Here’s this week’s Media Mix about the fall of the Japanese apparel industry as a result of the coronavirus crisis. As I mentioned, the industry was already failing even before the pandemic. The Big Three—Renown, Onward, and Sanyo Shokai—were struggling mightily and relying on foreign investment funds or partners to keep them afloat. And it wasn’t just competition from fast fashion that was eating into their revenue. Perhaps the most representative change was when Sanyo lost its license to sell Burberry, a hugely popular brand in Japan, back in 2015. The company’s fortunes tumbled and have never climbed back. Sanyo has gone through three CEOs in the meantime.
The main problem is that the culture of fashion has changed a lot since Japanese apparel’s heyday in the 70s-80s, when television and magazines were at the apex of their influence. There were so many publications—not just fashion magazines, but lifestyle publications centered on clothing—that everybody regardless of income was up on the latest trends. The rise of the internet eroded this advantage in two ways. Firstly, it diluted the power of print, and secondly, it made shopping in person unnecessary, two factors that were essential to the prominence of clothing fads in the public’s imagination. Of all the emerging post-bubble Japanese clothing brands, Uniqlo is thought to be the greatest success, but even Fast Retailing, the company that owns Uniqlo, is going through hard times right now, and was suffering even before CV-19 arrived on these shores. Though Uniqlo bucked fashion trends by selling what is essentially generic-albeit-high-quality clothing, its success still relied on people visiting actual stores, and the brand’s rise was in direct proportion to the number of outlets it opened, and not just in Japan. Fast Retailing has closed a lot of stores in recent years, mainly overseas (in China, Uniqlo’s products are still considered status items), but it did recently open a new shop in Harajuku that points to its future sales strategy, allowing customers to browse apparel on screens, “coordinate outfits,” and then “process” their purchases via their smart phones. I’m not really sure why people have to go to a store to do all this, but that’s probably why the store is in Harajuku, where window shopping is still a thing. If the concept is successful, then Fast Retailing may expand it to other outlets. Rumor has it that Amazon is coming out with its own clothing line, so Fast Retailing is obviously worried they’ll be left behind in the digitization wave.
It’s hard to imagine that more hardcore fashion lines can survive in this kind of environment, though they seem to be adapting the best they can. Another evolutionary aspect covered by the Asahi Shimbun is very small fashion houses that could be called super-niche suppliers. One that the newspaper profiled is owned and run by a 25-year-old Japanese woman who grew up in Shanghai. She once worked as a sales clerk at Shibuya 109, the mecca for young fashionistas. Her concept is simple: she wants to make the kind of clothing she wants to wear, and so carries out everything herself, from design to marketing to sales. She even does her own modeling, and it’s all digitized, not just sales (via Instagram). Most importantly, she is sensitive to trends and tastes, and only produces as much product as she can sell. Unlike conventional fashion houses she isn’t afraid of running out of inventory. If she sells out a line, that’s great, since she doesn’t have to worry about clearance sales and stocking issues. And she charges what the market will pay, which, in the case of her T-shirts, is about ¥7,000. High fashion isn’t dead, it’s just crawled into a cubby hole.