To tide over disruptions like COVID-19 and become future-ready, fashion companies need to align themselves to new trends, says a new survey by IMD’s Center for Future Readiness. Pointing to the latest financial results of footwear and apparel brand Nike, the survey highlights its sales growth to $10.36 billion in the current financial year from $10.1 billion in the same period last year and credits this to focus on digitization.
Advance analytics to facilitate product movement
To discover the benefits of digitization in the fashion industry, the IMD center downloaded all reports published in the last 10 years by The Wall Street Journal. CNBC, The Financial Times. All corporate press releases were converted into an algorithm to track the digital evolution of fashion brands. It used hard market data to calculate the composite score. The survey measured fundamental drivers that fuel innovation in companies like their financial health, growth prospects, employee diversity, brand value, its degree of internationalization, and the early results of its innovation efforts.
The survey also analyzed the e-commerce presence of these brands in mobile apps, live-streaming, omni-channels, and their direct-to-consumer engagement. Further, it evaluated their fanbase on social media, their search volume on Google and their sustainability standards. Digitization can help companies offer customized products to customers within weeks. For this, they need to automate tracking and coordination with external partners. They also need to use advance analytics to gather the latest market insights. This can help them to categorize and move products based on demand. The survey also advises companies to discover stores that need specific products and deliver accordingly.
Not just an option
The survey showed, beginning its digital journey much earlier in 2017 helped Nike counter the negative effects of the lockdown-related store closures during the recent pandemic. The brand reopened almost 90 per cent of its stores. Yet, its digital sales are expected to continue growing in double digits, helping it to rebound faster. Therefore, digitization is no more just an option for fashion brands, it’s the only way they can stay relevant in the current turbulent market.