Profit

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Profit is an important aspect within a business as it tends to demonstrate how successful the brand is currently doing. It shows the brand how much money has been earnt in relation to how much money has been spent.

The fashion industry continues to grow and develop its size each year, with being the 7th largest economy in the world. The global revenue pre-covid 19 was between $1.7 trillion and $2.5 trillion. However, there has been an estimate 6.1% growth between 2022-2023 to $1.95 billion. (Fashion United, 2021). The luxury sector of the industry appears to be performing relatively well, with a predicted increase of between 5-10%. (Mckinsey, 2022). The Lyst Index demonstrates that many luxury fashion houses are thriving. For instance, within the Q1 Lyst index Moncler has had a +25% revenue. As well, within Q2 it demonstrates that Valentino has had a 10% rise in annual sales, (Lyst Index, 2023). Nevertheless, when excluding the luxury sector there has been a struggle for growth, with low sales within Europe, it is expected to shrink between 1 and 4%. This could mostly be the blame of inflation as well as insecure currencies. (Mckinsey,2022).

In fact, within these uncertain economic periods, it is essential for brands to remain competitive. A way in which this could be done is if a brand has a celebrity or an influencer as an ambassador or even promoting their products. This allows the brand to gain engagement from the right consumers in return. (Mitterfellner, 2019). A way in which this has been successful is with the brand Glossier. Within the pandemic in 2021 sales started to decline 22%. This was at a cause of multiple things, like bad publicity, failed brand strategies as well as the resignation of the chief executive Emily Weiss. (Financial Times, 2023). Nevertheless, her replacement Kyle Leahy has aided the brand to regain its momentum, by reopening its flagship store in New York as well as opening multiple in various locations. In addition, they have appointed singer Olivia Rodrigo as their brand ambassador allowing consumers to emulate with her, the brand’s marketing department stated that there are “many parallels between Glossier’s ‘come as you are’ ethos and Olivia Rodrigo’s songwriting nature”. (Vogue Business,2022).

The late Karl Lagerfeld would bridge the gap between creativity and commerce within his large and extravagant fashion shows. Some examples are when an airport was created in Paris’ Grand Palais for the S/S 2016 show, as well as a giant rocket for the Fall 2017 show. (Mitterfellner, 2019).

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