Sustainability is a growing trend across almost all markets worldwide and the fast fashion and luxury markets are no exception. According to a McKinsey report, Fashion’s new must-have: Sustainable sourcing at scale, apparel companies around the world now consider “sustainability and traceability” their top priority for action.
The waste from clothing manufacturing is enormous. Greenpeace estimates that 400 billion square meters of fabric are produced globally each year; 15% of that production, or 60 billion square meters, is made up of scraps of unusable garment cut-outs. Of the 80 billion pieces of clothing made each year, around 60 billion will be dumped into landfills.
While the luxury market has traditionally been associated with high price tags and excessive consumerism, today’s consumers are becoming more conscious of the environmental and social implications of their purchases. According to GlobalData’s 2019 UK Sustainability report, 80% of consumers think that retailers aren’t doing enough to tackle sustainability issues. Nielsen’s 2015 Global Sustainability Report revealed that 66% of global consumers are willing to pay more for sustainable products and over 50% are influenced by key sustainability factors, such as a retailer being environmentally friendly. Clearly, consumers have a growing focus on environmental factors when deciding which brand they will purchase from.
The fast fashion industry has also received a lot of scrutiny over the years for its cheap disposable clothing, which is causing negative environmental impacts like high levels of waste and pollution. Fast fashion retailers, such as Zara and H&M, have built their reputations on producing affordable clothes that reflect popular fast-changing trends. But as the fast fashion industry continues to grow dramatically, consumers are beginning to demand that companies take steps towards becoming more sustainable.
Industry Turning Point
Sustainability wasn’t always considered important—the Governance & Accountability Institute’s 2018 Flash Report showed that, prior to 2013, only 20% of S&P 500 companies chose to disclose their environmental, social and governance (ESG) information. Today, that number is 85%. The industry has now reached a key inflection point: consumers have become more cognizant of sustainability and as a result, brands are adjusting their promises and customer offerings.
Two strong drivers are increasing the importance of sustainability in fashion. One is that today’s consumers have more access to information through technology. As a result, they have a greater awareness of environmental issues. Secondly, consumers increasingly demand a higher level of transparency in companies’ values and operations.
Introducing Reformation: A Brand of Sustainable Women’s Clothing and Accessories
Many fashion retailers are attempting to understand how to leverage their brand to drive growth, and sustainability is increasingly being seen as an important ingredient to a customer-centric promise. This shift towards sustainability can be seen through a range of budding partnerships, changes in supply chains, and new product developments. Reformation, a fashion retailer that launched in 2009, was created with the value proposition of offering chic and stylish garments that also have a green footprint (the effect that a person, company or activity has on the environment).
Reformation is a multimillion-dollar retailer that prides itself on being 100% carbon, water, and waste-neutral. The company, which has been endorsed by celebrities including Rihanna, Alexa Chung and Bella Hadid, produces clothes that are plant-based, made from recycled materials, and themselves 75% recyclable. Due to their popularity, major retailers like Nordstrom have also begun stocking its products. Reformation’s competitive advantage is that it embraced the ethos of eco-friendliness and sustainability from the very beginning, increasing the credibility of their brand.
What Makes Reformation Successful
Sustainable fashion often requires companies to reconsider their products’ full life cycles. This includes measuring the impact of design, sourcing, production, and disposal on the environment, workers and communities. Reformation’s promise is consistently kept by using a unique strategy to drive growth in the sustainable fashion segment. Not only was the company created with the purpose of providing a green footprint, but it has also been lauded for offering a tool called “Refscale.” Refscale enables customers to easily track the environmental footprint of each item listed on the website. This is an example of how Reformation has operationalized its overarching promise.
Conversely, an inconsistent promise would be considered “greenwashing.” Retailers interested in genuinely embracing sustainable practices must find ways to educate consumers and differentiate themselves from companies that rely on “green” marketing without changing how they operate. Reformation’s Refscale is a great way of doing this: it helps educate consumers on the severity of the issue and clearly illustrates the company’s direct impact.
Sustainability is primed to evolve from being a menu of marketing-focused Corporate Social Responsibility initiatives into an integral part of the fashion industry. The biggest challenge for retailers will be to instill sustainability practices that don’t compromise the production of high-quality goods at reasonable prices. To accomplish this, companies will have to change their business models and the way they educate consumers.
Fashion brands need to realize that customer drivers are changing, and environmental responsibility is becoming a priority. Brands that successfully articulate their increased commitment to sustainability and prove it through consistent execution and authentic organizational commitment—not greenwashing—will stand to gain the most. As consumers everywhere increasingly demand transparency from the brands they buy and interact with, it will be integral for companies to align their organizations around this promise—and fashion brands are no exception.