Sassy. Sexy. Sustainable.

That’s the future of fashion. And in this post we are going how Business Model Innovation (BMi) is the mechanism to bring it back there.

+ Time for BMi – Business Model Innovation

Not Sassy. Nor Sexy. And certainly not Sustainable.

That’s the fashion industry of today. Why?

Because it’s not sassy to buy a $10 halter top from a fast-fashion brand that’s made on the back of slave labour in Bangladesh.

Nor is it sexy to rock boots and bags mades from the skin of scarce species.

And it’s certainly not sustainable to buy clothes from the fashion houses that destroy the worlds most precious and sensitive ecosystems in order to stock their High-Street shops.

So we need a new vision for fashion, one that is sassy, sexy & sustainable, no compromise.

Unlike the Food industry, which we covered in our initial BMi post, there is no household brand that represents what #sustfash (sustainable fashion) is all about; there is no Whole Foods for #sustfash, at least not yet anyways.

+ BMi: FOOD

Rather, the fashion industry is being led through its metamorphosis by a collective of edgy upstarts & nueluxe brands who are starting from scratch; their designs, materials, business practices and processes are nothing like today’s High-Street fashion brands.

Recycled materials, upcycled designs, tribal patterns and sustainable sourcing characterize how these brands operate. We are moving past the point of burlap bags and hemp overalls, #sustfash is sexy and sassy, far more than its predecessor, the soon-to-be-dead industry of all-that-matters-is-your-image fashion. #SustFash has a soul, a pulse.

As an example, Ser Sustantavel com Estilo (be Sustainable with Style), a Brazilian blog that is on the beat of the #NewEraBiz of fashion, recently launched their runway series SP EcoEra 3.

Wholesome. Colorful. Real. Vibrant. That’s where the #sustfash movement is taking the future of fashion. Defined as – environmentally responsible, socially just, economically viable and culturally appropriate – sustainable fashion is starting to rock the runway.

Not to be completely outdone, a few big brands are starting to realize that you can only run a business with an ignorance-is-bliss / look-at-our-numbers attitude for so long. In the same way people want real, organic food, they want straight-up, sustainable clothes. The demand is building and the market potential is huge.

Will the new fashion industry meet somewhere in the middle, combining the scrappiness and brand purity of the upstarts with the scalability and experience of the icons?

Could be …

But in either case, the real breakthrough potential for fashion is related to Business Model Innovation (BMi). Because stocking a few sustainable brands in the department stores won’t move the dial. You need to create scalable entities and collective units capable of reshaping the world’s High Streets, replacing the icons of today’s fast-fashion / snakeskin-luxury world with spunky, scaleable & sustainable brands. Not just one or two, but hundreds and thousands.

What is Business Model Innovation?

A business model is defined as the rationale of how an organization creates, delivers and captures value.

+ The Key Components of a Business Model

Business model innovation is the process of reinventing the business model itself. Rather than being focused on end-product innovation, such as new materials or designs, BMi focuses on changes in the process of exchange across value chain, whether it be a new pricing mechanism, supply-chain partnership or distribution channel. In the end, it is the model itself that SHIFTS, rather than simply the product.

How do we bring BMi to the Fashion Industry?

As a first step, let’s talk about what we want to BMi towards. We need hundreds and thousands of brands that can deliver on the sustainability side without compromising the design side. Ethics and aesthetics, hand in hand.

The challenge with changing the fashion industry is that there are so many moving pieces, and the logistics/cost pressures required to make a fashion brand fly are immense. With all the factors, including materials, labour, supply chain, distribution, sourcing – it’s a lot of work.

But there are a few mid-size luxury brands, such as Brunello Cucinelli (Italy) and Osklen (Brazil), that are showing that it is possible to deliver on design without sacrificing everything else.

Given our meet-in-the-middle market thesis on the evolution of the future of fashion, it would be brilliant to have heaps of brands who can move into the mainstream market, making it both unfashionable and uncool to purchase a $5 sweatshop T-shirt or a $40 pair of plundered-ecosystem leather shoes.

How can we tweak the business model to make this happen?

Click here to view the bigger image. Download the full PDF here.

The fashion business model can be primarily broken into two main categories: mainstream retail and luxury. Mainstream retail’s business model (ie. Zara) is built off of scale, while luxury’s model is built off of margin.

The primary cost drivers are the materials, designers and labour.

The primary revenue streams are product sales, through both branded and wholesale channels. Distribution Channels is at the core of the fashion business model.

While retail’s business model is based around scale, and luxury’s model around margin, both operate on very high profit margins. From the remnants of the Bangladesh tragedy, a Mango invoice was found showing that the company produced a shirt for $4.45 and sold on High Street in London for $46. Luxury’s margins would likely be even higher because their scale is much smaller. Overall, the typical fashion brand is going to markup products with a gross margin of 75%.

Given all of the moving pieces and logistical components, fashion brands work in a lot of partnerships. Whether it is for materials, design, production, logistics, etc., fashion enterprises rely heavily on their partners to keep everything in motion. In most cases, this is why established brands argue that it is so difficult to become ‘sustainable.’

In the Market Beacons section of our #NewEraBiz research on Fashion, we analyzed a handful of companies that are making moves in an unconventional fashion. These are brands who are shaking up the model in some way, all but one (Fashion.me) in ways that revolve around sustainability:

  1. PUMA
  2. Fashion.me
  3. Eileen Fisher
  4. Catalytic Clothing

+ A New Era of Business: Fashion

  • PUMA is taking on the ultracompetitive sports apparel industry using sustainability as their core strategy. Unlike NIKE, who is focused on Material R&D (link to Sustainability …), PUMA is building their business model on transparency and developing collaborative strategies with sustainable partners (ie. PUMA Wilderness Collection);
  • Fashion.me, the Brazilian fashion social network launched in 200x by two former investment bankers, is selling ‘big data’ packages to brands based on user interaction with key products;
  • Eileen Fisher, the wildly popular New-York women’s clothing line, was built on casual style and a commitment to ethics; however, small ‘sustainable’ tweaks to the business model, such as the Eileen Fisher Repair Program (started in 2005), are what have really helped turn ;

On the macro level, there are three key areas of focus for sparking Fashion BMi:

Materials are one of the key cost drivers in the fashion business; similar to FOOD, the shift from GMO products (ie. cotton) requires a significant shift in agricultural practices and will take time to scale. There is also, however, a significant opportunity to make breakthrough technological advances to speed up the sustainability curve.

  • Cooperatives, where Fashion growers who are farming sustainable crops (ie. Organic Cotton) form cooperatives to help build their collective clout. Inversely, smaller fashion brands can create buying cooperatives to purchase sustainable materials from producers;
  • Nanotechnology, where with new nanotechnologies firms take an approach like Catalytic Clothing in order to bring cool new materials to the small-scale designers who can bring them to the market in imaginative and innovative ways;
  • Collaborative Partnerships, when two different entities find alignment in their motives, there are no limits to what can happen.

Ex. Brazil’s Osklen, a global sustainable-luxury leader, partnered not with another brand, but a country. Italy, a place known for its history of craftsmanship and design, and Osklen have come together to research six new ‘sustainable’ materials and study their potential in the market.

Given the logistical challenges and supply-chain complexity in the Fashion industry, technology can play a huge role in the evolution of the business model.

Beyond Enterprise systems to track inventory and manage suppliers, new brands can use technology to take transparency and brand experience to a whole new level.

  • Material Tracing, where enterprises use technology to trace their entire garment-creation process, from end to end, and show consumers

ex. Rapa Nui – award-winning ‘From Seed to Shop’ transparency

  • Fitting, where companies enable their customers to get a feel for the garment from the comfort of their home by embedding new technologies into their eCommerce store

ex. Embodee – Digital Garment Experience

  • Experience Apps, where companies show how their product(s) fits into their market’s lifestyle and uses technology to help expand their experiences

ex. PUMA Run Navi app

Given that distribution is at the core of the fashion business model, brands need to focus on building new channels via the Web. Especially new #sustfash enterprises, who can use the digital medium to build their market and grab their attention, then enable on-the-spot purchasing.

  • eCommerce, where established eCommerce enterprises scale their channels to help bring new sustainable brands to market, and new upstarts use ecommerce to disintermediate the channels and cutout costly middlemen.

Ex. eTailer Yoox has created the Yooxygen platform for its shoppers who crave chic #sustfash clothing. New startup Evocha is bringing high-quality garments to European shoppers at mainstream prices.

  • Networks, where startups like Fashion.me harness the power of the social web to create new networks of fashion-focused consumers;
  • Clickable Video, where companies take advantage of technologies to enable consumers to purchase garments while they watch a runway show on any one of the main digital media networks.

In the future, fashion brands will start to model their business model around nature. Models built around Closed Loop, Zero Waste and Biomimicry are closer to becoming a reality with each passing day.

Overall, fashion needs to come back to its couture roots while embracing the needs of contemporary culture. BMi is the key to enabling #sustfash to reach a point where it can scale and compete against today’s heavyweights. When this happens, fashion can come back to being sassy, sexy and sustainable, full stop!

Have you seen any great examples of FASHION BMi?


PLAN – the Business Model

The world 2 point O (2.0) is upon us. The 2.0 buzzword, used to characterize the diffusion of technology and social media into traditional markets, is permeating every industry and vertical on the planet. One industry in particular, fashion, is starting to see profound effects as a result of this shift, which is why in this edition of Business Model Breakdown we are going to analyze Fashion 2.0.

Around the world, the movement has begun to create open and borderless markets powered by social connections. It’s what we call ‘the collaborative economy.’ With technology as the enabling factor, enterprises are becoming empowered to efficiently develop and mobilize the people and resources they need to make their mark. That’s how the world 2.0 is happening.

But what’s behind this movement?

Beyond the impulse to create enterprises and ecosystems that are social, the real reason is rooted in the desire for democratization. Tired of watching big brands and multinationals dictate the rules of engagement, global communities are mobilizing to develop open, transparent markets and shift the focus from consumption to creation.

And no other industry in the world fits this profile more closely than fashion. With hordes of heritage and fast-fashion brands driving the style agenda, the emphasis has shifted from creativity and natural beauty to profitability and manufactured looks. Now, consumers and designers alike are collaborating to counter the trend and bring fashion back to its roots.

While some focus on the technology side of Fashion 2.0, we are going to focus on the social side: user-generated content, co-created fashion lines, community lookbooks, these are just a few examples of how Fashion 2.0 is evolving from this perspective.

Fashion 2.0

User-Generated Content

Rather than the brands defining the content and setting the style bar, what if the customers themselves began to write, record and create the content about the brands they love and the looks they roll with. And not just on their own personal blogs, but on the brand’s site itself.

Burberry developed Art of the Trench, which shows photos of customers rocking the iconic Burberry trenchcoat. While some photos are specifically commissioned by Burberry, others are uploaded by customers themselves; users can vote and comment on their favorite photos and share with their networks.

Community Lookbooks

As a strategy for brands to sell their wares, they create lookbooks, visual collections of selected garments that help customers visualize new clothing lines as part of a look. Naturally though, many customers have their own version of how the new clothes could be combined, and not all of them will be from the same brand. So people have started creating community lookbooks, customized versions created by users and voted on by the community.

The Brazilian website, Fashion.me, was created for just that reason. On the site, which blew past more than a million users last year, users can create their own lookbooks from an assortment of brands, vote and comment on other lookbooks, and connect with community members.

Co-created Fashion Lines

Since forever, major fashion houses have brought in sought-after designers from the top fashion schools to design their new collections. But those who attend those establishments represent only a tiny fraction of the collective design talent out there. That’s why brands are starting to tap into that latent talent by integrating their customers into the design process (co-creation).

Mod Cloth, an online women’s clothing store specializing in vintage and retro, recently completed their ‘Make the Cut’ competition where users submitted designs for an upcoming collection and the community voted on it. Now that the winning design has been selected, the next step will be put into into production and sell it on the company’s website.

While that all sounds cool and exciting, the question is, where is the business model in all this?

Business Model

Beyond just a branding tool for fashion houses, communities and shopping portals are being created to create socially-driven experiences. Rather than just click and buy, users are immersing themselves in the content, interacting with the community and expressing their tastes through their own creations. It’s evolving from the traditional one-way, you-buy-we-sell experience, towards an open-ended ecosystem where anyone can buy, anyone can design and anyone can sell.

And behind this engagement is a big business model.

View the larger full-size image(). Download the Fashion 2.0 BM Canvas (PDF).

To illustrate our point, we will use Fashion.me, the social fashion community that started in Brasil. The company was created by two former investment bankers in 2008; the duo started building an e-commerce clothing website on the weekends for their wives, when they realized how big of a need there was for a site that centralized around user-generated content. Now they are a full-scale startup which recently launched in the US.

Their business model has several revenue streams (present and future), all of which centre around the community:

Present BM:

  • Affiliate Clicks

When users create customized lookbooks, they include a selection of garments from a range of potential fashion brands, big and small. If someone from the community sees a piece of clothing on a community members’ lookbook, they can click on that item and be taken directly to the brand’s website in order to purchase the piece of clothing. In this case, the click will be marked and tracked back to the site where it originated, earning the platform a commission on the sale.

  • Sponsorship

Brands can sponsor certain areas of the main community pages in order to have their clothes featured; it’s a way to promote without creating an explicit ad.

In this case, Fashion.me has the ‘Look do Dia’ (Look of the Day), which in this particular case is sponsored by e-Closet. The assumption here is that e-Closet has paid to have their clothes featured there, but that is not known 100%.

Next-Level BM:

  • Data & Analytics

With so much rich interaction happening on the site, the 3rd potential source of revenue will be related to data and analytics. Currently, Fashion.me offers brands the opportunities to create ‘Brand Pages’ for free. As the community grows and user interaction with brands’ content increases, Fashion.me can start to use that data to analyze trending styles, understand user behaviors and forecast future patterns, all of which would be valuable to brands on the site.

Polyvore, the US-based equivalent of Fashion.me, incorporates analytics into their site to measure trends about hot products (ie. wide-brimmed hats). While it is unclear whether they would actually sell these analytics to brands, it looks like they are currently using it to increase traffic to top-selling products, which would help increase their affiliate revenues.

  • Advertising

Finally, we would expect to see advertising become a substantial revenue stream in the future as well. Ideally, they would take the time to develop an advertising-as-content strategy; otherwise the ads will diminish the quality and feel of the site.

Polyvore has ads on the side of their website from major brands as soon as you click off the main page.

The key for any company operating with the Fashion 2.0 business model is that they focus on enhancing the user experience without making the Facebook mistake – building their business model for corporate interests using advertising – so that the community can continue to grow without users losing trust in the platform.

In fashion in particular, there are a lot of big brands with a lot of money to spend who will be keen to jump on board to new sites like this in order build their presence. The risk is the site will become cliché and commercial and develop a consumption-driven community rather than a creation-driven community.

Another key is to develop partnerships with entities that have an aligned vision. In Fashion.me’s case, their major partner is Intel. Beyond just the capital injection, Intel can help them move into the US market, which is clearly high on their radar. Intel clearly has an interest in Brazil as well, the 3rd largest PC market in the world and has a highly-connected Internet population.

While what Fashion.me and other similar Fashion 2.0 sites are doing is interesting, there is a lot of room to develop it further and bring the impact of the business to a whole new level.

What lies beyond for Fashion 2.0?

Future BM

  • Sustainability

With ‘sustainable’ fashion brands just starting to get the #momo behind them, the next generation of Fashion 2.0 platforms need to start mixing values and ethics into online communities, rather than just style.

To make this happen, education needs to be integrated into the platform design, so that users know what to look for (ie. which materials are sustainable) and how to find design-driven brands that make being sustainable stylish. From there, the community can evolve and influential users can use their clout to drive business to up and coming brands and share in the profits.

+ Avant Garde: Moving Fashion Forward

  • Gen Y

The shifting demographics globally represent a huge opportunity for the first group of communities/platforms who can figure out how to make a custom-tailored Gen Y experience, especially in fashion.

Given that our generation is wired to be social, are very values-driven in our purchasing decisions, and will go to great lengths to find brands that can deliver full-spectrum performance, there is a need for new-era platforms that bring a visual, immersive and playful experience to commerce. Beyond just the cliché business trends like ‘gamification’ and ‘social commerce,’ people in our generation are looking for authentic experiences from real brands. Add in the ability to be tribal and connect with the brands that we love, and you have the future of fashion e-commerce for Gen Y.

Overall, Fashion 2.0 is an exciting movement that can bring badly-needed creativity and connectedness back to the industry. It’s part of a shift to a more collaborative economy, one that requires new business models and a new view on markets. For those enterprises who understand the ecosystem mentality and can build trusted platforms, the opportunity is massive.


PLAN – the Business Model

The Year of the Crowd is in full swing; crowdfunding is taking off in 2013. While some industries are tapping into the crowd #momo with full force, others, like fashion, need to pull up their proverbial socks. The time has come for fashion designers and enthusiasts alike to start crowding the runway and funding designers of the future.

What is crowdfunding?

Crowdfunding is a collaborative funding process where individuals/entrepreneurs can raise funding for their projects/businesses from their networks through online platforms. Project creators make a short video and launch their project online, and project backers (the crowd) each donate different amounts of money until the project is funded. What started off as small experiment in 2009 with Kickstarter has now become a red-hot industry with an expected transaction volume of $5.1 Billion in 2013.

+ Funding the Niche

How is crowdfunding relevant to the fashion industry?

Crowdfunding is helping to move capital to the industries that need it most, and fashion is definitely at the top of that list right now. With the industry in need of a radical shift, crowdfunding can spur a new generation of fashion designers and help democratize the way clothes are created.

+ Avant Garde: Moving Fashion Forward

What’s happening right now?

Fashion designers and next-generation brands from all over the world are beginning to experiment with crowdfunding as a way to bring their new clothing lines to life.

Here are three examples of how clothing designers are starting to crowd the runway:

Wowcracy

Wowcracy went of its stealth mode on Sunday and opened up the site to start accepting projects. The Italian-based entity has been promo’ing their launch since late 2012, and it looks like the veil is about to be lifted on the crowdfunding portal that promises to bring ‘Endless Fashion Week’ to its collaborators.

Wowcracy will function using what’s known as the ‘pre-buy model,’ where project backers can collaborate to help bring new collections to life. Essentially, backers will pledge to pre-buy the garment or accessory of their choice, and if the entire campaign is funded (all or nothing) then they will (technically) donate the money to the designer and receive the specified garment when the collection is finished.

Expect to see live projects on Wowcracy in the coming weeks.

+ www.wowcracy.com

Kickstarter

Kickstarter is the original crowdfunding platform that sparked the global crowdfunding movement in 2009. After having helped project creators raise millions of dollars globally, the platform is now being used by fashion designers in selected countries (US and UK) to help get new collections off the ground.

One duo in New York recently decided to launch a crowdfunding campaign for their sustainable line of activewear, made using Merino wool.

To create Opus Fresh and start re-defining adventurewear, they were hoping to raise $15,000 USD over the 90 day time period. Well as you can see, they have blown that target out of the water and raised more than 300% of their original goal; and they still have a month and a half to go!

+ Strategies for a Successful Crowdfunding Campaign

Kickstarter is built to help get projects like this off the ground. While it’s not strictly a fashion-focused funding portal, like Wowcracy, it is another great option for aspiring fashion designers to bring their ideas to life.

+ Kickstarter: Fashion Projects

Everlane

Everlane is a US-based fashion retailer committed to shaking out the middleman and helping bring fashion back to its roots. When the company was thinking about how to approach the Canadian market, one of the engineers in the company came up with the idea to crowdfund their market entry to see if the demand was there. And so the #CrowdFundCanada campaign was born.

#CrowdFundCanada campaign

So the company created their own branded crowdfunding campaign with the goal of raising $100,000 to break into the Canadian market.

And they succeeded! By raising $118,000 through their #CrowdFundCanada campaign, Everlane showed that not only can crowdfunding be used to get off the ground, but also to enter new markets.

We talked about this strategy last year, in our Building Blocks for the #NewEraBiz series.

+ BB: Test Demand via Crowdfunding

Everlane is the best example we have seen of actually executing this strategy, showing how brands can use the collective crowd power to their advantage to blaze new trails and enter new markets.

Overall, the time to crowd the runway has come. With an abundance of creative talent and a shortage of capital, crowdfunding can help connect the dots between aspiring designers and would-be backers. Suit up for a spring full of crowdfunded fashion!


+ BMi: FASHION
+ Time For BMi


PLAN – the Business Model

Wake up, it’s 2013. The time has come to kick off those sweatshop sneakers and throw on those retro runners. In the midst of a systemic sustainability crisis, the fashion industry is being shaken down from head to toe in search of a new definition of style.

Now, the next generation of brands are getting set to step onto the runway and strut their stuff sans the heavy emphasis on eco and ethical. That’s why we went on the hunt for stylish, fashion-forward brands who are stepping up and moving away from the ‘sustainability’ sidelines. Here’s our look at some of the best examples of brands who are in tune with the La Mode of Branding for 2013 and beyond:

#Raison.d’etre : LINA.Lhu

As Paris is (according to our sources) the fashion capital of the world and ‘La Mode Ethique’ is hot in the French market, we started doing a little research to see how upstart French fashion enterprises were defining themselves.

One (seemingly) brand new company, in particular, caught our attention:

However, Lina Lhu is not an ‘eco’ or ‘bio’ brand. Lina Lhu is first and foremost a line of clothes that pleases and provides a certain pleasure, but without negligence towards the environment.

(roughly) translated from LINA Lhu site.

+ www.LinaLhu.com

What we love is how the focus is, above all, on giving the people that experience that they want when they buy clothes ; that tactile pleasure and sense of connection to the garment. That is the most important thing.

BUT the clothes are made of local materials and assembled in a country nearby (Poland), and they are created consciously with respect for the surrounding world.

Therefore, Lina Lhu is a company that produces beautiful clothes, not a bio / eco brand that happens to make garments. The clothes are built to be sexy, yet because they are ‘sustainable,’ they can be made again and again (and again) for years to come.

HAUTE.gamme : EILEEN.Fisher

Eileen Fisher is one of the most progressive ‘sustainable’ brands on the market.

The company’s high-end line of women’s clothes go way beyond aesthetics.

Unlike most other high-end brands, Eileen Fisher is not cut in the image of today’s mega-fashion houses who trade status for integrity.

In February, we saw an Eileen Fisher ad in the New York Time’s Style magazine.

The first 50 pages of the magazine have glossy ads with (mostly anorexic) models from top fashion brands who don’t even mention one word about how or where their clothes / handbags were made (hmmm why would that be …). But there, on the last page of the magazine away from all the other ads, is a subtle Ampersand ad that ever so casually mentions the following:

& We’d like you to know what we’re made of. A harem pant that’s manufactured in NYC, a reversible sweater that gets its strips from organic linen.

+ Eileen Fisher: Ampersand campaign

That just-for-your-information, no-need-to-shout approach is spot on and demonstrates the best way to embed sustainability into branding initiatives without yelling.

#FOTO.collage : NAU Clothing

In its brief history, PINTEREST, the new social network that blew up out of nowhere in 2012, has already reshaped the way brands engage with their audience online.

+ The Advent of Collaborative Commerce+

Visual, artistic, and clean, the Pinterest experience is much different from (cluttered) Facebook or (hyper) Twitter. For fashion brands, in particular, it gives a much better opportunity to convey the essence of the brand using a collage of photos.

Using NAU Clothing as an example, you can see that the company’s Pinterest page gives the feeling that the company cares about more than just clothes:

+ NAU Pinterest

After all, businesses are part of an ecosystem, both within their respective industries and in the world around them. Through a selection of photos that communicate certain themes, colours and designs, companies can create a certain feel using visual media.

In the NAU Pinterest collage, you can how they use photos of people in their clothes getting out there into the world around them, such as ‘NAU in motion.’ Other PIN Boards, such as ‘urban lifestyle’ and ‘wanderlust’ show how the company’s interests extend beyond their four office walls. And their ‘fabric deconstructed’ PIN Board is there to help educate you about the materials that go into their products.

After going through the NAU Pinterest boards, you certainly don’t get the feeling they would be the type of company making their garments in an undercover sweatshop in China.

#SANS.Sustainable

To make their mark on the mainstream, leading-edge ‘sustainable’ fashion brands need to move beyond the sustainable part.

An article last month in the Guardian Sustainable Business section hit the nail on the head:

So perhaps its time to drop the word ‘sustainable’ altogether.

Not only is the global fashion industry huge in its own right but it has the ability to do what organic and fair-trade vegetables never could, and that is to make sustainability cool.

+ Sustainable Fashion Needs to be Design-Led#

Making sustainability sexy and cool – that’s where the movement needs to go. Not in a trendy, lets-pose-for-Facebook-photos way, but in a bold and sincere manner that shows what fashion should really be about ; the beauty of the people wearing the clothes.


+ BMi: FASHION
+ Time For BMi


PLAN – the Business Model


+ BMi Services

The proverbial ground underneath the fashion industry is shifting, the vaunted halls of the world’s most established fashion empires are shaking. After decades of dominance and the creation of storied brands with enough clout to develop the very definition of style, the walls are starting to crumble. That’s because a new era of avant-garde fashion enterprises are moving in and seeking to redefine what it means to be fashionable – and today we will look at what a few of these companies are doing and why it’s working.

While the majority of world’s biggest luxury fashion brands continue to embarrass themselves and jeopardize their future in the name of ‘haute couture,’ a new breed of brands are emerging to make style sustainable. In other words, they are not plundering precious ecosystems, driving mammalian species to extinction or filling sweatshops in Asia with malnourished workers to get to the top of the fashion food chain. Instead these brands are using natural materials, faux furs and the labour of professional seamstresses to create garments of haut qualité.

Performance metrics based on environmental destruction and use of toxic chemicals for top luxury brands as reported on the Fashion Duel.

+ The Fashion Duel

Moving into their place is a new set of leaders in the fashion revolution, as they make the transition from competing only on ‘eco and ethical’ characteristics to going head-to-head on style. While ‘La Mode Ethique’ (ethical fashion) is certainly a growing and respectable market, we think it is the brands that are taking the ‘sustainable fashion’ fight to the mainstream who are the true leaders of the charge. After a (brief : ) blog on ‘The New Era of Fashion’ back in December, we are coming back to look at three companies who are moving fashion forward on a few different levels:

+ A New Era of Fashion

Osklen

Target : high-end fashion market in Brazil and the US

+ www.osklen.com

Osklen is a raw and rugged luxury brand that takes its inspiration from the beautiful beaches and lush rainforests of Brazil. Originally started by designer Oskar Metsavaht in the ‘80s, the Osklen line is inspired by nature and uses a range of natural and exotic materials to create collections of great quality and durability. What makes Osklen special is that it competes at the highest level of fashion, in the luxury market, but plays within nature’s rules. That’s because Mr. Metsavaht understands that design is, and always will be, the most important part of the clothes; however, he also knows that a brand does not need to break every ethical boundary to get there.

The company has gone far beyond creating a line of sustainable clothes in order to break the design-ethics paradigm in the industry. They have partnered with the Italian government on the Traces Project to advance the research and development of renewable materials that can be produced in a sustainable way. They have also setup Instituto E to share information related to next-gen fashion principles and build a network of partners to help turn Brazil into a global leader in sustainable development.

Early last year the company did a fashion show in honour of A21 (embedded below) and then followed that up with a first-time appearance in the New York Fashion Week with its Spring/Summer ’13 collection.

Nueluxe

Target : global luxury market

The name says it all. Nueluxe is bringing a stable of new luxe brands to a network of luxury-loving professionals who want it all : style, sustainability and substance.

While not strictly limited to fashion, Nueluxe has been going about its business of adding to its already impressive network of avant-garde ateliers from all over the world. Luxury brands are bar-none the worst when it comes to social, environmental and ethical performance, as they seem to stop at nothing to meet their uber-rich clienteles’ sophisticated tastes. That’s why Nueluxe is the seeing the opportunity to bring in a new wave of luxe brands, the ones who can create unmatched experiences without compromising the species that surround it.

+ Nueluxe : Wear

After all, that’s what sustainability is all about. Instead of allowing a few of the world’s wealthiest to consume a resource to extinction, the future of luxury is about creating experiences that future generations will be able to enjoy as well.

Members of the Nueluxe community can use the platform to learn and connect with the brands at the forefront of this change, and gain access to exclusive discounts and product offers. Check it out!

+ www.nueluxe.com

Modavanti

Target : everyday fashion buyers who are conscious about their purchases

+ www.modavanti.com

Derived from the Italian words ‘moda’ and ‘avanti,’ Modavanti is an online boutique that sells fully sustainable clothing lines. One of the major factors that separates Modavanti from other similar online retailers is the site’s design and branding. The site does not scream green, or sell clothes that are heavy on sustainability but light on style; instead it has created a store that looks like a real fashion store.

Modavanti makes sure there is real substance behind the brands you are buying. Beyond just selecting and stocking the brands, they have created a clean and colourful system to show the specific ‘sustainable charareristics’ of each brand. What’s even better is that they actually educate you about each characteristic on their Sustainability page.

Modavanti is showing what being fashion forward is all about. Unlike bloggers and industry insiders who write and tweet mindlessly about the hot colour for 2014 (pink, purple, yellow …), these guys have a vision for what the future of fashion will really look like … bellissimo!

What are the common threads that connect these brands?

None of the aforementioned companies incorporate eco or ethical into their name, or brand heavily around these themes. Rather they try and come out with a strong brand image that resonates with traditional consumers while at the same time educating their market about what they need to know.

The whole ‘eco and ethical’ category is very niche and represents 5% (at most 10%) of the market. For those brands that want to really make an impact on the mainstream market they need to embed sustainable principles into their collections and not try and win consumers over on strictly ‘ethical’ branding arguments.

People who are purchasing clothes are primarily interested in the style and price. If the clothes don’t look good, the average person is not going to buy them, even if they were made using organic materials from a poor rural village in India. If you want them to pay more because they were made using sustainable practices (research suggests they would pay a 10% premium, verus 25% for tailor made#), you need to educate them as to why and develop a premium brand image. It doesn’t conjure up images of sexiness and style to talk about ‘eco trousers’ or an ‘ethical short sleeve.’

This is especially important if you want to target generation Y. People in our generation expect things to have certain qualities and are not willing to sacrifice quality just to fit a certain ethical profile. The new breed of ‘sustainable brands,’ those whose end products are in-sync with their social and environmental surroundings, will find Gen Y to be a very big and receptive market. But to hit that market, brands need to still provide the emotional benefits that the ‘unsustainable alternatives’ would provide. When it comes to fashion, people just want to look good and rep brands that match their lifestyle.

Just like the food market has made the move to everything organic, fashion is in transition to become its own version of ‘sustainable.’ There has been a lot of recent movement at the top levels, thanks to campaigns like Detox fashion, despite the fact that many of the traditional luxury players seem to hobbled by their heritage. But the movement at the bottom is exploding, and by the time many major labels reach fully sustainable levels (by 2020 according many Detox responses), a new crop will be arising. So suit up and lace ‘em on, because the fashion revolution has begun.

Do you agree or disagree that avant-garde fashion enterprises should steer clear from being too focused on ethical and eco?


+ A New Era of Business : Fashion
+ Business Model Breakdown: Fashion 2.0


Building Blocks – PLAN – the Business Model

The New Era of Business reports are focused on the future of important industries and include examples sourced from around the world.

Fashion forward – it’s a term typically used to describe the trendsetters in the fashion world, the fashionistas – but in today’s blog we are going to look at it from a different perspective, the future of fashion. Arguably the most unsustainable industry in the world, it’s time to put a new face on fashion and redefine the rules of the runway. Fast forward to a new era of fashion.

Fashion touches us all. The threads of the fashion world are sewn around us from our very first moments on earth. But the clothes we wear are not what they used to be. What started as a cultural tradition of artisan handiwork passed down through the generations has become a mass-market business of shipments being passed down the supply chain. The pressures of globalization has flipped fashion on its head – thoughtful fashion is out, fast fashion is in.

The time has come to redesign the system and move fashion forward. Within the wreckage lies an unprecedented opportunity to build an entirely new stable of brands who can bring sustainability to the world of fashion without sacrificing style and sensuality. Fashion forward begins from the bottom up.

Recently, we attended the second annual Beyond Fashion Summit in Berlin. The workshop brought together a series of experts, designers, and entrepreneurs from around the world to lead a debate about how fashion is evolving and what the future holds in store. The theme for the event was ‘Hypernature,’ a term loosely used to describe how sustainability, technology and fashion might interconnect as we move towards a new era of fashion.

While many new ideas and concepts were introduced, one theme remained constant, the industry needs to change – radically. The behemoths who dominate today’s fashion markets have built their brands behind a manufactured illusion of glitz and glamour without regard for the social and environmental consequences; a seismic shift is required. That’s is why in this post we are going to look at the future of fashion from three angles:

  • Raw Materials
  • Textile Production
  • What it Means to be Fashionable

In each part, we look at high-level examples of brands who are catalyzing the change. We will follow that up with a look at our Market Beacons, companies who we think are redefining what it means to be fashion forward. Then we will look at how to take action and turn the sparks we are seeing today into a full on fire.

Let’s start with the materials.

The Raw Materials

To reinvent the fashion industry, we need to start with the core components, the fabrics and dyes used to produce the clothes. The fashion industry generally has two options to choose from when it is selecting materials to use for its designs, natural and synthetic. Natural materials are sourced from the natural world and include fabrics such as cotton and wool, whereas synthetic materials are created using chemistry and include materials such as polyester and nylon. Once the materials are selected, the majority are then dyed using an array of chemicals, many which have toxic properties.

Just because some materials are natural and others synthetic does not mean that one is necessarily better than the other. On one hand, polyester, the most widely-used material, is synthesized using an energy-intensive process that requires large amounts of crude oil; cotton, on the other hand, grows naturally on cotton plants but requires a huge amount of water (2,000 L to produce the average T-Shirt) and large amounts of pesticides (10% of all pesticides and 22% of insecticides are sprayed on cotton globally). This environmental impact, coupled with the social externalities from these industries, is why we need to take a hard look at the materials used to make the clothes we wear everyday.

So who’s entered the market to start shaking things up:

People Tree : Fair trade and organic cotton

People Tree is an organization that is focused on bringing fair trade to fashion and helping to expose the realities that make the majority of the world’s biggest fashion brands so immensely profitable. Founder Safia Minney started her career in the advertising industry, but it didn’t take her long to see behind the curtain and realize what fashion was really about.

People Tree’s garments are produced using 100% organic and fair trade cotton from rural farmers in the global South. Cotton can be grown as a rotational crop, reducing water consumption by up to 60%, and without the use of heavy pesticides. The company, which started in Japan in 1991, has spread throughout UK and Europe, with over 450 Stockists and ever-expanding inventory of fair-trade artisan garments.

+ http://www.peopletree.co.uk

Rubia : Natural Clothing Dyes

Rubia produces 100% natural dyes derived renewable sources. The madder plant, which was used as a dying agent as far back as 1350 BC, is the primary agent used to create Rubia’s dyes; the plant was phased out of production last century as synthetic agents began to reach the market, but is making a comeback thanks to its environmental and chemical properties. The resulting dyes, which are produced in powder form, come in a variety of different colours and can produce a level of quality beyond that of synthetic compounds.

+ http://www.rubiapn.nl/

Ploughboy Organics : Waste to wearable

Ploughboy Organics is taking the waste from one of the world’s most controversial substances, tobacco, and turning it into clothing. Using their patent-pending technology, they are turning the waste from the tobacco plants into their Onatah Fibers and Avani dyeing agents. Scheduled to be released in 2013, Ploughboy is taking a waste from a previously unthinkable source and transforming it into a fiber with brilliant and enduring properties. The reused tobacco fiber contains 30% vanillin and has 29 colours that are lightfast, colourfast and meet all testing standards. Because tobacco can be grown anywhere where the tundra does not freeze, there is an abundant source worldwide.

+ Ploughboy Organics

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While it’s not expected that we are going to suddenly return to 100% organic materials, or start making the majority of our clothes out of tobacco fiber, the transformation has to start somewhere. In the same way that only a few years ago organic food was seen as a high-end item, organically sourced materials may start out in higher-priced garments before becoming the norm over the long term. Here are a couple of examples of companies in the market who make it easier to source and evaluate materials:

Source4Style

+ http://www.source4style.com/

a hip site dedicated to helping designers source sustainable materials from around the world

Blue Sign

+ http://www.bluesign.com/

a material rating company dedicated to tackling the problem of material inputs, they have created their own proprietary black, grey, blue rating system to help brands manage and control the inputs in their production process.

Textile Production

Once the materials have been produced and the designs selected, the clothes go into production. While it may be natural to assume that only a few exploitive brands would engage in child sweatshop labor, as Nike did in the ’90s, the reality is that the process is as common now as it ever was. Countries such as Bangladesh compete to be the low-cost textile producer and setup factories in slums where child workers work 100+ hour weeks for a barely livable wage. Fashion editor Liz Jones wrote a story in the Daily Mail two years ago, ‘The Real Price of your £5 jeans,’ detailing the practices of fashion megabrands such as Primark who exploit child labour to make fast fashion as profitable as it is.

The whole cycle of textile production needs to redesigned from the ground up, and that starts with transparency. Rather than outsourcing production to foreign countries and using child labour to pump out cheap, generic garments, we need to return to the era of the artisan and localize aspects of production. And with so many clothes already on the market, many old clothes can be recycled, upcycled or simply rebranded (ie. vintage) to give them new life.

IOU Project : The return of the artisan

The IOU Project is a new social enterprise created by Kavita Parmar that is designed to bring back the story to the heart of the clothmaking process and connect consumers to the garments they purchase.

By sourcing fair-trade garments from artisans in countries such as India, the company endeavors to decommoditize fashion by focusing on the supply chain. While currently selling their garments online and through trunk sales, they will eventually be trying to white-label their platform to major fashion brands.

+ http://iouproject.com/

Junky Styling : upcycled

Junky Styling is a UK company that deconstructs and reconstructs men’s garments, including suits, blankets and anything else they can source from local charities and agents. They then remake and remodel these old clothes into a sexy, sassy collection.

For those consumers who have treasured olds garments that they loathe to part with, Junky Styling offers Wardrobe Surgery, a process whereby they will take the old garments and restyle them into something completely new and unique. Junky Styling is transforming would-be throwaways into something worth showing off.

+ http://www.junkystyling.co.uk/

Remei : end to end transparency

Remei is a Swiss company that has been committed to fair trade and sustainable fashion since its inception. Using their own bioRe® philosophy, the company adheres to stringent social and ecological requirements throughout their entire production process, which is audited by independent institutions.

To take their process to the next level, Remei is developing an end-to-end online system to show consumers the traceability of each and every garment produced by the company, including production, transportation and distribution. Starting in mid 2013, a consumer will be able to buy a garment and scan a unique QR code on the label to see the origins of the product.

+ http://www.remei.ch/en/

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While it won’t be feasible for every fashion label to implement end-to-end transparency, or source 100% of production from artisans, it all begins with a step in the right direction. Examples of big brands who are incorporating these principles into their actions include:

Top Shop

+ http://www.topshop.com/

In July of this year, Top Shop introduced it’s ‘Reclaim to Wear’ collection in it’s Oxford location in London. The new collection is made from upcycled materials from surplus stock and production offcuts in collaboration with eco-fashion label From Somewhere.

Patagonia

+ http://campaigns.ebay.com/patagonia/

Last year, Patagonia, maker of high-end outdoor apparel and one of the most sustainable companies in the world, launched their Common Threads initiative, allowing customers to resell old Patagonia jackets online through a partnership with eBay. Beyond being a well-thought out move sustainability wise, it was also a brilliant branding move by demonstrating the durability and endurance of Patagonia’s products.

What it Means to be Fashionable

While it’s great in theory to create fashion that is in-sync with the world around us, it won’t matter unless we change the culture around fashion and redefine what it means to be fashionable. Nobody wants to wear clothes made from toxic materials using exploitive labour practices, and yet the majority of the clothes we wear are precisely that. Why? Because it’s cool to do so. Fast fashion is chic, it’s stylish and it’s cheap, in the same way that ordering a Big Mac is filling, delicious and light on the wallet. We feel good for a brief period in the moment and then regret it soon afterwards. Why do we do it?

To try and reach the (unobtainable) image of beauty and stylishness fed to us by the media. We are surrounded by sexy models whose photos are fixed-up on Photoshop to make us believe in flawlessness and fed celebrity endorsements that paint luxury as must-have social symbols. Lost in the process is the natural beauty of people, the importance of individual style and the connection to the real designers.

It has to change. Fashion should be fun, energizing and customized. The days of traditional tailoring and hand-sewn everything may be gone, but the old-school principles can be reapplied to make a new era of fashion come to fruition. Here are a few examples of what needs to be done:

Sustainable and Eco → Sexy and Stylish

Most people don’t want to buy something that screams ‘Save the Whales’ or ‘I am Eco,’ nor do they want to buy a wardrobe full of hemp clothes and carry a purse made of burlap. Fashion being fashion, is meant to be sexy and give people the confidence to step out everyday and do what they do best. Rather than striving to be ethical or eco, brands need to embed these principles into the brand, be transparent about their activities and focus on giving consumers what they want (stylish clothes).

Earlier this year, the Brazilian company OSKLEN launched its A21 collection in accordance with the Rio +20 Sustainability conference in Rio de Janeiro. Founder Oskar Metsavaht believes that the best way to advance the sustainability agenda is to embed it into the collection rather than letting it define it, and promote a mindset of consciousness about the world around us. Check out the funky collection below by one of the world’s premiere fashion brands (embedded above).

Mass-Market Generic → Customized and Co-created

The new era of fashion is all about customization and co-creation. To reverse the trend of fast fashion, brands need to get customers involved into the design process and build a community around a line of customized and creative apparel. Crowdsourcing certain elements of the production process will not only help develop more inspired designs, but also help create a deeper sense of connection to the clothes that are produced for everyone involved.

UK-based SketchStreet has created a platform to co-create design collections, which was built around the idea of ‘Let’s Do it Together.’ Everyday designers submit their designs to the site, which are then voted upon by the community. From there, samples are created, pre-orders are made and then the garments are sent into production. The new designs are then added to the company’s online Shop, making the SketchStreet collections fully co-created.

+ http://www.sketchstreet.com/

Model Mashups → Small Touchups

Many of the photos we see on billboards and in shops are no longer just moderately Photoshopped images, they are full on mashups. A few image touchups here and there might be necessary, like a pimple on photoshoot day, but to fully manipulate images to create a certain image of beauty is beneficial to nobody. The return of real models photographed as their natural self will help bring the expectations of what we need to look like down to earth.

Leni’s Models Management was the first ethical model agency to be launched. Former model Eleni Renton saw the effects that industry practices were having on young models and decided to create an agency around being natural. Beyond just finding the models contracts, the agency educates young models about how to manage themselves, eat properly and live life. The company’s mission is to ‘promote a more realistic image for women and reject the ‘size zero’ look.’

+ www.lenismodels.com

Market Beacons

PUMA

Puma, known for its stylish sports apparel, has started to bare its teeth in the ultra-competitive shoe and clothing industries, but with a slightly different strategy than its competitors – transparency. The company has taken reporting on its P&L statement (Income Statement) beyond just the typical greenwash jargon, and shown some new metrics to demonstrate the company’s environmental and social impact. In 2012, they reported on the overall environmental impact of the company’s activities on their P&L, but in 2013 they will take it to a whole new level by reporting on the impact of each individual product and displaying the overall environmental cost information on the price tag.

Along with reporting on their products, they have several design initiatives aimed at reducing the collective impact. Two years ago, they launched the Clever Little Bag initiative (embedded above) in collaboration with renowned designer Yves Behar. In 2013, they will be introducing a line of biodegradable shoes and shirts. PUMA is pushing the envelope in the world of sport and lifestyle fashion and building themselves a sustainable advantage in more ways than one.

+ www.puma.com

Fashion.me

Fashion.me is a new Brazilian startup that is fusing together fashion with the social web to create a collaborative platform where users can create their own looks and style collections using a range of designer labels. Conceived by two former investment bankers as an experiment, the original Fashion.me site was launched as a gift to the duo’s wives in 2008.

As of June, the company had 1,000,000 users in Brazil, and raised capital earlier this year from Intel Capital to finance their expansion into the US. Users can create their own looks from a few million different labels, interact with other users on the platform and even dress up virtual models. The site is bringing the fun back to fashion and showing the enormous potential enabled by collaborative platforms.

+ www.fashion.me

EF (Eileen Fisher) Lab– concept store

Eileen Fisher is an elegant women’s fashion label based out of the US that has built a strong following through its focus on simple design. The designer launched an Eco Collection that uses a variety of organic materials sourced from diverse countries such as Peru. To expand the company’s impact, they have created several philanthropic initiatives to support women’s entrepreneurship.

To merge the company’s vision together, they opened up the EF LAB store in New York in 2009. The LAB is unique because of the product assortment it offers: new clothes, last season’s clothes, samples and recycled clothes. To incentivize recycling, the EF Foundation setup the Recycling Reward program out above), which rewards customers for recycling gently used clothes. Any profits from the Recycling program are donated to one of the company’s philanthropic initiatives. The EF Lab demonstrates how a combination of creativity and vision can come together to bring sustainability to the consumer level.

+ www.eileenfisher.com

Catalytic Clothing

The future of fashion will include creative uses and applications of high-level technology. One promising technology is nanotechnology, an advance that enables scientist to manipulate matter at a molecular level. Catalytic Clothing is a new project based out of the UK that is striving to reinvent what’s possible with fashion by creating a fabric that can clean the air while being worn.

Started as a venture between designer Helen Storey and chemist Tony Ryan, it is a large-scale partnership between the University of Sheffield, University of London Arts and the London College of Fashion. The goal is to use photocatalysts on their Catalytic Clothing to break down pollutants in the air. These catalysts are activated in the wash cycle, and have been applied to the first generation of products in the Field of Jeans project. The idea is that multiple people wear the products, air quality can be vastly proved. Who said fashion is only about style?

+ Catalytic Clothing

Action

Fashion forward begins with the individual. The choices we make when we buy clothes, the way we talk about fashion amongst our friends, it all adds up.

The greater impact, however, comes through entrepreneurship and the creation of new models to build a sustainable ecosystem. The Blue Ocean opportunity that lays ahead is enormous and can be approached from numerous different angles.


+ BMi: FASHION
+ Time For BMi


PLAN – the Business Model