Legitimacy and transparency in the fashion industry - an empirical research into the legitimacy profiles of more transparent and less transparent fashion brands as perceived by consumers
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Today’s fashion industry is highly controversial due to its environmental as well as social impact. Accordingly, consumers are developing an increasingly critical attitude towards fashion brands’ practices. This makes it hard for fashion brands to gain legitimacy, which refers to the way in which an organization is perceived of by society and is important for firm survival. As a result, firms are constantly trying to become more legitimate. From the literature, it has become evident that transparency has the potential to contribute to a legitimate status. Thus far, the link between legitimacy and transparency has never been empirically proven. Therefore, the aim of this research is to answer the following research question: How and why does legitimacy as perceived by potential consumers vary for more transparent and less transparent fashion brands? To be able to do this, 2 more transparent brands (Esprit and H&M) and 2 less transparent brands (Urban Outfitters and Mango) were selected. Moreover, 20 potential Dutch consumers that are familiar with these 4 brands were selected via purposive sampling. To measure the levels of legitimacy of the brands, 9 legitimacy concepts from the legitimacy framework of Suchman (1995) were operationalized in a semi-structured interview. This interview was conducted among the participants and the transcripts were analyzed in Nvivo, using both theory based as well as open codes. Also, a 5-point scale was developed that allows for scoring the various forms of legitimacy based on the answers of the interviewees. Data analysis revealed 5 factors that determine levels of legitimacy: transparency, product price, appearance, feeling and firm size. Moreover, final legitimacy scores for the brands could be calculated. Overall, H&M has the highest score (34), followed by Urban Outfitters (31) and Esprit (31) and finally Mango (28). This ranking does not consistently correspond to the transparency categories to which the brands belong. The major reason for this seems to be that consumers are not aware of levels of transparency and accordingly, of efforts brands put in sustainability. However, they do explicitly say that transparency does have the potential to affect the way they evaluate a brand, which is why it was also identified as a legitimacy determinant. Taking this into account, it seems like fashion brands should create more awareness about their transparency levels and sustainability initiatives, if they are willing to use transparency as a tool to become more legitimate. The major limitation of this research is that it was assumed that all of Suchman’s 9 legitimacy forms do contribute to overall legitimacy of the brands to the same extent. It is not clear whether this is justified or not. Another limitation is sample size, both with regard to the number of fashion brands as well as the number of consumers. Also, the composition of the sample of interviewees forms a limitation. Future research should work on these issues. Moreover, other countries and other stakeholders from the fashion industry could be involved as to gain a more comprehensive understanding of the link between transparency and legitimacy.