The fashion industry has been quick in adapting to the new and not-so-pleasant reality. Brands are reevaluating fashion weeks, observing consumer-shopping behaviour and all in all shifting to strategies relevant to the present time, which are also at par with sustainability. The latest fast-fashion giant to be making the headlines is Zara. Pablo Isla, CEO of Inditex—the parent company of Zara, announced that the brand will be shutting down 1000+ stores globally. This radical move came about due to a whopping loss of $460 million the brand incurred from February to April, which was also the period of full lockdown.
Online sales have seen an obvious growth due to social distancing which forms the basis of Zara‘s decision. Although the exact locations of stores haven’t been disclosed, most stores are concentrated in Asia and Europe. Due to the pandemic, brick and mortar stores have seen a massive drop in sales and hence Zara will be doubling its online sales. The brand is focusing on three key strategies: digitalisation, integration between stores and online model and sustainability. According to their statement, Zara reported a 50% increase in online sales from 1st February to 30th April and 95% alone in April.
Isla also announced that Inditex will be investing $1 billion into its online shopping platforms over the course of three years. Additionally, the company will also be investing $1.7 billion in upgrading its existing stores with advanced technology solutions for better equipment and enhanced store experience for customers.
It is no doubt that the COVID-19 pandemic has caused huge losses to the fashion industry but it is nice to see the way brands are re-strategising their businesses and moving forward.
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