The fashion industry is witnessing a shift from performance marketing to brand building, driven by factors like rising costs and data privacy regulations, according to the McKinsey State of Fashion 2024 report.  It’s a new year, but my analysis of the 128 page report continue as we reach part 6.  Let’s look at why McKinsey feels the future of fashion marketing is with “All Eyes on Brand.”

The Future of Fashion Marketing in 2024: From Performance to Brand

The fashion marketing landscape is undergoing a seismic shift, and it’s all about brand building. For years, fashion brands relied heavily on performance marketing, tracking every click and conversion. Tightening consumer budgets and data privacy regulations are reshaping the industry’s approach to fashion marketing, with the power of storytelling, emotional connections, and long-term brand building taking center stage.

The Rising Importance of Emotional Connections

Fashion marketers are realizing the critical importance of forging emotional connections with consumers. Performance marketing — with its targeted ads and data-driven approach — is becoming costly and challenging as privacy regulations gain greater power. Brands are pivoting their fashion marketing strategy towards creating meaningful and lasting relationships with their customers.

The Fashion Marketing Pivot to Brand Marketing

The statistics speak volumes. According to the BoF-McKinsey State of Fashion 2024 Executive Survey, 71 percent of fashion executives are planning to redirect their fashion marketing budget to increasing brand marketing spend in 2024, while only 46 percent intend to do the same for performance marketing. This marks a significant shift in strategy for many, including direct-to-consumer labels that have traditionally relied on performance marketing for growth.

The Transformational Power of Brand Marketing

Although not as data-rich as performance marketing, brand marketing does offer unique benefits of enabling brands to stand out in a crowded media landscape. Done correctly, it can also  completely transform a brand’s image and open doors to entirely new customers.

Real-Life Success Stories

Several fashion giants have already embraced this fashion marketing shift with remarkable results. Hugo Boss is one such success story as they pursued an image reboot by differentiating between its “Hugo” and “Boss” lines, targeting Gen-Z and Millennials, respectively. The company hit record sales through this rebranding effort that enlisted celebrity endorsements, innovative campaigns, and special events.

Another success is Italian luxury house Ermenegildo Zegna, who streamlined and modernized its image, partnering with streetwear labels to reach a younger audience. The result? A 16 percent year-on-year sales increase.

Meanwhile, New Balance leveraged collaborations to reinforce its brand positioning, ranking as one of the best-selling brands on sneaker resale platforms.

These transformations underline the power of brand storytelling.

The Brand Marketing Toolkit

Brand storytelling and emotional affinity are an essential part of fashion marketing. Brands should leverage the personalities behind the creativity, engage bold ad campaigns with social causes and tap into their unique qualities and heritage. Miu Miu and Loewe have successfully capitalized on this strategy, creating organic content around these influential figures.

Brands are finding success by collaborating with adjacent industries like music, film, and sports to stay relevant and engage with their audience on multiple fronts. In 2024, we can expect more cross-industry collaborations and sponsorships.

Creating Long-Lasting Affinity

A shift in fashion marketing priorities will be necessary to succeed as a brand in 2024. Chief Marketing Officers will play a pivotal role, requiring a focus on customer perception and cross-funnel strategy. CMOs will need to build teams with both brand and performance marketing specialists who can collaborate effectively.

Impact measurement will shift from instant returns to long-term, strategic horizons. Maintaining consistent and authentic storytelling throughout consumers’ daily lives will be key. Quality will outweigh quantity, with a focus on carefully crafted narratives to transform the old era fashion marketing into the new status of amplifying a brand’s personality.

KEY TAKEAWAYS FOR THE FUTURE OF FASHION MARKETING

1. Shift in Marketing Strategy: The fashion industry is witnessing a significant shift from performance marketing to brand marketing, driven by factors such as rising costs and data privacy regulations.
2. Budget Reallocation: Fashion executives are reallocating their marketing budgets, with 71 percent planning to increase brand marketing spend in 2024, surpassing spending on performance marketing.
3. Brand Marketing Advantages: Brand marketing, while offering fewer trackable insights than performance marketing, provides the advantage of helping brands stand out in a crowded media landscape.
4. Image Revamps: Successful brand marketing involves holistic strategies, as demonstrated by brands like Hugo Boss, Ermenegildo Zegna, and New Balance, which transformed their images to capture new customer bases.
5. Brand Marketing Toolkit: Brands can leverage personalities behind the brand, create memorable shopping experiences, and collaborate with adjacent industries to enhance emotional connections with consumers.
6. Long-Term Brand Stories: The key to success in 2024 and beyond is a focus on long-term brand stories, supported by a cohesive strategy and talent. CMOs must balance brand and performance marketing capabilities.
7. Authenticity is Key: Maintaining consistent and authentic storytelling throughout consumers’ daily lives is crucial for sustaining consumer attention and loyalty.
8. Less is More: In the evolving fashion landscape, brands should prioritize quality over quantity in storytelling, embracing the power of authenticity and emotional affinity.