Spending on clothing,
footwear and other personal adornment
The first table below reviews the performance of the
personal adornment market as recorded by Mintel for its annual British
Lifestyles report. By this measure, total clothing spending saw 1.8% growth in
2010, a slight slowing of growth rates compared to 2009. Similarly, the core
outerwear and underwear sub-categories all registered 2010 growth of below 2%.
This against a 2.1% rise in total recorded consumer spending.
Of the constituent
sub-categories, accessories posted by far the highest growth rates, at 10% for
2010 – this coming on top of broadly similar growth the year before. For the
period 2006-10, Mintel recorded 35% growth in spending on accessories.
Accessories have been buoyed
by trend-driven purchasing of costume jewellery such as charm bracelets as well
as bags and other leather goods, including “it bags” and designs seen on the
arms of celebrities. Handbags are the dominant accessories category and are
increasing their share of sector sales. Accessories have benefited from being a
relatively inexpensive way for consumers to instantly update their look. At the
same time, the premium end is also performing well as shoppers are looking for
high-quality investment pieces.
A similar trend-driven
motivation has, Mintel believes, underpinned similarly strong growth in the
footwear category. This category recorded 8% spending growth in 2010. As Mintel
outlined in its recent Footwear
Retailing UK report, evidence suggests the fashion sector was the key
driver in the young and luxury footwear segments: the shoe has joined the “it
bag” as a highly-valued fashion accessory. The footwear category’s growth in
2010 was further underpinned by strong fashion trends such as wedges,
platforms, killer heels and clogs. But 2010 has now set a very tough
comparative for 2011 and with household incomes under pressure and footwear
prices rising we believe category growth will slow substantially.
Key analysis: The performance of the accessories
and footwear categories – each peripheral to the clothing market’s core
garments segment – highlight growth areas for clothing retailers facing a
stagnating market. Major young-fashion retailers such as Topshop,
Zara,
and New Look
have strong ranges in these peripheral categories, and developing accessories
and footwear ranges could be a means of sustaining growth for other clothing
specialists.
Maintaining momentum for fashion brands is notoriously
difficult simply because the essence of fashion is change and some clothing
brands are looking tired or have simply been upstaged by competitors that have
read their segment of the market better. We would include Arcadia’s Bhs, Burton and Dorothy
Perkins in
this category as well as Alexon and Gap. But, despite the highly competitive nature of the UK
clothing market, new entrants are never far away. This year sees the arrival of
the USA’s Forever 21
and with an initial target of more than 100 stores it could represent a serious
threat to other young fashion retailers.
House of Fraser
Positioning
House
of Fraser is positioned firmly at
the upper end of the mass market, with a strong selection of premium brands
such as Superdry, Marc Jacobs, Polo Ralph Lauren, and Ted Baker. Its stores exude a degree of luxury
while remaining accessible to the mass market.
Recent
developments
Total gross transactional values were up 2.3% in the
year to the end of January 2011. Menswear saw like-for-likes (incl. VAT) rise
by 6% in the year while womenswear saw 2% growth by the same measure. Like Debenhams and John
Lewis, House
of Fraser is making ongoing
efforts to boost its revenues from higher-margin own brands. Four new private
labels in womenswear were launched during 2010: Biba, Dickins & Jones,
Label Lab, and Pied a Terre. House
of Fraser has made strides
forward in multi-channel development, with in-store web-ordering zones and the
opening of a purely click-and-collect store in Aberdeen in September 2011.
What we think
House
of Fraser looks to be less
vulnerable than mid-market Debenhams in the current economic climate. The retailer’s
pitching of its offer at the more affluent consumer together with its courting
of the young shopper with its brand selection should help to continue to shore
up its performance despite the ongoing squeeze on consumers.
One in four adults would like to see more personal
service/advice from in-store staff. While human resource is one of the biggest
costs in retailing our research suggests that it would be particularly
worthwhile for higher end stores to invest more in staff training. Perhaps a
focus on superior service could be concentrated and championed in flagship
stores as part of a wider integrated package drawing on latest technology and
mobile devices to address other issues such as choice, availability and payment
options too.
25-34s to boost market
●
Female 25-34s have grown by 1.3% in the last
five years and are forecast to grow at an even faster rate of 10.6% to reach a
total of 4.5 million by 2015. These women enjoy shopping, buy new clothes once
a month and like to keep up with the latest fashions. They also prefer to buy
fewer items but better quality clothes and are also most likely to shop at
higher-priced fashion stores.
Key
analysis: The growth in 25-34s is important for the sector and will boost the
women’s fashion market as these consumers like to keep up with the latest
trends and buy clothes on a regular basis. At the same time, they are also
willing to invest in quality clothes.
