McKinsey Institute for Black Economic Mobility

Unlocking the full potential in fashion for Black consumers

| Article

By definition, fashion—particularly apparel and shoes for mass-market and luxury consumers—is culturally and personally significant. For Black American consumers, fashion signals taste as well as personal and cultural identity; as such, Black Americans have long set and influenced broader tastes and trends in fashion.1 The Black consumer is also economically significant. Our analysis suggests that Black consumers’ spending on apparel and footwear will grow by about 6 percent a year to $70 billion in nominal dollars by 2030. This will be part of the total of $445 billion in nominal dollars that our survey data suggests will be up for grabs from 2022 to 2030, including a cumulative $50 billion in entirely new spending.

The channel preferences behind this spend on apparel and footwear are not novel. Black consumers increasingly use online channels to shop for these products, and they are also more likely—by 11 percentage points—to prefer to use e-commerce to shop for and buy apparel. What is especially distinctive is Black consumers’ strong preference for Black-owned fashion brands and brands that are culturally resonant with Black culture. They are up to three times as likely as non-Black consumers to switch to a Black-owned apparel or footwear brand.

These preferences are linked to an overall rise in inclusive consumers across race and ethnicity: 45 percent of consumers want to support diverse brands.2The rise of the inclusive consumer,” McKinsey, February 8, 2022. To address these preferences, companies in fashion—both incumbents and new entrants—should implement holistic strategies along four dimensions: product innovation inspired and led by Black consumers, activation of Black consumers, affordable products that appeal to a wider range of consumers, and channel optimization in Black communities. The reward could be brand-level dynamism and a wider base of Black customers.

Needs and preferences of Black fashion shoppers

Despite the economic significance of the Black consumer to the fashion industry, our 2021 survey found that Black consumers cite concerns about the lack of diversity, equity, and inclusion in the industry, as reflected in the makeup of the ranks of leadership, designers, and corporate-level commitments to social justice.3Black consumers: Where to invest for equity (a preview), McKinsey, December 2021. They are dissatisfied and willing to switch from current brands: while Black consumers report a comparable level of satisfaction with fashion offerings as their peers—about 82 percent—75 percent of both Black and non-Black respondents to our survey would be willing to switch footwear and apparel brands, and 83 percent would be willing to switch luxury brands.

Our research suggests that Black consumers may respond to these gaps by looking for Black-owned fashion brands, prioritizing price and value, tapping friends and family for inspiration and recommendations, and actively doing research online.4Black consumers: Where to invest for equity (a preview), McKinsey, December 2021.

Desire for Black-owned brands

Crucially, Black consumers have an outsize preference for Black-owned brands and brands that speak to Black culture, and this remains true across sectors (Exhibit 1). With fashion, our research shows that Black consumers are up to 2.3 times more likely than non-Black consumers to switch to a Black-owned apparel or footwear brand. This demand for fashion brands that speak to Black culture is especially prominent in luxury fashion goods: two of the top ten key buying factors for Black respondents to our survey are related to brand inclusivity and leadership diversity. Comparatively, these factors are not reflected in the top ten buying factors for non-Black respondents.

In every sector, Black consumers are more likely to switch to a Black-owned  brand than non-Black consumers are.

This preference is growing among non-Black consumers, too, as American consumers increasingly make shopping choices based on their social values. These influential inclusive consumers, who cut across ethnic, income, and age groups, are more likely to buy Black-owned brands to support diverse entrepreneurs. However, actually finding these brands and products remains a significant barrier: one in five inclusive consumers cite an inability to find products as a reason for not buying from Black-owned brands.5The rise of the inclusive consumer,” McKinsey, February 8, 2022.

Conscious of price and recommendations

Our research suggests that a fashion brand’s ability to tailor marketing and engagement to Black consumers could be particularly fruitful. These consumers are more likely to rely on recommendations from friends and family—one of the top four critical buying factors for footwear and luxury fashion goods for Black respondents in our survey. Maintaining a strong brand position and capitalizing on word of mouth and buzz can reinforce a brand’s value in the Black community.

In addition, Black consumers are more price-conscious when evaluating brand alternatives—a finding that holds across sectors. Compared with non-Black shoppers, Black consumers are four percentage points more likely to switch luxury brands to pursue lower price points. These findings suggest that marketing material that highlights the value customers can experience from brands’ products would be particularly well received.

Preference for digital channels

Black consumers are five percentage points more likely than their non-Black counterparts to visit a brand’s website before making a purchase but are six percentage points less likely to read print reviews. This digital-first engagement style may be a sign of their active engagement with brands or reflective of the fact that they are relatively younger. Our research on key buying factors shows that Black consumers are active shoppers who are continuously on the lookout for brands they trust and are proud to support. For example, Black consumers are ten percentage points more likely to follow luxury brands on social media, which can be a way to engage with brands outside the context of a purchasing decision, especially because Black consumers often find in-store experiences lacking.

Black consumers are active shoppers who are continuously on the lookout for brands they trust and are proud to support.

They are also more likely to shop online for fashion than non-Black consumers. The one outlier is footwear, which Black respondents have a noticeable preference to purchase in-store (Exhibit 2). Despite this preference, Black respondents express higher rates of dissatisfaction with brick-and-mortar offerings across categories, citing elements such as distance, layout, and in-store merchandising. This dissatisfaction is noticeable for department stores, which Black respondents are five to 12 percentage points less likely to be willing to revisit compared to non-Black respondents.

Black consumers prefer online delivery for apparel and luxury fashion and goods but prefer an in-store purchasing experience for footwear.

Four strategies to amplify cultural relevance

Companies in the fashion industry should seek ways to serve Black consumers effectively and holistically across the full value chain, from product design to distribution and marketing.

Design and introduce products inspired by Black consumers

Fashion retailers and brands have the opportunity to reach Black consumers by helping Black-owned brands overcome barriers to growth or innovating their own products to fit the needs of Black consumers.

Amplify the work of Black creators and Black-owned brands. The structural barriers that keep Black-owned businesses from expanding also keep Black-owned brands from scaling. Despite their unique ability to meet the needs of Black consumers, brand awareness, access to capital, scaling without compromising operational excellence, and access to networks and mentorship are all challenges for Black-owned brands.6The rise of the inclusive consumer,” McKinsey, February 8, 2022; “The Black unicorn: Changing the game for inclusivity in retail,” McKinsey, November 17, 2021; Milan Prilepok, Shelley Stewart III, Ken Yearwood, and Ammanuel Zegeye, “Expand diversity among your suppliers—and add value to your organization,” McKinsey, May 17, 2022. Less than 1.0 percent of venture capital funding goes to Black founders,7 and only 4.0 percent of Black-owned businesses continue operation after three and a half years, compared with 55.5 percent across all businesses.8The Black unicorn: Changing the game for inclusivity in retail,” McKinsey, November 17, 2021.

While the solution is multifaceted, established fashion brands and retailers can support the growth and longevity of Black-owned brands. For example, one retailer helps consumers find Black-owned brands more easily by highlighting diverse brands in a dedicated section on its website. Incumbents should also evaluate consumer perceptions of their brands and identify opportunities in which collaboration with a Black-led brand might help these growing brands accomplish a strategic aim. Such collaborations would help Black-led brands gain visibility and financial and social capital while contributing to the established brand’s own product innovation. For instance, one major American label partnered with designers from historically Black colleges and universities (HBCUs) to launch a targeted collection.9 Once launched, the online collection sold out in less than 30 minutes and the in-store collection within 24 hours.10

These kinds of partnerships and investments can be especially culturally salient in light of recent movements—and widespread corporate commitments—to dedicate resources such as shelf space and capital to Black-owned brands.11

Invest in innovation to meet Black consumers’ needs. Many companies, mostly Black-owned, are already innovating products with Black consumers in mind. One company offers nude underwear specifically for Black and Brown women. Another offers nude-toned shoes for darker skin tones. A third company makes swim caps that are designed to be easy to wear and nondamaging for athletes who have curly and textured hair.

Other apparel companies should contribute their own innovations. In addition to building on the existing work of Black-owned brands and Black creatives, companies should invest in their own understanding of Black consumers’ challenges with apparel and footwear. Hats for different hair types and textures, nude tones that match a wider range of skin tones, hair wraps, and clothing that pays homage to Black culture and style are a few important areas. The insights that generate more of these kinds of innovations are most likely to come from a diverse group of employees who can offer their culturally and personally relevant perspectives.

Activate Black consumers

Having products that appeal to Black shoppers is just one aspect of making a brand or company more likely to reach those shoppers. Another is working to market products in ways that appeal to Black consumers and encourage them to shop.

Ensure diverse marketing and communications campaigns. Diverse marketing campaigns are especially salient in fashion, which is built on offerings that help consumers shape their own images. However, Black consumers report that they do not see themselves in these campaigns. Designing diverse marketing and communications campaigns is not just about casting diverse models. Companies should ensure that images reflect how products address fashion needs or style preferences unique to Black consumers—for example, how scarves or hats can be styled for Black hair.

Of course, companies in fashion should already have efforts under way to connect with Black consumers. One major American label often uses actors from Black-led film and TV projects as models in its inclusive marketing campaigns. Another works with Black celebrities and influencers as part of a broader inclusive marketing strategy. Some brands’ experiments in working with artists and public intellectuals as spokespeople could also translate into fashion marketing for Black consumers.12Investing in—and with—Black consumers in financial services,” McKinsey, September 6, 2022; Alexandra Jacobs, “Joan Didion on the Céline ad,” New York Times, January 7, 2015; Lucy Whitehouse, “Chimamanda Adichie is new Boots No7 ambassador,” Cosmetics Design Europe, October 27, 2016.

Promote user-generated content. A source of consumer feedback can be a boon, particularly for mass-market brands. Ongoing consumer feedback can become self-renewing, consumer-generated content that enhances brands’ digital experiences and bolsters online communities, especially if this feedback is shared with the public. Dedicated spaces for commentary and recommendations are one way to help Black consumers engage with brands and other consumers in the ways they already enjoy. As previously discussed, our research shows that Black consumers are more likely to use social media and to seek out recommendations.13Black consumers: Where to invest for equity (a preview), McKinsey, December 2021.

Digitally native brands are among the savviest practitioners of this approach. Some invite customers to share photos with a branded hashtag that the brand incorporates into its online platforms. One digitally native fast-fashion brand reaches out to brand supporters on social media and promotes its products by making those supporters brand ambassadors. Another promotes haul videos (videos in which users show off their purchases) on social media, which helps prospective customers see how the brand’s clothes look on people who are not models.

Emphasize product affordability to reach more consumers

Once a brand or retailer has popular products and the marketing to match, a third strategy to amplify cultural relevance is making products affordable. And fashion companies have multiple options for doing so.

Embrace affordable luxury. Consumers want quality at an affordable price; for many, that means luxury brands are completely off-limits. Black consumers in particular have faced barriers to accessing these brands due to the growing racial wealth gap. More recently, however, luxury brands are trending toward offering more affordable products that are attractive to a broader range of customers. Some brands and companies are now developing limited-time products and creating an independent line to target a broader range of customers. Off-White has an affordable collection, For All, that allows new customers to see themselves in the brand. Proenza Schouler launched Proenza Schouler White Label to meet the needs of their customer “at a more accessible price point.” And Fear of God, by Jerry Lorenzo, launched the Essentials line with lower price points. Designing different product tiers increases the accessibility of the brand to a wider range of fashion-forward consumers.

Brands should make sure their inclusive and equitable in-store policies are upheld to ensure that Black communities are being treated fairly and with dignity.

Offer flexible payment models. Fashion brands can reach a larger audience by implementing flexible payment methods. Brands and department stores are increasingly partnering with buy-now-pay-later solutions to reach a larger audience with their products. Research shows that Black consumers already use buy-now-pay-later solutions at higher rates than the US population as a whole, so this increased accessibility can benefit both the company and the consumer.14Investing in—and with—Black consumers in financial services,” September 6, 2022.

Strengthen presence in Black communities

Fashion companies can facilitate more Black consumers coming into stores (or browsing online) and improve the customer experience.

Optimize digital and physical footprint. In addition to showing up to support organizations in Black communities, fashion brands are responsible for having a digital and physical presence that makes their products accessible to Black consumers. To improve the store network, it will be important for brands to not only analyze the neighborhoods with significant spend in relevant categories but also determine the preferences that foster brand loyalty and engagement among Black consumers in those areas. For example, one global brand recently launched an innovative store design in Black communities that collaborates with local partners to design storefronts and celebrates stories from the community. This brand also had the highest ratings among Black respondents of any fashion brand we surveyed.

Improve customer experience. Creating an environment in which Black consumers feel comfortable while shopping is table stakes for winning Black consumer spending, but many brands are still missing the mark. Our survey shows that store layout is one of the most cited causes of dissatisfaction among Black respondents.

First, brands should make sure their inclusive and equitable in-store policies are upheld to ensure that Black communities are being treated fairly and with dignity. For fashion brands looking to improve their in-store experience for Black consumers, the first steps should be public acknowledgment and goal setting. For example, one beauty brand unveiled a plan to reduce disparate customer treatment and scale back security forces used in stores. Following these initial steps, consistent and transparent reporting will help reinforce public perception.

Brands can also invest in data management and analytics capabilities to generate insights and track customer satisfaction. For example, an industry-leading jewelry brand implemented bias mitigation strategies by partnering with a neuroscience research firm to apply customer survey data to measure the brand’s progress and improve its retail training programs. Beyond the trackable outcomes, investment in bias mitigation can signal clear priorities on inclusion across organizations.

The potential to better meet Black consumers’ needs is significant and meaningful. Changing the paradigm will not be easy, but research has helped to isolate the building blocks that can help brands get there.

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