If you miss a hot trend, does it matter? For consumers, fads come and go miss one today, just wait for tomorrow but they are important to retailers in an increasingly competitive market.
Trends may not represent the core business of a clothing retailer, accounting for no more than 10 percent of its revenue.
But that's the percentage where the best margins are. Tap into a hot trend you have a chance to outperform your projections, and every now and then, strike the fashion equivalent of the lottery jackpot.
So it's essential to get it right.
Worth Global Style Network Ltd (WGSN), a London-headquartered fashion research institution, recently released the Top-10 Trends for Fashion Industry for 2007/08.
It highlights "fast fashion" as a growth engine to help further propel the industry.
Because the retail market is now so mature, retailers need to be sharper and faster to attract customers and get them through the door more often.
Fast fashion, also called "speed to market", means small-batch internal manufacturing and constant response to fashion trends, requiring manufacturers to work very near the season and even within the season to produce small production runs for key stores to test the market.
A Bain & Co study released in New York late last year said that retailers who offer on-trend, in-season apparel with constant restocking of limited quantity styles are the best at luring shoppers into stores on a regular basis.
"Fast fashion creates more excitement about a store," says Kris Miller, head of Bain's North American retail consulting operation.
"Consumers know they have to buy it now. This gives them very little reliance on markdowns. Retailers would rather move something to a different store than mark it down," he says.
To cope with fast product turnaround, WGSN suggests retailers look to multi-sourcing and a diversity of suppliers.
The report contends that China remains the leader in high sales volume and low cost, and continues to dominate international sourcing. But it predicts that there are problems ahead even for China as labor costs increase.
Many local companies are looking to create value-added products and move further up the fashion chain, leaving behind their low-cost reputation.
The report notes producers should not overbuild in one place and should spread the risk.
As markets are increasingly saturated in the Western and developed world, people now talk more about BRIC, an abbreviation for Brazil, Russia, India and China, which represent emerging markets with great purchasing power.
"The luxury industry has room for growth in North American secondary cities and parts of eastern Europe, but less so in major Western cities, and the growth that is there is often dominated by high-spending customers traveling from BRIC," says David Kurtz, WGSN country manager in China.
In China, wealth creation in major cities on the eastern coastal area is creating a new middle class with money to spend. These consumers are still cautious and price conscious and they seek reassurance in the brand values of true international names, according to WGSN.
Another trend noted in the report is that the big brands just keep getting bigger.
As the big international brands are becoming more dominant, it's very difficult to launch a new brand these days due to high marketing costs, the organization notes.
It's really necessary for the label to be backed by a strong parent company, such as John Galliano with Dior and Marc Jacobs with Louis Vuitton.
WGSN suggests that if you are launching a brand in a new market, the skill is in spending marketing money selectively, not just throwing dollars at the challenge.
Per capita income was 11,759 yuan in China's urban areas last year and even residents of cosmopolitan Shanghai earned about 20,000 yuan each in 2006 on average. This means that attracting a substantial number of consumers that don't shop very often is essential for financial success, the report says.
WGSN highlights Ports Design's selective marketing, which targets "once in a lifetime" shoppers, such as those preparing for weddings.
"Chinese consumers need guidance so that they can appreciate the value of a quality brand. The problem is that most fashion magazines have small circulations, typically 100,000 to 200,000, so brands need to find other avenues for promotion," Kurtz says.
The report notes Ports' targeted marketing, such as involvement with model competitions and beauty contests such as Miss Universe.
In another development, the report says the Internet is the new battleground for the fashion industry.
Statistics show that online sales were over $200 billion in the United States last year. In Britain, online retail spending was over $52 billion and growing at a rate of 45 percent annually
WGSN also holds that celebrity culture is getting bigger, so it predicts fashion companies will increasingly use celebrities to promote their existing brands. How celebrities choose to dress will influence trends more and more, it says.
Other trends noted include "green" fashion that combines organic cotton materials and corporate social responsibility, national and regional identity in the globalization of fashion industry and the importance of service in the retail sector.
(Copyright 2002 by China Daily)