In a sign that the issue is no longer just an afterthought, the topic was a key discussion point at this year’s WWD Apparel + Retail CEO Summit, which concluded Wednesday in New York. The two-day event gathered some 300 top industry executives, including the CEOs of Macy’s, Kohl’s and Neiman Marcus as well as the heads of luxury brands Paul Smith and Ermenegildo Zegna.
“Five years ago, customers only cared about if they like the product,” designer Eileen Fisher said of her namesake company. “Now they care about whether (their purchase) makes a difference. … We need to move the flow of money to sustainable business. … We are thinking about ‘What are the other ways we can make money that don’t require making new stuff?’”
The Eileen Fisher brand, certified as B-Corp. since 2015, last year opened its first company-owned factory in Irvington, New York, to give new life to old and damaged clothes it takes back from customers, as new, limited-edition pieces for sale.
“Our customers have an appetite to engage with the brand outside shopping,” said Libby Wadle, president of J. Crew’s hip sister brand Madewell. “We have an audience that’s passionate about sustainability.”
About 10% of Madewell’s jeans sales are now tied to its denim recycling program, which involves Madewell taking used denim and recycling it into house installations, she said.
Yael Aflalo, CEO and founder of Reformation, known for its sustainably sourced apparel and business operation, said the brand had seen increased social-media engagement on sustainability from its customers. The company’s pitch on sustainability has also helped it attract talent in a tight labor market.
“A good 50% or more (of our employees are) coming to work for us because they like our mission,” she said.
According to this year’s Pulse of the Fashion Industry Report, published by Global Fashion Agenda and the Boston Consulting Group, 52% of fashion-industry executives polled said “sustainability targets acted as a guiding principle for nearly every strategic decision they made,” up 18 percentage points from last year. The study also showed that a heightened sustainability focus makes dollar sense: It translates to a positive impact on profit.
Besides the issue of sustainability, attracting traffic and new customers was also another key topic at the WWD event as many traditional brick-and-mortar retailers and brands have sought new partnerships and other tie-ups to appeal to shoppers.
In an initiative that began last year, for instance, at about 100 Kohl’s stores, Amazon customers can return their Amazon-bought items to be packaged and shipped back for free.
“Customers love the experience,” said Kohl’s CEO Michelle Gass. “It’s an opportunity to show we are willing to take a risk and make a bet.”
Still, she acknowledged that even though the move is driving traffic, “it has to convert enough into sales” for Kohl’s; she added that this holiday season will serve as a good barometer of that. Kohl’s is also looking at downsizing its store size from an average of about 90,000 square feet to about 60,000, with the remaining space to be leased to fitness centers or other retailers.
“We want to bring a neighbor to help us bring traffic,” Gass said.
For its part, Macy’s will be “much more aggressive” in its lease models and feature restaurants and other categories that “revolve around the way customers live and shop” to drive traffic, chairman and CEO Jeff Gennette said.
Macy’s has also taken a stake in Silicon Valley tech-retail startup b8ta, which features online upstart brands and major labels like Sony at its locations, including an in-store boutique at Macy’s New York flagship. B8ta, which drives traffic and sales by regularly featuring new brands and by allowing customers to try products in an out-of-the-box setting, is also using its technology to expand The Market at Macy’s pop-up shop concept.
Macy’s this year also bought Story, famous for its New York shop that hosts different brands with unique themes. Story’s founder Rachel Shechtman has been named Macy’s “brand experience officer” and is tasked with helping replicate a Story-like in-store experience at Macy’s.