Is this the end of the ethical millennial brand?

Are we entering an era when consumers prefer “value” over values?

That’s the question many are asking after Everlane’s recent acquisition by Shein.

For years, brands like Everlane, Reformation, and Allbirds represented a new vision for fashion: stylish basics paired with sustainability promises, transparent supply chains, and a distinctly millennial sense of conscious consumerism.

Now, many of those same companies are facing a reality check. The Everlane-Shein deal, for instance, surprised much of the industry given the stark contrast between the two companies’ reputations and business models.

Meanwhile, Allbirds—the once-beloved sustainable sneaker brand that became synonymous with Silicon Valley minimalism—recently announced a pivot away from footwear and toward AI cloud infrastructure after years of declining sales and mounting financial pressure.

Beginning of the end: These developments raise larger questions about whether the original “ethical millennial brand” movement was ever truly sustainable as a business model.

“I was pretty shocked by it,” Sim Gulati, co-founder of the textile production company Everbloom, told Retail Brew of Everlane’s acquisition. “It was the antithesis of what they stood for. Just at face value, seeing Shein acquire Everlane I felt was a contrast in values and principles that you don’t really see go together.”

To Gulati, it showed not only that the business was hurting, but it served as a “stamp” of the fact that while consumers cared about sustainability, they didn’t necessarily want to pay for it.

“You’ve seen the rise of Shein and fast fashion over the last 15 years,” he said. “[Consumers are] speaking with their principles, but they’re making decisions with their wallets.”

Wendy Zajack, adjunct professor of marketing at Georgetown’s McDonough School of Business, said there’s a mismatch when it comes to sustainability in terms of what someone would like to pay for a shirt and what the price of something actually sustainable might look like.

“Human beings…live in this space where, ‘I want to have this really inexpensive, trendy piece of something to wear, but I also want it to be made sustainably and [with] safe labor practices,’” Zajack told Retail Brew. “This, to me, was an underscore that that might not be possible.”

Two truths: Ultimately, consumers have grown accustomed to constant discounts, cheap basics, and trend cycles accelerated by TikTok and ultra-fast-fashion platforms. At the same time, shoppers continue to say sustainability matters to them. It’s also why DTC brands struggle with this pressure.“

It’s really tough for consumer brands, because where are you going to source from?” Gulati said. “You’re still going to source from China. You’re still going to have to deal with tariffs, and you’re still going to deal with inflation. How much lower can you get in price, and how much cheaper or value-driven can you be?”

It also might be indicative of the fact that millennial-era ethical brands may have overestimated the long-term power of conscious consumerism altogether. While brands that have a distinct focus on sustainability, such as Patagonia, have thrived and survived, it still makes for only a handful of global apparel retailers that are profitable while entirely mission-driven.

For most other brands, the reality is quite different.

“Fashion is this aspirational industry where it is selling a dream, but people who are living often are dealing with really harsh realities,” Gulati said. “Sustainability is a nice fantasy, but when it comes to dealing with one’s reality, how can they pay that 20%, 30%, 50% premium on the garment, and then also have to live their lives?”

This reality doesn’t necessarily mean the end of conscious consumerism, but perhaps a marked shift in the model.

“It’s a moment in time, and we need to look at the reality of some of the business models that have been out there,” Zajack said. “You can’t necessarily have it all, and we’re going to have to decide what our priorities look like going forward.”

It’s why for the next generation of successful ethical fashion brands, it might be important to strike a more difficult balance between product desirability, affordability, and sustainability without relying on the sustainability messaging alone to drive demand.

“There is going to have to be some premium to get it right,” Zajack said, adding that as shoppers, we’re “creatures of duplicitous behaviors,” which is why there will need to be a movement where consumers realize they can’t hold two competing truths at the same time.

“We’re going to have to come back to [thinking about the earth] at some point,” she said. “It’s just not something…that we’re just going to continue to be able to ignore forever, and so I do have confidence that we will shift back in that direction.”