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"I don't know how much longer we can claim that only London, New York and Paris are the fashion capitals of the world. I think there is going to be competition."
Said Amalia Agathou, Head of Innovation at Havas Media, who kick started our most recent breakfast discussion in London in Soho Works.
We, at HVO Search, brought together some of the most interesting founders, executives, senior business leaders and HR professionals (see end of the article for the list of our guests) to discuss how the young generation from rising fashion capitals are driving and forcing the fashion industry to adapt.
WHERE IS NEW TALENT COMING FROM AND WHAT IMPACT IS THE NEW GENERATION HAVING ON THE FASHION INDUSTRY?
Amalia Agathou believes that London, Paris and New York won't stay the fashion capitals for long. "We have already seen a lot of other countries strengthen their backbone and claim their own place. Singapore offers a lot of support to local creatives. We have also seen the Lagos fashion week building up. And, despite their own political challenges, Brazil is also making moves in this space. I used to work with the London College of Fashion. Every year the students grow more diverse. I'd say that British talent is now a minority. In fact, fashion schools are starting to set up overseas operations to cater to this swathe of international talent. The important point is, what happens after this talent graduates? This talent is now empowered to go to an existing company or to start their own brand. But we still have a diversity problem in fashion. This has only really been addressed in modelling. Progress hasn't been reflected in the business part, or in terms of creative talent. And it needs to be, since this is where a lot of new talent is.”
"Now we have a responsibility to make sure that our industry is attractive to all groups. We all have to aspire to help in this regard since there is a wealth of untapped talent in these groups."
Gena Smith, Senior Human Resources Vice President at LVMH says, “Well over 50 percent of our employees are now diverse. For whatever reason, our industry hasn't historically been attractive to diverse talent. However, that is changing. I don't know why our industry has been so slow to adapt. But now we have a responsibility to make sure that our industry is attractive to all groups. We all have to aspire to help in this regard since there is a wealth of untapped talent in these groups. At it's core, fashion and luxury is all about creativity. In the luxury industry, you have to create desire, and that requires having new, desirable products to sell. This means we have to cultivate creativity. One of the challenges we’ve seen is that very few people have creative brilliance. As such, we need to create leaders capable of cultivating talent and of creating spaces which encourage creativity. For a long time, it was all about the creative director. Now, we have to enable our leaders to nurture creativity at all levels of an organisation – from merchants to HR to tech.”
"Our values, for example – how true are they? Millennials will see through you if you have values but fail to meet them."
Peter Collyer, People Experience Director at ASOS.com adds: “Of course, we need to make money. But is that all it’s about? Today, people want to belong to something. And this is why, over the past 15 months, we’ve done a lot of work to figure out what we’re about. Our values, for example – how true are they? Millennials will see through you if you have values but fail to meet them. In today's environment, no one believes anything, and consumers are super cynical. But, at the same time, consumers are attracted to companies who are doing what they believe to be right – and that includes fostering genuine creativity. Our biggest fear is becoming the corporate business. That's why we are constantly asking ourselves, are we stifling creativity? Are we preventing people from becoming their best selves?" Peter goes on to add:
"One thing that we’re looking to pursue is to personally sit down with our employees and update their CVs with them, to show them how much they have progressed in, say, six months. Rather than encouraging them to leave, this shows how committed we are to our staff and helps them stay motivated and moving forward”
WHAT CAN COMPANIES DO TO FOSTER YOUNG TALENT, AND HOW WILL EMERGING TALENT AND TECHNOLOGY AFFECT THE FASHION AND LUXURY INDUSTRIES?
Maria Hvorostovsky, founder of HVO Search, believes that young people have a different perspective on work: “I think people's attitude toward work is changing. People want to love what they do as a profession. This simply wasn’t the case before. It’s important that businesses are able to live up to this, and to give young, entrepreneurial people the opportunity to do what they want to achieve. It's not just young people's responsibility. It is our responsibility to help them too.”
"At the top, it’s predominately male, pale and stale. And this has meant that a lot of fashion and luxury companies have been slow to react to new trends in digital and e-commerce."
Sarah Curran, NED, French Connection points out the difference between the older and younger generations: “It's an interesting time in retail: at the top, it’s predominately male, pale and stale. And this has meant that a lot of fashion and luxury companies have been slow to react to new trends in digital and e-commerce. Only now are a lot of companies beginning to play catch-up. Today, we have a wave of digital-savvy people coming through.”
The discussion throws light on the fact that there is a cognitive dissonance between the traditionalists at the top and the young people joining their companies. Eventually, there will have to be a move over of the old guard so that the younger generation can move things forward.
Eleni Chatzivasiliou, Global Head of People & Culture at AllSaints adds: “The old guard will have to be receptive to new ideas. But we don't all have to take an 'out with the old, in with the new' approach. Your approach to fostering young talent has got to be whatever works for your company and your culture. Companies in the fashion space each have their own priorities. That's what's so healthy and exciting. For example, LVMH placed creativity over commerciality. But if after 10 years they were posting losses, their attitude would have to shift. We're not all in the same position as LVMH. And that means our approach toward fostering young, creative talent will be different.”
“You're right that the old guard will have to be receptive to new ideas. But we don't all have to take an 'out with the old, in with the new' approach."
For Amalia, companies should consider hiring those who don't have an existing interest in fashion: “What you said about new talent not necessarily being the right talent is interesting. Attracting people who aren't already interested in fashion is important. The people who love your brand may not be the best placed to change them – and possibly for that reason.”
"What you need is a healthy tension between the old and the new, modernity and heritage. It’s not easy.”
Gena, likewise, is concerned about “handing the keys to young people”: “ I met someone last week who was involved in a big media company in the US whose company had to digitally transform in 2003. If they didn't, they wouldn't have remained competitive. This is the case for those operating in the fashion and luxury markets today. However, we also have to respect our companies' heritage as move forward with new innovations. For those of us working for successful brands, our objective is to make sure that they are around in 100 years – not just that they are relevant today. You have to have a long-term point of view. In other words, we’re about building brands and not just selling products. That said, well over 50 percent of our employees are millennials. The younger generations are super passionate, love our brands and want to bring newness. This is great – but we have to be careful. We can’t just hand them the keys. What you need is a healthy tension between the old and the new, modernity and heritage. It’s not easy.”
WHERE WILL THE NEW FASHION CAPITALS BE?
"Simply put, if people don’t feel welcome, they will go somewhere else."
For Amalia, the fashion capitals are undoubtedly shifting: “To work in fashion, previously, you had to go “there” – to one of the fashion capitals, such as New York, London or Paris. Just like if you want to become a celebrity you have to go to LA. That’s not the case now. You’re not limited by location. That is something we’re already seeing and there will be a corresponding shift of capitals. There is more competition now. And today's politics will affect this, too. Simply put, if people don’t feel welcome, they will go somewhere else. In fact, The London College of Fashion now has schools in Dubai. A lot of the students that go there are Indian and African, since the Arabs may be able to afford to study in the UK. Many of these individuals want to start their own brands and businesses. Of course, they need a support network to do this – a community and investment. But they also need production capability. But similarly, these resources are no longer exclusive to the Western world. A lot of the production capability is now in China. And, in China, there are also a lot of investors, a lot of technical talent, and a lot of support from the government – as well as plenty of clientele. So why on earth would they stay in the West?”
"Millennials are often super critical when it comes to corporate issues. But, at the same time, they love these brands. However, that doesn't mean they're not open to exploring of doing things."
Serge Carreira, COO at Mary Katrantzou agrees: “I lecture about fashion and luxury. And I can tell you that today's young people are not blind. Ten years ago, they were blind. Now everyone knows the dark side of fashion and the challenges. And it’s paradoxical. Millennials are often super critical when it comes to corporate issues. But, at the same time, they love these brands. However, that doesn't mean they're not open to exploring of doing things. In China, for example, the fashion industry is growing much faster than it could in Africa or South America. This is because, as Amalia said, they have manufacturing capability. On the other hand, Brazilian fashion has never expanded outside Brazil. But this may be about to change. Today there are new, innovative ways to create fashion. Online designers are making new collections every month. People post prototypes on their online shops, then consumers pre-order what they want. After a week or so, sales close and the designers produce exactly what consumers have ordered. No over-stock. No over-orders. This approach is great for sustainability, builds communication between brands and consumers, and is very efficient and affordable (young people talking to young people).
SUMMARY
Change is coming in the fashion industry - and the change is likely to come from generational differences and tensions between the millennials and the old guard.
Old fashion capitals will lose some of their influence to new, vibrant cities which are either better positioned (both politically and economically) or are actively encouraging activity in the fashion industry.
Traditional companies need to do more to harbour and inspire the young generation, to create spaces where creativity can flourish. To help brands to move forward, they need to adapt to the modern world and continue to be relevant without losing the heart and soul of their heritage.
Those who fail to embrace change early may be left on the wayside.
OUR GUESTS
Amalia Agathou: Head of Innovation at Havas Media
X UK, headed up by Amalia Agathou, is Havas' innovation hub. The hub serves as a bridge to connect Havas and its clients with the dynamic start-up ecosystem
Eleni Chatzivasiliou: Global Head of People & Culture at AllSaints
Eleni is a senior HR Generalist with a strong record of establishing creativity and delivering results.
Gena Smith: Senior Human Resources Vice President & Head of Global Executive and Creative Recruitment at LVMH
Gena is a key member of LVMH's global HR leadership team and is responsible for leading executive and creative talent acquisition.
Helen McGee: Founder of The Disappearing Agency
Helen specialises in marketing, content, operations, digital, creative strategy and mobile, and, through the disappearing agency, launches disruptors in the luxury, retail e-commerce, fashion, beauty and technology spaces.
Peter Collyer: People Experience Director at ASOS.com
Peter is a values driven HR executive with significant international experience spanning hospitality, leisure, investment banking, retail and consumer products.
Sanjit Vallance: Founder & Director at Nui Ami
Nui Ami brings a new approach to sleepwear, and combines versatility and comfort with luxury and sophistication. As Founder and Director, Sanjit has a wealth of responsibilities and roles.
Sarah Curran: NED at French Connection
Sarah serves as a Non-Executive Director at French Connection, as well as a member of the Audit Comittee and Chairman of Remuneration Committee.
Serge Carreira: COO at Mary Katrantzou
Serge began his career in the industry at Galeries Lafayette, where he worked as a buyer. He holds a postgraduate degree in political science from the Institute of Political Studies of Paris.