Response to Changes in The Fashion Industry. Over the last 20 years, the fashion apparel industry has greatly evolved through its changing dynamics. Through the fading of mass production, modified structural characteristics in the supply chain and the increased number of fashion seasons, the retailers have been forced to desire flexibility in design, quality, delivery and speed to market, and to desire low cost in fashion production. The competitiveness in the industry of fashion have been identified to be marketing and capital investment in addition to speed up design and market. Since the fashion industry is increasingly becoming dynamic and its market becoming so demanding, the key strategy to keep profitable position maintained is through
The composition of luxury market is changing and to meet such changes such brands need to ladder down to lure its varied customer base as now even customers are ready to experiment. From being “Armani loyalists” they are now ready to switch brands and have widened their horizon of luxury items.
Other criticism explains that, although the innovative products have an evolving supply, there are some exceptions; fashion apparel products are one. Even though, how explained above, they are innovative products, they have the peculiarity to follow a stable supply process. In fact, their supply is represented by a well-developed system and a mature and technological process of manufacturing (Lee, 2002). Additional theory based on Fisher's model As a consequence of the spread critics against Fisher’s Model, which refers only to the mass markets, others authors have introduced additional categories, in order to determine the best supply chain for the luxury segment. Sure enough, Fisher’s model has also generated additional theory.
Introduction Sustainability and environmentally friendly production are a growing trend amongst consumers, which is evident from current retail companies, including fashion businesses (Wiese, Kellner, Lietke, Toporowski & Zielke, 2012). The fashion industry is a large, fastly changing, international industry that ensures about 20 million people with employment. Unfortunately, the large size and the rapid development and disposal of products results in negative consequences, such as polluting production and poor labor conditions, which have gained a lot more negative media and consumer attention in recent years (Pedersen & Gwozdz, 2014). Thus the fashion industry experienced social and institutional pressure to change their ways from both
Fashion is a very big industry and luxury its is other name . The term fashion and luxury have always gone hand in hand since the very first time fashion came into being . Fashion came into being in the form of a revolution and ever since has flourished itself in the same way . As fashion revolutionized it entertained the elites and thus adopted the name luxury. As fashion replaced its name as luxury peoples taste and preferences became more specific and sophisticated and so the concept of luxury brands came into existence.
Customers do not want to switch to purchase different brands, as such they hold some bargaining power to drive the demand. In the luxury industry, it is possible that existing companies or new designers could enter internationally. However, the brand positioning serve as a serious barrier to create awareness due to customer loyalty and acceptability of the brand. In this case, threat of new entrants is relatively low. Luxury products are not easily substitute as it is not an ordinary goods but the threat can derive from imitation.
Weakening demand in Europe market Although the largest luxury goods market is in Europe, which constituted 37% shares of the total luxury market in 2011, the demand has decreased due to recession. The estimated growth rate in Europe in 2012 is about 3%. The slowing down of the economy has caused great impact on the luxury market. Also, to reduce the price differences, the company strictly controls on pricing for each sales regions. For instance, the company increased prices in Europe by
ADVERTISING LUXURY Luxury brands furnish a affluent arena to examine branding processes. Advertisinf stays the guardian of the luxury brand and is frequently the central envoy of the viewers brand relationship. Advertising is frequently described to be a method of grasping a mass marketplace because it utilizes the mass media. Role of advertisements in creating a luxury brand Advertising has always been the most elevated profile method of making cognizant of a brand from the main dates of daubed shop signals to banner publicizing, internet and advertorials in TV, print mass media and on wireless . Branding came to be an openly pervasive control alongside the advent of business television and publicizing was the brand darling for countless corporations.
Due to their huge success, control over suppliers can be always be maintained by the company. Rivalry among the competitors is the force to reckon with and it is the one that will decide the future profitability of the fashion industry. Competition in fashion is very high since there are only a handful of competitors when looking at the giants. Future Industry evolution Scenario 1 The future of today’s world is technology. The evolution of fashion industry should be in trend with the technology developments.
The bargaining power of the suppliers in the luxury industry is moderate. Even though these companies have economies of scale emanating from their global operations, most of them use the focused differentiation strategy on the basis of quality. This gives their suppliers some leverage over them because finding suppliers of premium materials in the quantities which these companies procure is not easy. Noteworthy, these companies must consider the time they spend in building their relationships with their suppliers. The bargaining power of the buyers is also moderate.