The Roaring Twenties: How Global Retail Brands Will Stay Relevant in 2020

Experts in Experience
FITCH
THE ROARING TWENTIES:
HOW GLOBAL RETAIL
BRANDS WILL STAY
RELEVANT IN 2020

The dawn of a
new decade brings
new challenges
2019’s retail winners are here because they managed to
stay culturally relevant and stand out for the right reasons.
At FITCH, we are always designing the future: future
experiences, future memories, the future of retail.
As Millennials’ and Gen Z’s pockets get deeper, smart
retailers are always changing to stay relevant.
FITCH’s 15 global studios collaborated in December to
unpack best-in-class retailers, using past learnings to
explore what it could all mean for retailers in 2020.
This report is a summary of our findings. We hope it helps
your business as we enter this new decade together.
© FITCH 2020 FITCH for 2020
2

In 2019, it looked like
the end for some…
9,300
Retailers closed their
doors in the USA
106,000
Retail jobs were lost due
to failing stores in the UK
150
Nike stores closed in
India by November 2019.
...but smart
retailers are growing
0.9%
Sales volume growth of
Mercedes-Benz from 2017 to 2018
€26.9 Bn
L’Oréal global sales, a 7.1%
increase from the previous year
51%
Revenue increase that
The RealReal saw in Q2 of 2019 alone
↓ ↑
↑
↑
↓
↓
3

Brand new decade,
new brand behaviours
Is it time for a new ‘Roaring Twenties’?
We’re hopeful for a similarly transformative
decade, but with many retailers closing in 2019,
how do retail brands stay relevant?
We identified three key themes...
01
SHAPESHIFTING
02
CONSCIOUS
CONSUMING
03
CULT
COLLECTIVE
4

MERCEDES-BENZ
Mercedes-Benz knew some drivers
wanted to have a car without the
commitment of actually owning one.
The brand’s subscription service
‘Collection’ allows customers to access
a fleet of cars according to their weekly
needs. Going to the countryside?
Take a SUV. City break? Nab a coupé.
Mercedes-Benz has now evolved from
pure ownership to also offering a
subscription service, giving car lovers a
stress-free, exciting way to belong.
THE OWNERSHIP/SUBSCRIPTION SHIFT
→
6

THE REALREAL
Way more than
just a website
The RealReal is the leader in
authenticated luxury consignment.
Using physical spaces to bring its
digital offer to life, the brand gives
free valuations, personal shopping
experiences and consignment delivery.
← GLOSSIER
Beautiful faces
and selfie spaces
Social sharing inspired the
entire Glossier brand and retail
strategy. From selfie-perfect mirrors
and secret canyons, to #impeccable
flower arrangements.
↑ RENT THE RUNWAY
Coffee and clothing
“Sometimes women need to find beautiful
clothes and get shit done simultaneously.”
Maureen Sullivan, COO. Which is why Rent The
Runway has a co-working space, salon and coffee
shop alongside a rentable wardrobe.
THE DIGITAL/PHYSICAL SHIFT
→
7

THE TRADITIONAL/CONTEMPORARY SHIFT
CHANEL
Fun and games
This travelling beauty and
gaming pop-up allows
consumers to relive childhood
memories while exploring
Chanel beauty products.
TIFFANY CO
Style Studio
The Style Studio in London
encourages creative interaction
and play. Consumers can
put their own spin on Tiffany
classics, while enjoying a diverse
programme of events.
NIKE
Light the way
Nike built the Unlimited
Stadium in Manila, the worlds’
first LED running track.
Following the Lunar Epic’s
footprint, the track takes over
an entire city block, allowing the
runner to compete with an LED
version of themselves.
8

THE SAFE/SURPRISING SHIFT
HEYTEA
Afternoon cheese?
Naigai cha, or ‘Cheese tea’
has changed the game for
this Chinese tea retailer.
Topping a traditional
Chinese traditional drink
with cheese has given
customers a fresh way
to connect with cultural
traditions.
MUJI
Keep it clean
Muji’s “No logo/No Brand”
policy has brought Japanese
minimalism to the mainstream.
The brand has focused on
widening its product range and
shifted into interesting areas
such as homes, hotels, florists,
cafes, and even campsites.
RELIANCE INDUSTRIES
Widen your net
Acquisition and organic growth has transformed India’s
Reliance Industries from a B2B player into a towering
consumer-facing giant involved in nearly every industry;
from supermarkets, to clothing, to toys - with the brand
recently buying Hamleys toy shop in London for an
estimated £68 million.
9

WHAT WE KNOW
Shapeshifting keeps brands fresh
and front of mind in 2020
10

In an increasingly ‘woke’ world, it’s surprising
that fast fashion houses, both online and
offline, grew at an alarming rate in 2019.
The profit surge of such retailers is hard
to ignore, but the desire to be chic and
environmentally and socially conscious has
created a modern dilemma.
One FITCH colleague summarised:
“I think the trade off between
fast fashion and ethical shopping
is only going to polarise in 2020.”
We expect the conversation around
ethical retail to grow in 2020.
The environmental impact of retail, from
waste to the role of animals, will dominate.
Everything is up for review; from logistics
and transport of products, to the treatment
and wages of employees along the entire
supply chain, through to the point of sale.
According to the Retail Industry Leaders
Association, 93% of consumers expect more
from their favourite brands to support social
and environmental issues.
Ethical retail and
sustainability is
now expected.
12

Consumers are becoming increasingly
conscious. The growth rate for
‘fast-fashion’ brands is on the decline
as consumers look for ways to do
better for people and the planet.
13

MORE SUSTAINABLE TALK,
MORE EFFECTIVE ACTION
PATAGONIA
Clothes-free zone
One of Patagonia’s latest
retail spaces is a café where
like-minded individuals come
together to take action on
various environmental causes.
EVERLANE
Transparent teaching
“It’s really about being able to
help the communities we’re
going into, and if they want
to buy a pair of pants then
great.” said Tara Shanahan, VP
of retail at Everlane. Everlane
educates customers on how to
make fashion better.
KIEHL’S
Leave your mark
For each empty, full-size container a Kiehl’s
shopper brings in-store for recycling, they receive
one stamp. Once they’ve racked up 10, they receive
a free travel-size Kiehl’s product.
14

THE REALREAL
Calculate the difference
As the leader in authenticated luxury
consignment, The Real Real partnered
with some like-minded brands to create
a ‘Sustainability Calculator’ to encourage
buyers and sellers to see the positive
environmental impact of consignment.
← STOCKX
Drop in to win
Trainer trader StockX use retail
to offer planet-friendly pick-up and
drop-off sites. Customers can deposit
the products they’ve sold and get
paid on the spot. Each site offers
exclusive prizes available to win through
gamified competitions.
↑ ALLBIRDS
It’s all good
Allbirds use retail to tell the story of it’s
sustainable footwear. The walls are adorned
with the brand’s process of creation and
commitment to sustainability. Breaking down
all the component parts of the shoes highlights
their benefits.
TELL A GOOD STORY OR LOSE YOUR VOICE
→
15

GETTING IT RIGHT FROM THE INSIDE-OUT
PICK N PAY
Tasty change
Pick n Pay is the first retailer in
South Africa to introduce ‘pick ‘n
weigh.’ The effort to reduce its
footprint encourages customers to
bring their own packaging, making
them eligible for discounts and
reducing their own waste at home.
SOLEREBELS
Soles with soul
Considered the world’s first World Fair
Trade Federation (WFTO) and FAIR
TRADE certified footwear company,
soleRebels products are handcrafted by
Ethiopian artisans using hand-loomed
fabrics and recycled tires for soles. The
brand and its minimalist retail spaces
are taking the world by storm.
LUSH
Animal lovers
Proud pioneers for animal rights,
Lush has been transparent about
its animal testing policy, which
states that the brand: “does not
test on animals, does not use
materials that contain animal
derivatives that are unsuitable for
vegetarians, and only buys raw
materials from companies that are
not involved in the use of animals
for testing.”
16

Change needs to happen faster
Rent the Runway, Everlane and resale platforms like Depop and The RealReal
epitomise the swing back against fast fashion brands. Lush and The Body Shop
have revived the adage of “reduce, reuse, recycle.“
But the real truth here is that society is shifting quickly. Today, sustainability isn’t
about shouting if you do it, it’s about being shamed if you don’t.
Endless waste production and poor factory conditions will rightfully be under
scrutiny in 2020. Retailers whose purpose and messages weigh stronger with
a more ethical audience will go the distance.
17

WHAT WE KNOW
Conscious consuming
drives consumer sharing in 2020
18

With a desire to belong to something bigger than
they are, Millennials and Gen Z are looking to their
communities to guide them.
In 2020 we’re going to see this sense of community
manifest through retail.
What else would make people queue for hours in
the freezing rain to buy a handbag everyone else
already has?
Why else would anyone spend an entire day
watching videos of YouTube influencers ‘unboxing’?
In 2020, there’s something for everyone.
THE GREATEST RETAIL CREATES CULTS,
NOT CONSUMERS
20

Retail as a centerpiece for community
has evolved far beyond having a coffee
machine by the checkout counter.
Retailers have recognised they need
actionable experiences for niche
audiences, building around the lifestyle
the products help create, rather than the
products themselves.
Many brands have realised that brand
devotion needs followers, and followers
are always going to need something or
something to inspire them and lead the
way. Usually something ‘new’.
BUILD IT RIGHT,
AND THEY WILL COME
21

SELFRIDGES
FAR OUT
The Selfridges Skate Bowl in
London acts as a hub for skate
culture and fashion. Always holding
inclusive and welcoming events,
this experience has bought fresh
new customers into Selfridges.
← IKEA
Feel at home
In its latest city spaces, IKEA
plans to teach consumers how
to live more sustainably. The
brand has a ‘sustainability lab’
and a yoga studio to fit with
this new focus. The meatballs
are still available too.
↑ SUPREME
Desire through limitation
Supreme manipulates the supply chain to
create competitive demand for limited products
and secret drops of hits. The brand finds
growth through the cultivation of its devotees.
Websites, blogs, forums and content creators
drive success and promote the brand’s embrace
of unique urban fashion.
BUILDING COMMUNITY PLAYGROUNDS
→
22

EXPERIENCE,
BOUND IN AN APP
DEPOP
User-generated content slays
The world is connected through
social media, and Depop has
created a sense of community
for everyone (even if they’re not
looking for something to buy or
sell), allowing people to become
content creators and interact
with others.
UNIQLO
Be the face
At Uniqlo, customers
become influencers.
The brand has partnered with
Tik Tok to find models for
Uniqlo’s stores. A chance for
in-app creativity and also the
possibility of more followers
and social dominance.
GLOSSIER
Click and connect
Turning social chatter into actual sales is tricky on a
platform like Instagram. Young people shopping online
are still twice as likely to buy something from a brand’s
website than through a social platform.
Glossier decided to create its own version of the platform
on the Glossier app. Users can share their own photos
along with Glossier product reviews. From here, other
users can buy Glossier products.
23

WHAT WE KNOW
Brands need to build
a cult collective to rule in 2020
24

The super-performing
exceptions in 2019 were
those retailers who were
able to combine multiple
brand behaviours. Depop,
Reformation, New
Balance, IKEA, Off-White,
Burberry and The RealReal
all managed to show 2
or 3 of the behaviours
working together.
Shapeshifting keeps brands
fresh and front of mind
Keep on moving. Be flexible, dynamic and change
with your customers. Don’t forget to surprise them
sometimes.
01
02
03
Conscious Consuming makes for
consumer sharing
Believing in a cause great, but now, action is
expected too. Make shoppers feel good about
choosing your brand.
Build a Cult Collective to rule
The cult speaks for itself, and with the right
encouragement they’ll do the content generation
and recruiting for you.
26

DEPOP MAKES A DIFFERENCE
IN THE REAL WORLD
Depop is the social selling platform focused on the
up-cycle mentality. Mainly run through a truly social
app, the platform empowers all users to become
content creators and influencers.
The brand hosts events for followers, pushing the
community to grow in the real world conscious.
New stores are physical manifestations of the brand,
a chance for Depop to showcase what the app does.

DEPOP
CULT
COLLECTIVE
CONSCIOUS
CONSUMER
SHAPESHIFTING
27

Partnerships appeal
to consumers’
interests in fresh,
unexpected ways
Success in 3-Tail can also be realised
through considered brand collaborations.
Libby Riddell, Designer at FITCH
Columbus, and part of the FITCH
Must See Team notes that:
“Brands need to understand where their
shoppers are when they aren’t in their
store, and what experience will bring
them in at this time.”
If a brand wants to address the needs,
desires and hobbies of its customers,
pairing with another brand that
complements the experience can
re-engage customers and bring an
unexpected but appreciated disruption
to each brand’s category.
28

REFORMATION AND NEW BALANCE
REINVENT THE CLASSICS #REFBABES
Eco-friendly fashion brand Reformation, known for its
carbon neutral production footprint, collaborated with
New Balance to reimagine three famous models: 574,
997W and x90. Every pair was made with environmentally
friendly materials, from soles to laces.
The success of the collaboration has brought these models
back to life for New Balance, and drawn in Reformation’s
“#RefBabes,” while giving fans of both brands something
that helps them stay both active and stylish.

REFORMATION
x
NEW BALANCE
CULT
COLLECTIVE
CONSCIOUS
CONSUMER
SHAPESHIFTING
29

FASHION YOU CAN’T WEAR.
IKEA X OFF-WHITE WELCOMED VIRGIL
ABLOH’S FANS HOME WITH MARKERAD
Ikea and Virgil Abloh came together like furniture shoppers
had never seen before. While Gen-Z and millennials may
be price-conservative with homeware purchases, they will
be the first to shell out for the latest Off-White drop.
This brand unity therefore provides a gateway and a
legitimacy for consumers to push their indulgent nature
into new categories, opening up intrigue and awareness.
SHAPESHIFTING
IKEA x OFF-WHITE
CULT
COLLECTIVE
30

Other success stories:
Burberry X The RealReal join forces
to promote a circular economy
Supreme has birthed a cult that queues
for limited supplies
Sephora keeps the wellbeing of the planet
in mind while inspiring cult following
Louis Vuitton X Riot Games brought
two major players together
Nespresso and Caran d’Ache bring
communities together with their trash
31

Don’t be a fast fashion
house. And if you are, it’s
definitely time to evolve!
It’s no longer enough to
talk about sustainability
– really do it.
Keep things fresh and
interesting for your
customers. Move and grow
with them and they’ll
reward you by becoming
your biggest cheerleaders.
Never believe your brand
is an island. Stay open to
partnerships – customers
are more interested in
products if two brands with
reflective values and offers
get together to offer
a new experience.
WHAT HAVE WE LEARNED ?
32

Experts in experience.
FITCH is a global design consultancy – experts in the
ever-changing space where customer meets brand. We
use data to codify experience across every dimension:
physical, human and digital. By uniting all three, we
generate love for your brand, and growth for your
business. Now, and over time.
This is Designing the Future.
www.fitch.com
MAKE IT HAPPEN
33

The Roaring Twenties: How Global Retail Brands Will Stay Relevant in 2020

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