The retail industry, while not unfamiliar with change, has reached its proverbial tipping point.
The convergence of an economy in transition, rapidly developing new technologies and increasingly high consumer expectations has created the perfect storm that is dramatically transforming the retail landscape – leaving some struggling to keep up as they try to navigate the murky waters.
Technology has not only caused a shift in the behavior and attitudes of consumers, but it is also profoundly influencing and molding the shopping environment as the lines between digital and physical blur together.
Its affects across the apparel categories have resulted in a period of instability and stunted growth, leading to low margins and the freezing of expansion plans.
However, while forecasting the future is no easy feat, the apparel retailers that survived the fallout can look to the future with a sense of cautious optimism and open-minded skepticism.
The apparel market is beginning to see its long-awaited return to growth, albeit tempered as consumers continue to rein in their non-essential spending and seek out cheaper alternatives to traditional clothing stores.
Nevertheless, U.S. clothing stores continue to invest in improving the in-store experience to provide higher levels of service and more entertainment value in order to stand out from the competition.
The fruits of their labor might finally start to pay off as consumer spending on apparel is forecasted to grow at an annual compounded rate of 3% between 2014 and 2018.
While the category’s growth is modest, some apparel segments, such as plus-size apparel and menswear, are experiencing gains that are outpacing the overall market.
As the world of retail changes, the retailers who achieve lasting growth will be those who embrace this new environment and redefine their business models to be better in line with their customers’ wants and needs.
But, the million dollar question is: do you know what your customers want?
With effective customer analytic strategies – those that focus on defining who your customers truly are as consumers – you have the customer insight needed to guide future growth and improve targeted marketing efforts.
Want to know who your customers are and how that knowledge can deliver benefits across all elements of your overall brand concept? Then we should talk.