The Kingdom and the Power
If you took an informal poll of industry members right now, the overall sentiment would probably skew heavily negative. I’ve covered this industry for two decades, and never has the collective mood seemed so disillusioned, disoriented and downright depressed. I used to think fear about the end of Capitalism back in 2008 was an industry downer, but the end of retail as we know it makes that episode seem like a walk in the park. This one hits much closer to home, where our industry lives and breathes. Retail is our heart, but for the past year or so it’s been in a state of cardiac arrest. Many mighty retailers have flat-lined and many others—in all tiers and sizes—are gasping for breath. Bleak is the new black, as another the “mother of all bombs” (Amazon) lays waste across the landscape.
To be fair, plenty of other factors have contributed to the great retail shakeout. Over-expansion, tired formats, stale fashion, stagnant wages, crazy politicians, an even crazier and scary world, nutty weather, athleisure’s overwhelming dominance, intense competition for discretionary dollars, head-in-the-sand syndrome, apathy…pick your poison. Collectively, it’s a witch’s brew that has cast a spell paralyzing sales industry-wide, with only a handful of sneaker brands and retailers managing to escape. Everyone knows that when sneakers reign, the rest of the industry feels the burn—and not in a good way. And this time it’s like sneakers on steroids. The ubiquitous yoga pants trend stretches well beyond gym and casual attire, bringing (mostly retro styled) kicks to the height of everyday fashion. Here in Manhattan, a woman in heels is as scarce as a subway seat at rush hour. And the few guys who might still wear suits on occasion can now pair them with sneakers without being labeled a walking fashion faux pas.
Of course, reigns come and go. Not long ago, Adidas couldn’t get arrested in a town outside Germany. Now look at the brand, giving Nike a run for its money in A-lister status and brand buzz. (Overall sales volume still has a way to go.) At the very least, it will force Nike to double down and become even more innovative and in-tune with influencers. It’s also a reminder that the business of fashion changes constantly. There’s always a fresh contender vying for the crown. And that’s where retailers can help play the role of kingmakers. They serve as the gatekeepers and curators of cool. At least, they should. Why else go through all that effort and expense to showcase brands?
Unfortunately, too many retailers have abdicated their powers of late, choosing to play it safe, which causes a chain reaction of brands doing the same. It’s a cycle of stagnation that has been going strong since the Great Recession. Retro, heritage, nostalgia, classic—call it what you want, these factors have been the driving themes in fashion. None of it is really “new,” yet newness is the lifeblood of this business. Is it any wonder consumers are spending more on dining out, drones and smartphones these days? Fashion has lost its status as a top draw for discretionary dollars, and it’s got itself to blame. The industry has allowed consumers to become complacent when it comes to their closets. It’s given them little impetus to update their wardrobes. Chances are, that “new” retro item is already hanging in their closets. What’s more, the rise of fast-fashion chains has reduced garments to disposable commodities.
The loss of power across the fashion spectrum has been sweeping. Price has become king, displacing product and brand status. Relentless margin and brand erosion, caused largely by online shopping, is taking a hefty toll on many full-price retailers and wholesalers. (Enforced) MAP policies and controlled distribution are the first lines of defense, but ultimately product has to rule again. It will require passion and risk-taking from both sides. Meetings can’t be stalemates over margins and terms where the product suffers. It won’t be easy, and it won’t happen overnight. It will require all the king’s horses and all the king’s men to put the business of fashion back together again. But it’s the battle we all must fight to save our kingdom!