Introduction
Technological developments in the field of communication have helped increase the popularity of online shopping. According to Qin (34), there has been a consistent change in the family structure in the American society, and in many other countries in the world. The role of women in many families has changed very rapidly. Women are no longer confined to homes to take care of children and attend to the household chores. They are now actively engaged in the corporate world, just like men. This means that in a standard American family, both parents will be in employed, forcing them to leave in the morning and come back late in the evening after work.
The problem with this current structure is that most families do not have time to go shopping regularly in brick-and-mortar stores as it used to happen in the past. These families only have the weekend to address all their social issues. According to Tillman (78), these families find themselves in a scenario where they have to do a lot over the weekend. For this reason, online shopping has gained massive popularity in this society. This has had a massive impact on various industries. The fashion and design industry is one of the most affected industries with this shift in shopping pattern. Large fashion and design firms such as Louis Vuitton, H&M, Kering, The Gap, and Christian Dior have been forced to rethink their strategies. In this report, the aim will be to determine the impact of online shopping on the fashion and design industry.
Discovery
The fashion and design industry is one of the oldest and most developed industries in the world. According to Ellinwood (72), the fashion industry has been experiencing massive growths in developed countries, as the numbers of those who belong to higher social class keep increasing. This growth has a positive impact on the economy of this country. The increased profitability of this industry means that the individual firms have the capacity to pay higher taxes to the government to help in addressing the developmental needs. This industry is also playing a leading role in the creation of employment in the country. Engle (58) says that fashion and design industry are one of the best paying industries in this country as compared to other related industries. The figure below shows the annual mean wage for fashion designers by state.
As shown in the figure above, some states offer better remuneration to their employees in this industry than others. States like New York pay very attractive remunerations to their employees. This may be attributed to the fact that most of its residents are urban dwellers with a higher purchasing power. This translates to the higher sales and profitability to firms operating in the state, making it easy for them to offer attractive remunerations to their employees.
Online shopping has had a massive impact on this industry for over the last decade. According to Martín (112), players in the fashion and design industry largely ignored the relevance of online shopping during its inception period. The big players in this industry could not just imagine a scenario where people would make most of their shopping online. For this reason, they never prepared themselves for this revolutionary approach in the shopping culture. Most of the firms did not bother to put up structures that would enable them participate actively in the online market. When they realized the relevance of this new shopping approach, it was too late for some of them. This explains why there has been a consistent drop in the size of the apparel manufacturing industry for the last ten years. The figure below demonstrates this consistent decline.
The research was done using secondary sources of information, and it was discovered that there has been a consistent drop in the size of the apparel manufacturing industry from the year 2001 to 2011. According to the discoveries that were made, the shrinking size of the industry is caused by two main factors. One factor is that many firms in this industry have reduced in size in terms of the number of employees they have, and their output. The second factor is that some of the players have left the industry or ceased their existence. Those that could not withstand the wave that cane with the changes taking place in this industry fell off the market. Some investors considered withdrawing their investments from this industry to focus on other industries that they considered promising. The consistency with which firms failed in this industry led to its reduction in size. The chart below shows some of the leading players in this industry.
It was also discovered that for the last fifteen years, there has been a consistency in the mass layoffs, in this industry. The data collected by Hill (92) from 1996 to 2011 revealed that most of the leading apparel companies lay off more employees than they hired within the same period. Some of the firms simply failed to replace their employees in cases where some left their firms for one reason or another. The figure below shows the cases of layoffs that have taken place within the period in this country mentioned above.
It was also observed that the employment opportunities that existed before in this industry have been consistently reducing over the years as people embraced online shopping. Most of the fashion and design companies rarely employ, making it difficult to consider developing one’s career in the industry. The chart below shows the employment trend in this industry over the past twenty one years in the United States.
Employment Trend in the Apparel Industry in US
According to McKelvey and Munslow (28), the industry players have come to appreciate the relevance of online shopping as a convenient way of transaction. Most of the leading fashion and design firms such as Louis Vuitton currently have a heavy presence in the online market. These firms have developed online shops on their websites where customers can view a variety of products, get their descriptions, the prices, and how the product can be paid for and delivered to places of their own choice. The rate of online shopping in this industry is on the rise as many consumers prefer obtaining the products from the online stores rather than travel to brick-and-mortar stores.
Analysis
The discoveries made above demonstrate that online shopping has had a massive impact on the online industry. According to Kühn (119), firms always pay their employees based on what they get out of what they do. Highly profitable firms pay high salaries to their employees. On the other hand, firms struggling to survive in the market may not be able to pay high salaries because of their limited income. The fact that different states in this country pay the employees differently in this industry indicates that there is a difference in the performance of the firms in these states. It is important to appreciate that states such as New York are densely “populated” with the apparel shops conveniently located along different avenues and streets. Consumers would find it easy to drop into these shops and make their purchase. This boosts the sales made through online market, making these firms more profitable than those operating in other states.
It was discovered that for the period running from 2001 to 2010, there has been a massive drop in the size of fashion and design industry. According to the research by Sonmez (58), it was noted that many firms were either forced out of the industry or some just disappeared following a series of losses within a given period. It is important to note that it is during the same period that online shopping was gaining shape in the American market. According to Bluschke (35), online shopping experienced a massive growth for the period running from 2001 to 2013 as information and technology infrastructure improved.
There are more people shopping online as personal computers become more affordable, and internet services more reliable than ever before. The same period has also seen the development of the Smartphones, which makes it easy for people to access the internet and do all the online transactions with ease. Ferreday (47) says that online banking where people can make online transactions without the need to visit the bank has also gained popularity in the last one decade. All these factors point to the fact that online shopping has been made easier and the global society has embraced this new form of market. It is, therefore, worrying that many fashion and design firms have been suffering during the same period.
According to Zheng (131), this paradoxical situation can be explained by understanding the nature of sales that takes place in the apparel stores. Most sales made in the apparel stores are always associated with impulse buying. When an individual visits an online store, he or she will be attracted by the beauty of the other products that they did not plan to buy. According to Na and Zhang (510), impulse buying is a common phenomenon at apparel stores. This has been one of the main reasons why apparel stores have been making attractive profits. Their displays are so attractive that it may be almost impossible for a customer to pass without noticing the beauty of the products.
This means that a customer who wants a wedding ring will buy the ring, and probably a designer watch that looks very attractive on the display. This is what online marketing has eliminated. When an individual is interested in buying jewelry, he or she will go to the column of jewelry. He or she will then choose the desired jewelry without getting swayed into other products in the store such as dresses. This has had a serious negative impact on many of the apparel stores, and this explains why their sizes have reduced. Others have even moved out of the market because the industry has lost its main strengths in making profits.
The subsequent layoff that has taken place in the industry is understandable. Given that the number of customers visiting the stores has reduced, many of the apparel firms have considered reducing the sizes of their workforce. This is done in an attempt to reduce the cost of production as a way of maintaining the profitability. When other players leave the industry, the capacity of the industry to employ will further be reduced. For this reason, many have stopped viewing this industry as one that can support serious career development. The opportunities in the industry may continue dwindling as most of the tasks that were previously done by the employees can now be done with machines.
Conclusion
The discussion above has clearly demonstrated that online shopping had made a negative impact on the fashion and design industry. Customers rarely visit the brick-and-mortar stores, and this reduces the possibility that they will make impulse buying. This industry had largely depended on impulse buying to make abnormal profits as customers ended up picking the products that they had not planned for, because of their attractiveness. The size of the industry has reduced since 2001. Within the same period, the number of employees and job opportunities in this industry has considerably gone down. The industry is yet to emerge from the shock of this shift in the shopping design.
Recommendation
Players in the fashion and design industry must find a way of addressing the problem that they are currently facing. The following recommendations should be observed.
- Companies in the fashion and design industry should increase their online presence in order to attract more online customers.
- The management units of firms in this industry must ensure that the graphical displays in their online stores are as attractive as they would be when on the shelves.
- Players in this industry should avoid price wars and instead, focus on the quality improvement strategies.
- The players should consider hiring experts in online marketing to help the industry regain its competitive edge.
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