While barriers to entry in retail have never been lower, thanks to online e-commerce solutions and the digital reach of social media, the retail channels consumers are coalescing around are consolidating, as native-app commerce replaces mobile commerce and shifting retail power dynamics dramatically.

Social media networks and marketplaces are taking a larger share of e-commerce sales thanks to the attention economy. Global data consumption increased by 30 percent during 2020 as the pandemic and its lockdowns enforced consumption within homes, according to a PwC Global Outlook report this year. Short form video content is responsible for the majority of this growth and dominated by social media platforms. The professional services company anticipates a similar increase in rates from 2021 for global data consumption rates.

In China, mobile-first consumer cohorts and differing cultural attitudes to data sharing mean its digital ecosystem and ‘Super-App’s, like WeChat, are more connected, more personalised and more developed than in the West. Last year, Meta chief executive Mark Zuckerberg announced plans to reshape Facebook’s social networking apps into a ‘Super-App’, not unlike China’s WeChat, South Korea’s KakaoTalk, Indonesia’s Gojek or Japan’s Line. More recently, Google began moving toward the super-app model through its new Spot platform in India.

But how can brands navigate this new paradigm to ensure long-term growth, while tapping novel opportunities?

Hosted by Carl Rivera, VP of Product at Shopify, BoF’s Johanna Layolle, global head of brand and community partnerships, and moderated by BoF’s Robin Mellery-Pratt, executives and founders from Tom Ford, Saks Fifth Avenue, Jason Wu, Ralph Lauren, Altuzarra, Bloomingdale’s, Carolina Herrera, La Ligne, Tomorrow, Kule, Intermix, t.a., Prabal Gurung and Phillip Lim, met to discuss the ways in which fashion brands and businesses are adapting to the in-app commerce space — and the ways in which the industry can work together to support a move towards a more sustainably minded, values-driven industry in the process.

Held at The Polo Bar in New York, the retail forum was conducted, as always, under the Chatham House Rule, to ensure attendees can share freely and openly with their peers.

Below, we share condensed, anonymised insights from the closed discussion, to provide actionable insights to our global community to assist in their navigation of these transitional times.

Customer Acquisition and the Growing Importance of Apps

The average consumption of social media has gone up to 145 minutes a day in 2020, according to Statista. Social media and service providers are becoming the “remote control to the internet,” and brands are increasingly positioning themselves as digital companies to meet the digital demands of consumers.

“Everything is now in a digital experience,” said one attendee, whose business now customises to the individual needs as guided by data acquired from these platforms and understanding the identity of the consumer. Although, for some attendees, wholesale rather than D2C remains central to their retail strategy, so social channels must instead be leveraged purely — and effectively — for communications.

In speaking to the younger consumer, attendees discussed acquisition strategies in leveraging social and gaming spheres. “The big thing for us is shifting to a social-first photography,” said one attendee. “We know [to] shoot social first. [...] We make sure that what we’re doing is adaptable. This is the environment that we’re putting it in.”

“Making sure that we’re with [gaming platform] Roblox, that energy, that we continue to bring [this] kind of innovation. And that’s the biggest piece — how do we create a world within digital?” adds another participant.

It’s not about clicking right into the buying — it’s more about how this content is creating engagement.

Online, short videos are proving the main driving force behind data consumption, accounting for more than three-quarters of data consumed in 2020. As a result, businesses need to continually invest in new content — or consider strategies that do not cost too much, such as user generated content (UGC). But the focal points for return on investment is shifting.

“It’s not necessarily about the ROI as it used to be. Now, it’s brand sentiment,” said one attendee. “It’s engagement, awareness consideration, those kinds of purpose and equity scores, that we’ve worked with the research company to do. It’s not about clicking right into the buying — it’s more about how this content is creating engagement. Is it the right audience that we want in the future?”

Adapt to Growing Operational Complexity By Fostering Community Values

Attendees also discussed their increasing struggles around operations, with the pandemic leading to factory lockdowns and shipping crunch in amongst surging demand, impacting all businesses — whether brands or retailers.

“Everything’s moving at such a fast rate — tech and the way we operate. It’s always advancing,’ said one attendee. “I also see that designers on all different levels are unable to keep up with natural things that are happening.”

Indeed, established brands face a series of challenges — but attendees expressed distinct concern for emerging designers. “While they rely on accounts with major retailers to help bolster their brand, keeping up with demand for new product and regular delivery can put their business under immense, unsustainable pressure,” said one participant.

With new and extensive logistical challenges come new economic challenges. “Containers are now seven times more expensive,” shared one participant. “But designers have cost out their goods last month. Not only are we sticking to the price point that we sold nine months ago, [...] we’re still facing the pressure of chargebacks or accountability of shipping late, global prices.”

The knock-on effect sees buyers and retailers implementing their own sanctions on late deliveries, with discounts added. “That’s why we need to take that conversation to the next level, and invite the stakeholders to say, ‘until the pandemic is over, let’s do this for our community so that we can feel like we’re in it together instead of fighting.’”

In discussing ways in which the attendees are adapting to the operational challenges, the focus was on technological but sustainable solutions. “I’m most interested in blockchain technology — the only way that we are going to have a sustainable world,” said one participant. “Forget about sustainable fabrics — to be on the blockchain, people know where your product is from. All of that is going to be that ecosystem. We are having this physical break here in the real world.”

Deeper Partnership Required in an Independent and Entrepreneurial Industry

The conversation moved on to discuss the role that consensus could play in uniting the industry post-pandemic, from negotiating with super-app platforms to the continuing need to adapt and support fashion weeks, to agreeing upon supply chain values and practices to support workers rights and drive for more sustainable manufacturing.

“The areas where brands can form alliances, so values are related, [is] to things like shipping, like supply chain, [...] like buying,” said another attendee. “Those are [topics] where brands can come together and actually force change.”

“Brands are not competing against each other, they’re competing against the world of Amazon,” said one attendee, citing that Amazon Prime went from 37 percent market penetration in the US in 2o20 to 50 percent penetration this year.

How can we make this system work better for a young designer who’s truly talented? How can we set them up for success without stressing?

Clear concern on the ability for emerging talent to enter the industry without support was voiced by all attendees, many of whom referenced mentoring work they did and their belief in platforming young designers and creatives.

“How can we make this system work better for a young designer who’s truly talented?” asked one participant. “How can we set them up for success without stressing? That’s honestly how I look at it in a simplistic way.”

Attendees stressed the need to work together to drive towards better social and environmental practice as an industry. They also voiced their agreement to open conversations beyond the brand and retailer level to better represent supply chain partners and entities drawn throughout fashion’s supply and value chains.

“There’s $700 billion of investment we need to make in order to be sustainable to fit the Sustainable Development Goals — between $20 and $30 billion a year has to be done, no one’s agreed to foot that bill,” said one participant, noting the rise in consumer concern and demand for improved social practices throughout the supply chain.

Focus on What Matters Most

With technological innovation transforming how the industry operates at an accelerating rate, and the consistent disruption caused by the pandemic and the climate crisis, the pressures on leaders and businesses are growing. Attendees discussed what was most critical to focus on.

“Mission-driven, brand-driven, value-driven and consumer-driven to the ecosystem and the ideology — I focus on those things. I don’t think about checking off all these boxes, because that makes me feel empty and anxious. [...] I think that the pandemic allowed me to think about the things I don’t want. To allow [myself] to say ‘no’ to so many things that I might have said ‘yes’ to before, because I thought that was business as usual.”

“Infrastructure is realising what is important to your company and to your brand, and to really think about your ecosystem and why it’s important to you. Because whatever is important to you should be a reflection of your company and your brand values,” they concluded.