Retail is on a seesaw. With online on one end and standard retail on the other, consumers are serving as the fulcrum. And while one side dips further into digital, the other’s traditional significance is losing ground. But this isn’t to suggest that retail is diminishing — its role is simply in a state of much-needed change. NPD’s latest report, “The Future of Apparel,” confirmed these developments — noting that online shopping increased year-on-year by seven percent, totaling $46 billion in online apparel sales.
“Retail is not dead, it is just spread. The apparel industry is spread across a wider range of options than ever before, be it in-store, online, buy, rent or resell,” said Marshal Cohen, chief industry adviser at NPD. “Online has opened the doors to more ways to engage consumers.”
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The report served as a compilation of multiple areas of research. It included insights from its point-of-sale data, which reviewed stats from retailers like Amazon, Belk, Nordstrom and Dollar General. It also deployed an online survey of more than 6,100 consumers.
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The research confirmed that in-store shopping is declining. According to the results, in-store sales dropped three percent year-on-year from 2016 to 2017. “In 2017, 21 percent of annual apparel sales came from web site purchases, and 76 percent came from in-store purchases,” the report said. And if the forecasts of Amazon Prime Day revenue is accurate — analysts predicted that the shopping bonanza might secure as much as $3.6 billion — this trend will only strengthen.
“Apparel’s online consumer audience is expanding as the platform evolves into a more complete and diverse shopping experience,” said Cohen. “Online-only retailers have a unique flexibility that helps them compete in this constantly changing shopping environment, provided they don’t lose sight of innovative thinking.”
Perhaps unsurprisingly, consumers are also becoming more fluent in online shopping, often using social media as a product discovery tool, then purchasing an item through their mobile device. The report said that “the average annual apparel online spend per buyer increased 11 percent, compared to 2016.”
With rich online experiences, retailers actually have the opportunity to rethink brick-and-mortar strategies that dovetail with their digital channels. By elevating physical interactions that can’t be replicated online, retail won’t shrink, but will instead widen their available consumer touch points.
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