and feel in the time of social distancing: A big increase in visitors to retailers websites could seem like a silver lining during these troubled times, but for many shops those visitors don’t actually turn into customers. – Read More on Forbes
1. The pandemic is a calamity for many American retailers: The pandemic will change shoppers’ habits in ways that are likely to be lasting. By the time America is open for business again, more consumers will be comfortable shopping online, for clothes as well as for food. – Read More on the Economist
2. What is the future of fast fashion? Even before the pandemic, fast fashion was undergoing major upheaval, namely, the old guard of fast fashion had ceded ground to nimbler pure-play upstarts like Boohoo, Fashion Nova, and Missguided, which, unyoked by decades of debt, expensive real estate, and clunky supply chains, had conspired to make fast fashion cheaper and more shoppable through newfangled channels like Instagram. – Read More on R29
3. Top fashion brands found making little progress in transparency index: Max Mara, Pepe Jeans and Tom Ford are among the least transparent fashion brands when it comes to providing information about their supply chains, according to an index published on Tuesday that found little progress in the industry. – Read More on Reuters
4. RETRO READ: Here’s the thing about fashion’s “transparency” and “sustainability” indexes, they often only take into account info that brands choose to make public, leaving a lot of room for brands to skew the narrative in their favor, and game the system. – Read More on TFL
5. Social sustainability, overstock and ‘greenwashing’: How COVID-19 is changing the fashion industry. “Sustainability has dropped off the agenda for the past few weeks at the top executive level in the industry as even strong companies have had to fight for sheer existence.” – Read More on Forbes
1. ‘It’s Black Friday in April’ as closed stores get desperate to unload spring clothes: Despite the temptation of deals, homebound shoppers still aren’t spending on apparel and footwear. Online sales for the category have declined each week since March 9, including a 20% drop in the week ended April 6, compared with the same period a year earlier. – Read More on WSJ
2. Spending on clothes plummets 50%. Here’s what it means for fashion’s future. In the short term, analysts believe that consumer spending on fashion is going to decline even further, if lockdown orders continue. In the long run, Coresight Research expects 15,000 stores to close permanently as a result of this crisis, which could force some brands into bankruptcy. – Read More on Fast Co.
3. Mary Meeker’s coronavirus trends report: “Covid-19 has upended our modern lives in ways we’re just starting to understand.” Prior epic viruses have permanently changed the world, but coronavirus may prove less impactful because of our information-sharing and scientific technologies. – Read More on Axios
4. How Retailers Can Reach Consumers Who Aren’t Spending: Companies should immediately evaluate their customer journeys and re-imagine those that could be redesigned for a digital-first/digital-only world. This includes everything from expanding capacity of your offering or customer service to putting a pause on certain late fees/cancellation fees. – Read More on HBR
5. A tsunami of bankruptcies are about to wash away America’s retail sector: With rent, interest, and other expenses continuing to accrue and no idea on when stores will be allowed to reopen, retailers are coming to the conclusion they must get ready to file for bankruptcy to alleviate costs in the hopes of surviving. The avalanche of filings are likely to begin hitting in late May and early June. – Read More on Yahoo
1. LVMH, L’Oreal Recovery in China Fuels Optimism for Outlook: “What we’ve seen in China is a pretty quick bounce back for the consumption of beauty products.” Sales in Louis Vuitton stores in China are up about 50% in the past three weeks over the same period a year ago, while L’Oreal Chief Executive Officer Jean-Paul Agon said that sales in China turned positive in March and are on track for a gain of 5% to 10% this month. – Read More on Bloomberg
2. As coronavirus restrictions drag on, Americans shift online spending from stockpiling to entertainment: e-commerce spending in the U.S. is up more than 30% from the beginning of March through mid-April compared with the same period last year, while sales data reveals that many shoppers have shifted their focus to entertainment products such as books and games as they adjust to the new normal of life in quarantine. – Read More on CNBC
3. Investor Wendy Yu on Chinese Fashion: “I think there will be a natural return to retail and luxury over time, but this epidemic will inspire us to be more purposeful about our decisions and spending, which will, in turn, create new and improved benchmarks for brands to meet to be relevant.” – Read More on SCMP
4. As glory days recede, fashion and luxury companies face a reboot challenge: “Overheads are being reviewed,” LVMH CFO Jean Jacques Guiony, in a conference call with analysts last week. “Selling costs are being reviewed. Marketing costs, obviously, are being reviewed. So we are taking measures, I would say, more or less everywhere.” – Read More on S&P Global
5. Looking ahead, DTC brands start scenario planning for store re-openings: “I think people are preparing models [in which stores] will open as early as July and as late as October,” said Logan Langberg, principal at Imaginary Ventures, which has invested in Glossier and Everlane. – Read More on Modern Retail
6. RELATED READ: How Will the Market’s Buzziest Direct-to-Consumer Brands Fair in Light of COVID-19? “Many of those businesses are looking less viable than they once were,” pointing to Casper’s February IPO, which “valued the company approximately $600,000 lower than its last private fundraising round;” Brandless’ shuttering; Glossier’s suspension of “its color cosmetics line Play after lackluster sales;” and Outdoor Voices’ “reported $2 million monthly burn rate on $40 million of annual sales.” – Read More on TFL
1. Luxury’s Hefty Price Tag Awaits Earnings Reckoning: As Europe kicks off one of the most uncertain earnings seasons in a long time, market players are hoping for clues on the extent of the damage from the pandemic. So far, no luxury stock has severely de-rated and a number of them appear “more expensive today than last autumn.” – Read More on Bloomberg
2. Get ready for the TikTok influencer beauty brand wave: TikTok engagement is especially high right now among the Gen Z audience stuck at home and bored. So, a newly launched beauty line Gloss Twins created by TikTok “twinfluencers” Shanae and Renae Nel, who have 1.2 million followers on their shared account, is offering them a lip gloss is set at an affordable $11.88. – Read More on Glossy
3. RETRO READ: Is TikTok the Next Big Beauty Space? TikTok’s greatest virtue is its accessibility: it’s full of DIY makeup tips, dupes, and how-to vids. Can’t afford Fenty’s Body Lava? Just mix baby oil with a crushed up highlighter. Don’t want to shell out for Glossier’s Cloud Paint? There’s a hack for that too. – Read More on W Mag
4. Will Extravagant Fashion Shows Ever Happen Again? “We knew already that we were getting too big. I can’t imagine having a fashion show with 1,500 people all gathered together. Do we need to simplify a way of communicating these ideas?” – Read More on the Cut
5. Why Coronavirus Will Dramatically Change The Retail Supply Chain, and How: No other country matches the current manufacturing dominance of China, nor do any yet have the established infrastructure to support such a huge business. Retailers were already seeking options outside of China to produce apparel, and COVID-19 will only increase that. – Read More on Forbes
6. Amazon continues to gain share in apparel: More than 70% of apparel shoppers bought clothing or footwear on Amazon in the past 12 months, up 10 percentage points from last year and almost 25 percentage points from 2018. – Read More on Retail Dive
1. Airlines Aren’t the Only Casualties of Empty Airports: Luxury brands are also dependent on purchases made in travel hubs. Last year, 6% of all global luxury sales were made in airports, according to Bain estimates. – Read More on WSJ
2. RELATED READ: Travel Retail, a Luxury Cash Cow, Down as Much as 70% in Some Hubs. For luxury brands, the risk is sizable. Coresight put airport retail sales at $44 billion in 2019, and Switzerland-based Dufry projects the value of the segment to inch towards $67 billion over the next few years. – Read More on TFL
3. How apparel retailers can deal with excess inventory: The current crisis has created a unique challenge: retailers have a huge amount of inventory in stores that they can’t sell right now, and it’s unclear just how much consumer demand there will be the rest of the year. – Read More on Modern Retail
4. The economic data is even worse than Wall Street feared: “The bottom line is that consumer spending has fallen off a cliff after being relatively solid for a prolonged period of time.” – Read More on CNBC
5. Can direct-to-consumer brands survive the COVID-19 apocalypse? Many DTC companies were in trouble before, and now, the key to surviving the downturn will be cold hard cash. Many brands have minimal revenue coming in right now, which means they’ll need to tap financial reserves to continue paying workers’ salaries, office and store leases, and marketing expenses. – Read More on Fast Co.
6. RELATED READ: How Will the Market’s Buzziest Direct-to-Consumer Brands Fair in Light of COVID-19?As “sales continue to shift from nice-to-have products to must-have products,” DTC brands are “preparing to see steep sales declines [with] COVID-19 [potentially being] what puts some of these companies out of business altogether,” various venture capitalists have projected, since most of these brands and their products “fall under the nonessential category.” – Read More on TFL