On demand
Automation and data analytics have enabled a new breed of start-ups to achieve agile made-to-order production. Mass players will begin to experiment next, responding more rapidly to trends and consumer demands, achieving just-in-time production, reducing overstock, and making short, small-batch production cycles the new norm.
Self-disrupt
Traditional brands are beginning to disrupt their own business models, image, and offering in response to a new breed of small emerging brands that are accelerating thanks to decreasing brand loyalty and a growing appetite for newness. We expect more brands to follow this path of self-disruption, which will have significant impact on their operating models.
Digital land grab
As the race to be the platform of choice for both customers and brands intensifies, e-commerce players will continue to innovate by adding profitable value-added services. Those players that diversify their ecosystem, whether through acquisitions, investments, or internal R&D, will strengthen their lead over those that remain pure players relying solely on retail margins.
Now or never
In the mobile consumer journey, the gap between discovery and purchase has become a pain point for a more impatient fashion consumer who seeks to purchase exactly the products he or she discovers, immediately. Players will focus on bridging this gap through shorter lead times, improved availability of advertised products, and new technologies such as visual search.
Radical transparency
After years of having personal data owned and handled by businesses, a more distrusting consumer now expects companies to reciprocate with radical transparency and sharing of information. For companies to meet a new bar for consumer trust, they will need to offer a heightened level of transparency along dimensions such as value for money, creative integrity, and data protection.
End of ownership
The life span of the fashion product is becoming more elastic as pre-owned, refurbished, repair, and rental business models continue to evolve. Fashion players will increasingly tap into this market to gain access to new consumers seeking both affordability and a move away from the permanent ownership of clothing.
Getting woke
Younger generations’ passion for social and environmental causes has reached critical mass, causing brands to become more fundamentally purpose driven to attract both consumers and talent. Consumers from some but not all markets will reward players that take a strong stance on social and environmental issues beyond traditional corporate social responsibility.
Trade 2.0
All companies will need to prepare contingency plans to face a potential shake-up of global value chains. On the one hand, the apparel trade could be reshaped by new barriers, trade tensions, and uncertainty; on the other hand, it could be reshaped by new opportunities from growing South–South trade and the renegotiation of trade agreements.
Caution ahead
Downward movements in key economic indicators and other potentially destabilizing forces will conspire to create a more cautious mood. With the possibility of a global economic slowdown by 2020, companies will turn more prudent and start to look more aggressively into opportunities to boost productivity, compared with previous years.
Indian ascent
India becomes a focal point for the fashion industry as its middle-class consumer base grows and manufacturing sector strengthens. Fashion players must redouble their efforts in this highly fragmented and challenging market where an educated and tech-savvy demographic rub shoulders with the poor and upwardly mobile.
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Ten trends will define the fashion agenda in 2019.
Source: McKinsey analysis
Percentage of survey respondents that were concerned about the overall global macroeconomic outlook in 2019
Projected number of smartphone users in India by 2022, 2.3× the usage in 2017
Percentage of survey respondents that believe changes in trade policy will pose potential risks to global economic growth (Q2 2018 sentiments, +8% from Q1)
Percentage of survey respondents that believe the pre-owned business model will be more relevant in 2019 than in 2018
The number of times the word “feminist” is forecast to appear on retailer homepages and newsletters in 2018, compared with 2016
In 2018, customers of Amazon in the US expected deliveries within 24 hours, as opposed to a 9-day delivery-time expectation in 1995
Percentage of survey respondents that cited “consumer needs for trust in product authenticity and creative originality” in their top 5 trends for 2019; ranked 2nd out of 12
Top-ranked trend that fashion executives predict will shape the fashion industry in 2019, included in top 5 by 80% of respondents
Revenue compound annual growth rate of fashion e-commerce retailers over traditional fashion retailers from 2013 to 2017
Aspiration level for a shift to “nearshoring” will double between 2018 and 2025
