Fashion Business Module 4.1 Overview

The COVID-19 pandemic significantly disrupted the global fashion industry, impacting sales, profits, inventories, jobs, and the entire fashion ecosystem.

The global fashion industry is valued at $3 trillion and represents 2 percent of the world's GDP.

Despite the pandemic, the global economy was projected to grow 5.9 percent in 2021 and 4.9 percent in 2022.

Lockdowns, travel restrictions, and social distancing measures were implemented globally during the COVID-19 pandemic, impacting retail, especially fashion.

COVID-19 restrictions caused a surge in online shopping as retail stores were shut down.

Fashion is considered a discretionary consumption, meaning people can delay buying it if necessary.

Global fashion sales decreased due to COVID-19 lockdowns, travel restrictions, and social distancing measures.

Fashion inventories increased across the supply chain as people stayed home and bought less.

The demand for fashion items shifted dramatically towards essential wearables, like comfort clothes and loungewear. Luxury and aspiration fashion items were less in demand as people focused on practicality.

Many big fashion players had to suspend or delay events like fashion shows, trend forecasts, new launches, and expansions due to the pandemic.

Big fashion houses shifted focus from typical business activities to supporting charities, donating supplies, and prioritizing human welfare and sustainability.

The availability of COVID-19 vaccines brought a sense of relief and optimism to the fashion industry, as markets reopened and businesses revived.

Global freight and transportation constraints disrupted supply chain logistics, making it difficult and expensive to move goods to their destination markets.

They innovated, implemented new strategies, and learned from the pandemic's challenges to adapt to the changing realities of the fashion industry.

The pandemic forced fashion companies to re-evaluate their priorities, focus on sustainability, and consider the long-term impact of their actions on society and the environment.

The fashion industry embraced agility, adapting quickly to new realities, shifting to new operational models, and embracing technology.

The fashion industry showed signs of recovering in 2021 with some brands returning to profitability. However, rising costs and supply chain disruptions presented new challenges.

Luxury brands were impacted by pandemic restrictions but bounced back in 2021. The market is expected to return to full strength by 2023.

Luxury brands are shifting from a focus on exclusivity to a focus on inclusivity and social responsibility.

Artificial intelligence is expected to play a significant role in fashion, revolutionizing everything from design to production and distribution.

Luxury brands are focusing on engaging domestic consumers while international travel restrictions remain.

The fashion industry is facing challenges related to material shortages, transportation bottlenecks, and rising shipping costs.

Rising input costs, including transportation and materials, are expected to increase consumer prices for fashion items.

The use of artificial intelligence (AI) in the fashion industry to enhance various aspects like manufacturing, marketing, sales, and understanding consumer behavior.

The application of AI technologies in retail to improve customer experience, optimize sales processes, and personalize product recommendations.

The use of AI chatbots on fashion websites to enhance customer experience by providing instant personalized assistance and answering questions.

The use of VR and AR technologies to enhance the fashion shopping experience, allowing customers to virtually try on clothes and visualize how they would look.

A seamless and integrated shopping experience across multiple channels, including online and in-store, where customers can interact and make purchases.

The use of AI and technology to personalize clothing recommendations and create virtual fashion looks for customers.

A digital platform that allows users to store and manage their clothing, try on virtual outfits, and explore different styles.

Partnerships between fashion brands and technology companies to create digital fashion experiences, such as virtual clothing designs and avatars.

Using smartphones for online shopping and making payments for retail purchases.

Two out of three millennials prefer online shopping to in-store purchases.

Brands use social media to reach customers and sell products directly through integrated e-commerce platforms.

A growing trend towards eco-friendly and sustainable fashion practices.

Increasing use of recycled materials and closed-loop recycling technologies to reduce environmental impact.

Designing durable pieces that can be worn for years, reducing the need for frequent purchases.

The mobile commerce market is expected to grow rapidly due to increasing smartphone usage and online shopping trends.

Fashion brands are increasingly expected to take environmental responsibility by promoting sustainable practices and reducing waste.