Sustainable Threads: Exploring Fashion Consumer Attitudes | Redress | PI Apparel

So yes, here we go. Right, so I'll be talking a little bit today about fashion consumer attitudes. So first of all, so like how Vincent was introducing, I'm the Circular Fashion Program Director for Redress. So I've been working with Redress for about 2 years, but my background is in supply chain. I used to work in supply chain for different fashion brands here and in Europe, and this is how I get to start working with Redress. I actually joined them after doing a program with them where we try to recycle clothing for the former brand I was working with. It's quite an interesting introduction to get started with them. So I'll explain a little bit first about what is Redress, give you a little bit of context. So Redress is a charity. We've been created in Hong Kong over 15 years ago with really the goal to emphasize solutions to move to a circular economy. We work on lots of different aspects and the main two focus for us are two different audiences. So mainly we're going to work on designers with the Redress Design Awards in which we support young designers to access knowledge and connection through an extensive curriculum and a competition. This is an international competition. Is currently the largest sustainable design competition in the world, and we're currently actually selecting the finalists at the moment. The rest of the team is working on that at the moment, and we should be announcing our semi-finalists very soon. This is a competition that really helps us to connect with designers, to learn, to support them in learning about circular design and actually how to apply that in a real-life fashion brand context. The second program, and this is the one I'm heading, is about circular fashion here in Hong Kong, really focused on consumers. How do we help Hong Kong consumers to access knowledge and solutions to lead a more sustainable lifestyle? And the way we do this is by having solutions such as take-back programs to gather unwanted clothing in Hong Kong, as well as promoting education from very young to much older people. We work from, you know, kindergarten to people like you, industry experts, consumers. We work with lots of different people on this education aspect. And later on, I'll tell you also about a specific campaign that we are running very soon to try to share a little bit that education and the solutions at a large scale here in Hong Kong. So the topic today is about consumer attitudes, but I can't really talk about consumers without talking first about what is the situation at the moment. I thought I would be closer to the screen, but basically here what I'm showing you is a very interesting graph where you can see that our purple line is the clothing sales. We've been selling huge amount of clothes, which has helped all of us to develop our companies and our brands. And what we can see that is a bit more concerning is the fact that this— the This blue line, this turquoise line, is the clothing utilisation, which has drastically been going down as the sales are going up. I think no surprise here for most of you, right? We've been creating more clothes, selling them faster, making people access them in an easier and easier way as we go along, and unfortunately that results in the fact that people wear their clothes less and less times. We estimate that it's roughly people wear their clothes twice as little as they did a generation ago, and we buy twice as much. So this is why you can see this issue is, is really growing, where we are just buying more items and wearing them much less. And of course, the consequence of that obviously is increase of the carbon emissions related to that, increase of deforestation, which obviously has led to an impact and the issue of climate change that we're all facing today. So I think it's always interesting to show these two graphs in correlation, because you can see how our sales are increasing, our temperatures are increasing. So sure, yeah, there's quite a few steps in between the two. But the reality is that, of course, as we produce more and more carbon emissions through the increase sales and production, increased clothing production, we are also having an impact on the CO2 emissions, on deforestation, which has created the situation of climate change. So looking at this, I think we all know that 2023 was the warmest year ever. So what is 2024 bringing us? Hopefully something better than just warmer climates. But we can see that there is a strong connection now. And of course, none of us here ignores the fact that we are all looking to find solutions to climate change. And this is also something that has become more and more part of customers' decision and knowledge. So I've been here in Hong Kong 10 years and working on sustainability for over 3 years, directly working with consumers of different ages, and we can see the change in people's mindset, in people's knowledge. Recently, an anecdote, someone told me, why do you write recycling? You should write downcycling, because you actually do downcycling. And this is a very interesting question, because for most consumers, recycling is a very hazy term, right? Downcycling is something very specific. So I think having this question from a consumer, someone who works for a very large company, made me realize, okay, so now people are a lot more aware of what these terms mean. Of how we apply them. And so that's something that is— that people take, of course, as part of their daily life and consumption decision. Before I move on to explain that, additionally to, of course, the carbon emissions, we also talk about waste. I think we talk about money, which is always an important aspect here. It's a lot of money that we are wasting every year by throwing away so much clothing in landfill. At the moment, it's less than 1% that can be recycled from whatever we are throwing away. And all of that results in about $100 billion wasted per year. Wasted resources, you know, like fabrics, dyes, and things like that. Wasted resources in terms of manpower and labour that has come to that, that just gets to landfill. So currently, to also put a comparison to that, one garbage truck per second is the kind of agreed number, but it is a very hard number to reach. So this one has been done by the Ellen MacArthur Foundation to achieve this number, but it's actually a very tricky one to identify because, as you may know, transparency— and I think our colleague will talk about later on— transparency is a major issue in supply chains. And not a lot of— a lot of us don't really know how much clothing is actually produced, therefore how much is actually being thrown away at the end. So a lot of money being wasted here is why I'm here today, to try to talk about the alternatives that can help us to develop a circular economy that can be beneficial for all of us. So why resale? And I'll start talking about resale because it's the most common system that we can find. Resale from an environmental point of view first is really something that would help us to reduce the carbon footprint by 20 to 30%, simply because it means whatever you reuse, you don't have to buy, simple as that. And also because actually the use of the item is only about 20 to 25% of the carbon footprint of an item. Most of the carbon footprint comes from the production, transportation, and retail, right? So if we keep an item for longer, then it's a pretty easy way to reduce its carbon footprint. So just knowing that, this is something that can help to justify why should we look into these alternative business models to have a better environmental impact. And then this is the reality. Why should we look at resale? Because this is a study we did with Regis in 2020. To— we talked to about 1,000 people here in Hong Kong of various backgrounds, age groups, incomes, to try to understand how they behave towards their clothes. And this is what we found: that about a third of people's clothing is never or rarely worn. So rare— never or rarely is basically less than 5 times a year. And then that 2 in 5 people keep their clothes for 1 year or less. So that's about over 30% of clothes are just basically not being worn even once in a year. So that shows us there is a lot of clothing currently staying in people's wardrobes that are not being fully utilized. And so what should we do about this? This is a graph coming from ThredUp. ThredUp, it's an online resale platform based in the US, and they do these studies every year. Where they show us how the growth of the secondhand apparel market has happened. And they're always— it's always quite an optimistic view in the last few years that you can see that since 2021, when they started to record this, and of course they projected to 2028, that is supposed to increase by about to represent— start to represent about 10% of the total market. And the increase has been about 18%. And I think we all here know that the retail sector has experienced lots of difficulties in the recent years following COVID, the rebound that has not really reached the level that we were all expecting. So secondhand markets on the other side does show some promising, promising capacity, at least an increase in terms of just in terms of turnover, but also in terms of portion of how people purchase. So this data, as you can see, we have different groups. Asia is seen as a group that is going to be growing the fastest. But yet these are more US-based numbers. So continuing on this, just to show you some ideas of the way they have asked Gen Zs behaviour towards secondhand and resale. Gen Z is about 30% of the population globally, roughly, and at the moment we can see that they are extremely interested in looking at the resale value of their item. So that being true, not just for luxury, which used to be the case anyway, right? When you were buying a luxury, especially handbag or accessories, a lot of people would already consider what is the resale value of this item, how can I, you know, is it a worthwhile investment? But now this is something that only also happens to a lot of different kinds of brands and no longer only luxury, affordable luxury and mass market as well. And I'll show you afterwards a lot of them. So of course, they were showing that the resale value, like it's a huge amount of the decision-making for Gen Z in terms of what they're going to buy as well and trying to compare it with for the rest of the consumers. Of course, it's always interesting for them to look at Gen Z as the future consumer, the consumers that we can have for the longest period of time. So looking at this, it's something that is starting to be a lot more part of the decision-making, at least for younger generation. So the resale value. And if we compare that with the amount of clothing that is currently in people's wardrobe not being used, what's the possibility there? We also did a survey here in Hong Kong. So we did two, one in 2020, one in 2021. While not as extensive as the one done by the US, ThredUp, we were also talking to 1,000 consumers here in Hong Kong, not secondhand consumers, just various types of people, again, different income, different backgrounds, to try to understand what is their interest in secondhand. It's quite interesting. So it's, as you can see, as you know, data is data. And if you integrate, if you ask 1,000 people and you ask another 1,000 people, I'm not telling you that this is the perfect explanation that yes, of course, everything has changed. But I think in general, this is something we also observe, not just with this data, but also with people's behavior. In the last few years, we have observed, especially after COVID, the increase of the number of secondhand shops. Either brick-and-mortar or online shops, IG shops especially in Hong Kong, many led by Gen Z shop owners. We also saw the rise of swap activities that has been really great in Hong Kong, really showing us that there is an increased interest in reselling, in purchasing secondhand and reselling as well. So we recently talked to a friend's consignment shop more luxurious than whatever ReDress does. And they were saying they just can't keep up with the amount of things that they are receiving as consignment. So there is definitely a trend happening of people interested in purchasing secondhand but also interested in reselling. We also looked at the factors. What is it that we can do to encourage people to purchase secondhand? And of course, I think not surprisingly, in Hong Kong, hygiene is a very key area, and that's something very important, but also quite doable as retailers, right, to try to see how we can make sure items are clean and sanitized. Of course, making sure that cleaning are not fake, pretty important. And again, as retailers, if we started to sell, to resell your own brands within your own shops or on platform, this is also one way that people can have the confidence that the item is authentic because it comes from the actual brand. And then the third one is most important, kind of equal, would be also that, you know, having their favorite brand. And this is something, of course, we notice everywhere. People are very brand sensitive. They may have a lot of brand loyalty, again, whether it's a luxury brand or not, and they would be interested to find their favorite brand. So this is why I highlighted these three items, because I think these are the most relevant. To retailers at the moment that we can use as elements to understand how we could— the benefits of reselling items. So opportunities for resale. We found that about 66% of consumers were likely to purchase secondhand in their usual retail stores. With secondhand, we noticed something also interesting is that a lot of people, they are keen on trying it out, but they're also like, where is the secondhand shop? I don't know secondhand shops. How can I find them in my favourite malls? So having them proposed as an option within a retail space that they know, that they love, that they enjoy the experience of, could be an interesting way to start convincing consumers that secondhand could be an interesting option. It's also a way that these items are presented, of course, within the brand image and not as a separate item, because we know that when people purchase secondhand, very often they would come with a brand in mind, with a style in mind, and that's what they're probably going to be looking for. And we found that also, of course, majority of people interrogated were going to see brands who offer secondhand in their usual retail store as a more positive brand, so increasing the brand image of, of these specific retailers. Just to show you some ideas of platforms. We often have the discussion around should it be online, should it be offline, which one is the easiest one? In Hong Kong, of course, online and offline have pretty big differences. We all know the price of a rental space in the IFC. So online and offline, as you can see, my different two different blues show that people are buying both, right? They're going to both directions. Of course, we added our little shops in there, but you can see that we have a lot of different platforms. And interestingly, Carousell, which is really an online app that is completely customer-to-customer, is currently the biggest one. Why? Because it's very, very easy and you can buy anything and everything. But as you can— as you may remember from my previous slides, there is no— there is a big issue about authenticity of the brands, a big issue also about like where is this item actually coming from, and definitely zero experience of a retail shop because this is really person-to-person. So also finding their favorite brands, easy on Carousell, and that's also why people are going for that because this is the easiest way to do it at the moment in Hong Kong and also the cheapest one very often. So a lot of the other ones are actually other secondhand shops online and offline. Some of them are US-based or foreign-based, and some of them are locally-based. And yeah, and we have a couple that don't necessarily remember where that was. But I think it's interesting to see that there is no clear cut between it has to be physical shop or it has to be online. People are also very used to purchasing these online, but tend to seem to also appreciate an in-store experience. This is something— this is more of an anecdotal feedback, but we've been running pop-up shops with Redress for about 6 to 8 years, and we've constantly tried to make them look as nice as possible. And we know that very often having this retail experience is really key for people to switch them to secondhand, because they're very often— the idea of secondhand may be something not very pleasant. So again, this is also an opportunity here to include that in a very lovely retail space connected with your brand image that could really switch people's mindset around what secondhand could be. Top reasons for people to purchase secondhand. Again, I think not a lot of surprises here for you. It is cheaper. And so this one comes from 2021. So I would be quite interested to ask this question again today, and hopefully we'll get to organise this kind of survey very soon. But it is cheaper. It's cheaper, and I'm— I can bet that right now this actually is increasing because of course we all suffered from inflation and having secondhand remaining usually cheaper than the retail options can make it more accessible to a number of people. Again, I'm not just talking about luxury brands, and I'll show you in a slide afterwards. And the second one, it's environmentally friendly. Everyone wants to feel good about what they're purchasing. We all love fashion, but if we can buy fashion that is also good for the planet, that makes everyone happier. So this is again coming from ThredUp, another of— another way that they were showing the new brands that have come on board recently as resellers. Some of them you may recognize as opening their own platform, some of them selling through other platforms, and just trying to show how, yes, it used to be non-existent in 2020 pre-COVID, and there has been a surge in the last couple of years, so a surge of interest, as you can see also on brands. So this is also, I think, showing us this 74% of people working in retail saying that they are looking into it. So I'm sure— I don't know if it's 74% of this room today, that would be quite interesting to know, but quite a large number of people thinking about it. So right now, what's going to happen also very soon is also the being able to move on it quickly, faster than others, could also still be an advantage at this stage because there is still a huge room for growth. And I'm also showing you the different brands that came up recently. The main reason I wanted to show you is my little comment on the side, but I'll come to that in a second. So what has that helped people to achieve? So of course achieving their sustainability goals, I'm sure that's pretty obvious, but also generating more revenue. And very often when I talk to brands about it, this is the first concern, a very valid one, obviously. But is that going to actually help us to achieve more revenue? And I think this, this study is pretty interesting from this aspect to show us that it is possible. Not to say that it is not challenging. And I think the bottom data that the number one concern of brands is not getting enough inventory of pre-owned product shows one of the very important concerns here. Very often we also have the concern about the actual logistics, but we can, you know, come to me if you want to discuss that afterwards. But yes, mainly I think 65-67% of people saying that it has become a meaningful revenue stream for their company is really the one that we should try to get from that data. And just showing you the brands on the right-hand side simply because I wanted to show you the fact that I was saying about, it's not just about luxury anymore. Within Gen Z especially, people are interested to purchase any kind of brand that they like in secondhand. It doesn't really matter anymore whether it's luxury or not. It's more about a brand that they like, an item that they like, an item that is being sought after. So as you can see, most of the brands here are actually affordable or mass market brands. And what happens in Hong Kong? Uh, at the moment we don't really have a resale concept here in Hong Kong. I'm sure you recognize a number of the brands here mentioned on this list, uh, to be also brands that exist in Hong Kong. And at the moment it's something that is definitely more mature in the US and in Europe, but we definitely hope to see that happening in Hong Kong more often. Asian customers are also very interested in looking at these alternative business models. And I think the success of different platforms I was mentioning earlier should show it to us. So we hope to see more and more people looking into this resale aspect here in Hong Kong, where there can be also lots of benefits about, for example, it being quite a small territory, making it easier to— for logistics and also the interest in novelty, which is quite a strong aspect of consumers here in Hong Kong, the interest in new and up-and-coming activities. So, some last— one of the last points I wanted to show you is about the take-back aspect, because of course if you want to be able to resell items, it's also going to be interesting to first collect it. This is an example of a partnership that we have with Tommy Hilfiger. And we noted from the same study that most consumers, 88%, were actually interested in take-back programs. Take-back programs, again, can be a very positive way to associate your brand with, usually seen in a very positive way by consumers, and make it very easy to consumers to not only shop from you but also give away their clothes to you to then be reused and potentially resold. Buy your brand. So looking at this and looking at the programs, we only have very positive feedback from consumers on that, and hopefully this 88% is going to keep growing as the concept gets into people's mindset. So before I— so yeah, I just want to conclude quickly on the increased appetite for secondhand and for alternative business models that consumers see because it's more environmentally friendly and because it's cheaper as the two main reasons. Established interest in take-back programs. People are getting more and more used to that. And with the arrival of the domestic waste charging here in Hong Kong, it's going to make people even more eager to actually access take-back programs so they can give away their clothes to have another life. And not have to pay to dispose of them. And as earlier I was saying that a lot of clothes are currently sitting in people's wardrobes, so that is an unused potential to promote resale, to make resale advantageous for consumers who surely will be very happy to benefit from that and increase the resale value of their wardrobes. I'll leave you with just one thing, which is that we are going to be running a special campaign in May, in May 2024. This Get to Dress Month campaign is our annual campaign where we encourage people around Hong Kong to collect unwanted clothing that can then be sorted for reuse, recycling, and donation to charities. It's an easy way to engage consumers around this topic because it's fun. It's a very, very easy step to take and then to encourage hopefully brands here to look into alternative business models to promote sustainable options for consumers. So I leave you with that, and thank you so much for your attention. Is there— thank you. Is there any question? Okay, I don't know, so thank you very much. Oh yes, we do both, we definitely do both. In terms of the study that have been done, they did include clothing and accessories as well as shoes. They included everything in in there. Certainly we know that from experience, of course, for example, shoes tend to be harder to resell for obvious reasons, because once you've worn them a little bit, they are very, very worn out, very usually, whereas accessories tend to be the easiest thing to resell because of course it's not really attached to a physical person, it doesn't have a size as well. So definitely there are some differences between different categories of items, but these studies were done on like the globality of all kinds of fashion items. Thank you. Oh, interesting. Sorry, I didn't see this. So, resell the real life— impact the relationship between my— hmm, that's a very big question. So how does it impact the relationship? Well, definitely with customers, I think I was explaining a little bit that there is a potential to create new new relationship with customers where they see your brand not just as a first point of purchase, but also a second point of purchase, and potentially someone who can, you know, that they can help to give a new life to their clothes that they no longer want to wear. With manufacturers and suppliers, there is an aspect, of course, of increasing the long-lasting aspect of clothing, right? That if we want items to be able to resell, ideally they are made to be resold. Therefore, they are made to stay, to last for a longer time. So this circularity aspect, I talked today about the, the resale aspect, about the consumer aspect, but really it also would have a strong impact on, of course, the design and the manufacturing, because you can only resell something if it's still looking nice and new. And obviously a circular fashion system cannot really work without having that in the, in the beginning. So while we see also any brand being resold, we know that the value of resale resell obviously is increasing with whether the item looks nice or not. So certain brands may be harder to resell from that regard, and we really hope that seeing this resale opportunity will drive manufacturers and brands to increase the quality of the items that are being put on market. Do you see resale driving a retro clothing market? If by retro that person means vintage-looking style, I wouldn't really say so. At least in Hong Kong, you have something very interesting, which is the secondhand shops. A lot of them have their own style, which is really amazing. So some of them are very retro, some of them not at all. So you have— every shop would have their own personal style. So I don't think it's necessarily retro. Something I do see is sometimes the confusion between secondhand and vintage or retro, which obviously doesn't mean the same thing, but we do see that confusion from time to time. So I think, yeah, resale can drive a secondhand clothing market, but not necessarily retro. So to the question about the revenue potential, we would have to look at numbers. I cannot really say from the top of my mind. It depends obviously about the size of the brand, the number of shops, the actual retail value of the items. So I think it depends on a lot of elements. A bit too difficult. Would be a very interesting case study to look into together, obviously. It's completely dependent on— can we have the screen back with the questions? It's completely dependent on what that brand is and also how they manage the take-back and the resale aspect. Some brands indeed would do repairs and then just return to to customers with no price. Some brands would actually prefer to do just take back and resell as is. These options involve different kind of costs. And so finding that unique selling point is really up to the brand. And I think here there is a lot of room to create something that is your own very unique resale offer. If you look at Patagonia, the repair and the return, I think mostly for free. If you look at— we're talking about Lululemon in the US. They would mainly take items that are in a very good condition and resell them. So everything is possible within that, and I'm sure there is a lot of opportunity that again will depend on the brand. Brands we commonly come up— so as you can imagine, because we work with shopping malls and with specific shops, we do see a lot of the brands coming from these specific shops and brands, which kind of makes sense, but it's quite a big mix really. So we do see indeed a lot of Zara and a lot of Tommy Hilfiger because simply we have our boxes in their brands. It makes sense, which also means that if it's in your shop, what kind of items are we going to find? This is also why we're talking about TakeBack as potentially a solution to help you start a resale capacity. Because if people can identify that my item from that brand, I can return it to that brand and I can shop from that brand. It's certainly a much easier pathway than having to return it to some other guy's brand. So we do tend to see that. But then we see a huge amount, a huge variety. We also get a lot of luxury, but we also get a lot of very fast fashion brands that is kind of all in together. We also get things that are from perfect condition. You don't even understand why it's in the box because it's so beautiful and perfect. And items that are, of course, very, very damaged. And that's the whole purpose of what we do, is to take them all because we know that we need to find a solution for each and every one of these items. And we cannot ask the consumers to, by themselves, be able to decide, oh, this is, you know, not good enough and I can put it over there, and this is good for that charity and I give it to that charity. That's a very complex system. So this is why we're trying to be that middle organization to help consumers out with this issue. I think that was the last question. Thank you so much for your attention.