Where have all the industry grants gone? This is an extract from Ragtrader's print edition. To subscribe for more hard-hitting content like this, head here.

As a $30 billion industry, fashion retailers and businesses are consistently looking to utilise new technology in order to stay at the front of the pack.

But as new retail challenges continue to arise and retailers move to adapt more quickly to address consumer expectations, the roles of innovation and data analysis in business growth have come to the forefront as important tools to both meet those demands and assist in planning future developments for Australian designer brands.

To facilitate this growth and development of Australian designer labels, the Australian government had previously launched a ten year project which ended in 2016 which saw fashion brands eligible to apply for up to $50,000 in funding for innovative projects and initiatives as part of a $2.5 million scheme.

The scheme saw prestigious Australian designers such as Ellery, Dion Lee and Romance Was Born receive funding for projects including supply chain improvements or e-commerce developments to help grow their businesses both in the Australian market and internationally.

Ginger & Smart co-founder and managing director Alexandra Smart argues that government support and grants are important for brands looking to innovate within the industry.

“For us, the grants and the support from a technology and innovation point of view have dried up for the fashion industry, the government support in those areas was very important.

“Fashion is a very important industry for design, innovation and employment and many other aspects that contribute hugely to the Australian economy and yet there’s no support for any kind of innovation and the industry. It’s a miss and it should be there.”

According to Australian Fashion Council CEO David Giles-Kaye, the value of the Australian fashion industry has been undervalued and by extension, underpromoted by the federal government but adds that designer labels need to take the lead when it comes to areas of innovation for fashion retail, highlighting data collection and analysis as an area where designers are falling short compared to their international counterparts.

“It’s about understanding what the industry is and the value the industry gives to Australia. Our industry is usually undervalued, we’re a big industry, a $30 billion industry here in Australia.

“We have brands that are exporting their brands around the world and I think that if politicians and government bodies understand that and then can think it’s actually worth promoting the Australian fashion industry because it is providing a lot of value, that’s great.

“But I’d say we, as an industry, need to determine our own future, we shouldn’t be looking for the government to lead us or to sustain our future. What we should be doing is working out how we’re going to grow and then how government can support that growth.

“We’ve had a bit of a shift in Australia but we’re still living in a bubble, I think, and we’re not seeing the innovation that’s happening in places like America around that user and consumer experience and the use of data, we’re not seeing that here.”

When Australian designers look to innovate in areas surrounding data analysis as a possible avenue for future growth, many labels are focusing on what their core customer looks like and how they can best reach them through their current channels including physical stores, e-commerce platforms and social media outlets.

Smart says that the Ginger & Smart team are looking to further their ability to relate with their customer base through innovations in ranging, buying and planning strategies and inventory management based on the data they’re pulling from new technologies integrated into the business.

“Fashion, by definition, is innovative, especially for Australian fashion designers. We’re constantly innovating and constantly reinventing and coming out with something new that excites our customer so that innovation is embedded and it’s just part of what we do by definition as designers.

“We see technology as enhancing that because technology allows you to see the numbers behind the numbers and helps from a retail point of view because we can analyse what’s selling well, what’s not, what’s happening in the world and how we are going to create something for our customers.

“The technology part then becomes about how we make sure that we’re buying correctly, buying enough, having the right size in the right place at the right time and how we can keep all of that lean through automation.

“We definitely read our data about who our customer is and we’re certainly looking at who’s shopping in our stores, but also who’s interacting with the brand on social media and through other channels.”

According to reports from NAB and American Express, online spending in Australia is currently on an upwards trajectory with total spending growing 17% year on year with online sales now representing an equivalent of 8.3% of spending at brick and mortar stores, representing an approximate value of $1.7 billion in sales per year.

In discussing how Australian designers can be looking to use data to help guide new developments and innovations, Giles-Kaye says that Australian designers should look to benchmark themselves against international brands while also collaborating more domestically with each other in order to avoid falling into the trap of expecting government or other industry groups to develop those innovations successfully.

“I think how we benchmark ourselves is by looking outside of Australia. Seeing what people are doing here is interesting but I think it’s also really important to also look outside and working with other companies in the supply chain and also with other labels to talk and develop ideas collaboratively.

“Particularly in the US, you see companies which are building fashion distribution or retail companies online in a similar way to a tech company. We’re seeing it with Amazon and how they use data but there’s also companies like Stitch Fix and things like that which have built new business models into massive businesses and we’re still not seeing that coming over here.

“We’d always like the government to be doing more but we can’t really fall into the trap of looking for the government to lead us or sustain our businesses, we have to be leading the way and looking for ways for them to support or help us.”

For the Ginger & Smart team, this innovation is taking the form of technology investments as the business looks to the next 12 months to change how customers shop and interact with the brand across its digital channels including the addition of new payment options for consumers or integrating the online channels into the brand’s physical store experience.

Smart says that as labels begin to prepare for the next 12 months, they should be looking to stay ahead of the curve when it comes to changes and advances in technology offerings and utilising them in appropriate ways.

“Keeping on top of the opportunities presented by technology is a challenge and keeping on top of new upgrades and integrations is also a challenge.

“Sometimes technology can bring productivity and often it can take productivity away so it’s about finding that balance between making sure that technology is actually working for you and that you’re always using it to the best of its ability.”

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