The pandemic and the mash-up of the holiday supply chain have helped solidify the newfound religion of fashion’s full price.
And the first reading of 2022 is that brands are keeping the faith, at least online.
E-commerce data specialist Edited analyzed marketing emails from over 500 retailers in the US and UK and found that the word “new” was used 15% more than “sale”.
Additionally, the use of the word “sale” to grab shoppers’ attention in emails decreased by 23% over one year.
Overall, this paints the picture of an industry that appears to be avoiding the worst of the January annual clear-out (although sales are certainly not disappearing and there are still holiday and end-of-year promotions).
Maintaining the price is a little easier than usual this year – holiday sales have generally been strong, the pandemic has forced inventories to fall, and traders don’t really want to cut the price as general inflationary pressures push their costs. above.
But Juliana Prather, Edited’s chief marketing officer, said there are some structural changes in fashion that, when taken together, have led the industry to move towards a new, more full-price approach.
“This is a real change of pace,” Prather said, pointing to key aspects of a new full-price landscape, including:
- The In-season Push: While brands for years have complained about the traditional fashion calendar that swimsuits hit stores in January and sold out in July, Prather said the start-up brands have succeeded. to successfully challenge the old way of thinking to move more during the commodity season.
- Sustainability Goals: Fashion brands are almost fully aware of the environmental impact of clothing manufacturing and are looking for ways to operate more sustainably (and communicate it to customers). Now those goals are supporting and fueling efforts to limit excess inventory that would still weaken margins with downsides.
- Data Drive: Retailers have integrated data into business models since before the pandemic, and many now have the ability to be more targeted when and how they use price promotions. Instead of planning price promotions in advance, brands can be quicker and only put their extra large green shirts on sale instead of making a cross cut.
Each of these requires, not just small changes, but transformations in many companies and in different parts of the industry, with big pushes to develop the necessary tools and know-how and force change through an established system.
It wasn’t long ago that simply changing shipping times so that spring merchandise arrived at the store in, well, spring seemed to be an insurmountable problem. Now, and especially online, it’s a much more manageable change in a sea of change.
There are hardly ever hard and clear lines when the world changes. There is evolution and a mixture of new and old that is so utterly confusing that it can be hard to see the difference.
But if it is true, as everyone says, that the pandemic has accelerated trends that were already there, including e-commerce and data, then COVID-19 may just be the global force that has lifted the industry and brought it into a new future that we are still trying to understand.
Pricing and selling more at full price could very well be part of that future (if the animalistic instinct on the part of traders to cut the price and grab market share can be tamed).
Prather said it’s a change that needs to come from the top of companies and that CEOs are motivated.
“It’s very real to their earnings reports and their bonuses,” he said.
And figuring out how to stay at full price may be more than a good idea, but necessary in today’s economy.
“If you can protect your margins with more full-price sales, but also be effective with [data-driven] targeted promotional, so you can also make some better decisions about how much inflationary pricing you need to pass on to your customer, ”Prather said.
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