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WANTS TO MEET CUSTOMERS IN STORE AND ONLINE
Among Kappahl’s competitors, those focusing on e-commerce have
experienced a major decline after the pandemic. The reality has
changed and it has become clear that consumers also want to be able
to shop in physical stores.
“We’ve always stuck to our omni-strategy, that is, that the consumer
wants to be able to move between stores and e-commerce, and
this has been successful,” says Thomas Gustafsson. “During the
pandemic, a lot of people talked about the death of the store, as
the focus was on e-commerce. But 2022 has shown that it’s not a
question of ‘either or’, but rather ‘both’.”
SUSTAINABILITY GENERATES NEW OPPORTUNITIES
Sustainability is becoming increasingly important in the clothing
industry. In Sweden, each person buys around 14 kg of clothes per
year, a level that needs to be radically reduced. The industry takes in
too many garments, and as much as 30 percent has to be sold off at
a discount. The Swedish Trade Federation has estimated that each
item of clothing is used on average seven times, a figure that needs to
increase significantly in the coming years.
“The big sustainability issue in the ready-to-wear clothing industry
is that we need to get much better at assessing demand,” says Sven
Knutsson. “Consumer behavior is largely based on the clothing’s
disposability. But almost a third of garments being sold at a discount
is not sustainable. The industry needs to take action to produce
garments that are so attractive and durable that they can be used
multiple times. This will require a major adjustment.”
New EU directives are constantly being introduced, requiring
garments to be clearly labelled with the materials they are made of,
to be easy to repair and for sellers to offer to take them back once the
person has finished wearing them.
“The big change concerns how many times the garments can be
used,” says Sven Knutsson. “They have to be of such good quality
that they can withstand being worn 50, 70 or even 100 times. The
next challenge is to create new business models, such as offering to
mend clothes or making second-hand a natural part of the business.”
A specific example of this is Sustain by Oscar Jacobson in
Stockholm, a brand new store concept that combines sustainability
with experiences. The items sold include clothes that consumers
return and in exchange receive a voucher that can be used to buy
new garments. You can also buy sample garments there that have
been hanging in the stores, as well as test garments made in just a
few copies.
“We’re curious about new, exciting and sustainable ideas at
Kappahl and want to invest in them,” says Thomas Gustafsson. “The
management team has a clear mandate to not only focus on the
garments but also on the offering to consumers. We want to be able
to implement the concepts in the stores, but we’re not quite there yet.
Among other things, we’re looking at rentals, especially of children’s
clothing. Children grow quickly and have a constant need for clothes
in bigger sizes. There’s an interesting market in this area.”
“Some of these sustainable changes can be driven by the
companies themselves – others require the industry to work together,”
says Sven Knutsson. “The companies should be able to improve the
quality of their garments, but to establish new consumer behavior,
the major players need to work together to increase the volume in
question. When regulation is introduced, the industry will change
rapidly as consumers recognize the benefits of the new systems.
There are likely to be some big changes over the next few years.”
“Clothing is a matter of economics,” says Thomas Gustafsson.
“It’s important that there are clothes for everyone, which is why
legislators are somewhat more cautious. Sustainability is crucial
for the future and generates opportunities. We shouldn’t wait for
regulation but instead be at the forefront, curious and working on
concrete solutions.”
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