Sales patterns suggest that the pandemic has boosted the so-called “casualization” trend, with a fraction of consumers spending less on formal, medium range clothing because of new habits acquired during the months spent working from home. Instead, leisure and sportswear have clearly gained traction, reflecting both growing engagement in sports activities and a preference for more simple and comfortable clothes. At the other end of the price range, luxury sales are already back to pre-pandemic levels, but are mostly driven by sales made in international markets (China, in particular, see Appendix).
Alternative distribution channels are winning over specialized retailers
On top of a trend towards more frugal consumption, consumers are also increasingly favoring alternative distribution and consumption patterns at the expense of traditional, specialized fashion stores. Measuring total household spending on fashion vs sales made in specialized fashion stores (Figure 7), we observe a divide that has only been growing in the past few years, with sales in stores trailing total fashion spending and lost to alternative distribution channels, including e-commerce (pure-players and retailers shifting to an omnichannel business model) and the second-hand market. Based on available data, we estimate that about 40% of fashion spending is now happening outside of specialty stores in the top Eurozone markets.
Figure 7: Fashion consumer spending and specialized fashion retail sales in the Eurozone (2010=100)