Online sales in the fashion industry are growing three times faster than in a physical store sales (Studio Dressed for Digital by Boston Group). Over 25% of fashion sales in Western Europe are expected to take place online by 2020.
In the period 2017 and 2022, the annual growth rate of online sales in the fashion industry should be the following:
- 8.8% – in the US
- 8.7% – in Europe
- 14.1% – in China
The footwear sector is expected to grow at a rate of 6.6% in 2022, resulting in a market of $ 135 billion in 2022. The sector of bags and accessories should grow from $ 67 billion in 2018 to $ 103 billion in 2022 (Source Shopify Ecommerce Fashion Industry).
Brands will invest more in digital marketing and omnichannel
For 2019, fashion brands plan to increase their investments in marketing (43%): two thirds of online media spending includes performance actions, marketing and branding. However, there are substantial differences by category: while streetwear brands spend more than 40% of their online media budgets for branding (content marketing and style guides, for example), footwear and sportswear brands spend only 20% and 26% respectively.
Famous brands have been using digital strategies aimed at improving ROI for some time already
Zalando, thanks to the huge growth in online sales worldwide, aims at reaching about 10 billion euros in GMV in 2020, increasing the customer base and engaging the clients.
Gucci, doubling between the turnover in 2015 and 2017 through ecommerce (from € 120M to about € 270M), talks about “Journey of Desire” with a 360 ° strategy, starting from the emotions, committing to building supreme experiences through the shops of excellence.
The strategy of Hugo Boss for the next few years will aim at an expansion of online concessions and omnichannel activities, with the goal of quadrupling the turnover from 2018 (about 100 million euros) to 2022.
And similar to them, many fashion brands have focused on omnichannel experience.
However, while big fashion brands implement a true digital marketing strategy, few are able to operate efficiently: 76% of brands consider personalization very important, but only 13% use it fully. In general, brands are only halfway when it comes to achieving excellence in digital marketing: less than 10% of fashion brands personalize their messages via e-mail, paid social media and display advertising. But mostly, ecommerce is not personalized; only 38% of brands have a fully customized engine and only 21% combine their online and offline services to offer their customers a truly omnichannel experience.
About 54% of BoF-McKinsey State of Fashion Survey participants stated that omnichannel integration, along with investing in e-commerce and digital marketing, will be the priorities in 2019.
In 2018 fashion executives have experienced their customers being obsessed with online sales and mobile sales in particular, highlighting a personal searching behavior supported by clear and fast information.
The three words describing the fashion industry in 2019 are: changing, digital, fast.