June 03, 2020
Apparel Sales Starting to Rebound
Mall-based retailers, like Abercrombie & Fitch, are doing better than expected at their reopened locations across the country.
Apparel sales have started to rebound as coronavirus-related lockdown measures are lifted across the country, according to market research firm The NPD Group. In particular, consumers have been focused on summer seasonal wear, including shorts and swimwear. The shift in apparel spending could have an effect on promotional apparel needs going forward as well.
“Apparel was a low priority early in the COVID-19 crisis when consumers were focused on things like groceries and other in-home necessities, but we’re seeing evidence that apparel is once again entering the spending consideration set,” said Maria Rugolo, apparel industry analyst with NPD. “Warmer weather is spanning much of the country, allowing consumers to extend their mostly homebound routines to the outdoors, and expanding their apparel needs beyond comfort and above-the-keyboard dressing.”
U.S. apparel dollar sales in the last week of April were 35% lower than the same week in 2019, but that decline is only half what it was at the lowest point during the pandemic. Summer clothing captured nearly one-fifth of total apparel spending, a higher percentage of spending for this category than at the same time last year. Steadily rising sales of many basic apparel categories, including underwear and sleepwear, are offsetting steep dollar sales declines in tailored clothing since the pandemic began. Basic apparel accounted for 25% of apparel sales in the last week of April, compared to 17% last year.
“Needs and behaviors will continue to shift with each phase of the country’s reopening and crisis recovery, but it is encouraging to see the consumer demonstrating an interest in adding to their wardrobe,” Rugolo said. “Tapping into this interest with a focus on needs and an underlying yearning for normalcy will be central to capturing apparel sales along the uncertain road that lies ahead.”
In another encouraging sign, CNBC reports that teen-focused retailer Abercrombie & Fitch is returning to sales levels of about 80% of the same period a year ago. (The brand reported a sales decline of more than 30% during its last quarter, due to the coronavirus pandemic.) As lockdown measures begin to lift in various states, Abercrombie & Fitch has reopened 45% of its stores in the U.S., or 285 locations. Fran Horowitz, Abercrombie’s CEO, told CNBC that the brand has been beating its own sales targets.
Analysts attribute the stronger-than-expected sales to teenagers perhaps being less afraid than older generations of heading to the mall and shopping right now. “The invincible teen consumer seems willing and eager to return to the physical world,” said Stacey Widlitz, president of SW Retail Advisors, in an interview with CNBC.
Overall, mall-based retailers are doing better than many had anticipated. Experts had predicted such stores to be around 25% to 30% of sales volume compared with normal levels. However, many are trending closer to 55% when they reopen, according to Jan Kniffen, CEO of consulting group J Rogers Kniffen WWE. “It really looks like a V-shaped recovery if you are looking at the retailers,” he told CNBC.
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