Maria Fruci is following the holiday shopping season closely. She not only is analyzing how consumers are buying, but how much they are buying — and the changing nature of their purchases.
Fruci, the co-chair of the Fashion Law Practice at Genova Burns, said the COVID-19 pandemic has changed everything.
“While the need to buy gifts — and the usual general increase in shopping and spending will likely increase sales for fashion companies and retail stores — the reality is that people aren’t shopping for all the same pieces, anymore,” she said.
“The work from home trend will likely spill over to holiday shopping, where many may opt to buy more casual wear, over formal work or ‘going out’ pieces, which also affects the accessory fashion world like shoes, handbags and jewelry.”
Increasing online sales impacts total consumer spending, Fruci said.
“The issue here for the fashion world in particular is that online shopping doesn’t always lend itself to that same pattern of buying — or in the same quantity — as when perusing the racks in your local favorite shop,” she said.
And Fruci notes that greater online shopping isn’t the only thing reducing sales. The pandemic’s impact is felt here, too.
“In light of smaller or nonexistent holiday gatherings, people may also not need as many gifts as in past years,” she said.
Holiday season sales are just the latest part of the industry that has been so greatly impacted by the COVID-19 pandemic:
- In the spring, many factories in garment-producing countries such as Asia shut down due to a shortage of raw material being imported from China and a steady decline in orders from clothing brands in the West;
- In the summer, large retailers Neiman Marcus and Lord & Taylor both filed for Chapter 11 bankruptcy protection, with Lord & Taylor expected to permanently close all its stores by the end of the year;
- In the fall, New York Fashion Week had a new look, with the traditional runway setting being replaced by virtual events.
These events will have impact long after the holiday season.
Len Spinelli, a bankruptcy lawyer at Genova Burns, said a Chapter 11 filing impacts more than just the company doing the filing.
“When a small designer or fashion house is faced with a reorganizing retailer, the business should be cognizant of the contractual relationships they have with these stores and understanding how the bankruptcy process and the proposed Chapter 11 plan may impact their relationships, contracts, receivables and consignments,” he said.
And Fruci said next year’s offerings already have changed.
“A lot of fashion designers aren’t going to be putting out a new line next year,” she said. “They’re going to reuse a prior season’s collection. … They haven’t sold to the level that they would want and there will be just way too much leftover inventory.”
Carmela Spinelli, a fashion historian and the director of fashion design at Savannah College of Art and Design, said there has been a “pandemic pivot” in the industry.
“Designers (are) creatively communicating their collections with other media and replacing the costly traditional fashion show,” she said. “Many designers are opting not to show it all — instead, creating video content with a storytelling and a narrative that takes the viewer through their collections in a creative way.
“At Moschino, the designer Jeremy Scott created a fashion show online using marionettes, a full fashion show with puppets. JW Anderson sent editors a ‘Show in a Box’ filled with images of the garments, fabric swatches for the tactile experience and a narrative about the collection.”
While COVID-19 led to these adjustments, Fruci said changes in the industry had been coming for a while.
“There was an existing malaise in the fashion industry well before the pandemic hit, from the cost of fashion shows, to the fashion calendar and the timing of deliveries,” she said. “What COVID did was accelerate the ideas that were being discussed before the pandemic into action.”
The future of fashion will be different, she said. How it will be remains to be seen.
“The world is now very different than it was pre-COVID,” she said. “While e-commerce had a significant impact on sales, online shopping has skyrocketed and social media tools have never been more important. This is an interesting time in fashion history. We’ll have to wait and see what’s going to happen next with all these seismic changes.”
While most of the impact of the pandemic can be viewed as negatives, Spinelli said there are some positives to take away.
“I think that there was a shift generally to more a more liberal approach to the work environment that that was kind of underway in in the years proceeding,” he said. “I think that what the pandemic is showed us is two things. On the one hand, remote work and working from different locations and not being in office is feasible. On the other hand, I think it’s also not necessarily an end-all, be-all solution.
“I think there’s going to be a balance struck between working from home and working on site.”
This transformation will greatly impact the fashion world as the nature of work clothes surely will change, Fruci said. But she cautioned it will not be a complete transition.
“I think, because work from home has become feasible, it’s going to be much more widely accepted,” she said. “On the fashion side, things are certainly going to change. But I don’t believe we’re going to be doing away with work clothes or formal wear any time soon.”