Versace
Recently announced it was closing all thirty (30) of its stores in Japan.

New World
A new world is likely to emerge in which designers rebel against long lead times and where they take their collections directly to the consumer through their own boutiques, trunk shows, and over the web.

Web Sales
Web sales are projected to reach $156 billion in 2009, representing 6% of the total U.S. retail pie

The Web Fashion Consumer
Consumers have come to expect new merchandise more frequently, thanks to the web and fast fashion retailers such as H & M. Many cannot understand why they have to wait 6 months to see the fashions seen on the runways. Buyers at department stores generally base their orders on the past, while fashion editors gravitate to the most photogenic and future looking styles, leaving the consumer stuck in the middle. This results in one facet of the fashion industry looking forward and the other looking backwards. The consequence: a consumer on one hand is told what to buy but on the other, not where to buy it.

In response, a new generation of fashion retailers is emerging on the web where news is freely given and fashion is sold. Net-a-porter with average sales of $820.00 per transaction and customers from 170 countries is one example of this new generation of merchants. The company has successfully merged its web retail site with a fashion news site catering to a new consumer who wants credible news over magazine advertisements and the most up to date fashion now.

Entertainment
Families spent 5.1% more on entertainment in 2008 than in 2009, something that has surprised many economists. As consumers tightened their pocket books and wallets one would expect entertainment to be one of the first categories to see significant decreases. But the 5.1% increase in spending equated to 16.5 billion more dollars spent in the category over 2007.

Household debt
The American family is trying to put money into savings and reduce their overall debt, but they are clearly not faring as well as one might expect in this recession. Household debt now amounts to about 125% of after tax income.

High Net Worth Individuals
Luxury retailers are faced with a significant decline in Americans with a high net worth defined as having $1,000,000 of assets available for investment. In 2008 the assets of these individuals dropped by as much as 22%. The result is a major decrease in sales at retailers such as Neiman Marcus where sales have decreased by over 20% in 2009 over 2008.

I think we all have memories of a parent scolding us and stating “why did you do get a D”. As independence seeking teenagers, our responses were generally defensive and short “I studied!” Imagine if our parents had changed a few words and asked “how did this happen”. Perhaps we would have retold the events causing us to not fully understand the material while simultaneously fostering more understanding between ourselves and our parents.

By simply asking what consumers like and why, we are only receiving a small glimpse of the story and possible creating a disconnect, just as our parents only saw one side of the situation. Projects and clients often require us to gather vast amount of information in a short time frame, making the collection of grocery sales based on household income and ZIP code necessary, but far too often we stop there instead of using this knowledge to dig deeper. While this information provides a great deal of information and a starting point it merely tells us what consumers are buying, not why. Discovering the how and why allows us to truly know our customers.

By asking why or what framed questions, people tend to give answers they believe the questioner/interviewer wants. Therefore, we tend to receive answers that sound logical and are even what we expected. This is why polls and surveys have too many variables. With the social media world providing a quick turn about on a large sample size, the holes in polls and surveys are being illuminated as questioners are finding that the time of day the survey is offered drastically changes the results.

So how does market research evolve? As an anthropologist, I am biased towards the anthropological method and therefore suggest we take a lesson from Claude Levi-Strauss and move beyond studying the mere content provided by polls, surveys and classic quantitative demographics to analyzing the structure – or connections accomplished through examining the sub-cultures of our consumers and engaging with them on a deeper level. With the economic meltdown, I believe we are seeing a drastic shift in consumer spending. Brands have to compete more for their consumers. Investing in more in-depth ethnographic research will enable them to build a stronger bond with their customers. For instance, in the wake of many luxury retailers closing shop in Japan I ask is Japan loosing prestige as a luxury retail destination or are the retailers not connecting with a changing mindset of its Japanese clientele. I argue that these luxury retailers are becoming too elusive and exclusive and the up and coming generation connects more and has more loyalty to brands they can relate to through events such as Tokyo Girls Collection.

A model waves to a fan during the Tokyo Girls Collection fashion show

Below is a PowerPoint by David Armano. It is very interesting in its analysis of social media. The current recession will only strenghten social media as more business use the networks as a source of free advertisement and to solidify their networks in the wake of lost projects and cancelled conferences/conventions.

How do you use social media/networking and has it changed with the downturn of the economy?

The Micro-Sociology of Networks

The Micro-Sociology of Social Networking

Like-for-like sales, which do not include sales from new shops, fell 1.2% – the ninth fall in sales in the past 10 months.

The BRC said continued economic uncertainty was leading consumers to tighten their belts.

The fall was exacerbated by the fact that Easter fell in April this year but in March last year.

As a result, March’s figures did not include the traditional boost from Easter sales.

Expensive items suffered the the most pronounced drop last month, with furniture sales falling to their lowest level in at least nine years.

‘Tight control’

Meaningful year-on-year comparisons were also made more difficult by the unusually cold weather in March last year, the BRC added.

“Customers are still worried about jobs and their own finances, so they are keeping spending under tight control,” said Stephen Robertson, director general of the consortium, which compiled the figures along with consultancy firm KPMG.

But there were some sectors that saw sales increase.

Non-food internet, phone and mail-order sales, for example, jumped by 10.8%.

Food, clothing and footwear sales also rose slightly.

Total sales in March – which includes new store space – were up 0.6% from a year go.

“A slight air of pre-spring optimism tempted customers to buy new season clothing and women’s footwear,” said Mr Robertson.

“But this is unlikely to be the basis of any sustained improvement,” he cautioned.

J.C. Penney (Plano, Texas) will begin selling the Joseph Abboud Joe clothing line, now sold exclusively at Macy’s, at its stores this summer. The line will appear in 600 of the chains 1100 department stores nationwide.

The move reflects ongoing changes to the retail landscape as stores and brands continue to vie for shopper’s loyalty and shopping dollars. Macy’s says it’s dropping the Abboud line because its customers preferred its store brand Tasso Elba.

Penney has been trying to distinguish itself from discounters like Target and Walmart, by adding such style-conscious lines as Kimora Lee Simmons, Charlotte Ronson, Allen B. Schwartz and a new home decor line from Cindy Crawford. The addition of the Joe line is designed to help boost the company’s image with style-conscious men. “We’re playing a little catch-up with men,” Steve Lawrence, Penney’s executive vp, men’s apparel, told The Wall Street Journal.