If there’s one thing that the fashion industry knows very well, it’s change. Trends come and go, styles are replaced every season, and technological advancements are now being integrated. But, now more than ever, the fashion industry is facing what’s probably the biggest evolution that it has had because of the pandemic.
The answer to most of fashion’s current challenges seems to be digital: Internet-based fashion shows, ramped-up online shopping experiences, and digital wallets.
But, first, let’s look at what makes the fashion industry the behemoth industry that it is today:
It’s expected to have a revenue of $665 billion by the end of 2020.
It has a projected market volume of $445 billion by the end of the year and an expected number of 3.5 billion consumers by 2024.
While offline channels still generate more sales, a positive growth is building in digital channels.
It’s followed by the United States ($127 billion) and the United Kingdom ($33 billion).
The market share of the region is expected to increase to 44.2% by 2025.
However, a growth of 2%-4% is possible in 2021.
These brands rely heavily on consumers from Asia, where the pandemic has hit the longest.
This affects the overall decline in the country’s retail sales. The last time that this drastic one-month drop happened was in Fall 2008.
It all depends on how much longer stores will remain closed or partially operational.
Additionally, 56% of the consumers said that they purchase apparel only because of special promotions.
Similarly, the decline in revenue of fashion retailers contributes to the overall decline in eCommerce.
For Gen Zers, the biggest inconvenience is the wait time after ordering. The second biggest inconvenience across all audience segments is the shipping fee.
This is mostly composed of Gen Xers. However, millennials and Gen Zers are more likely to experiment with smaller brands.
The younger segments of the consumers are leading this development.
It’s followed by Europe, Bangladesh, and Vietnam.
However, this decline is better than the previous months: 60% in May 2020 (vs May 2019) and 42.8% in June 2020 (vs June 2019).
Aside from China, the market is shared by Vietnam, ASEAN countries, Bangladesh, and Cambodia.
The slowdown of the economy, weaker demand, and economic tensions among the biggest players contributed to this decline.
It’s expected to grow at least 5.3% annually through 2025.
It has a market volume of $910 billion.
This growth can be attributed to millennial men becoming more fashion-conscious and designers offering more options for the target audience.
This was an even further dip than March 2020, where a decline of 51.3% was reported (versus March 2019).
The United States has generated a revenue of $86 billion.
Its compound annual growth rate (CAGR) is estimated at 5.5%.
This can be attributed to increased health awareness, which has led to more people doing workouts and fitness-related activities.
The brand is followed by Adidas, New Balance, and ASICS.
It has a compound annual growth rate (CAGR) of 9.6%, resulting in an expected market volume of $171 billion by 2024.
Its compound annual growth rate (CAGR) is at 8.5%, contributing to projected market volume of $26 billion by 2024.
China and India are two of the top contributors, due to the shift in consumer behavior, bigger spending power, and influence of celebrities. However, North America remains to be the largest market.
Brands in this segment are experimenting with limited editions, co-creations, and customer-driven designs to increase sales.
With an expected compound annual growth rate (CAGR) of 8.1%, the growth is due to the increase in disposable income and shift in shopping behavior.
It’s followed by the United States, Italy, France, and Germany.
The market in this territory is expected to grow by 6.6% every year through 2025.
In late 2019, the company acquired Tiffany & Co; however, its Watches and Jewelry group showed a decline of 39% in the first half of 2020.
However, only 12% said that a “buy” button on a social media platform would make them check out.
This information was from a survey conducted in late 2019. The next biggest age groups are millennials and Gen Xers.
Video streaming of live online selling, in particular, is an emerging trend and promising sales-driver.
Other platforms that will soon have shopping options are Instagram and WhatsApp.
These people provide different forms of services for the fashion industry that’s worth $1.3 trillion.
This is a huge decline from 112,000 people employed in August 2019.
However, this amount continues to suffer a drastic decline because of COVID-19.
Most of them are from China, India, and Cambodia.
Other top countries where cross-border consumers shop from include China and the UK.
Its current revenue for 2020 is estimated at $32 billion with a compound annual growth rate (CAGR) of 4.7%.
The other top cities include Shanghai, São Paulo, Moscow, and London. These cities are also considered as emerging markets in the fashion industry.
The apparel brand saw a 40% increase in brand value, compared to 2019.
It’s being used in generating new designs, always-on customer service, hyper-personalized marketing, smart shopping, and overall convenience.
Smart clothing includes fitness-tracking wearables, smart sport apparel, and outerwear with LED, among others.
Fashion brands are looking into technology to reduce their waste and have an eco-friendlier production.
This growing shift is attributed to the preference of mobile phones over other devices and more digital wallet options.
While the fashion industry is currently facing a downward trend, it’s doing multiple stretches and working double time to bounce back. After all, a “V-shaped” trend is forecast for the industry in the coming years. Moreover, consumers are slowly but surely adjusting to the “new normal” and have discovered other (and maybe more convenient) ways to shop.
With an industry as big and formidable as this, fashion has not met its end just yet. It will dress itself up again in just a matter of time!