Sustainability and the off-price channel PT. 3
Click on image to download high resolution version
OFFPRICE dives deep into sustainability issues surrounding the fashion industry and offers a solution as a marketplace for excess inventory. This three-part series looks at sustainability from the simple perspectives that are starting to take root today in our modern fashion ecosystem. This conversation between OFFPRICE Global Retail Business Manager, Audrey Taylor and Retail Strategy Group CEO, Liza Amlani took place on Earth day 2022.
"Seeing how Macy's has expanded their Backstage and how they're going to roll that out across stores is super interesting, because it's telling you that mainstream full price retail is not only testing the market of off-price but they're going all in".
In the exciting conclusion of this three part series, Audrey and Liza discuss innovations in the resale market, how luxury goods promote sustainability, gen z spending habits, and the excitement of the treasure hunt.
Audrey:
We realize that off-price is not going to be 100 percent of a retail business model, but it can be 10 to 15 percent of any retailer’s business model, if you’re planning to save open to buy dollars for opportunities to purchase deeply discounted products with high margins.
Liza:
Yeah absolutely, and I’d say that just seeing how Macy's has expanded their Backstage and how they're going to roll that out across stores is super interesting, because it's telling you that mainstream full price retail is not only testing the market of off-price but they're going all in. In fact, those backstage stores are shop in shops in a full price store, so imagine the opportunity that a full price retailer has to not only extend the product life cycle, which is extremely sustainable, but possibly even include circularity in that journey, where customers could return products and it could actually be part of a private label journey. There's a lot of different ways we could look at this from a retailer and brand perspective that I don't think we've ever actually talked about before or thought about before as a full price retailer.
Audrey:
There's a lot of innovation recently, this is a great segue into the resale market. That is something we're also seeing being introduced at our show and full price retailers you would have never expected going into resale market. Let us know, how does this play in?
Liza:
The way that I look at resale is from a luxury standpoint and also from a mainstream standpoint there's so many other retailers and brands that are looking at resale as part of their model. Thinking about it from that luxury standpoint and consignment, all the things that go with your beautiful vintage handbag or coat or designer piece, all that is part of the resale market. Luxury already has a sustainability factor because of the product life cycle and how long it lasts. I have handbags that my mom passed down to me, I mean she's not dead or anything, but I basically stole them from her because, I'm like, these are fabulous!
So, you know there is something to be said about the product life cycle and how long it lasts from a luxury standpoint, the reason its luxury is because a lot of it is handmade and a lot of it has used the best materials, even the best biodegradable materials, so there's a lot less petroleum-based synthetic fabrics that are bad for the environment to begin with. Resale luxury just brings a whole other conversation to life for any retailer, and you'll find a lot of full price retailers have a little section for luxury resale, so I’d say there's a huge opportunity there.
Audrey:
We're seeing it more and more even small boutiques introducing it, starting small and growing. Another thing I think is interesting with gen z that's coming up, and the platforms that they're shopping on, is that it's not only luxury products now. If you look at Depop, they have fast fashion products that teenagers and young adults are reselling. I think it speaks to that shift in consumer demand and the value in extending any products life cycle.
Liza:
Absolutely and I love that you brought up the younger generation. I would say that those values around sustainability and circularity, and of course the product life cycle are so apparent. With a lot of the folks that I've talked to, I would say that it's not even an untapped market, but it's a market that a lot of retailers should be taking very seriously.
Audrey:
Absolutely, because they're not only buying luxury like you said, but they're also buying fast fashion, they're buying all price points. The fact is they're doing it because it aligns with their own personal sustainability values. When we think about price point, they don't have a lot of disposable income, like that of a 30-year-old or 40 plus, so when we think about disposable income we think about trading, bartering and things like that. I think that's also going to come into play in some of these resale tech solutions.
Well, we've touched on a lot, I think some of the big takeaways for me is there's so many different strategies in the off-price world that retailers at all levels can use. I think you shed a great light on that for us and starting this conversation that not a lot of people are talking about yet.
Liza:
One thing to always go back to, no matter what vertical channel or what price point you're selling is truly about the customer, and what they're looking for. How do we meet them where they're hanging out, where they're shopping, where they're engaging with a brand? A lot of the times it is the weekly visits to a TJX, or any store that sells brands for less. Everyone I know shops at an off-price store, I don't think I know anybody that doesn't and that tells a lot, because imagine just me personally, my community, this global network and every single person I know shops at an off-price store, and that tells you a lot right there.
Audrey:
Even us who are in the industry are still consumers at the end of the day and clearly the mind shift has shifted on the consumer side, so I think as an industry it should start to shift as well.
Liza:
Absolutely, it's a treasure hunt.
Audrey:
for sure, always has been always will be.
Well thank you again Liza, this has been such an eye-opening conversation and I hope some people can take some lessons and try some new strategies when they start planning for next year.
Liza:
I think they will, I think that we ruffled some feathers hopefully today, I think that education and just like learning about what options are available is critical in retail today and this is definitely a solution that we need to consider
Audrey:
Thank you so much again Liza for joining us and if anybody wants to connect with you can you tell us where they can find you?
Liza:
You can find me on Linkedin, you can also find me at themerchantlife.com, which is where I put out a lot of retail content, a lot of tips and tricks. So definitely sign up for the newsletter and across social @themerchantlife.
----------------------------------------------------------------------------------------------------------------------------
Thank you for reading our three part series on sustainability and the off-price channel.
This was part of a webinar recorded on Earth Day 2022. Watch the full interview here
----------------------------------------------------------------------------------------------------------------------------
Audrey Taylor is the Global Retail Business Manager at OFFPRICE, serving as a resource for retail buyers looking to make valuable connections with wholesale partners. Audrey joined the OFFPRICE team in 2019 bringing 8+ years of experience in the retail and wholesale apparel industry.
Liza Amlani is the CEO of Retail Strategy Group, a consulting practice which helps companies in the retail space dramatically improve profitability. She is a respected voice on topics such as responsible retail and sustainability, retail diversity and inclusion, the future of retail and the urgency of technology enablement in merchandising, assortment optimization and demand planning. She has 21 years of experience in the retail industry.