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London Fashion Market
The purpose of the report is to provide a wide evaluation of the value of the London Fashion industry. The principal focus of the report is to provide a robust estimate of sector’s economic value. The report also partly explores the wider social impacts of the fashion industry. The results of the report indicate that the London fashion industry contributes significantly to the entire UK economy, both in terms of employment and Gross Value Added (GVA). The fashion industry is majorly composed of the designer fashion. The London fashion industry has a richly-deserved reputation globally as one of the fashion design leaders and trendsetters (MacKie, 88). The fashion industry is more than just the designer fashion as it encompasses textile production, complex web of materials, manufacturing, wholesaling, clothing design, and marketing. The report also refers to the designer fashion industry relating to the London designer company sales such as the companies that normally have shows at the London Fashion Week and other similar events.
The creativity of the London designers makes it become more distinguished. Diverse shopping opportunities with the retail sector unique in terms of its strong linkages with the designers and a strong education system offers a world-class support in mentoring the potential designers. However, the industry faces several ongoing challenges like the lack of entrepreneurial training and business skills- and high rate of failure of designer businesses. In manufacturing and textiles, there is low level of linkages with technical and scientific innovations with the UK, as well as threats to the ongoing support for the apprentice schemes that seeks to nurture skills on the younger generations. Online selling development and globalization offers new opportunities for the fashion industry, with export growth potential heightened by depreciation of sterling (Vincent, 104). The other challenges that the London fashion industry has to deal with include educational funding pressures, increased skills in the emerging markets, environmental concerns, and the emergence of other cities competing to become a leading fashion centre. The report however presents an analysis of a number of policy opportunities, research and communications initiatives that would make it possible for the fashion industry to exploit its opportunities and strengths more fully and learn how to face the forthcoming challenges.
The UK economy currently goes through a hugely challenging outlook. This has made the fashion industry to attempt to frame some potential interventions by the government, in line with stated goals of the administration such as re-balancing production and up skilling the workforce. To overcome such problems, there is need for interventions to help in tackling the gap in business skills within the industry. This may include a campaign on fashion careers with an aim to promote awareness on a wide range of the available career opportunities and provision of education on fashion and design courses (Sanders, 98). There is the need to adopt a long term plan and strategy to ensure that there is a continued performance and success of the major showcasing events like the London Fashion Week in light of international competition. The fashion industry also needs to support high skilled manufacturing and adopt policies that would attract foreign direct investment.
Considering the importance of brand of a product in the fashion industry, it is of great importance to consider the aspect of promotional activities that are undertaken particularly by the retailers in order to boost sales. Expenditure on marketing contributes largely to the Gross Value Added (GVA) through job creation and potential boost on profits. The definition of marketing includes advertising, event organizing, PR, and modeling agency works. To estimate contribution of PR, marketing, and associated activities to the fashion industry, it is advised to use the approach used for estimating the textiles. This implies that it is possible to estimate the amount that fashion manufacturers, fashion wholesalers, and fashion retailers spend on PR and advertising. It is estimated that fashion advertising and other related activities contribute an estimated 241 million pounds to the GVA. This has an implication that advertising and other related activities is very vital to the success of any fashion industry. The other important aspect about the fashion industry is brand equity which essentially describes the name of the product brand. Products having a brand label may highly be valued by the consumers than other identical products without such a label due to the feelings and knowledge that the consumers have about the product brand in question and the qualities that they associate with it. Branding plays a major role in the domestic fashion industry of the UK (Gehlhar, 108). The associations and images that the London consumers have of the fashion products are very vital in terms of their decision to purchase the fashion products as well as the enjoyment they get from such purchases. London presently enjoys some level of international brand equity due to the international perceptions of the country’s role as one of the major fashion trendsetters and international fashion centers.
The good image presented to the outside world by London is partly shaped by the London fashion and its cultural associations with the arts, popular culture, and music throughout the recent history. Designer labels like Paul Smith, Vivienne Westwood, Burberry, Stella McCartney, and Mulberry have greatly influenced the global perception of London at various periods across diverse cultural contexts. Given the important roles played by branding in the London fashion industry, brand equity concept is for that matter of obvious importance in measuring the value of the industry. However, owing to the intangible nature of brand equity, it has proven to be a concept that is too difficult to measure. The other problem associated with brand equity is that marketers have always associated its value as that of a single product rather than that of the whole economy or the industry (Vincent, 120). Quantitative estimate can be used to determine the brand equity of the London fashion industry, while the qualitative work is used to indicate the importance of international brand equity elements that come about due to the existence of the London fashion industry. Market research and advertising plays a critical role in developing the brand equity, which is a long term investment that focuses on the “build the brand”, rather than just being short term expenditure.
As much as the UK seeks to promote its brand at the local level, the value of international brand equity can never be underestimated. International brand equity is a reflection of a number of factors, including the country’s images of culture and exports. The perceptions of the trends in fashion form part of the overall image of the nation to the outside world. Images associated with the fashion industry of the UK largely affect the behavior and attitudes of the people living outside London. People might purchase London fashion exports or choose to travel to the UK to shop for the fashion items or pay a visit to the fashion museums. The value of such activities would be reflected in the fashion sales and exports by the UK retailers. However, even if the visitors from abroad never visit London or shop for the items there, they might still form a positive image of the London fashion products because of the presence of London fashion industry and its associations and images. The international brand equity associated with fashion industry is very difficult to quantify as is the case for the domestic brand quality. The UK uses other measures like the Nations Brand Index (NBI) to compare its performance in the fashion industry with other countries since the quantitative measure for the international brand equity does not exist (MacKie, 116). The NBI results have been used by various institutions and governments including the British and Scottish governments to determine the nation’s strengths and weaknesses and the possible remedies that can make the countries enjoy a competitive advantage. As much as the index is designed in a way that it provides the country’s overall ranking for the perception and image, it is also built on several other dimensions, including culture, governance, tourism, population, exports, immigration, tourism, and investment.
A recent research on the performance of the London fashion industry indicated that amongst the nations covered in the research, the fashion industry international perception of the UK came second to that of France. In addition to this, fashion was ranked ahead of all other industries as majority of the respondents only associated the UK with fashion. This has an indication that fashion is considered the “top tier” national product in the UK. Other studies also show that the UK is considered an important fashion centre by other global fashion centers like Italy, France, and the United States. The London fashion market enjoys a regional diversity, with various areas and individuals specializing in different techniques of production. Survey data on the household expenditure can be use to estimate the retail spending by the residents on the fashion products in London (Vincent, 87). London has a very large population and has an above average income. This makes it account for the largest share of the retail spending in the UK. Recent studies have shown that retail spending in London was higher than expected even if given its huge “fundamentals”. However, the report can be justified given the disproportionate number of foreign tourists who only go to London, while domestically; London fashion attracts a large number of shoppers from Home Counties and even beyond.
London has also put emphasis on the aspect of manufacturing in order to attain a competitive advantage. Manufacturing in London is basically focused on the high-end designer products. Clothing and textile production units in London is typically competitive and lean, with most of the units “traded up” to produce a high added value products having customers worldwide and a global reputation. Such manufacturing units remain very critical in the areas where manufacturing industries developed from the periods of industrial revolution (Sanders, 112). The London manufacturing industries have also embraced the modern knitting techniques from Japan, which involves seamless garment that particularly look contemporary. London has a renowned manufacturer called John Smedley who makes his own brands like the fine-gauge knitwear for several international designers.
The next point to put into consideration in order to give London a competitive advantage is the aspect of innovation. It is evident that innovation and creativity is very inherent in the London fashion industry. This can be broadly divided into two parts: the product side innovation and business side innovation (use of marketing and PR techniques; the supply chain management, and so on). Product innovation involves two main channels: first, there is an inherent creativity among both the textile and fashion designers in London. Evidence shows that London designers are distinguished for their individual and edgy styles, which is very important in helping the country create a very strong international brand. It is also noted that London designers have always in the past engaged in the world leading innovation of products in more practical and prosaic ways. Some of such products include odour-resistant socks and sweat-resistant shirts.
The London retail market portrays a very good performance in terms of flexibility and innovation in managerial practice. It should also be noted that the London retail market had become a world-leader in terms of marketing techniques and supply chain management. Most retailers in London have the opinion that market research and PR had continually become very vital tools to replace the more traditional techniques advertising (Vincent, 89). Statistics show that the firms’ gross output involved in the market research had tremendously grown by approximately 8.3% per year in 1995 (MacKie, 103). Similarly, management consulting gross output had also grown by 1.4% per annum in the same year. This is only comparable to the advertisement’s 4.3% annual growth and that of the 6% per annum economy-wide average growth. A SWOT analysis into the London fashion industry provides a reflection of the internal factors (strengths and weaknesses) that are most likely to affect the fashion industries in London and how the industries can respond to external opportunities and threats(MacKie, 103). The major focus of the retailers is the strengths and the opportunities that they have. It is very important for the fashion industry to focus on its strengths very deeply so that it can attain a high competitive advantage over other industries.
The first major strength of the fashion industries in London is the creativity of London design. London products retains a unique and “edgy”, making it distinct from other brands across the world. This creates a substantial brand image. The other cited strength is the variety of products and designs on the London high street. Shopping on Oxford Street offers a very unique experience, in comparison to other fashion centers. London also offers a world class education system, which promotes creativity and design thereby enabling the industries retain a significant competitive advantage. The next strength of the industries is the specialist manufacturing, which has remained extremely lean; employing highly specialized and skilled workers. The other aspect that the industries put focus on are the opportunities. One of the opportunities is the rise of new large markets abroad. Rapid rise in emerging markets such as Russia, India, Brazil, and Mexico has equally led to a rapid rise in the external demand for designers and retailers all over the world (Gehlhar, 98). This implies that there is an increased demand for London’s fashion products. In conclusion, London controls a significant portion of the worlds fashion production due to the sustainable strategies put in place that has for a very long time given it the competitive advantage over other nations across the globe.
Works Cited
Gehlhar, Mary. The Fashion Designer Survival Guide: Start and Run Your Own Fashion Business. New York: Kaplan, 2008. Print.
MacKie, Erin. Market a La Mode ; Fashion, Commodity, and Gender in the Tatler and the. Baltimore, MD: Johns Hopkins University Press, 2002. Print.
Sanders, Lise. Consuming Fantasies: Labor, Leisure, and the London Shopgirl : 1880-1920. Columbus: Ohio State Univ. Press, 2006. Print.
Vincent, Susan J. The Anatomy of Fashion: Dressing the Body from the Renaissance to Today. Oxford: Berg, 2009. Print.
