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Dear Reader, The eighth annual State of Fashion report by BoF and McKinsey & Company reveals an industry navigating deep uncertainty. Causes for concern include geopolitical events, weakened economies and the continuing impact of high interest rates. Yet executives also see some reason for optimism in specific markets and segments.
Below is a snapshot of the 10 key themes set to shape the fashion industry agenda in 2024. Download your free copy of the full report to learn more about each theme and understand how to prepare for the year ahead.
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1. Fragmented Future: As new and ongoing financial, geopolitical and other challenges weigh heavily on consumer confidence, fashion markets in the US, Europe and China are facing differing headwinds, requiring suppliers, brands and retailers to bolster contingency planning, among other measures. 2. Climate Urgency: The climate crisis has become even more visible, leaving the fashion value chain especially vulnerable — more than $65 billion of apparel exports are at risk of being wiped out by climate events such as flooding and extreme heat by 2030. 3. Vacation Mode: Consumers are gearing up for the biggest year of travel since before the pandemic. But a shift in values means travellers have a different set of expectations, even as shopping remains high on the agenda. 4. The New Face of Influence: A new guard of creative personalities is gaining brands' attention, winning trust and fandom among key audiences. Working with these personalities in 2024 will require a different type of partnership, an emphasis on video and a willingness to relinquish a degree of creative control. 5. Outdoors Reinvented: Technical outdoor wear has been propelled by consumers' post-pandemic embrace of healthier lifestyles as well as "gorpcore," and is likely to accelerate even further in 2024. |
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"Industry growth is forecast to be between 2 percent and 4 percent, with potential growth opportunities coming from a rebound in global tourism, with travel flows reaching up to 10 percent above pre-pandemic levels and innovations presented by generative artificial intelligence." |
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6. Gen AI's Creative Crossroad: Capturing the value of this transformative technology in 2024 will require fashion players to look beyond automation and explore its potential to augment the work of human creatives. 7. Fast Fashion's Power Plays: Fast-fashion competition will likely become even fiercer in the year ahead. Challengers are changing tactics around price, customer experience and speed. Success for disruptors and incumbents will likely hinge on their ability to adapt to evolving consumer preferences, while navigating regulations that may impact the industry. 8. All Eyes on Brand: Brand marketing will be back in the limelight in the year ahead as the fashion industry confronts a shifting landscape in which performance marketing no longer reigns. 9. Sustainability Rules: The era of the fashion industry self-regulating sustainability is drawing to a close around the world. Across jurisdictions, new rules could have a widespread impact on both consumers and fashion players. 10. Bullwhip Snaps Back: Changes in consumer demand have resulted in the "bullwhip effect," where cuts to orders increase in magnitude at different parts of a supply chain, putting pressure on fashion's suppliers. Now, if supply is to keep pace with anticipated renewed demand, brands and retailers should consider focusing on transparency and bolstering strategic partnerships. |
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| AGENDA-SETTING INTELLIGENCE, ANALYSIS AND ADVICE FOR THE GLOBAL FASHION COMMUNITY. |
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