Managing Technology & Innovation inthe Fashion IndustryIt’s ourfirst month of 2017, and we’re still in the 21st century. We’re in acentury were technology and innovation have become one ofthe brains priorities.
It’s like when you want to open a new business, orrelease a new product the first thing that comes to your mind is building anelectronic product that contains high technology. After all, this revolution oftechnology and innovation needs management.Managing fashion technology andinnovations:As we just stated that technology is in every part of ourenvironment these days, and also technology is interfering in the fashionindustry too. Of course this technology needs management.
Why does it needmanagement? Management must be present in this domain to provide companies orthe founder of the product in this industry withthe profiles they need to be highly competitive in a complex environment.In this case, where a complex environmentis present, and in this competitive industry, orientation must always bepresent, providing very good opportunities for growth in a hypercompetitiveenvironment. Hence, managers must be recruiting experts in this domain and theyshould aware of the structure and the dynamic of this field, able to managecompanies and develop brands in a successful way.Fundamental knowledgefor fashion management1- Creating Brand Awareness:In a fashion brand, the person designingand developing the product is often also responsible for the advertisingcampaigns and the brand communication.1- Brand Story: A brand story is what people will talk about when they thinkof your brand. It summarizes why your brand exists and what are the uniquecharacteristics of your product that makes it distinct from everything else inthe market.
2- Marketing Mix, The Four Ps: The marketing mix is a set of tools that allow you to crafta clear marketing direction and tell your story. Product is the tangible physical product or service you provide. Price effectively positions you in the market. Place is where you distribute and sell your products to customers. Promotion includes everything from traditional marketing with advertising and PR, to new media marketing on social media. 3- Social Media: Social media is a powerful and affordable way to buildawareness about your brand. Only engage in those platforms that address yourtarget customer.
Be aware that it takes time and resources to manage andprovide content on social accounts, so it is probably the right choice to beginwith only one or two social media channels. 4- Public Relations: When you have things to share, new products coming out orannouncements to make, working well with different types of publications isgoing to be a key part of building your brand. 5- Advertising: Advertising can help you reach a large audience, control andincrease brand awareness and secure press coverage. However paid media comes ata high cost and it will probably be a long time before you can afford it.
2- Finance YourFashion Business?A- Equity: Equity investors provide cash to invest in your business.The best equity investors can offer you smart money, which is money that comeswith expertise; contacts and other types of advice that can help you build yourbusiness.B- Debt: Debt financing usually comes in the form of a loan. Takingon debt will mean that you will have additional cash outflow that your businesswill have to support each month and that can be an additional burden for abusiness to bear in the early stages. C- Other Income: This can come from a variety of sources, including awardsand competitions and providing advice or services to other companies.
3- Write a FashionBusiness PlanA- Executive Summary: The executive summary is at the beginning of business plan,but should be the last thing to write. It encapsulates all the key points,ideas and objectives of business in a very short and concise “elevator pitch.”B- Vision &Objectives: This section willhelp investors, and anyone else reading your business plan understands whatparticular market need you are going after and what you will offer that isunique and differentiated.C- Market &Competitive Landscape: This sectiondescribes the market that you plan to operate in. How big is the market? Howfast is it growing and what evidence do you have that this part of the marketis a viable opportunity?D- ImplementationPlan: This is probably the most detailed sectionof business plan, identifying the specific actions that business will take togo after the market opportunity you have identified. Ideally, it should coverthree years of activity, on a seasonal basis, and should include everythingfrom how you communicate as a business and the staff you will hire, to thespace you will need and the outside expertise you will require, in terms ofmarketing, communications or PR.E- Financials: Financial plan shows how your business will grow in terms ofboth profit and revenue and what financing will be needed to make it happen. 4- E-CommerceA- Starting a fashionbusiness is an intense, all-encompassing experience:Running a small fashion business is a 24hours a day, 7 days a week commitment requiring militant self-discipline.
Youwill need to think of yourself as a CEO first and will likely spend less than10 percent of your time designing. B- There are four keysteps in the fashion value chain: Production & Supply Chain: Design & Development. Marketing & PR: You will not be able to sell your collection unless people know about it. Sales & Distribution: The last step is to distribute and sell your products. C- Focusing on fourcritical success factors will help to increase your chances of success: Bring something unique to the market: Carefully craft your business concept. It is essential that you have an idea of the person you are designing for. Find a business partner or advisor: To help realize the business that you want to build, find someone who can work side by side with you to help manage your business.
Use your network of contacts: Building a fashion business requires access to all kinds of people and resources Manage your cash tightly: Too many designers have been in the situation where they have orders to fill, but insufficient cash to buy the raw materials to produce and deliver those orders. Fashion productmanagement:1. StakeholderManagementKnow your stakeholders.
Without knowingyour market and customers, the chances are high that you will fail. A companyin the fashion industry has to deal with trade organizations, suppliers,sponsors, buyers and distributors, partners etc. Transparency, communicationand collaboration with these stakeholders are important for a company to growand succeed.
2. PlanningThere are many types of projects infashion, ranging from opening a store (physical and/or online), launching aproduct, organizing a fashion show, to entering a new market or market segment.You need a plan for each of these projects and have a clear vision of what youwant to achieve with the respective project.Project plan needs to factor in all thenecessary steps to successfully reach your goals. To launch a product, you willhave to design the product first, and then plan demand and start producing.After that you have to decide on the pricing and sales budget.
Your plan shouldalso include market research and marketing measures. These are only a few stepsin the process of launching a new product. 3.
Changes and RisksFashion companies need to identify possiblerisks (production failures, supply chain errors, etc.) also need to be awarethat customers are much more conscious of the social impact of fashion’spursuit of producing clothes as fast as possible.4. AgilityAgile allows for more flexibility and helpsimproving processes, such as sales, customer management or supply chainmanagement, leading to higher and faster turnover of products – which can inturn give you a coveted leading position.5. TeamworkIt’s important that fashion companiesfoster a collaborative and creative culture. Avoid misunderstandings betweenteam members by communicating information early and often.
Fashion management inR&D Sections (Strategy and business models):Business models are necessary features ofmarket economies where there is consumer choice, transaction costs, andheterogeneity amongst consumers and producers, and competition. Profit seekingfirms in competitive environments will endeavor to meet variegated consumerwants through the constant invention and presentation to the consumer of newvalue propositions. But when we think of design, we often focus on the creativeside alone. This is no doubt important. Make design process more effective andprofitable by following these six steps:1.
Pore over salesresults each seasonImportant metrics to focus on are: unitsales, total volume, sell through percent, net gross margin, net average retailprice and returns. A quick note on the all-important sell-through, however.Sell-through is only a function of the success a product achieves related tohow you or your buyers purchased it. So, while this is an important measure, itcan exclude some important contextual information that should always beconsidered, as well. 2. Talk to floorassociates and check out the competitionInitiate these relationships as often aspossible and encourage the associates to speak candidly about what is and isn’tworking, and what’s missing. As an added bonus, you may be pleasantly surprisedby the attention your product gets on the floor once an associate is betteracquainted with you.3.
Gather first-handcustomer feedbackThere is nothing quite as valuable as adirect interaction with customer. Reports may tell what consumers bought, butspending quality time with them or at least watching them shop will help tounderstand how and why they make purchase decisions. Spend as much time aspossible on the floor interacting with your customers. And if possible, whenvisiting your accounts, observe (or work!) the sales floor. Trunk shows are anothergreat way to meet customers directly.4. Develop acollection planThere are three fundamental elements toplanning a balanced collection and it’s essential to keep these in mind.
The Base: Every successful fashion company rests upon the success ofone or two items which form the foundation of the overall product assortmentand a more predictable stream of revenue around which a real business can bebuilt. These products don’t change dramatically from season to season and theybecome the staples of your product offering. The Middle: In the middle are the products that you adapt and refresheach season with new colors, fabrics or prints, but the basic silhouettesremain the sameThe Top: At the top of your collection are the purely seasonalelements which are more about driving interest and bringing new energy to yourproduct mix. 5. Consider costscarefullyMake sure that you are designing anddeveloping a product that can reasonably be produced. While that may sound likean obvious point, many talented designers create beautiful concepts that proveto be too expensive or complicated to produce at scale.Products should have clear cost targets,derived from working backward from final retail pricing.
Make sure to build ina realistic margin for yourself that considers not only the pure costs ofproduction, but also other monies that you will have to spend in order to getthe product into a selling environment.6. Use a stylist –smartly!The most important outcome here isreceiving a second opinion on how the collection sits together best and how topresent it to buyers or customers.Product promotions and marketing -runways:Generally speaking, every product or event or any otherservices need a very well marketing plan so we can penetrate the market withhigh confidence and set our main goals, and to enhance our mission statement.Who said fashion weeks is only about clothing and dressesand what so ever. Runways have become a new way or idea to promote productsthat concerns fashion innovation and technology, its innovation digitalmarketing in other words. Now let’s take a look ata few of the most interestingmarketing trends seen at previous Fashion Week events:1. Selfie Style:Fashion labels are using technology to breathe new life into the selfie;London Fashion Week saw a fashion-first when Cara Delavigne glided down theGILES runway with her smartphone last February, posting aselfie video on Instagram.
Content doesn’t get much more exclusive than that.MatthewWilliamson isintroducing the Twitter Mirror backstage at its London Fashion Week show thisseason. Already becoming a regular feature of events such as The Grammys, The Oscars and even NBA games,this is a tablet usually positioned off-stage that enables celebs to snapselfies and auto post them to the event in question’s Twitter feed. Now that’ssome creative intelligence that can be used by celebrities on runways or otherevents. The whole point of this is to give access to the fans behind thescenes, which is every fan’s dream I suppose.2. SocialShopping:Creating online buzz around your product launch or event hasbecome so valuable that some brands are now accepting social currency as a formof payment – tweets and posts in exchange for goods.
User-generated content canhelp bring out the human side of a company and reinforce your brand message.Inthis particular idea, shoppers can only buy their products just by posting onsocial media with a hashtag that concerns the brand, also with the best photosand videos being rewarded with more valuable prizes, like jewelry.3. Real-timemarketing: Real-time content means relevant content, and this makes itmore engaging. No one knows this better than fashion brands who live-streamtheir shows and post backstage content in real-time on their social channels.In the live streaming techniques, the brand is being promoted, but of courselive streaming must be streamed by a famous super model that got like hugenumber of followers. In addition to that a hashtag must be put, and prizes aregiven away to winners, such a great idea.The intersections between fashionmanagement and planned marketing:Management and planned marketing mustbe implemented in every organization or any plan.
Where do fashion managementand planned marketing intersect? With respect to management, usually focuses on fashion buying, fashion futures, sustainability, productdevelopment, range planning and digital communication. Fashion management is about the actually operation of a fashion business andrequires both an analytical mind and an eye for discovering creative andmarketable designs, with management we can understand how fashion industrieswork, and to how to coordinate runways and what to look for when analyzing afashion trend. Inthe other hand, when it comes to marketing, no doubt it’s an important elementwhen it comes to clothing. While implementing a marketing plan in the fashionindustry implementing of product development, building label name recognitionand loyalty, and successful advertising techniques must be present.
Implementing those elements will lead us to a successful penetration of themarket and to develop a plan of action with very high benefits.Technologicaltrends in fashion management:Workat the intersection of fashion, science and technology is leading to some veryinteresting possibilities. While it’s impossible to say exactly wheretechnology will take fashion in the coming months and years, we do know it paysfor apparel manufacturers and retailers to remain in touch with what’s cuttingedge. If you are looking for ways your business might be impacted bytechnology, consider these six prominent tech trends in the fashion industry:1.
Visual Search going mainstream (Find me something similar)Computervision as a technology is not new in fashion industry, but it is finally goingmainstream with heavy weights like Macy’s, Nordstrom, Target and others, usingvisual search in their apps and websites. Visual search uses color, shape, sizeand proportions to find similar items. This offers an advantage overkeyword-matched search, in which results are only as good as the searcher’sability to describe an item. Retailers are experiencing increased click throughand ROI’s are driving rapid adoption of this technology.2.
‘Fit’ becoming criticalFeaturessuch as virtual fitting rooms where you can “try on” fashions withoutever undressing, visual signage social media tickers that tally”likes” of individual articles of clothing, and scannable QR codesthat trigger detailed product information and carefully crafted marketingdisplays on handheld devices are just a few ways retailers are using tech toengage shoppers in brick and mortar locations.3. Advanced machine learning becoming an integral part of fashion technology4.Designing for online5.Wearable technologyGoogleGlass and the like have finally hit the market to marginal impact, but wearabletech (still in its infancy) is breaking through in tangible ways that are justbeginning to resonate with popular culture.
6. Big Data or is it my Data.Technologyis changing how the fashion industry makes decisions. With real time analyticsthey give actionable data that many companies currently use to makepurchasing and merchandizing decisions.Benefits of fashion management:Inevery management strategy, plan, and process benefits is present, and it issome kind of a priority, after all the whole process was built and implementedto reach benefits. It is a very big and competitive industry, so in this casemanagement must do an expert job of analyzing and leading and also controllingto set our mission statement and goal, and to reach the benefits that we areseeking for.
Without good management planning, benefits will be inevitable andour goal will not be reached. Through management fear of not having benefits ornot reaching our goal is inevitable. That’s why management is an importantelement in this industry.
Sustainable integration between fashionindustry and social technology (social media – TV):The fashion industry is truly a global industry with a longand complex supply chain – from fibers and yarn production via fabric formationand finishing to garmenting, designing and retailing. Since the late 1990s and early 2000s, the fashion industryaround the globe has been faced with structural and disruptive changes. Thesechanges led to globalization, technology (e-commerce and digitalization) andsustainability (social and social and environmental concerns); they areconnected in many ways.Mainlyin the fashion industry, the key to reach the top is social media. Reaching ahigh number of followers on social media that concerns any fashion trend orbrand, is something really big. Through promotion on social media the latestfashion trends can be reached in just a second, how? Approximately 80% ofpeople are online the entire time on the internet, just waiting and searchingfor the latest fashion trends, and just wanting to have that trend first, whichis pretty intense. Through numerous amounts of followers and especially livestreams the product or the trend that is just officially launched can reachmillions in just couple of minutes.
But these things actually take long todevelop and build.Whenit comes to television, this is a pretty good promotion too. With TV promotionyou will be impacting the missing percentage of the people who don’t spent mostof their time on social media, in this way promotion will be 100%, which is anefficient way to be promoting and trend or brand.Management Developing Methods thatharnessed the fashion field progress:The fashion and luxury sector is facing rapid business changeand people are at the heart of this revolution. It is widely accepted thatcompanies with well-organized management structures and talent managementpractices are gaining the competitive advantage. Within this sector, the challenge is finding the right peoplewith the right skill mix to enable successful growth through a phase of majortransition and expansion.
Managers and leaders in this industry must put all oftheir experience and expertise. It’s a really complex domain and the mostimportant key is just being creative to a high level.The globalization of markets and digitalization ofrecruitment methods are two key trends that are driving the need forprofessionalization in a sector that is traditionally labelled as a ‘creative’industry. In the fashion world, changes are always present, that’s why we mustbe seeking,developing and maintaining talents. In this category, we must be treating recruitment likemarketing, so we must spot and nourish the right talent which is reallyimportant than before. Innovation must take place, but the question is who andwhere? The answer to that is the strategic recruitment, which is the actuallythe key; Sometimes your best people sit in different markets and functions; itis not about looking in the immediate surroundings but looking across borders, perspectivesand experience. Using social media communities is a must also. Fashion andluxury companies can leverage their customer networks of people interested inthe products, which may in turn result in high-quality recruits.
References:1-For further development of this idea, see W. Davidow, HighTechnology Marketing, Free Press (1986).2- Osterwalder, A., Y. Pigneur (2002).
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