STARTING-UP IN A DOWNTURN

There are two opposing schools of thought. 

The first: You must be crazy. These days the consumer is not spending on fashion or luxury, and nobody really knows how things will shape-up in the future.

The second: There has rarely been a better time to plan the launch of a new luxury of fashion brand. You have avoided the worst of the seismic market declines seen across many categories, and can build upon all that has been learned so far. You can also act in a way that will challenge the problematic environmental and social practices that have become the legacy of major parts of the fashion industry.

The truth, as always, lies somewhere in-between the two polarities. For many, the limitations of financial resource currently make starting up a daunting prospect. That said, for those with an insatiable appetite for doing things differently from traditional brands, and the energy and capacity to create a new direction, there is a significant opportunity. They will be able to launch in tune with a new consumer mindset, and benefit from the eventual upswing in luxury consumption. 

During Covid, many people have talked about experiencing a time of personal reflection, of considering what is really important in their lives, and for some this has acted as a catalyst to embark on a new startup journey. At SUM we have been creating brand strategies and identities for some amazing luxury and fashion startups, as well as helping them to develop their marketing plans.

This won’t be the first time in history that a downturn has acted as a hotbed of creative endeavor. Glossier, Goop, Lyst, Warby Parker, and Rent the Runway were all established between 2008 and 2010, the years that followed the financial crash. And it wasn’t just the fashion and luxury sectors that saw start-up successes at that time - Airbnb, Uber, Groupon, and Whatsapp also launched then.

There is little doubt that for luxury there will be life after Covid, it’s just that it won’t be the same as it was before. Nuance will be critical, because, as the sector re-emerges it will do so in an evolved way. Just as 2008/9 was followed by a dramatic growth in minimalist design and new tech-enabled solutions, so Covid-19 will be followed by its own new market behaviours. 

For luxury and fashion startups that are prepared to address a new consumer mindset, and to act in agile ways, there will be ample opportunities for success.