How purpose and innovation will shape how we spend

In the future, brand success will depend on value and values. Innovation can drive both, says David Wagner, VF Corporation’s executive vice president of venture platforms.

Ipsos | What the Future Spending | How purpose and innovation will shape how we spend
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  • Kate MacArthur Managing Editor of What the Future
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VF Corporation is a global apparel and footwear company with brands like The North Face, Timberland, Supreme and Vans that are ubiquitous from ski slopes to skate parks. David Wagner, executive vice president of venture platforms, leads the company’s entrepreneurial incubator and early-stage venture capital investments. His mission is to take the 123-year-old company into the future while staying true to its purpose around “powering movements of sustainable and active lifestyles for betterment of people and our planet.”

Kate MacArthur: How does innovation help deliver purpose and value? Or is it the other way around?

David Wagner: It is a virtuous cycle. Our brands were all created in different ways with a purpose that came from the original founders. Innovation ultimately is what delivers value because in order to retain a consumer, you have to continuously deliver more value because you’ve got competition that’s trying to do the same thing. The notion of purpose and why it matters is it channels your activity and, therefore, what you bring forth in the product or in the experience you’re providing to the consumer.

MacArthur: I know you focus on four macro trends, but is there one that would be most meaningful for how consumers will spend in the future? 

Wagner: It would be the active health and wellness space. The thing that’s most different today versus even just a couple of years ago is this emphasis on mental wellbeing, where both our society and cultures around the world are talking about mental wellness in ways that they did not before. We tend to believe that physical wellbeing is interrelated with mental wellbeing. We see consumers continuing to value brands that can provide solutions for them in those spaces.

MacArthur: How will you balance for consumers various economic climates with affordability and sustainability?

Wagner: We sell what most people would say are discretionary products. If hiking or snow sports is a super important part of your life and the economy is tough, that’s probably an area of your personal spending that you’re going to protect. So, this activity-based orientation that most of our brands have gives us helpful insulation.  

MacArthur: How does climate change affect how you think about innovation and getting people outside and active?

Wagner: In general, consumers continue to say that they want more sustainable products, but they don’t want to pay for them. Our brands often make sustainable innovation a point of difference for their consumers as opposed to being an important point of parity. Being more sustainable and being more affordable are not necessarily mutually exclusive ideas. Recommerce extends the product lifecycle and gives that next buyer a still-high-quality product at a discount versus if they bought it new.

MacArthur: What’s the biggest challenge in taking physical products and brand experiences into virtual spaces?

Wagner: It’s easy to fall into a trap of being technology-led because there are a lot of really neat, shiny objects that brands can try out. Our goal with the metaverse or virtual goods and experiences is not to help consumers get sucked into the universe, but rather to use these environments to introduce more consumers to healthy and active lifestyles and to have more fun in those real-world environments when they’re there. For example, all else equal, we would favor augmented reality over virtual reality.

MacArthur: How are you thinking about the value for brick-and-mortar versus online or how they fit together?

Wagner: We see three specific roles for retail stores going forward. We see stores as brand equity enhancers. We see stores as consumer acquisition and trial enablers, and we see stores as fulfillment vehicles, and these are not mutually exclusive ideas store by store. We can’t forget, especially in apparel and footwear, that shopping is fun and a very social thing for a lot of people. A great in-real-life shopping experience can speak to the senses in ways that digital cannot.

MacArthur: Where do you see the role for social shopping, like Instagram and TikTok shopping?

Wagner: We think there is an opportunity for social commerce through properties which can be part digital, part physical. They enable consumers who are like-minded in how they spend their time and what they deeply care about to come together and talk. For example, they can share their activities, the products they wear and the services they spend their money on — thus enabling commerce through that kind of trusted community setting. It’s a potentially quite different approach to social commerce than what we might call version 1.0.

The author(s)
  • Kate MacArthur Managing Editor of What the Future