“The Portuguese companies must focus on the premium segment”
“Ten years from now, the resale market will be bigger than fast-fashion retail”
“The customer expects brands to take a stand that fits their own values”
She’s Portuguese and has replaced Portugal for England seven years ago. To the question “Why London?”, Ana Roncha replies that, from all markets, she believes this is the one that presents more challenges and opportunities. Ana Roncha is currently the Director of the Master Degree in Strategic Fashion Management at London College of Fashion. Passionate for the industry, she’s goes far from reason: “what fascinates me is the way we use fashion as a personal expression”. We talked with Ana Roncha at the Conference ‘Future of Fashion’. Which are the trends that will persevere? What will be the main challenges for the companies? In which way will the industry adapt itself? Get to know the answers below.
There’s a concern at London School of Fashion in combining education with the industry. Will the future bring these two realities together?
Definitely. I think what we do well at the School, and should be replicated, is to combining education with the industry. For instance, each four years, we renovate the course’s content. After discussing this matter, we brought together to the conversation current students, old students and even people connected to the industry, such as designers and premium brands. This means the content is adapted to the market’s real needs.
What are the main changes that are happening within the fashion industry?
We can identify the changes in three main issues. Starting with social transformations, mainly focused on sustainability. Secondly, I highlight the changes that are happening at the consumer level. This topic is very relevant when we’re talking about B2C businesses. The current customer is different from ten years ago. It’s a customer with very high demands, who likes to get involved in the brands’ story and is available to pay for customized products. Lastly, there’s technology, which has caused a systemic change within the sector. It’s necessary to understand the client due to its direct relation with the brands.
There are main topics within technology. For instances, big data, artificial intelligence or chatbots are new realities to which the companies have to get used to.
However, there’s another question… Where are these changes taking us? For that, we just have to look into the business models transformation. We can’t continue to think in business as usual because it no longer makes sense.
The best way to analyze the current state of the sector is to look at the three unicorn companies (evaluated in over one billion) of the industry, in 2018: Farfetch; Rent the Runway e Glossier. All of them are virtual platforms. On one hand, this thrives online sales platforms. On the other hand, new business models are emerging, and, in this case, built upon resale.
In which ways can the smaller companies adapt themselves to these changes?
Nowadays, we operate under a thinking model that should be cross-sectional to all areas and all types of companies, from SMEs to big: the start-up mindset. This mindset is essential for companies to stay agile and flexible. The focus for the smaller players and brans that are now starting, is to know well their target audience, who is the costumer and to which market are they interested on.
Today, there’s no unique customer, there’s no unique market. It’s crucial to define that and deeply know the geographical market in which the companies are going to establish themselves. It’s very important to study the cultural, social and economic context (to avoid crisis and surprises) and understand exactly who is the consumer, what they buy, how they relate to the brand, what they seek, etc.
There is a lot being written about sustainability within the fashion industry. Is this a concept or a reality?
At the beginning, this was a niche trend. However, this matter quickly took over business in a completely unexpected way. And the data shows it is going to stay like this. In ten years, the resale market will be bigger than the fast fashion retail.
Sustainability is one of the main trends at the moment. We can talk about technology and all its applications, but the matters related to sustainability and how we can protect our planet can’t stay behind. Nowadays, the customers expect the brands to take a stand that fits their own values.
However, the sustainability issue is much bigger than the question of “who made my clothes?”. This topic is based on a much more cultural character and the genuine concern from the consumer to know all the value chain of a product.
In a broader sense, sustainability can have two main results. On one hand, transparency. Brans will have to be ready to share where their pieces are produced, in which factories and countries. It’s vital that this information is available. On the other hand, this matter is having a great impact on business models. For instances, and how we could see on 2018 unicorn companies, resale platforms or renting clothes are increasingly growing. This a sign of concern and responsibility for our planet and for consumption decrease.
What about the Portuguese fashion? Does a collective and growing identity exist?
There is an increasingly recognition of the Portuguese fashion and some creators, for instances, that are already established on external markets.
I believe there’s starting to appear a national identity. Portugal was always oriented to B2B, and we’re excellent on that. We present quickness, flexibility, customized responses and quality.
In terms of B2C, the business is completely different. The Portuguese internal market is small and, therefore, it’s necessary for brands to have an international expansion. The main problem of internationalization is it requires high investments, along with a collective and repaired strategy for it to be able to thrive.
There’s no doubt that with digital abundance it’s easier to create a brand. It’s not an easy process but it’s naturally much easier than it was 20 or 30 years ago. The hardest part then is the ability for brands to escalate. Brands must want to grow. And, for that, mentoring programs will be needed, as well as incubators, accelerators and strong structures to support the brands.
Is the UK a desirable market for the Portuguese companies?
Even with all the uncertainty from Brexit, the UK still is an extremely attractive market for the Portuguese companies. In addition to the great fashion consumption, it’s a market in which the industry represents 32 billion sterling pounds.
However, I believe the premium sector has a lot potential, compared to fast fashion, which is completely saturated and overtaken by international players.
