presented by: mary brett whitfield senior vice president apparel webinar series february 14, 2014 a...
TRANSCRIPT
Presented by:
Mary Brett WhitfieldSenior Vice President
Apparel Webinar Series
February 14, 2014
A Not-so-Basic Look at Apparel Basics… and other current topics in Apparel Retailing
© Copyright 2014 Kantar Retail
Copyright © 2014 Kantar Retail. All Rights Reserved.
501 Boylston Street, Suite 6101, Boston, MA 02116
(617) 912- 2828
No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photography, recording, or any information storage and retrieval system now known or to be invented, without the express written permission of Kantar Retail.
The printing of any copies for back up is also strictly prohibited.
Disclaimers
The analyses and conclusions presented in this seminar represent the opinions of Kantar Retail. The views expressed do not necessarily reflect the views of the management of the retailer(s) under discussion.
This seminar is not endorsed or otherwise supported by the management of any of the companies covered during the course of the workshop or within the following slides.
© Copyright 2014 Kantar Retail
Agenda
• Holiday Wrap-Up and a Look Ahead
• A Tour of Apparel Basics
• Shopping Approaches
3
© Copyright 2014 Kantar Retail
Happy Valentine’s Day!
4
© Copyright 2014 Kantar Retail
Agenda
• Holiday Wrap-Up and a Look Ahead
• A Tour of Apparel Basics
• Shopping Approaches
5
© Copyright 2014 Kantar Retail
Holiday 2013: Online Led Sales Growth
6
* Holiday is measured as fourth quarter: October, November and December**Topline measure excludes auto, fuel, & food service channels; includes auto parts stores*** Nonstore sales include catalogs and TV home shopping in addition to online sales
Topline: Holiday 2013 Forecast and Actual*
Prior Year vs. Forecast and Actual Holiday 2013
4.0% 3.5%
10.5%
4.7%3.4%
12.5%
4.1% 3.6%
9.0%
Topline retail sales measure**
Brick & mortar stores
Nonstore Including Online***
2012 Holiday Prior Quarter 2013 Holiday
CHANNEL BREAKOUTS
Source: U.S. Department of Commerce, and Kantar Retail analysis
But nonstore retailing grew slower than 2012
© Copyright 2014 Kantar Retail
Holiday Spending Steady …
7
… though fewer shoppers participate in holiday gifting
Source: Kantar Retail ShopperScape®. December 2007–2013
Self-Reported Spending on Holiday Gifts(average among all holiday gift shoppers)
Percent of Shoppers Purchasing Holiday Gifts
Note: Arrows indicate significant difference vs. prior year (95% confidence level)
© Copyright 2014 Kantar Retail
Amazon Becomes the Top Holiday DestinationLeapfrogs Target in 2011, Walmart in 2013
Source: Kantar Retail ShopperScape®, December 2011, December 2012 and December 2013 8
Note: Arrows indicate significant difference from Holiday 2012.
© Copyright 2014 Kantar Retail
• Data points indicate that “Limiting” is on the agenda
–Fewer retailers shopped for back-to-school
–Fewer retailers shopped for holiday gift giving
–Lower rate of category purchase incidence across myriad discretionary and non-discretionary categories in Q4
Evidence that Shoppers Drawing Boundaries Mounts
9Source: Kantar Retail ShopperScape®, December 2010–2013
© Copyright 2014 Kantar Retail
Fewer Stores on List, but More Purposeful Conversion rates trended up across most retailers & channels
10
Holiday Gift Shopping: Top Conversion Rates*(among all holiday gift shoppers who shopped retailer)
*Conversion calculated as the percent of retailers’ holiday gift shoppers who also report buying a gift there
Source: Kantar Retail ShopperScape®, December 2012 and December 2013
© Copyright 2014 Kantar Retail
Holiday Shopping Shifts OnlineProving ground for building online shopping routines
Source: Kantar Retail ShopperScape®, December 2013 11
Budget shifted in favor of online/Cyber Week, away from Black Friday
Budget shifted in favor of online/Cyber Week, away from Black Friday
Holidays set stage for year-round online
shopping
Holidays set stage for year-round online
shopping
© Copyright 2014 Kantar Retail
Overall, Shoppers Spent More OnlineEven as penetration of online shopping and purchasing stalls
Source: Kantar Retail ShopperScape®, December 2010, 2011, 2012, 2013 12
Average spent online on
holiday gifts:
Average spent online on
holiday gifts:
© Copyright 2014 Kantar Retail
Online Conversion Rates Lag Conversion in Aggregate for Multi-Channel Players
Source: Kantar Retail ShopperScape®, December 2013 13
Conversion*
*Conversion calculated as percent of shoppers who purchased; arrows indicate significant increase from 2012
© Copyright 2014 Kantar Retail
Apparel’s Popularity Grows on Amazon Moved into number four gift spot in 2013 holiday
14Source: Kantar Retail ShopperScape®, December 2011, December 2012 and December 2013
Top 5 Gift Purchases on Amazon.com(among all holiday gift shoppers who shopped Amazon.com)
© Copyright 2014 Kantar Retail
Clothing in Middle of Pack re: Online Penetration
• Consumer electronics/ computers have biggest ramp up
• Softgoods retailers and categories increasingly affected
• Consumables categories just a matter of time
15
18% of clothing sales online by 2018
Online Share of Goods Categories*
Source: U.S. Department of Commerce and Kantar Retail
Clothing
FurnitureToys & sporting goodsBooks, magazines, music & videos
Food & Alcohol**
Computer products, electronics, appliances & office equipment
Drugs & HBC
*Goods categories exclude auto, fuel, and tobacco categories
**Read as: In 2018, 3% of Food & Alcohol spending will be online (and, conversely, 97% of Food & Alcohol spending will remain in stores)
© Copyright 2014 Kantar Retail
Goods Category* CAGR ‘08–’13
CAGR ‘13–’18FC
2.7% 3.6%
4.6% 5.9%
2.6% 3.7%
1.8% 4.4%
1.8% 4.1%
3.2% 4.1%
3.0% 4.6%
Goods Category Totals* 2.9% 4.3%
Five-Year Category Spending Outlook Improves
16
USD Billions
Source: U.S. Department of Commerce and Kantar Retail
*Excludes Autos, Fuel, and Tobacco**Includes prescriptions, OTC drugs, & health & beauty categories***Includes miscellaneous other durable & non-durable goods categories
$2,568
$2,965
$3,661
Growth lifted by incomes, inflation, spending intentions
Clothing & Footwear
Furniture & Home FurnishingsMedia, Sporting Goods & ToysOther Miscellaneous Goods***
Food & Alcohol
Electronics, Appliances & Office Equipment
Drugs, Health & Beauty Care**
• Drugs/HBC propped up further by health care reform impact
Consumer Spending and Growth Rates by Goods Category
© Copyright 2014 Kantar Retail
Goods Category* CAGR ‘08–’13
CAGR ‘13–’18FC
OnlineImpact
’13-’18FC
14.5% 14.7%
2.3% 3.3% -1.0 PPT
2.6% 3.2% -0.4 PPT
4.2% 5.3% -0.6PPT
1.4% 2.1% -1.6 PPT
-0.6% 0.7% -3.7 PPT
1.2% 3.0% -1.1 PPT
1.7% 1.5% -2.6 PPT
2.3% 4.1% -0.5 PPT
Goods Category Totals* 2.9% 4.3%
Online Impact on Store Sales Moderate for Clothing
17
USD Billions
Source: U.S. Department of Commerce and Kantar Retail
Clothing & Footwear
Furniture & Home FurnishingsMedia, Sporting Goods & ToysOther Miscellaneous Goods***
Food & Alcohol
Electronics, Appliances & Office Equipment
Drugs, Health & Beauty Care**
Categories Online
Categories In Store
*Excludes Autos, Fuel, and Tobacco**Includes prescriptions, OTC drugs, & health & beauty categories***Includes miscellaneous other durable & non-durable goods categories
$2,568
$2,965
$3,661
Consumer Spending and Growth Rates by Goods Category
© Copyright 2014 Kantar Retail
Apparel & Footwear Sales Growth: Online vs. StoreGrowth Forecast vs. Current and Prior Year
Apparel & Footwear: Improving Topline Growth
• Pickup in 2014 will be held back by weaker pricing compared with recent years
• Gains will remain skewed online, forecast to reach18% of sales in 2018
• Online impact will limit category growth in stores to between 1% to 2% annually
18
But strong online gains will keep in-store gains weak
Source: U.S. Department of Commerce, and Kantar Retail analysis
FORMAT BREAKOUT
Online Penetration2003 2008 2013E 2018F2% 6% 12% 18%
© Copyright 2014 Kantar Retail
Shoppers More Optimistic about Apparel Spending than They’ve Been in Years
Source: Kantar Retail ShopperScape®, December 2012 and December 2013 19
All Female Shoppers
Gen Y Gen X Boomers SeniorsDown Market
Middle Market
UpMarket
Spend More
Spend About the
Same
By Generational Cohort By Income Market
Plans for Spending on Wardrobe in Coming Year(among female primary Household shoppers)
© Copyright 2014 Kantar Retail
Despite Macro-Economic Uncertainty, Spending Intentions Steady
Source: Kantar Retail ShopperScape®. June 2008–December 2013 20
Spend Much/Somewhat More
Spend about the Same
Spend Much/Somewhat Less
Retail Spending Intentions in Coming Month Compared with the Same Period Last Year (three-month moving average)
© Copyright 2014 Kantar Retail
Agenda
• Holiday Wrap-Up and a Look Ahead
• A Tour of Apparel Basics
• Shopping Approaches
21
© Copyright 2014 Kantar Retail
Basic Styles Are Everyday Go-To for More than 4 in 10 ShoppersBasics even more prevalent everyday wear for men
22
Everyday Style
Source: Kantar Retail ShopperScape®. September 2013
© Copyright 2014 Kantar Retail
Basics Are Perennially at the Top of the List
23
Plans for Adding to Wardrobe in Coming Year(among female primary household shoppers)
Source: Kantar Retail ShopperScape®. December 2013
© Copyright 2014 Kantar Retail
40% of Kohl’s Assortment Features “Classic” Styling
Source: Kohl’s Fact Book 24
© Copyright 2014 Kantar Retail
Apparel Has Been a Relative Bright Spot for WMT
Source: Company reports, Kantar Retail analysis 25
Walmart US Performance by Department, Quarterly
© Copyright 2014 Kantar Retail
UNIQLO: Coming Soon to a Market Near You?
Source: Company website and Kantar Retail analysis 26
The offer: “Our clothes are functional, designed with innovative features, and are available in a wide range of colors and styles … “.
© Copyright 2014 Kantar RetailSource: Kantar Retail store visits 27
UNIQLO’s “Life Wear”:Clothing to improve everyday life …
© Copyright 2014 Kantar Retail 28
… with a layer of capsule and specialty collections
Source: Kantar Retail store visits
© Copyright 2014 Kantar Retail
• Strengths:–Sharp price points
–Cross-generational/family appeal
–Technology and fabrication adds utility
• Weaknesses:–Shopping experience
• “Sea of sameness”• Engagement
–Assortment sameness
The UNIQLO Concept: “Made for All”
29Source: Kantar Retail store visits, Kantar Retail analysis
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
Source: Company Web sites, Kantar Retail analysis 30
TOPSHOP
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
Source: Company Web sites, Kantar Retail analysis 31
FOREVER 21
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
Source: Company Web sites, Kantar Retail analysis 32
H & M
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
• Educate and inform
Source: Company Web sites, Kantar Retail analysis 33
Target
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
• Educate and inform
• Call to Action
Source: Company Web sites, Kantar Retail analysis 34
American Eagle Outfitters
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
• Educate and inform
• Call to Action
• Evolve
Source: Company Web sites, Kantar Retail analysis 35
Banana Republic
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
• Educate and inform
• Call to Action
• Evolve
• Demonstrate End Use
Source: Company Web sites, Kantar Retail analysis 36
H&M, Old Navy
© Copyright 2014 Kantar Retail
Keeping Shoppers Interested in Basics
• Show versatility
• “Not-so-Basic”: A Modern Refresh
• Be “Best”
• Educate and inform
• Call to Action
• Evolve
• Demonstrate End Use
• “Mass Out”
Source: Company Web sites, Kantar Retail analysis 37
H&M, Old Navy
© Copyright 2014 Kantar Retail
Agenda
• Holiday Wrap-Up and a Look Ahead
• A Tour of Apparel Basics
• Shopping Approaches
38
© Copyright 2014 Kantar Retail
Convenience Most Important to Mass Apparel Shoppers
Source: Kantar Retail ShopperScape®,September 2013 39
Among Shopper Who Spent Most on Casual Apparel at …
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
All Shoppers Favor “Bite-Size” Shopping
40
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Value Department Store Shoppers Most Likely to Make Special Trip
41
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Mass Shoppers Are Truly “One-Stop” Shoppers … Apparel Specialty Shoppers Have Bigger Store Set
42
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Department Store Shoppers Are Most Likely to Buy on Impulse
43
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Shoppers Who Think Shopping Is Fun Most Likely to Be on the Mall
44
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Specialty Stores Attract Treasure Hunters
45
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Specialty Store Shoppers Most Likely to Have Done Pre-Trip Research Online
46
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Specialty Store Shoppers Also Most Likely to Buy Online
47
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Value Department Stores
48
Among Shopper Who Spent Most on Casual Apparel at …
Source: Kantar Retail ShopperScape®,September 2013
Which Statement Best Describes Attitude toward Apparel Shopping(among female primary household shoppers)
© Copyright 2014 Kantar Retail
Prevailing Approaches to Apparel Shopping
• Usually shop at few retailers that are conveniently located
• Tend to shop for clothing “one item at a time”
• Shop for clothing on trips specifically for clothing
• Look forward to shopping for clothes
• Like a predictable assortment (vs. treasure hunt) …
• … but like to see what’s in stores vs. researching online in advance
• In-store vs. online
• Buy at the end of the season
Draws:
• One or two regular retailers vs. Several different based on needs
• Buy against plan for the season vs. Buy on impulse
49Source: Kantar Retail ShopperScape®,September 2013
© Copyright 2014 Kantar Retail
Channels Where Shoppers Diverge from Average
MassValue
Department Store
Apparel Specialty
Store
Traditional Department
Store
Will Go Out of Way to Favorites
X X
“Big” Trips X
Shop When Out for Other Things
X
Broad Store Set X X
Impulse Purchasing X X
Shopping for Clothes Is Fun
X X
Want a Treasure Hunt X
Pre-trip Online Research X
Online Shopping/Buying Saves Time
X
50Source: Kantar Retail ShopperScape®,September 2013
© Copyright 2014 Kantar Retail
Digital Shopper Forum | February 25–26, 2014 | Chicago, IL
Participate in interactive, thought-provoking
discussions.
Network with the who's who of your peers and the experts
in the industry.
Learn from Kantar Retail experts' on the subjects of
digital, shopper, omni-channel, and big data.
Mention this webinar to save $100 off of your event ticket …
*if your company doesn’t already have a block of pre-
paid event seats
For more info on this event, visit our website
http://www.kantarretail.com/digitalshopper2014/
Or, email us [email protected]
© Copyright 2014 Kantar Retail
Questions?
• Holiday Wrap-Up and a Look Ahead
• Not-so-Basic Look at Basics
• Shopping Approaches
Submit questions on Q&A panel on right side of screen
52
© Copyright 2014 Kantar Retail
Contact:
Mary Brett WhitfieldSenior Vice [email protected]
T:+ 1 614 355 4010www.kantarretailiQ.com