INSIGHT: Customer Adoption + Circular Business

An important key takeaway from the latest Business of Fashion Article by BY LIBBI LEE AND KARL-HENDRIK MAGNUS

Supporting Customer Adoption. For younger consumers born into the sharing economy, adopting circularity is a natural step. However, older consumers may require education and encouragement. Some consumers believe there is a hygiene issue with second-hand clothes, and others struggle to translate their sustainable values into actions for a wide range of reasons.

Circularity is likely to be one of the key business trends of the next decade. However, it is not the kind of revolution that can be led by a few leaders, while others wait and see.

Some brands are responding by marketing circular items alongside conventional ranges, for example Patagonia. Zalando and Selfridges, meanwhile, are scaling a range of circular offerings in their core businesses, helping to normalise circularity in the minds of shoppers.

As circularity grows, digital enablement will be critical. As the traditional linear fashion value chain transitions into a circular system, consumers will be incentivised to engage beyond an initial purchase in order to engage in circular business models, which in turn will support data collection that can shape a brand’s business going forward.

Companies should:

• Offer rental options such as subscription services and the option to buy rented products at a discount;

• Borrow online marketplace techniques to filter, sort and group assortments, or leverage retailer-curated collections;

• Enable peer-to-peer business, including resale and rental, and sweeten the deal with logistics and digital solutions;

• Create timeless collections, reflecting the declining prominence of seasonality;

• Offer tips for care and repair;

• Enable returns and recycling;

• Develop data strategies to inform business decisions.