Although difficult to predictEven in the best of cases, the fashion industry is for a particularly tumultuous and uncertain cyclical slowdown. A long -term cyclical slowdown has arrived. Consumers, affected by the recent period of high inflation, are increasingly sensitive to prices. There is also the rise of dupes, the acceleration of climate change and the continuous reshuffle of world trade. The regional differences, which were developed in 2024, will become even more severe during the coming year.
In short, the negative environment predicted by many of the fashion industry this time a year ago has now been materialized. There is still growth to be found, but economic uncertainty, geographic disparities, as well as behavioral change and customer preferences, it means that this will require navigating a maze of challenges aggravating in each turn. Therefore, 2025 is probably a computing period for many brands.
Slow growth continues
Judged only by the first line, the prospects for the fashion industry for 2025 seem to be a continuation of the slowness observed in 2024: income growth should stabilize in low figures (exposure). Although luxury has led to the creation of value in recent years, the McKinsey global fashion index provides that in 2024, it is non-luxury that will stimulate all the increase in economic benefit for the First time since 2010 (excluding the Pandemic COVID-19).
The fashion leaders interviewed in our annual BOF – McKinsey State of Fashion Executive survey were just as pessimistic as last year. Only 20% expect improvements in consumer feeling in 2025, while 39% see the conditions of the industry get worse.
The geographic engines of income and economic profits are also during historical quarters. In particular, the industry will benefit from the drop in inflation and the increase in tourism in Europe, the resilience of high net of the pandemic). China will remain the center of gravity of the region, but as the country is shaken by macroeconomic winds, brands will pivot other Asian markets, including Japan, Korea and India.
Act on opportunities
To reach these consumers, the leaders told us that they would locate their marketing models, would expand their price ranges and focus on the positioning of the brand to attract the attention of buyers who are increasingly attaching the value. This impulse also stimulates the expansion of resale and rest segments. Brands that do not wish to play in these categories must demonstrate to customers why their products are worth the premium price.
One way to get there is to improve the shopping experience. Consumers return to shopping in prepondeic levels in a large part of the world, but retailers must remind buyers what they like in store experience. It starts with well -trained staff who are empowered to help and inspire customers.
In the return to physical retail trade, the luxury pure game markets were struggling. This coming year can see online mass markets undergo similar disturbances; Most have seen the course of their shares drop pandemic heights and had trouble finding a response to the drop in demand and the increase in customer acquisition costs.
Intelligent electronic commerce players focus on new product discovery paths. Buyers who were once dazzled by the apparently endless selection available from many online retailers now deplore the difficulty of finding what they want. Conservation, content and research powered by AI can help customers discover more effectively brands and products and feel more likely to make a purchase.
Brands also re -evaluate consumers cohorts to continue. While the fashion industry has historically prioritized young buyers, the “money generation” of more than 50 customers develops in proportion to the global population and fashion expenditure. In 2025, brands will benefit from the courtification of these often neglected customers.
Not all brands are able to make these pivots. Often, they are more recent brands and “challenger”, tirelessly by historical conceptions of products, stores and customers who go out in mind. This is particularly true in the category of sportswear, where holders are in competition with a wave of smaller but more innovative players who quickly capture market share.
Next year, current changes in world trade must also be monitored and planned for their impact on supply. The retailers will accelerate their reconfiguration of the supply chains to prioritize birth and manufacturing in geopolitically aligned countries.
These supply chains will have to become more agile, companies making efforts to reduce excess stocks and minimize the risk of deficits. Pressures on margins, as well as pressures from governments around the world to reduce fashion and fashion waste, will stimulate progress in stock management. New technologies will help these efforts.
Finally, the climate crisis will remain a powerful force through fashion supply chains and in the conduct of consumer behavior. Even Though Shoppers Have Proven Less Willing Than Hoped To Pay Extre For Planet-Friendly Products, Making the Business Case for Sustainability Less Obvious To Executives Among Other Compasting Priorities, The Mounting Cost Of Climate Change, and Government Action To Fight IT, Mean Sustainability Must Stay at the top of the agenda. Those who choose to approach sustainability with a long -term state of mind even during the fight against short -term problems will be rewarded with more efficient commercial operations and a competitive advantage.
The leaders who move quickly to identify the light points, whether geographic, demographic or technological, will be ready to succeed, but only if they are able to evolve. The old game book is now obsolete; The industry will need a new formula of differentiation and growth.