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If you haven’t met SHEIN yet, it’s probably because you didn’t mean to at all.
The Chinese fashion site has grown exponentially in recent years with a highly targeted social media strategy that has captured the attention – and wallets – of Generation Z and Millennial shoppers.
For young consumers who like to be trendy and often on low incomes, Shein is almost irresistible.
“I don’t think there are many players in the world targeting young consumers like Shane,” said Charles de Brabant, executive director of the Bensadon College of Retail Management in Montreal.
Toronto resident Jay Elanco says she’s shopping at Shein when she’s looking for affordable basic or unique clothing for an occasion.
“I’m like, ‘Okay, I’ll wear it once or twice or more,’” said Elanko, “but I don’t care too much about the quality itself.”
And while the materials aren’t on par with other brands, the 27-year-old says the price makes up for it.
Shein is now said to be worth $100 billion, surpassing big tech companies like Zara and H&M as they establish themselves as a leader in e-commerce. However, the company has been criticized for its sustainability issues among other practices and the fast pace of production.
While Zara offers around 600 products marked as “new” on its site, Shein offers over 6000 new products daily at prices significantly lower than its competitors.
I also found out last fall that Shein was an online retailer that sold products containing high levels of toxic chemicals, which were later removed from their site.
Despite the huge interest over the years in unsustainable practices in the fashion industry – and a young demographic claiming to care about the environment – the rise of the site is evidence that fast fashion is growing.
The original online player
Shein was founded in 2012 by current CEO Chris Shaw as a business-to-consumer retailer that buys products from local manufacturers and sells them worldwide.
According to their US site, their “digitally enabled agile supply chain” allows them to arrange orders from small batches of manufacturers that can be quickly delivered to consumers, to see what’s hot.
Shein’s ability to operate small production batches and test them with customers is beyond that of other retailers, says Sandrine DeVillard, senior partner of Montreal-based McKinsey.
“Because you have all the advanced analytics, you can read the client and decide whether it’s going to be successful or bad, and then you can renew in less than three weeks,” DeVillard said.
“You are in an amazing winning position, which is what they do.”
Unlike other retailers who have had to adapt to the rise of e-commerce, de Brabant says Shen’s operations are designed with a digital approach.
“The massive benefits you can sell just about anywhere, or what Shein has effectively done,” said de Brabant.
And while the lack of physical stores have their drawbacks, Shein eliminates some of the hesitation associated with online shopping by offering customers free returns and free shipping on orders over CAD49.
But what stands out from the experts who have followed the rise of Shein are the site’s algorithms serving virtual window shoppers exactly what they want to see. According to McKinsey, Shein uses “behavioral economics and gambling principles” which results in customers spending an average of 8.5 minutes on the website, longer than any other fashion site in the US.
Watch | Brazilian musician Anita collaborates with Shein to collect:
Shein has also excelled in her ability to direct customers to her site. The retailer has developed a strong presence on social media through influencers who primarily promote their products on Instagram and TikTok, to reach the next generation of consumers.
“We think that’s the main driver of its growth,” said DeVillard. “They are able to use their influence to reduce investments.”
Shein works with all levels of influencers, from celebrities like Brazilian singer Anitta to micro-influencers with thousands of followers. Some have replicated the same clothes using products from Shein and major competitors to compare prices and products.
“They are all boosting [Shein’s] Devier said credibility prevails.
Affordable, trendy and unsustainable
Shein’s success with young consumers contrasts with their stated values around the environment and sustainability.
The apparel and textile industry is responsible for two to eight percent of global greenhouse gas emissions, according to the United Nations Alliance for Sustainable Fashion. This is in addition to the high use of water in industry and the environmental impact of products that end up in landfills.
According to a survey conducted by Ipsos last fall, young Canadians place threats to the environment and climate change among their top five concerns. A sample of 501 Canadians between the ages of 18 and 29 was surveyed from September 3 to September 6, 2021. For comparison purposes only, a probability sample of the same size would result in a margin of error of +/- 5 percentage points, 19 times out of 20.
Shelley Haines, a lecturer at the Metropolitan University School of Fashion in Toronto, published a study last year on the gap between consumers’ attitudes toward sustainability and their actions.
” I found [the participants’] The wardrobe did not express the same level of sustained interest that they did in terms of interest and values,” Haines said.
The researcher found that some of the barriers to sustainable behavior were related to price, style, and a lack of knowledge about how to care for and repair clothing.
“One participant told me she bought the same skirt twice in a very short time, only because the zipper on the first skirt broke,” Haines said.
Elanko says the price is really what drives young people to jump into fast fashion, even though he knows its impact on the environment. She added that those with fewer financial resources should not choose between style and durability.
“I really think it’s because they can’t stand anything else,” Ilanco said.
Consumers today have more choices for conscious shopping with independent sustainable brands offering fast fashion alternatives. However, their prices are often significantly higher than those of major retailers for a variety of reasons, including the cost of materials and production volume.
Hines says sustainable fashion is within the reach of franchisees. For shoppers looking to balance finances and values, Haines recommends setting aside some of your fashion budget to buy fewer but more durable items, wear fast fashion items for longer, or explore thrift stores.
sustainable fashion future
Big brands are investing more in sustainable products and practices in recent years. Zara describes its website that lists its timeline of environmental goals, including reducing the impact of water on the supply chain by 25% by 2025. Recently, H&M announced that its line of baby products is fully compostable.
Shein has also set up a profile page on its website that lists some of the ways its operations integrate sustainability, including using solar-powered vehicles to transport products and testing in small batches before mass production of an item.
Shein’s success is likely to attract the attention of competitors and raise concerns about the future of the industry. DeVillard expects Shein to continue to grow and that its success will inspire other retailers to “up their game.”
But de Brabant is lukewarm on whether its growth can continue, especially given the very slim margins.
“I’m always a little concerned about exponential growth rates like this,” he said.
For traditional players in the industry, De Brabant is not recommending trying to compete with Shein on price and instead says they should focus on their business models that provide stable and healthy growth.
Shein’s success may seem like he’s found a way to avoid any consequences for his role in a quick way. However, de Brabant and Devilard believe that the company will eventually have to rely on consumers for environmental, social and governance concerns.
” to me [some] DeVillard said: “A period, mental behavior will follow.