I believe that Burberry has done a fantastic job at introducing digital elements to its business model, first driven by Angela Ahrendts, a CEO who truly understood the power that digital could play. Even as Angela stepped down (she is now VP of Retail for Apple), the company re-affirmed its commitment to finding new solutions and only recently announced the most disruptive change that the fashion industry has experienced in the past decade: “see now, buy now”. Launched in September 2016, this new approach allows final consumers (you and me) to shop live clothing worn by model, as the catwalk takes place. this required a major overhaul of the whole supply chain, which was used to present a fashion collection, and deliver it to stores 9-12 months later, as per industry standard. This could also be interpreted as a defensive move against fast-fashion retailers (ie Zara), which have built their own business model on the lag that is present from the time a high end collection is presented during the fashion show to when it is sold in stores. Historically, this lag has allowed fast-fashion brands to see the trends of the season as seen during the show, copy them and replicate those same patterns and designs for their own collections, and being able to distribute them in Zara stores at the same time as they hit Burberry stores. See more here: https://www.businessoffashion.com/articles/news-analysis/burberry-aligns-runway-and-retail-calendar-in-game-changing-shift
I disagree with you that there is only one way forward. In fact, the most effective strategy would be one that combines large existing stores that hold inventory, but smaller new showrooms without inventory. Currently, Nordstrom owns and operates huge stores across the country. It would be insanity for them to shut them all and replace those stores with showrooms. The existing locations that hold inventory should be leveraged by Nordstrom as potential distribution center for 30 minutes express delivery. What I am suggesting is to complement that network of department stores with smaller and more nimble operations to increase the penetration in major cities. Here is an example: Nordstrom is planning on opening its first NY flagship department store in Mid-town in 2017 (http://nypost.com/2013/08/26/nordstrom-buys-its-57th-st-store-jumbo-skyscraper-pending/); one store alone in the largest retail hub of the world is not enough. That one store, which by the way will cost >$100M to build, will attract very few loyal customers travelling from Downtown NYC. In my opinion, Nordstrom should consider open “neighborhood” showrooms across the city (think of what Bonobo is doing) to serve those customers that are looking for a different experience altogether.
Interestingly, FarFetch has recently decided to move one step forward, by creating Farfetch Black & White, which leverages the company’s technology infrastructure to offer e-commerce solutions for brands (see more at: https://www.businessoffashion.com/articles/bof-exclusive/farfetch-e-commerce-fashion-brands-omnichannel). what does that mean? that not only Farfetch operates marketplace that gives visibility to small brands that would otherwise have no exposure to the international market, but now also offer a 360 solution to major brands that need support in creating their own distinctive website (UX design capabilities), integrate POS (IT integrations), as well as fulfilling orders, payments and customer service for them. This move puts Far Fetch in direct competition with Yoox – Net a Porter, which has so far enjoyed high market share in setting up e-commerce solutions for high-end brands.
you bring up a great point: the importance of merging online and offline teams. it does indeed all start from there. breaking down silos is key to ensure that the company speaks with one consistent voice. Another example of a company that operates in a similar space to Sephora and is committed to bridging channels together is Warby Parker. At Warby, the user experience team is one. That means that the same team that does the window displays of the stores, also takes care of the UX of the website. To millenials this may sound like a no-brainer (why would you want to deliver 2 different experiences, when the consumer is the same one?!?), but it is something easier said than done, as very different skill sets and background are required for a graphic designer and a visual merchandiser. To merge these two position in one is definitely the way forward.
Very interesting phenomenon. Many studies (see one: http://www.bain.com/publications/articles/three-rules-for-building-the-modern-retail-organization.aspx) have found that customers that buy across channels (online and offline) spend up to 5x more than customers that shop in one channel only. Retailers, Amazon included, are therefore aiming to strike a balance between channels to maximize the dollar spend. That said, I believe that online-first retailers (companies that started with an online-only business model) have a competitive advantage in creating a seamless omni-channel experience, particularly thanks to their head start in controlling and managing customer data, and integrating the information across channels
My first reaction to this post is to be highly impressed by the foresight of California`s legislators. it is truly remarkable that California introduced ZEV credit regulations back in 1990, when carbon emission was not yet a highly debated issue. That said, I completely agree with your recommendation to increase the bar, and have California leading the way once again, to guarantee that automakers who are already producing energy-efficient cars, such as Tesla, are able to benefit from offering such superior performances. It is critical to ensure that a more fair incentive system is put in place to reward the car-makers that are truly making the difference, thereby attracting other car-makers to invest in this space
I completely agree with you that the IOC should leverage its clout and be a game changer. It does seem like Tokyo 2020 could be a wonderful opportunity for a highly industrialized country, Japan, to address climate change. In fact, there the organizing committee seems to be moving in the right direction, as highlighted by a recent plan they have shared: https://tokyo2020.jp/en/games/sustainability/data/sus-plan-EN.pdf
I think that one of the main legacies that Stella may leave to the world of fashion is the way she was able to make sustainable products “fashionable”. You have pointed out that Kering, the second largest luxury conglomerate in the world, has embarked on a very serious long term campaign to make its business model more sustainable, and you hint that this may have been influenced by Stella, whose brand was acquired by Kering few year earlier. It would be incredible If Stella had actually been able to influence Kering, and it would represent a very interesting model that could occur in other industries: small brands could become sort of labs for large corporations, used to test out new sustainable models, before going full scale.
I do think that your suggestion of limiting the number of flights that are not at full capacity makes sense. I am just worried about the execution of such a solution. many flights tend to fill out at the last minute, so it would be hard to stop a flight from taking off unless it is filled.
I wonder if any of the initiatives that H&M is proposing can be taken seriously, when H&M is the main driver of “fast fashion”, which relies on the production of low quality and low garments, which have an intrinsic shorter life cycle. I believe H&M should also attempt educating millenials to consider repairing garments, to minimize the number of disposed garments