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How to Sustain Cotton's Competitive Advantage

Cotton isn't in the fabric of our lives anymore. Polyester holds that distinction today. Why is that? Price is a major factor; globally, a glut of polyester – cotton's major competing fiber – only encourages low prices. Then there's fashion: a swing in favor of synthetics has long been underway. 'Athleisure' has made its mark: for consumers, the value proposition is clear, as is the fashion desirability.

So how does cotton compete in such a market? It seems like the deck is stacked against it: cotton prices are down, weak demand and large inventories in China will keep prices low for the time being.

But what about going forward? Is there anything that the cotton industry can do to help cotton regain market share? The short answer is: yes. The longer answer is: only if the disparate parts of the cotton industry come together to support a coherent message.

But which message? There are so many: we have branded cotton, environmentally-friendly cotton, regionally-identified cotton, and regular old generic cotton. But what remains central to the future of cotton is the ability of industry stakeholders to coalesce around a standard that balances the objectives and requirements of environmentalists and economic realities demanded by commercial interests. But then a clear message would need to be articulated to the entire textile supply chain – and consumers.

There are plenty of cotton initiatives in the industry all led by great organizations passionate about their mission and objectives. But as I look at the market, meet with mills and brands, and designers in the US and elsewhere, I am struck by one message that I've heard time and again: cotton has an image problem.

Think about it – environmentalists bash it for using water and requiring pesticides. Social advocates trash it for containing "genetically modified organisms." Mills complain about its inconsistencies (it is natural, after all) while in the same breath complaining about the vagaries of the futures markets. Clothing companies complain that they need more product differentiation – how to stand out in the crowded market. Designers, in turn, look for more flexibility, more options for their creative possibilities. Overriding all of this are consumers, who may or may not care what's the fabric of their lives if the price is right.

For some, the answer lies with organic production – let's strip away everything that was done before, revolt against convention. But does this work? There will NEVER be enough organic cotton grown to make a difference. That's a reality, folks.

However, something fundamental needs to happen with cotton messaging to accentuate its virtues.

Industry changes

Over the past ten years, two developments have dominated the textile and apparel business. First, 'fast fashion' took off as a sourcing and retail replenishment strategy, and, second, cotton got it in the neck. Why is this the case? Is there some causal relationship between the rise of 'fast fashion' and the decline of cotton?

Before we delve into the nitty-gritty of the business of fashion, let's review what we've seen in retail and the cotton businesses recently.

Retail today is piled high with inventory. Thanks to the success of 'fast fashion,' many retailers have developed super-efficient inventory replenishment systems: new products sporting new designs are available in ever-shorter replenishment schedules.

Demand for cotton, on the other hand, is waning, well below its historical average in part because so many of today's garments contained synthetic fibers. It seems that synthetics have made inroads everywhere. Moreover, consumers appear to like synthetics for various properties: wicking, stretch, and, most importantly, it's cheap.

Rapid product development and inventory replenishment may be the norm for many retailers – a successful strategy to be sure – but there are other factors affecting today's apparel business. For example, consider the internet: it seems that online sales of garments are greater than ever before. For brands and retailers, this represents a sea change in the way they not only approach their customers but what kinds of products they source and make.

The internet, however, tends to commoditize goods and services. Ease of delivery, along with low prices, fits the needs of many consumers, but the supply chains required to meet that demand have become more complicated and wasteful. Consider apparel sizing: often online customers, uncertain of a garment's fit, will buy two sizes and just return the size that doesn't fit. What happens to the returns? It's a problem that many brands and retailers lament.

Cheap, however, fits the 'fast fashion' model of production. There's lots of polyester on the world markets today. Cotton prices may be down at the moment, but how will those prices fluctuate over the long term? With so much polyester available what's the incentive for sourcing people to use more cotton? The vast majority of consumers don't care about fiber content as long as the garments meet their needs. So, then, what are the incentives for sourcing people to use more cotton? Not much.

How does cotton fit into the 'fast fashion' model? Indeed, this is the central question for the cotton industry today. Polyester isn't grown; it's made. Weather isn't a problem, let alone the vagaries of agricultural subsidies. Polyester spins easily into yarn. In many ways, cotton is at a competitive disadvantage in the world of 'fast fashion.'

Staying relevant

The greatest challenge for cotton is finding a way of staying relevant in the rapidly changing world of retailing.

But then we have the commercial realities of today's market. What should farmers produce to meet the needs of today's market? Moreover, what should the cotton industry do to claw back its market share?

I think the answer lies with sustainability. First off, it's measurable. Second, it's environmentally friendly. Third, it's commercially viable. And above all, farmers can make a good living growing it. But how should sustainably-grown cotton be best promoted? I suggest it's time for the cotton industry – industry leaders and advocacy groups – to sit down to discuss shared objectives. By some estimates, cotton consumption has fallen to as little as one-third of total fiber consumption. It was closer to two-thirds only 15 years ago. What's ironic is that cotton prices are rock bottom; at some point demand should improve, right? Economics suggest it. But why hasn't consumption rebounded with such low prices?

Sustainable future

Of course, a global overcapacity of polyester has only compounded the situation. But there's more to the problem.

Cotton is out of fashion, at least for now. Of course, fashion will swing back. But such a swing will need encouragement. Sustainability is a message that can help that. And a unified industry response will only make that more likely. Sustainability is cotton's competitive advantage. It's a powerful message. It builds on farmers' strengths while providing what the market demands: environmentally-friendly cotton.

The most successful cotton marketing campaign in history was Cotton Incorporated's 'Fabric of Our Lives' campaign. Simply put, the campaign was brilliant. The message was clear: cotton was as essential to our lives as the air we breathe, the water we drink. Back in the 1970s and 1980s, it helped cotton to cut through all of the market noise about synthetics and wrest back market share. The campaign was a textbook success story. But today's messaging needs to be updated to explicitly state (in so many words) that cotton is not simply the "fabric of our lives" but the "sustainable fabric of our lives."

I defer to industry marketers to come up with a better tagline. But the message needs to incorporate what's best about cotton – its sustainability, comfort, and performance. Cotton needs a revitalized message and now is the time to introduce just such a message. Urgent times demand an immediate response.

Cotton's message needs to cut once again through all of the clutter about synthetics. After all, cotton is renewable and can be grown sustainably. It's time to renew cotton's message. A new crop needs to be cultivated.

Originally published on on April 16, 2016.


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