Introduction
The growth in the US economy is marked by the progress of a dominant sector- the fashion industry. The domain of fashion is subject to various competitive entities within its internal as well as external environment. However, the contemporary markets have changed the definitions of business as well as the approach to customers. The fashion industry is gradually facing the intensification of several factors such as societal trends, environmental protection, business laws, and innovation. These factors are imposing a predominant effect on the fashion industry and thus the need for estimating the impact of the above-mentioned factors on the industry and organization is realized (Anandarajan, Anandarajan & Srinivasan, 2012). The organization selected for this report is Abercrombie and Fitch. Abercrombie and Fitch is a well-known name in the fashion industry and hence the research can be comprehensive. The factors are assessed individually in terms of definition, explanation, and impact on the industry as well as the organization (Botha, Kourie & Snyman, 2014). The description of each factor is accompanied by suggestions for probable areas that can be improved to counter the threats posed by the factors.
Company Overview:
The first establishment of Abercrombie and Fitch was in Manhattan where its first founder, David T. Abercrombie, had opened a store for selling exotic sporting equipment such as hunting gear. Abercrombie was employed as a railroad surveyor and miner before he opened his store in 1892. The second founder of the company, Ezra H. Fitch was a lawyer as well as a camping aficionado (Business & Design, 2012). The business between Abercrombie and Fitch existed as a relationship between customer and shopkeeper until 1904 when Fitch bought a majority interest in the company. This initiative resulted in the formation of the brand name Abercrombie and Fitch Co. as it is known today. The conflicts between the two partners resulted in Abercrombie’s separation from Fitch after the former sold shares to Fitch. By the year of 1917, the organization was serving high-profile clients like Ernest Hemingway, Charles Lindbergh, and Theodore Roosevelt. The expansion of the brand was noticeable during the 1940s and 1950s when the company included equipment and clothing for sports such as skating, golf, and tennis. However, the organization entered a phase of losses during the 1970s when the company failed to adapt to the change in trends and was adamant on issues such as price reductions. The brand was revived in 1979 with the opening of an Abercrombie and Fitch store in Beverly Hills, California. From there onwards, the organization achieved success in different strategic modifications such as the introduction of modern sporting equipment (Caiazza & Yoshikawa, 2016). Abercrombie and Fitch Co. was acquired by The Limited, Inc. in 1988 for $45 million. The strategies of The Limited, Inc. included targeting the teenage market and revision of pricing for Abercrombie and Fitch merchandise. The company regained an independent identity in 1999.
Changing Lifestyles and Societal Trends:
Lifestyles denote the nature of activities of a person in the common daily routine of the person. Lifestyle can also be reflected in the general routine of life followed by a particular group of the resident population. For example, the trend of having coffee houses, eateries, shopping malls, etc. have been considered as essential ingredients in a modern lifestyle. People like to follow a sophisticated lifestyle that changes depending on the products and services market in their vicinity (Cai & Yang, 2014). The population of the world will be more than a billion of the number of people existing right now. The statistics of the UN report that the population expansion will occur in developing or less developed countries (Chow et al., 2012). The predictions of the UN suggest that the population of 5.4 billion in 2007 will climb to 6.7 billion in 2025. The population changes are not limited to numbers only. Age is also a factor to be considered in the context of increasing population. It has been predicted that more than 20% of the population in the USA, China, Russia, and the European Union will comprise sexagenarian people. These predictions and their implications will have a considerable impact on lifestyles as well as social trends in fashion. The introduction of technology is also a major change for the fashion industry to adapt to. The prevalence of smartphones and the improvement in accessibility of the internet are some decisive factors that have changed the lifestyles of people. The fashion industry can avail substantial benefits from the changes in social trends such as the trend of social media (Chandel & Sharma, 2014). Social network websites such as Facebook, Twitter, Instagram, and other online social platforms are considered the virtual marketplace for almost every type of business. The people involved with the internet create the necessity for urbane and sophisticated designs from the fashion industry. The response of specific sections of society as a result of changing lifestyles is also a major influence on the fashion industry. Clothing is dependent on the personal preference of individuals and hence lifestyle changes can have noticeable impacts on the fashion industry. The introduction of social media has increased the modes of marketing through interpersonal communication (Craig & Campbell, 2012). Social networking platforms enable users to communicate among themselves and find common as well as appealing sources for fashion products. Industries such as fashion can capitalize on the fashion-conscious nature of individuals. The increase in consciousness among youth for fashion is an example of a societal trend change. Though fashion has been an integral part of human civilization since ancient times, the need for new designs and apparel relevant to existing generations is imperative. Youngsters prefer urbane outfits such as denims, and t-shirts rather than the conventional shirt and trouser outfits. The fashion industry is also initiating societal trends through the inclusion of celebrities for advertising purposes (Deasy et al., 2012). Various organizations in the fashion industry offer attractive propositions to customers through advertisements featuring popular celebrities belonging to the domain of music, sports, and movies. The fashion statement endorsed by celebrities is generally admired and adopted by the youth along with other people in society. These factors are considered as the impact of changing lifestyles on the fashion industry.
The effect of changing lifestyles and societal trends on Abercrombie and Fitch Co. can be determined from the example of Abercrombie and Fitch’s appeal to youngsters. The impact of the social trends on Abercrombie and Fitch’s business functions such as sales, marketing, human resources, and operations has been mentioned as follows. Abercrombie and Fitch assumed their target market the teenagers and prepared advertising campaigns that suited teenagers (Dragoi et al. 2013). The brand relied on conveying a message to teenagers that apparel from Abercrombie and Fitch would make them look chic and sexy. This initiative of adapting to current consumer tastes caused a crucial change in the business operations of Abercrombie and Fitch stores. The stores underwent a drastic makeover so that the interiors could exude a sense of sexual appeal to visitors. The sales of Abercrombie and Fitch gradually acquired momentum due to the trend of youngsters rebelling against their parents by wearing clothes from the brand (Hamilton & Webster, 2015). The marketing strategies of the company also changed drastically with major scope on advertisements featuring sleek models of either sex in different scenarios, the most common being a beach with some youngsters donning Abercrombie and Fitch outfits and having a good time. Though the organization faced major changes in the domain of operation, management, marketing, and sales while addressing the change in social trends and lifestyles, the organization can work towards finding weaker areas and work on them. The major area which Abercrombie seems to miss out is the online apparel retailing sector. The company should improvise its online retailing capabilities through unique alternatives which can place the brand of the company among the major players in the apparel retailing sector (Harrison, 2013). Online apparel retailing is creating waves among the community of internet users and customers are increasingly curious about new products and services of every industry. Hence Abercrombie and Fitch must develop new solutions to enter the domain of retail in fashion. This will help the company to be exposed to a wider base of consumers in different geographical locations which will ensure higher recognition of the brand and subsequently higher revenues for the organization. The company has shown credible initiatives to improve the designs of its products to appease specific sections of society. However, if the company focuses on a wider section of society or the world then it has better chances of sustainability.
Innovation:
Any business requires innovation in different facets of operation to succeed amidst critical competition. The fashion industry and innovation are not differentiable if considered from the context of the industry. The increase in competition has initiated the urge among companies to differentiate their presence from other peers in the industry. Innovation is required by an organization to realize sustainability as well as gain a competitive advantage in the market. Innovations pave the path for future sources of innovation. Innovation can be defined as an extraordinary initiative that can induce a chain of events for sustaining a business. The major outcomes of a business through innovation include additional profits as well as benefiting the environment (Sena et al., 2012). Product innovations in the fashion industry can change degrees of customer appreciation. The impact of innovation on the fashion industry can be understood through the representation of the necessity of innovation in context with the different stages of the life cycle of a product such as production, consumption, distribution, and disposal. Production phases facilitate critical indicators for sustainable innovation. This stage in the lifecycle of a product is the most important as it requires the utilization of different chemicals as well as natural resources such as water which is detrimental to the environment. Innovation in the distribution stage includes a preference for transportation alternatives in the proximity of retail outlets. Retailing innovations are also counted for the sustenance of the fashion industry (Welford, 2013). The use of accessories that consume a high amount of electricity must be replaced with eco-friendly solutions. The innovations in the consumption and disposal stage can be ensured by companies in the fashion industry. Customers have to be aware of the importance of recycling which will help reduce the waste created by discarded clothes. The concept of recycling will also appeal to the environmentally conscious young generation.
In terms of Abercrombie and Fitch, the innovations have introduced some changes in the human resources department and the marketing campaigns. The human resources department was staffed with new managers who could ensure appealing communication with employees to derive innovative applications in all phases of a product’s life cycle. The marketing of Abercrombie and Fitch was characterized by suggestions for recycling old garments which improved the brand appeal of the organization. The sales of Abercrombie and Fitch slightly gained momentum and are still steady (Zaki, Edwards & El-Gohary, 2015). The extension of the life cycle of products to include stages of research and development in between is a perfect example of the use of innovation from the business perspective. The innovations in the implementation of technology can serve as suitable attractions for the business world. The major areas of innovation that Abercrombie and Fitch has worked on and shall continue to develop shortly, include quality assurance, product security, and quality insurance. The future of Abercrombie and Fitch is uncertain like any other industry. So the company has to adopt unconventional approaches to innovations in business rather than following a widely recognized framework for innovations.
Business Law:
Business law refers to various employment laws related to the rights of employees as well as customers. The employment laws are meant to safeguard health and safety alongside intellectual property. The overall concept which brings all the above-mentioned factors under one roof is ethics. Ethical considerations in the fashion industry have formed the basis of different laws. Employees are liable to fair treatment at work along with care and concern from supervisors and fellow employees. Employees should be able to realize their significance as stakeholders in the organization so that they can associate with the brand on an emotional level. Employers must consider employee interests irrespective of any utilitarian or financial factor. Employee security is the basic implication of any employment law which vouches for the job security of the employee (Sena et al., 2012). Employees must also enjoy the right to due process which validates their capacity to challenge improper exercise of authority. Apart from the professional implications of ethics in the fashion industry, the scope for health and safety is also a major influence on employment laws. The employment laws specify that an employer is burdened with the responsibility of preserving the safety and health of employees. Health assumes high instrumental value since it is essential to achieve the different values in our lives. The problem lies in ambiguity over the intrinsic value of the health of an employee. Health and safety risks in the fashion industry arise primarily from the production phase which involves machinery and chemicals. These two elements can have a critical effect on the health of employees and hence companies should ensure proper protection gear for employees while dealing with the production stage. Managers must determine the levels of risk in different activities of the organization through comprehensive methods. However, employees must be involved in the decision-making process while determining risk levels and preparing remedial measures. Consumer rights are also an important ethical aspect of the fashion industry. Customers of the fashion industry deserve the exact value for money on apparel. Customer services and support are essential constituents of consumer rights (Welford, 2013). The fashion industry is also obliged to offer consumers with latest trends in apparel design alongside better-quality fabrics. The protection of intellectual rights is an inseparable facet of business law in the domain of the fashion industry. Intellectual property includes benchmarking and patents which safeguard the designer’s copyrights. Every organization must ensure proper measures for the safety of intellectual property or else competitors can use the design to their advantage.
Abercrombie and Fitch Co. has established a formidable name in the field of fashion. But it has also been involved in instances of violation of employment laws. In one scenario, the company did not hire a potential employee due to her religious outfit. The woman who was interviewed by the company had met all requirements for the post. This incident shows a clear example of a violation of employment laws and biased treatment at a workplace. The impact of the incident was noticeable in the legal proceedings which maligned the brand. Human resources were affected as the Muslim employees working with the brand felt that it was a violation of their religious ethics. The incident also led to worldwide dissent against the brand. The alternative to such situations can be framed by informing potential candidates about the organization’s employment policies which can help to negate any possibilities of employee dissent. Cultural differences have to be addressed by managers at different Abercrombie and Fitch stores all over the world (Harrison, 2013). The brand must also convey a visual appeal to customers from varying ethnic and cultural backgrounds.
Environmental management:
Environmental management has been mentioned earlier in this report in the context of innovation. Innovations in the production, distribution, consumption, and disposal of products are essential initiatives to protect the environment from harmful impacts of the phases of the product life cycle. The concept of a sustainable business is derived from the fact that the business has ensured practices to adapt to forecasted changes in the business environment. The integration of environmental management with business activities is a prolific step to strengthen the roots of an organization in the local business environment (Chandel & Sharma, 2014). The fashion industry is known for investing a lot of natural resources for the different stages of a product’s life cycle. For example, the production of a t-shirt uses up to 2500 liters of water which is polluted with the chemicals used in the process. This event signifies the loss of natural resources which cannot be reversed. Hence the use of environment-friendly alternatives for minimizing the impact of manufacturing processes is considered as an innovation for sustainability. Environmental management also comprises waste reduction in all phases of the product lifecycle. The use of recyclable materials for the transport and delivery of products can easily minimize the impact of waste on environmental entities such as water and soil.
Abercrombie and Fitch also face the impact of environmental management in the event of environmental management. Environmental management in the organization requires additional employees which results in the diversification of human resources. This factor accounts for the increase in the efficiency of the overall workforce (Caiazza & Yoshikawa, 2016). Marketing strategies are modified with an environment-friendly touch. The intentions of the company for environmental protection must be conveyed to consumers through viable means such as advertisements or labels on apparel that indicate that the garment is recyclable. Abercrombie and Fitch has also implemented subtle lighting in its stores with focus lighting on specific areas which is an indicator of conservation of energy. This factor is complemented by the use of a satellite system for music playback during the operational hours of the stores. This ensures unnecessary wastage of electricity due to incessant music playback during store hours. Abercrombie and Fitch have adapted to environmental protection standards set by different jurisdictions and governing authorities (Craig & Campbell, 2012). However, the organization has also faced an impact on its operations and resources due to environmental management. Environmental preservation is a tough task and replacement of conventional production materials with new materials would require additional employees as well as professional expertise in the production process. Hence highly paid managers and trained employees can achieve the desired degrees of environmental management (Dragoi et al. 2013). Operations of the organization will become directed towards environmental sustainability and customer preferences may give way to trending choices in fashion. Environment-friendly apparel has the potential to induce a drastic lifestyle change in terms of fashion.
Conclusion:
The report dealt with four different themes in the context of the fashion industry as well as the Abercrombie and Fitch Company. The report clarified the definitions of innovation, social trends, business laws, and environmental protection concerning the fashion industry. The observations pointed out in the report highlight the importance of following new strategies to cope with revolutionary market trends (Chandel & Sharma, 2014). Environmental protection standards and protection of employment laws are found to be subjects of utter importance to Abercrombie and Fitch Co. Hence, the company should capitalize on its present financial status to engage in the intricacies of themes of management.
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