Australian Fashion Brands Are Scooping Up International Shoppers

Outside the United States, retail is booming. In fact, international retail sales are projected to reach $4.8 trillion USD by as soon as 2021.

But one country in particular is experiencing rapid retail growth and expansion within the apparel industry: Australia.

Currently the 10th largest ecommerce market in the world based on its $25.2 billion (USD) market share projected for 2021, Australia's online retailers are seeing major growth: Within the fashion industry alone, it's predicted Australian online fashion retailers will see a 9.7% uptick in revenue this year.

Why is that?

David Whitcroft, CFO at Full Stack Finance, says that Australian brands have an advantage in that they have to think internationally from inception (as they're launching within a small market.) If they want to effectively scale up, they'll have to connect with international shoppers outside of the country.

But that's not all. Whitcroft also explained that Australia has higher input costs (like higher wages), which forces brands to be lean and efficient.

Add to this the country's geographic location and counter-seasonality (which puts it ahead of seasons in northern hemisphere countries) and the fact that demographically and traveler-wise it's a melting pot of Asia, Europe, and the US—and you have a handful of competitive advantages.

Bonus: There's no language barrier for English-speaking shoppers.

"Don't forget the legacy global surf brands that have come out of Australia, as well as high fashion brands like Zimmerman and Colette Dinnigan," Whitcroft said. "Australia has a huge cohort of professionals who understand how to launch and scale successful apparel brands."

Australia-based fashion brand Verge Girl is one example of these retailers finding success.

Effective team-scaling and remaining direct-to-consumer have been two key components to the 2,400% online sales growth they saw between 2013 and 2016, as well as an additional 100% increase every year since 2017.

"This growth happened after we started investing more time and money into the online store and hired a team to help with execution and fulfillment," said Daniella Dionyssiou, Verge Girl's co-founder. "We moved into a larger warehouse space and gradually hired photographers, stylists, warehouse managers, an operations manager and a marketing team."

Influencer marketing has also been a major focus for the brand.

Until late 2019 influencer partnerships accounted for almost 100% of Verge Girl's marketing efforts—and they still maintain a team that focuses solely on this channel. In the past few months, however, they've also started to focus on boosting customer acquisition via Facebook and Instagram ads.

Verge Girl has also kept a wide audience: Product was available to international online shoppers from the very beginning.

That said, international sales have only recently become a major portion of the brand's revenue, now accounting for about 60% of the brand's total annual revenue.

With growth on a steady include, the brand has no plans to introduce retail partnerships (despite multiple offers), and instead plans to stick with the direct-to-consumer approach.

The reason: It allows them to focus on the consumer, to stay agile, and to maintain exclusive rights to their brand and product.

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How Retailers Can Spur Consumers To Ditch Fast Fashion

Following recent worldwide climate strikes, more and more consumers are paying greater attention to their own carbon footprints, which has spurred many environmentally conscious shoppers to rethink their affinity for fast fashion. With Forever 21's bankruptcy, talk of darker days for fast fashion has only grown louder.

But the fast fashion industry benefits from one strong selling point: price competitiveness. Shopping more sustainably is typically more expensive.

Without creative solutions that harmonize consumers' eco-consciousness and their budget-consciousness, it will be hard for many shoppers to pass up the low prices fast fashion offers. To keep shoppers from feeling torn between their wallets and the planet, retailers should take steps like supporting clothing donations, offering green shipping incentives and making greater use of recycled material, as well as financing and payment options that lower customers' upfront cost burden.

For years, consumers have flocked to fast fashion outlets to get the latest runway styles at relatively low prices, but those low prices have come at a high cost. Fossil fuel-derived synthetic fibers like polyester, nylon and acrylic now account for 60% of the fabrics in our clothes. The World Resources Institute notes that manufacturing a single T-shirt requires 2,700 liters of water, while making one pair of jeans results in greenhouse gas emissions equivalent to driving a car 80 miles.

Cheaply produced and designed with the latest trends in mind, fast fashion items aren't built to last, which helps explain why consumers keep clothes for only about half as long as they did at the turn of the century, and why the average consumer purchased 60% more garments in 2014 than in 2000. Keeping up with consumer demand has meant more production and more adverse environmental consequences, with 2014 marking the first year that more than 100 billion garments were manufactured worldwide.

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Don’t Buy, Rent - Why H&M Is Hiring Out Fashion

Fast fashion relies on rapid turnover and few retailers have done as much to encourage the adoption of fast fashion as H&M. This week, the Swedish retailer unveils a new concept in its flagship store in Stockholm. Only it isn't selling clothes—it's renting them.

H&M, whose brands include Cos, & Other Stories and Weekday, is introducing a limited collection of some 50 selected party dresses and skirts from H&M's 2012-2019 Conscious Exclusive collections, made from "more" sustainable materials, as well as a small number from this year's collection. Customers will book an appointment with an atelier who will help them select up to three pieces a week, for around 350 SEK ($36) for each item. Once the garment is returned, it's dry-cleaned. A repair and remake counter will also be open for damaged fashion favorites.

This is in part a recognition of growing customer concerns about the fashion industry's impact on the environment. "Fashion is about lust and impulses," admits Anna Gedda, head of sustainability at the H&M Group. "By 2030 there will be 8.5 billion of us. We will need two planets—but that doesn't mean we will all be naked, so the question is how do we make that possible? At the end of the day, we have to change how we enjoy and use fashion."

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Amazon And Its Continuing Assault On Food Retail

There were two significant stories in the past few weeks involving Amazon's incursion into the world of food retail. The first was the announcement of changes to pricing for the Amazon Fresh delivery service and the second was the recognition of what has been an oft rumored launch of a new grocery brand. I wrote about these rumors first back in March of 2019. While these are two separate stories, they really build off one another and offer clues to their future plans to dominate the grocery world.

First, Amazon announced that they will no longer charge for their Amazon Fresh service for Prime members. Amazon Fresh, launched back in 2007, offers proof that not everything Amazon touches turns to gold. This service has slowly expanded without much fanfare, and is now offered in 21 metro markets in the U.S. It has been slow to take off and shows the immense challenges associated with delivering fresh groceries to U.S. households. When launched, this service was priced at $299/year. They later changed to $14.99/month in addition to the cost of a Prime membership. Now, it's free (with a $35 minimum purchase) with Prime but the pricing strategy changes illustrate one core problem of grocery delivery—it is expensive to execute, with the costs of warehouses, trucks and drivers and the trickiness of getting fresh and frozen products into consumers' homes.

In addition to Fresh, Amazon has also been focused on growing their Prime Now program, which delivers from Whole Foods. In fact, there has been so much focus on growing this “instant” delivery service that many Whole Foods stores are becoming overrun with Prime pickers, interfering with the retail customer's shopping experience. And, of course, you can still order directly from Amazon with Pantry and Subscribe & Save. Confused? It's a good bet that consumers are as well. Nevertheless, this relentless pressure on growing delivery has implications for others who are trying to compete (and actually trying to make money) in this space.

The second story is Amazon's confirmation of their first “Amazon branded” (name unknown) grocery store that will open early next year in Southern California. The 35,000-square-foot store is in a former Toys R Us (irony is not dead) and will offer a glimpse at Amazon's latest attempt to penetrate the grocery world. The obvious question is why do they need this, given that they already own Whole Foods and have launched Amazon Go?

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Global Fashion Collective Shines At Paris Fashion Week

International fashion producer, Global Fashion Collective, presented three runway shows at Paris Fashion Week, for the first time last month. The grand Palais de la Decouverte near the Champs-Élysées provided a stunning setting to showcase nine international brands including Kirsten Ley (Canada), Annika Klaas and Madeleine Mesam (Germany) Ozlana (Australia), Faun Studio (Canada), Pariha (India), EmulEos (USA), Erxi x MrHuaMrsHua (China), Sarah Kosinski (France), Devotion Designs (Canada).

A bold collection of designs from Canadian haute couture designer Kirsten Ley provided a dramatic opening to the runway shows in Paris. A recent move to Paris by this innovative designer appears to have inspired her creative processes further, with an exciting new range of highly structured pieces in a striking palette of blues and yellows.

Each of Kirsten Ley’s hand-sewn, sculptural garments take hours to create and is a unique work of art. Silk, chiffon and leather garments combine soft, flowing fabrics and designs with strong lines and tailoring.

                                                             

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