Two New Profitable Business Models for Your Fashion Brand in 2022

Two New Profitable Business Models for Your Fashion Brand in 2022

What is a Business Model?

If you’re looking to start a fashion business, chances are you are thinking about how to fine-tune your business model. 

A business model is the blueprint of your company, a simple and straightforward document that details the logic your organization is going to follow and how it is going to align its assets to pursue its mission and vision. 

Ultimately a business model will allow you to identify the value you are delivering to your customer and how you can generate revenue by serving your audience. 

The most popular framework used for developing your business ideas is the business model canvas. The BMC, in short, is a visual tool to help you break down the building blocks of your organization and understand how the assets you are building through your company are able to create a unique value proposition your customer simply can’t resist.

There are some foundational benefits connected to using a business model framework to develop your business:

  • It allows for trial and error. When developing a strategy for your business, there is a lot of guessing involved. To get the business off the ground an entrepreneur is forced to make assumptions about the three variables of a startup company: the customer, the problem, and the solution. By using the business model canvas, a founder can make a hypothesis, about these variables and test them, as he\she engages with the market.
  • It allows you to be creative. The focus of the model is to create value, aside from this goal, there are no specific rules to follow or pre-determined answers that you need to apply. A founder can use the Business Model Canvas to string together a unique set of assets that are able to bring to market the value customers are looking for. An example of this approach is provided by companies like Rent the Runway. In the link we’re providing a full analysis of the companys’ business model canvas by looking into each component of the brand’s strategy.
  • It allows you to focus on the customer. Last but not least, by focusing on value creation, you’re focusing not focusing on what the product is, but on what the product does. In this sense, the BMC helps you to understand that the focus of your company is solving a problem, not creating an item. This element is essential to approach the market by understanding customers’ behaviors and habits, as suggested by Jobs to Be Done Theory.

This is why, as a fashion entrepreneur, it’s always a good idea to keep an eye on the new business models that are being developed in the market, to make sure you’re not lagging behind the competition. 

In this post, we’re going to look at two new business models that have shaped the industry over the last few months, and are worthy of a little extra analysis. 

With no further ado, let’s dive into the topic. 

The Co-Creator Customer

In this model, brands realize that a customer does not perceive value in a one-direction relationship with a brand.

The relationship between the customer and the brand isn’t hierarchical anymore. It’s a peer-to-peer relationship. This relationship is what fuels the value of the brand, as customers are willing to be more than just clients, but want to feel as they are partaking in the company’s mission, helping it succeed.

As a result, brands need to change their approach to the market, as they don’t need authority validation (like brand endorsers and celebrities). What they need instead is the credibility that comes from social validation, coming from the users themselves – often through social media.

Brands need co-creator customers to experience the product and validate their brand promise.

The co-creator customer wants to test the brand and its social currency, by creating content that celebrates a product and adds a social dimension to it. This content is usually referred to as user-generated content.

In this sense, developing a relationship with the client is more important than simply selling the product. In order to pursue a higher degree of customer loyalty (and a higher customer lifetime value), a brand will be open to providing all sorts of entertaining, informative, immersive retail experiences to “lock in” a customer.

This will increase customer acquisition costs but on the other hand, it will increase the likelihood of building long-term engagements.

In this sense, a product is not simply the end of the “sales funnel”, it becomes a tool to start a relationship with a brand.

The Producer-Designer-Client 

This model is very popular for those individuals who have experience with crowdfunding and crowdsourcing platforms. 

In crowdfunding and crowdsourcing campaigns founders who are developing a new product or service build a close relationship with their customer audience in order to collect as much information as possible about their respective markets and learn how to make their product better, or more desirable.

In the producer-designer-client model, a customer is engaged in the development of a brand’s product in every stage of the “value chain”.

  • Customers are engaged in social media, as a company starts developing its own voice. 
  • Customers are providing feedback on possible product ideas.
  • Customers access early sales of new product offers to provide real-time feedback.
  • Customers share their product experiences and contribute to marketing efforts.
  • Customers suggest new features to be developed or implemented.
  • Customers connect to the brand and build a personal attachment to it, as they feel as their voice is being heard.

In relation to this last point, we can see that brands that build this producer-designer-client model create what we can also call the IKEA effect. The IKEA effect is a sense of enhanced appreciation for products that we have literally built ourselves, like IKEA furniture.

Great! Now that we’ve covered these new innovative business models, it’s time to draw a few conclusive remarks.


As we’ve discussed in this post, these two new business models are impacting the fashion industry and disrupting the traditional ways in which brands and companies manage their customer relationships. 

Digital technologies have fundamentally altered the once “hierarchical” relationship between customers and brands, and have made them evolve into peer-to-peer conversations. 

If you’d like to read more on business model development, one of the most authoritative books in this space is Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers (The Strategyzer series).

This is a very interesting publication that will help you develop a strong customer-centric approach to building your business.

f you’re interested in understanding new and upcoming trends in the fashion market, in this article, we’re discussing 5 consumer trends to watch out for!  

Also, don’t hesitate to explore our blog! We’re sharing a wealth of material for you to learn more about business models in the fashion industry. Enjoy!

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Two New Profitable Business Models for Your Fashion Brand in 2022 In this post, we're looking at two very innovative business models which are impacting the fashion industry and creating new opportunities for value creation.
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