CHAPTER 8

Handling Managers’ Challenges for Successful Fashion Products

What is important for fashion managers is that customers regularly buy their fashion products, whatever the trend is. To ensure they buy the specific products the managers are selling, fashion companies must keep two important concepts in mind: attachment and loyalty. Although attachment and loyalty may seem counterintuitive when it comes to fashion, considering the continuous changes to fashion products, themes, and trends, their importance is clear when we consider fashion as an overall concept, not a specific product that will be fashionable for a short time. Fashion persists, whatever the particular products or trends are as the concepts of brand or luxe do. Therefore, it is not just appropriate to consider fashion attachment and loyalty but critical for the success and profitability of fashion companies.

Building and Maintaining Fashion Loyalty

Managing values associated with fashion is crucial for fashion companies to achieve fashion attachment and thereby develop consumer-based fashion loyalty. That is, fashion attachment is a prior and necessary condition for the creation of fashion loyalty. As we have noted, consumers become attached to fashion because of the value that fashion adds to apparel and accessories. This added value influences fashion shoppers’ attachment to fashion items and their decision to adopt these products or not.

Fashion attachment mediates the relationship between fashion equity and fashion loyalty. The influence of fashion equity on fashion loyalty may not arise without an existing fashion attachment. Consumers regularly adopt new fashion products because they are attached to fashion in general, regardless of the products’ characteristics. Thus, we consider attachment an important concept for understanding consumer behavior, in that it helps explain fashion product adoption.

The theory of attachment, as developed in psychology by Bowlby, explains that attachment predicts the interaction between the individual and a product.1 Traditionally, attachment referred to an emotional link between persons, such as romantic relationships or friendships, but it also can apply to a person’s attachment to an object or brand.2 In this latter sense, attachment denotes a psychological state of mind that ties one individual to another, whether a person or a brand. According to various studies, brand attachment differs with the nature of the product and is most predominant for visible products.3

However, attachment to a specific fashion product is not particularly relevant because fashion products constantly change, so the attachment lasts only for as long as the product is fashionable. From a consumer behavior perspective, attachment occurs at the general level of fashion, rather than at the level of specific apparel or accessories. Attachment to fashion is an interesting concept for managers to examine, considering its function in enabling consumers to express their integration with, or differentiation from, their social environment over time. When consumers develop an interest in the value added by fashion to products, this fashion equity leads to the creation of a persistent emotional bond between the consumer and fashion.

According to Park, MacInnis, and Priester, brand attachment occurs if a brand enables consumers to achieve self-expression.4 Attachment exists if shoppers recognize the brand’s value and believe it offers positive benefits to or is of interest for him or her. Brands as fashion represent an extension of the self-concept, so if a brand provides leverage in terms of self-image improvement, an attachment develops.5 This fashion attachment exerts a real influence on fashion product adoption, through the symbolic and experiential benefits that enable shoppers to express themselves. In terms of the social visibility and self-expression associated with fashion products, fashion attachment is important and spans seasonal changes in apparel and accessories. Fashion customers are attached to fashion because it enables them to reveal something they like about themselves. Moreover, these customers can be recognized and considered fashionable in their social environment because they constantly wear the latest pants, coat, or shoes. The distinctive and valued benefits offered by fashion urge these consumers to develop this attachment so that they can maintain their fashionable image. They attribute value to fashion apparel that nonfashion products lack, creating the attachment that influences their decision and adoption process.

Thanks to the attachment developed through fashion equity, fashion customers remain linked to fashion to obtain its benefits, its added values, including self-expression, social self-expression, uniqueness, hedonism, and ostentation.6 Such attachment pertains to visible, symbolic, and experiential products, and it is critical to both shoppers and fashion companies. The shoppers can express themselves and change or improve their self-image, through the bond they develop with fashion; the companies benefit from fashion attachment through growth in their business. Particularly relevant for fashion companies is that the emotional ties between shoppers and fashion apparel and accessories imply long-term relationships. In any industry, a central goal for companies is to develop and maintain long-lasting relationships with their core customers.

With the knowledge that fashion shoppers are not attached to specific fashion items in one season, but rather are attached permanently to fashion, fashion managers can seek to benefit from these connections. This long-term aspect is critical for firms because it leads to fashion loyalty with increased potential for profits.

As introduced by Aaker, brand loyalty is “a biased behavior response expressed over time by some decision-making unit with respect to one or more alternative brands out of a set of such brands.”7 If consumers develop brand loyalty, they engage in regular and increased consumption, as a consequence of their equity and attachment. The concept of loyalty inherently suggests long-term relationships and their benefits in terms of profitability and growth.

Customer loyalty can be manifested as behavioral, which implies repeated purchases, or attitudinal, which entails a favorable attitude developed by shoppers. Usually, these two aspects are interconnected, with one leading to the other. If a consumer has a favorable attitude toward fashion, he or she may be more likely to purchase fashion items repeatedly. In turn, fashion firms need to understand why a shopper is loyal.

For their sales, fashion companies rely on the assumption that a loyal customer will constantly and repeatedly choose their products instead of competitors’. But after how many purchases can a shopper be classified as loyal?

Brand loyalty research suggests three consecutive purchases of the same brand is enough to consider someone loyal.8 But other studies argue that repetitive purchases are not sufficient to demonstrate loyalty, especially when we consider that two consumers may be loyal for different reasons. Repeated purchases do not offer any insights into why consumers buy repeatedly: Out of convenience? For the pleasure of wearing new clothes? Or because of a strong emotional bond with a brand or a retailer? In this sense, shoppers seemingly need to develop a positive attitude toward a brand or fashion to be considered loyal. Different reasons furnish explanations of loyalty, in its various types,9 including the following:

• Loyalty by inertia, when shoppers buy the same product because doing so is the easiest decision during the purchase process. The repeated behavior is mainly explained by habit or, routine.

• Loyalty by conviction, in which case the shopper is sure that this choice is better than any alternatives, because he or she has compared several alternatives and made up his or her mind about fashion apparel and accessories.

• Loyalty against potential risk, such that the shopper is afraid of change and prefers to stick with previous choices. The perceived risks of change force him or her to keep the same product and buy it over and over.

• Loyalty by satisfaction, when the shopper is satisfied and therefore keeps buying the same product.

Loyal fashion shoppers are convinced that fashion, because of its added value, provides specific benefits that other apparel lacks, so that fashion apparel and accessories represent their best choice. Fashion benefits also contribute to shoppers’ satisfaction and enable them to avoid perceived risks. If they keep buying items from fashion brands and retailers, they can maintain their fashionable self-image. Therefore, fashion customers express different aspects of loyalty to retain the value attributed to fashion. Loyal customers regularly patronize their favorite brands or retailers because they trust that through these companies’ products and image, they can project the self-image they desire.

In turn, it becomes important for fashion managers to consider the critical influence of the consumer’s state of mind—that is, feeling attached to fashion values and benefits—on the likelihood that the customer will remain loyal to fashion. These emotional ties ensure that the brand or retailer remains in the customer’s consideration set during the decision-making process and encourages customer loyalty. For the fashion firm, loyalty helps prevent customers from switching to competitors. If they can create strong emotional connections, customers have less incentive to visit competitors or consider buying from them. Loyal fashion consumers are committed to purchasing fashion products from their preferred brand; they resist efforts of competitors to attract their patronage. In addition, they need to maintain this emotional bond with their favorite brand or retailer to maintain their self-image, which offers managers a potential source of sustainable competitive advantage.

The emotional connection develops most strongly when shoppers receive personal attention. Thus, fashion loyalty is closely linked to customer services and the various loyalty programs often adopted by fashion companies. With these programs, firms seek to stimulate long-lasting relationships with their customers, using different types of rewards:

• Social relational rewards: Companies grant loyal customers access to VIP events or invite them to fashion shows.

• Economic rewards: Customers benefit from price reductions or purchase vouchers.

• Informational rewards: Fashion brands or retailers give information about new products to their loyal shoppers first.

• Functional rewards: Companies might offer free valet parking or deliveries.

These different rewards appeal to fashion shoppers, who then feel appreciated and, special to their favorite brand. Loyalty programs honor these regular and repeated shopping behaviors and stimulate fashion purchases.

To create and maintain this special feeling among customers, fashion managers use various communication, promotion, and assortment strategies. Increasing loyalty is a company-wide marketing effort; depending on its strategy, each company makes specific choices of promotional and emotional rewards.

For example, Nordstrom invites its loyal shoppers to fashion openings, pampers them during private shopping parties, and offers them free concierge services and alterations. Such special types of attention are highly appreciated by customers, more so than conventional discounts.

Neiman Marcus has a unique and specific program for its loyal customers, called Neiman Marcus’s InCircle Program. The retailer’s best customers receive special awards and services, gain priority access to designers’ limited collections, and are invited to luncheons on their birthday. They receive the latest editions of the InCircle newsletter and a semiannual magazine. This retailer even invites its loyal customers to join a board, to provide feedback and suggestions to improve shoppers’ experiences.

Such companies invest heavily in ensuring positive experiences for their customers, to build and manage their emotional connections, which in turn establish important avenues for developing loyalty. These customers’ advantages nurture their relationships with the retailers and encourage their attachment and loyalty.

Customer loyalty also represents a means for fashion firms to differentiate themselves from competitors, and thus to increase their profits. As one shopper explained,

I consider myself a loyal customer. I go and shop there because I like their offers, their price ranges too, but mostly because I really enjoy their customer services. I got free valet parking, I even got a birthday card, and every time I need them, I got free alterations from my clothes. If I change, I won’t have that anymore. (Julia M., fashion shopper)

Loyalty suggests that shoppers will constantly buy fashion apparel and accessories from the same provider, which means that the fashion company can reduce it marketing costs, as it does not need to invest as much in advertising. Loyal fashion shoppers already know it, trust it, and dedicate their fashion budget to it. For fashion managers, it is highly worthwhile to focus on this loyal target market.

On the basis of this loyalty, some fashion managers choose to apply premium prices to increase their margins and reduce their reliance on discounts. But caution is required, because modern shoppers are well informed and price sensitive. If the company betrays customers’ trust by overcharging them, it also will lose their loyalty. Thus, fashion companies must find a balance between price policies and loyalty. On the one hand, fashion managers can be tempted to earn higher profits by charging premium prices to loyal and trusting customers, who are not too price sensitive, and who prefer extensive customer services and advantages. On the other hand, to keep price-sensitive loyal customers, they might need to lower their prices, which means lower profits. As long as they achieve a certain amount of sales, even if their profit per unit is low, their overall profit will be high enough. However, this trade-off between price policies and profit outcomes cannot interfere with the development of long-lasting relationships with loyal customers, if managers hope to maintain their prized positions with these shoppers.

Leveraging loyalty as a source of competitive advantage and sustainable profitability thus remains a daily challenge for fashion managers, who must address both increasing competition and new customer expectations.

Developing Ethics in Fashion

Fashion is usually synonymous with choice, variety, pleasure, desire, and fun; it is often associated with frivolity and unnecessary products though. Talking about ethics in fashion may seem somewhat contradictory, but it refers to increasing concerns among both consumers and managers to create fashionable, affordable designs that avoid societal or environmental damage. For example, when fashion industries seek to speed up the processes of designing, manufacturing, shipping, and delivering fashion apparel and accessories to eager fashionable shoppers to beat their aggressive competitors, they might resort to different means that are not always ethical.

As companies adopt vertical integration strategy and outsource manufacturing to external suppliers, the fashion industry has grown more geographically dispersed, with manufacturing operations spread across multiple different regions and countries. The main goal of such outsourcing is to gain competitive advantages through decreased costs, but this practice can lead to unethical production condition. Fashion firms want to be the first to receive deliveries and, the first to offer the latest fashionable trend at a reasonable price on the market, but that pursuit might lead them to engage in questionable practices such as sweatshop labor. In sweatshops, factory employees work unreasonably long hours in dangerous and unhealthy conditions for low pay.

The following list enumerates several unethical practices that remain too common in many factories that support the fashion industry:

• Long hours: 120 hours of work per week is not uncommon. In China, some people work seven days a week, 12–14 hours a day. In Thailand, during peak season (i.e., to produce the main fashion collections for Spring-Summer and Fall-Winter), workers continue on to a night shift after working a day shift to deliver the fashion brands’ requests on time.10

• Hazardous work conditions: Old equipment, dirt, dust, heat, nonhygienic environments, and a lack of proper ventilation represent some hazardous work conditions. The main goal of a sweatshop is to produce more for less costs and as quickly as possible. To do so, manufacturers ignore workshop safety, use shoddy construction, and disregard equipment safety issues; they also are reluctant to invest in improving working conditions. Reducing costs is the priority, as a means to attract new orders, and nonhygienic or unsafe settings are not really a concern, as long as they can have the collections ready for on-time delivery.

• Low pay: Workers need a minimum living wage, defined as an amount sufficient to provide for their families’ basic needs (food, housing, education). However, in most developing countries, workers in the fashion industry earn less per month than the price of a Ralph Lauren casual shirt. In Vietnam, the minimum wage is between $80 and $112 a month, depending on the region;11 in Cambodia, it is $75 per month,12 and in Bangladesh, it is only $68.13

• Child labor: The minimum age for employees often is not respected. This minimum is often very young (e.g., 12 years), yet many factories use children of just 6 years of age as workers. India holds the sad record for the highest rates of child labor in the world. More than 55 million children go to work in factories daily.14

• Use of chemicals and pollutants: Manufacturing often requires various chemicals and pollutants to inject color or soften fabric, but these practices are done without authorization, without proper handling procedures, without treatment after exposure, without recycling, and without protection for workers. In China, the textile industry discharges more than 300,000 tons of chemical oxygen demand. In 2012, the China Pollution Map Database recorded 6,000 textile factories in violation of environment pollution regulations (e.g., discharge of untreated pollutants, wastewater contamination).15 The pollutants and pesticides spread to the air, soil, and water result in environmental contamination; their consequences for workers handling them are even more serious. Such unethical practices are common in sweatshops in developing countries; according to the fibre2fashion website, “nearly 2 billion USD worth of pesticides are used annually, of which pesticides worth about 819 million USD have been declared toxic as per the guidelines of the WHO. The health of the workers spraying pesticides in cotton fields and the people living around these fields are adversely affected.”16

• Use of endangered species: Fur from almost any animal is banned by many countries but still used in some fashion collections. The uses of leather, fur, and even wool have been condemned by associations dedicated to preventing cruelty to animals. One well-known example is People for the Ethical Treatment of Animals (PETA), which argues, “Animals are not ours to eat, wear, experiment on, use for entertainment, or abuse in any way.” Fashion consumers increasingly denounce the use of animals in fashion trends, contending that people can easily be fashionable without harming animals. Public figures, such as the singer Pink, the U.S. swimmer Amanda Beard, and the actress Pamela Anderson, have joined and testify in this organization to fight against cruelty to animals used in the clothing industry.17

These details reveal the state of unethical practices in the fashion industry and the critical needs for improvement, especially as multinational fashion firms continued to be accused of damaging the environment and infringing on human rights, merely to increase their profitability.

A recent dramatic event in a fashion factory awakened many occidental consumers to these issues, when a building collapse in Bangladesh killed thousands of workers producing clothes for well-known international brands. Many shoppers claimed they had been unaware, and some just preferred not to recognize that their desires for more and more diverse fashion apparel and accessories nurtured an unethical industry.

However, such awareness is growing among fashion companies, factories, and consumers. Therefore, ethics is emerging as a new expectation for the fashion industry, and shoppers are pursuing more information and awareness of the disasters and their impacts on their environment and society.

Many actors are responsible for the laissez-faire attitude of the fashion industry. Governments in both developed and developing countries make the laws related to the labor force, working conditions, and pollution prevention; it is their responsibility to identify violators that subvert human rights and pollute various regions and populations. With the emergence of awareness of ethical issues, and ethical demands from customers, fashion companies also have been forced to adopt more ethical practices and try to correct their subcontractors’ poor practices. For decades, these companies tended to deny their responsibility, pleading a lack of knowledge about the practices of different contractors used by overseas agents. These arguments reflected the view of the Nobel Laureate Milton Friedman, who famously declared in the 1970s that the only moral obligation of a company is to produce profit for shareholders. However, times have changed; modern fashion companies must take more responsibility for their manufacturing processes and develop corporate social responsibility programs. Companies from developed countries need to find alternative ways to improve their supply chains and profitability without endangering others’ lives and health or the environment.

Corporate social responsibility refers to self-regulation processes implemented by companies to ensure the application of ethical practices and international norms. Although no universal standard exists for these programs, some guidance is available to fashion companies through the International Register of Certificated Auditors to improve their practices. Other organizations offer assistance to companies that want to prevent the use of unethical resources and enhance social and environmental conditions. The Fair Trade Certified movement promotes high standards for international labor and, social and environmental production. The Ethical Trading Initiative (ETI) implements codes of conduct to improve working conditions. Fashion companies that adopt ETI commit to enhancing the working conditions in their supply chain, and an annual report summarizes their performance.

Yet from a business perspective, sweatshops persist because they are lucrative, for the firm and, in some sense, for their workers. In developing countries, workers often struggle to satisfy their basics needs and accept poor treatment as a means to survive. Jobs in the fashion industry entail long hours, unsafe and unhealthy conditions, and low wage—but for some people, they are still a job. As one Bangladeshi worker explained during an Ethical Fashion Forum, “This job has given me power to make my own decisions for myself. . . . Earning money has allowed me to send my daughter to a school.” The fashion industry provides work, orders to fulfill, and a possible means of survival for people in developing country. Still, unethical working conditions cannot be the solution, and maximizing profit for brands in developed countries cannot be the only goal.

Fashion shoppers also have a responsibility: They cannot be too naïve about such improvements. Fashion brands are not charity organizations and must generate profit to be able to survive and offer nice, fashionable apparel and accessories at an affordable price. Ultimately, fashion consumers have the power to insist on ethical fashion. Although some consumers are engaged by ethical considerations, others are not really motivated to change their habits. Ethical production practices can lead to higher retail prices, and some shoppers remain unwilling to pay a premium for ethical fashion products.

As Rob Boggy, CEO and founder of IRII, Industrial Revolution II, an ethical apparel factory in Haiti, recognizes, “tougher regulations and more stringent factory audits are not enough. Consumers have the ability to demand that the brands they buy make more responsible sourcing decisions, using their collective wallet as both the carrot and the stick. There is a lot of power at the top of the chain and as brands increasingly realize that consumers care deeply about this issue, real change will begin to happen.”18

To achieve this change, and covert fashion shoppers into ethical ones, customer education is necessary to make people more aware of the different practices in developing countries. Giving them a reason to pay more may lead to more ethical working conditions.

In particular, fashion shoppers need more information to be able to make better ethical judgments; usually, the only information available to a customer at the point of sale is a Made In tag that reveals the country of production, the wash care instructions and the fabrics used. Fashion companies should communicate their ethical practices more effectively to help shoppers make conscious decisions.

Hence, three main actors can influence the development of ethical practices:

• Governments from developed and developing countries: by mediating with factories and suppliers for minimum wage and labor regulations.

• Fashion industries: by having more control over their supply chain, their suppliers’ suppliers and negotiating fair price with them.

• Fashion consumers: by demanding more ethical products and being ready to pay few more dollars to improve social and environmental conditions.

These shoppers are not limited to green customers. They also include fashion-conscious consumers. Their ethical concerns are gaining recognition among multinational firms, leading to the emergence of alternatives such as recycled apparel. Such firms commit to enhancing working conditions and reducing their environmental impacts, in an effort to convince shoppers of the value of their ethical products and to gain their favorable judgment. As an element in their brand promise, ethics can help preserve customer loyalty, whereas unethical practices can lead shoppers to switch to more ethical competitors. By offering ethical fashion apparel and accessories, fashion firms thus add attractive value for customers. Ethics is increasingly valued by fashion consumers, who demand that their favorite brands exhibit ethics that are as irreproachable as their designs. Fashion companies will confront ever increasing pressure to change their supply chains and show their customers that they appreciate their social and environmental responsibilities. Following this ethical path, fashion firms can avoid the potential damage to their image caused by unethical revealed practices, as well as the loss of their customers’ trust.

Ethics is becoming a value for fashion companies that completes their brands’ promises. This new added value preserves customers’ loyalty whereas unethical practices are now drawing more attention and can twist these shoppers’ purchase decisions.

Several examples are instructive. Some fashion companies are committed to ethical organizations or created their own sustainable standards. For instance, The Gap Inc. has adopted several corporate social responsibility programs. Aware of the impacts of its outsourcing production in terms of ethical practices, this company tries to lessen the possible negative outcomes. First, it conducted assessments to determine its environmental footprint precisely. With this knowledge, this company could focus on specific elements in its supply chain that offered the potential for sustainable improvement and solutions to reduce environmental impacts. Second, the company began conducting unannounced interviews with employees to monitor working conditions and ensure its sustainable standards were being correctly applied. Even though The Gap Inc. manufactures almost all its apparel and accessories outside the United States, it can assess suppliers’ efforts and remains closely involved in the different production steps through its corporate social responsibilities programs. As a result of these efforts, The Gap Inc. is emerging as one of the most responsible firms in the fashion sector, named as one of the “100 Top MBA Employers” in 2010. Furthermore, this company enjoys a real and growing environmental and social sustainability reputation among its stakeholders and customers.

Marks and Spencer is also committed to sustainable programs, leading it to launch its “General Merchandise Living Wage” agreement. Mike Barry, Head of Sustainable Business, explained that the purpose of this program was to implement “a process to ensure our clothing suppliers are able to pay workers a fair living wage in the least developed countries we source from, starting with Bangladesh, India and Sri Lanka by 2015. We will achieve this by ensuring that the cost prices we pay to our suppliers are adequate to pay a fair living wage and by rolling out our ethical model factory program to ensure the cost price benefits are paid to workers.”19

Some designers also create fashion differently, to improve their ethical practices. The designer Stella McCartney, for example, refuses to use any fur or leather in her collections. She is a member of PETA, pledged to the causes of animal protection and rights. As she has said, “we address ethical or ecological questions in every other part of our lives except fashion. Mind-sets are changing, though, which is encouraging. As a designer, I like to work with fabrics that don’t bleed; that’s why I avoid all animal skins. You can buy cruelty-free fashion all over the place now, since demand is always increasing as people learn the dark truth about the fur and leather and exotic-skins trade.”20

Recycling is another means to introduce ethics in fashion. Galeries Lafayette emphasizes the concept of empty dressing to encourage recycling of fashion pieces. Space in its stores is allocated to collect fashionable apparel and accessories for recycling and exchange—following the trends of the season, of course. Even ethical shoppers want to stay fashionable! The department store’s slogan for the operation is “Fashionable Recycling: Renew Your Dressing Responsibly.” The idea is not to offer dated fashion products but rather to exchange items during their current fashion season when consumers no longer enjoy wearing them. In return, the ethical consumers may choose from others’ discarded fashion apparel or receive a gift card from the department store.

As these examples show, various ideas are flourishing to produce and offer ethical products to informed consumers and to support sustainable ways for them to become more ethical in their daily consumption behaviors. These different sustainable programs or initiatives by fashion companies, designers, and retailers reflect the rising awareness of ethical issues. As environmental and societal factors are more prominent in the decision-making processes of both fashion firms and consumers, these ethical trends should persist, especially if consumers start to avoid socially irresponsible fashion companies and reward responsible ones. To leverage the added value of ethical fashions, companies must make sure those values are visible and explicit for customers, such as through special advertisements and, communication about ethical programs, uses of organic materials, or recycling for example.

Another significant determinant of the development of fashion ethics is the question of price. The price of ethical fashion apparel cannot be so high that it prevents customers from obtaining it. They seek fashionable, ethical designs that are not priced too high. Shoppers cannot be expected to bear all the costs associated with improving the sustainability of their favorite brand. Rather, the costs and the benefits should be shared. Fashion companies can reduce their margin to allow higher living wage or better working condition in developing countries and thus attract more conscious shoppers. Fashion consumers can enjoy lessened their culpability when they buy fashion items that they know have not come from any child labor or caused any pollution. At the same time, producing ethical apparel and accessories is a way for fashion firms to improve their image. As ethical items are more attractive to more conscious shoppers, they enhance the development of ethical fashion attachment and loyalty, which leads to greater profits for ethical fashion companies.