The Price of Sustainability

The time has come for designers to retool their production models for survival in the post­COVID19 crisis world. It’s going to be a profound shake-up, but it’s already opening up new opportunities.

A 12-story installation promoting Virgil Abloh's new collection decorates and dominates the exterior of the Louis Vuitton store on Fifth Avenue in New York (2019) (Shutterstock)

Late February, 2020: Fashion Week is in full swing as the emerging COVID19 crisis begins to take hold, and Milan becomes the first city in the world to grapple with the pandemic that will soon have the whole world in its grip. Here, it’s already serious enough that Giorgio Armani turns his show into a live Instagram event held behind closed doors, without a physical audience. Later, in early April, he addresses an open letter to Women's Wear Daily announcing that a revolution is afoot: “The reflection on how absurd the current state of things is (…) courageous and necessary. (…) This crisis is an opportunity to slow down and realign everything; to define a more meaningful landscape. (…) The moment we are going through is turbulent, but it also offers us the unique opportunity to fix what is wrong, to regain a more human dimension.”

This crisis is an opportunity to slow down and realign everything

Giorgio Armani, in his open letter to Women's Wear Daily

In hindsight, his letter was shining a spotlight on a new value of luxury: the rejection of immediacy. Luxury needs time to be created and understood. This new ethical and responsible conviction has also been highlighted by another Italian, Brunello Cuccinelli, who has called for more focus on sustainability. Cuccinelli did not mince words when he proclaimed that our whole approach to manufacturing must itself be recycled, because poor quality production has no future, at least not in Italy where many fashion brands manufacture their collections. And it was Cuccinelli who enthusiastically announced that his company has devoted an entire division to repairing old Cuccinelli clothes, promoting the value of used garments over mere consumption for consumption’s sake.

The Price of Sustainability

The desire for change has become an inevitability that each fashion house is interpreting in its own way. Dolce&Gabbana just launched the social media project #FattoInCasa on Instagram, offering tutorials that, in just a few minutes, invite viewers to explore what they can make for themselves, at home. Starting with fashion of course, and then moving on to crochet, knitting and even baking bread, cooking or gardening. It’s a lesson in Made in Italy that reflects the upcoming fall-winter collection, aptly titled “Fatto a Mano” (hand-made), alluding to the time-honored tradition of small Italian artisanal workshops.

But this initiative has also a significant social component: it will support the Humanitas Foundation, which is conducting research in the field. American designer Virgil Abloh, Louis Vuitton Men's Artistic Director, has said that our times mark the passage “from vanity to humanity”. Alessandro Michele, Gucci's Creative Director, just announced on Instagram that nothing will be the same again and that from now on, Gucci will be abandoning the seasonal approach for good and limiting itself to two shows a year. These structural changes demand not only daring creativity, but also significant investment at a time of great economic uncertainty.

McKinsey's The State of Fashion report forecasts that in 2020 the luxury goods sector will shrink by 35-39%; meanwhile, a study by BCG (Boston Consulting Group) carried out in collaboration with "Fashion for Good" predicts that making the clothing industry sustainable will require investments between 20 and 30 billion dollars per year. It is time to rethink fashion’s production paradigm. According to Maurizio Dallocchio, professor at Bocconi University in Milan and working jointly with the financial department at SDA Bocconi School of Management, understanding the process underway requires an analysis that starts at the macro level, beginning with the meaning of the term luxury itself: "Since 2008, the term luxury has been much more popular in Asia and in high-growth economies in general, and much less appreciated in the West. In emerging countries, the word luxury retains a certain appeal as a token of social accomplishment, whereas at this point we associate it more with a feeling of frivolous vacuity and dismiss its intrinsic value. That’s why nowadays we prefer the term ‘high-end’, which is more about exclusivity and heritage, not simply spending for spending’s sake but rather investing – in something that has a history.”

the Dolce & Gabbana show at Milan Fashion Week Autumn/Winter 2019/20 (Shutterstock)

The coexistence of sustainability and profit

So how can this sudden interest of luxury brands for sustainability be explained? Maurizio Dallocchio shares his view: "Today’s luxury consumer is younger. And sustainability really matters to Millennials and Generation Z. High-end companies are influential, very alert to intercepting change, and willing to invest heavily in communication. Together, these factors can make for consumption without a sense of guilt."
But the challenge remains: how can profit and sustainability coexist, when the latter requires a reduction in consumption? "The environment, respect for social values, and good governance are the macroeconomic variables on which sustainability is based and which add up to staying power," insists Maurizio Dallocchio. "This is a very expensive exercise. However, if the brand does not invest in them, it is doomed to disappear from the market."

Tomorrow's luxury will be about manufacturing unique objects to be kept forever, valued for their provenance, their heritage

Francesca di Pasquantonio, head of the luxury sector at Deutsche Bank Group

The compelling march towards sustainability is an economic and social issue that even Francesca di Pasquantonio, head of the luxury sector at Deutsche Bank Group, considers essential for the future of any brand. "Fashion is one of the most polluting sectors on the planet,” she says, “and luxury companies are striving to become sustainable. This is a complex process that starts with communication, formal requirements, strategic product choices, and then continues in production, which is a much more complicated stage. All of this is done to ensure true sustainability aimed at reducing consumption in a sector that produces more than enough; the aim becomes to rebalance supply and demand, for example with smaller collections and products with a much longer lifespan. Some companies are already there. Tomorrow's luxury will be about manufacturing unique objects to be kept forever, valued for their provenance, their heritage. Obviously, the pandemic has revived forgotten values like silence, friendship, family, even home cooking, and put these at center stage, while compulsive shopping has lost ground in many geographical areas, at least for the time being. A new concept of luxury is now being defined, one that stems from the uniqueness of the garment. And that is something that is inevitably linked to its durability".

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