There can never be a dull moment in fashion. There is always something new to embrace, and that is why the fashion industry will continue to remain relevant. Globalization, changing consumer habits, and technological innovation continues to shape the fashion industry. Industry experts are optimistic about seeing a significant growth in the sector within the year. They are, however, in the same breath questioning whether those that are not embracing the changes will have the ability to continue to survive. Industry figures show that as of 2017, more 1800 fashion retailers had to close shop. The reason is many were unable to adapt to the changing consumer habits and could, therefore, no longer remain in operation. In 2018 the situation was worse with more than 9,000 outlets going-out-of-business.
However, with e-commerce, there is a lot of optimism for the growth of the clothing sector. Industry reports indicate that it could reach 4.5% within 2019. Earnings could reach more than $712 billion by 2022.
· Areas of Growth
Clothing and apparel will take a chunk of the sales within the year. Although, there may be a drop in the compound annual growth rate to 7.6% down from 15.3% within the 2018 2022 period.
The shoe segment is also not doing very well with regards to growth and may reach 10.8% by the end of this year. This is a projected 3% drop from 2017. Interestingly, the experts see an increase in market share within the range of $135 billion by 2022. A significant increase from the $96 billion the sector generated in 2018.
Bags and accessories could also shrink to 8.7% in 2022, down from 15.6%. It is, however, essential to note that the segment is experiencing a stronger growth rate than the other areas.
· Market Size
North America continues to dominate with its brand offering within the year. Europe will follow at almost 30% of the total market share. There are, however, emerging markets from outside the west, including India, China, Mexico, among others. The opening up of the global market is attributable to internet penetration and smartphone technology, which have also been instrumental to the growth of the e-commerce platforms.
We also have an emerging middle class who have more disposable income. They are, therefore, able to spend money on fashion and clothing items due to the improvement in their buying power. With the potential 1.2 billion customers, we can only be very positive about the Clothing industry. The age demographic also covers the 16- 24 and 25-34 year age bracket, who have no issues spending on fashion items.
· Role of E-Commerce
The e-commerce platform is robust and contributes over 1.8 trillion in global sales on an annual basis. Boutiques are becoming more active online, and many of them are taking advantage of the social media platforms to reach more customers, thus higher conversions. Companies operating in the online platform are applying different strategies to get more customers. By incorporating things such as better customer experience and transparency in pricing, they can make better conversions. With multiple tools available, a company can customize pricing for specific customers. They do not have to worry about other companies getting to know the pricing information. Companies are also investing in CRM to take care of the common issues that customers complain about. Such complaints include inadequate response to customer queries or questions.
The bespoke customer experience is also becoming more critical because of the discerning, modern customer. This customer wants accountability with regard to sustainable business practices. They also want immersive experiences before they purchase their products. Nike, for example, has a digital kiosk, while some clothing companies have a fitting app for anyone buying a clothing item. Cosmetic companies are losing augmented and virtual reality to sell their products.
· Influencer Marketing
Influencer marketing is one of the most critical factors in the growth of the clothing industry. The influencers will review particular products and get their audiences to buy based on their recommendations.
· Exclusivity Marketing
One of the best tactics some of the clothing companies are using is exclusivity marketing. The company will launch a limited clothing item and create a sense of urgency amongst their target audiences. They can also launch specifically to their loyal customers or those who have signed on to the membership platforms.
· Market Factors
Several issues may impact the purchasing power of the consumers. Such include political and economic uncertainty. It is, therefore, crucial that the relevant countries engage in trade talks. It will ensure that there are no trade wars or any unfair trading practices that may impact the industry.
It is also essential that the companies continue to innovate and look for ways to give the consumer the best experience. Several technological innovations are already helping to create efficiency. Such include augmented reality, virtual reality, and artificial intelligence voice-powered search, among others. Some of the leading brands are also partnering with development companies to come up with technologies that are unique to them. It leads to better brand engagement and gives the company a competitive edge.
· Sustainable Practices
The modern customer is very conscious of the sustainable production of clothing items. The companies must, therefore, look into factors such as pollution, recycling, among others. Sustainable practices have led to the establishment of new business lines for those who are responding to the more conscious customer. Companies that do not consider this may find that they are losing customers.
2019 has been exciting thus far, and we can continue to expect more growth within the fashion industry in the remaining months. The use of social media platforms and social influences has managed to generate a lot of brand and product awareness for established and start-up companies. Innovation is critical for the success of any company, and it evens the playing field for companies of all sizes.
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There can never be a dull moment in fashion. There is always something new to embrace, and that is why the fashion industry will continue
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