US Consumer Analysis: Apparel and Footwear

US Consumer Analysis:Apparel and FootwearFebruary, 2017

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US Consumer Analysis:Apparel and Footwear

Influences on Apparel and Footwear Purchases

About this Report

Key Takeaways and Market Overview

Purchase Behavior: Apparel and Footwear

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About this Report

About this ReportThis report is a collaboration between Fung Global Retail & Technology and Prosper Insights & Analytics. It uses propriety data from surveys conducted by Prosper in the US that track shopping behaviors and the future purchase intentions of consumers.

Survey MethodologyThe Prosper Insights & Analytics Monthly Consumer Survey provides insights into the US consumer market from multiple datasets and multiple sources. It surveys more than 6,000 consumers 18+ in the US on an ongoing basis.

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Key Takeaways: Brick-and-Mortar to Remain the Dominant Transaction Channel for US Apparel and Footwear

1. The majority of US consumers have purchased apparel both online and offline, however, brick-and-mortar is still the dominant transaction channel.

2. In fact, US consumers’ attitude towards fashion and their purchase behavior has changed little over the past five years.

3. We expect brick-and-mortar to remain the dominant store format for US apparel and footwear retail in the near future.

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Key Takeaways: Social Media has Become a Major Influencer in Apparel Purchases Among Millennials

1. As retailers have shifted their budgets to digital advertising, the influence of all major media channels has decreased in the past five years, except for social media and mobile video.

2. Among millennials, the influence of social media on apparel purchases is on par with traditional media like TV and magazines.

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Consumer and Category Insights

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US Consumer Confidence Solid in 2016, Following an Improvement in 2013–2015

Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-1720%

30%

40%

50%

60%

52%

Source: Prosper Monthly Consumer Survey – US/University of Michigan/US Census Bureau/US Department of Commerce

% of Respondents Feeling Confident or Very Confident in the Economy in the Next 6 Months

Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-1750

60

70

80

90

100 98.5Index of Consumer Sentiment (University of Michigan)

2011 2012 2013 2014 2015 20163.0

3.5

4.0

4.5

5.0 4.85US Retail Sales (US$ trillion)

2011 2012 2013 2014 2015 2016100

105

110

115

110.7

US Personal Consumption Expenditures Price Index (2009=100)

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2011 2012 2013 2014 2015 20160

100

200

300

400

278 282 285 287 293 292

26 30 34 39 46 55310 317 324 331 343 353

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Other nonstore-based retailing

Online (Internet retailing)

The Internet is Not Yet a Significantly Large Channel in Terms of Apparel and Footwear Purchases

Size of US Apparel and Footwear Market (US$ billion)

Source: Euromonitor

15.5%

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But it Increasingly Influences How Consumers Shop for Apparel Offline

2011 2012 2013 2014 2015 20160%

20%

40%

60%

80%

100%

49% 44% 38% 32% 26% 20%

40% 45% 50% 55% 61% 66%

11% 12% 12% 13% 14% 14%

Online

Web-influenced offline

Offline only

Apparel Retail Sales in the US, by Type

Source: Think with Google

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Nov-11 May-12 Nov-12 May-13 Nov-13 May-14 Nov-14 May-15 Nov-15 May-16 Nov-1640

60

80

100

120

105

85

76

8786

78

Children’s Clothing

Men’s Clothing

Men’s Dress Clothing

Shoes

Women’s Casual Clothing

Women’s Dress Clothing

Children’s Clothing Shows the Most Seasonality in Apparel, Affected by Back-to-School and Holiday Shopping

Spending Score of Respective Apparel Category

Source: Prosper Monthly Consumer Survey – US

A spending score higher than 100 means more consumers are planning to spend more on that category over the next 90 days than are planning to spend less on it.

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Consumer Purchase Behavior: Online or Offline

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The Majority of Consumers Search and Purchase Some of Their Apparel Online

78% of Consumers Searched forClothing/Footwear Online

Frequency of Clothing/Footwear Online Search (Jan 2016)*

25%

53%

22%

Regularly Occasionally Never

80% of Consumers Who Purchase Children’s Clothing Shop Online

% of Respective Item Purchased Online (2016)

Women’s Clothing

Men’s Clothing


Footwear

29%

33%

20%

47%

43%

39%

43%

29%

28%

28%

37%

23%


* No significant changes in the past five years * Sample: Moms with kids aged 9 and below

0% (do not buy online) 1%–50% bought online 51%–100% bought online

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Brick-and-Mortar Still the Dominant and Most-Used Channel for Apparel and Footwear Purchases

Around 10% of Consumers Made Purchases via Mobile Sites

Shopping Method Used in the Past 30 Days (Nov 2016)

10%

11%

39%

39%

63%

78%Apparel and Accessories

Footwear

Brick-and-Mortar is the Most-Used Store Format

Women’s Clothing

Men’s Clothing


Footwear

82%

71%

77%

62%

3%

4%

3%

9%

6%

8%

12%

10%

7%

15%

8%

18%


Physical store Online site Mobile site Physical store Internet Others No preference

Most-Used Store Format to Purchase Respective Items (Nov 2016)

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Women’s Clothing Men’s Clothing Children’s Clothing Footwear

More Consumers Use the Internet the Most Often to Purchase Apparel, but are Still a Niche Segment

1%

3%

1%

4%

1%

3%

4%9%

Nov 2011 Nov 2016

Those Who Use the Internet the Most to Purchase Respective Items (Nov 2011 and Nov 2016)

Sample: Women’s Clothing: All Women / Men’s Clothing: All Men / Children’s Clothing: Moms with kids aged 9 or below / Shoes: All respondentsSource: Prosper Monthly Consumer Survey – US

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For Women’s and Men’s Apparel, Heavy Online Shoppers Show a Preference for Specialty Stores


Department Store

Discount Store

Specialty–ApparelCatalog

Others

0%

10%

20%

30%

40%

Most Often Shopped Retail Category for Women’s Cloth-ing (Excluding Internet, April 2016)

Department Store

Discount Store


Others

0%

10%

20%

30%

40%

Most Often Shopped Retail Category for Men’s Clothing (Excluding Internet, June 2016)

All Shoppers Heavy Online Shoppers (Those who made 51-100% of their purchases online)

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Heavy Online Shoppers Also Show a Preference for Specialty Stores in Children’s Apparel and Footwear


Department Store

Discount Store


Others

0%

10%

20%

30%

40%

Most Often Shopped Retail Category for Children’s Cloth-ing (Excluding Internet, October 2016)

Department Store

Discount Store


Others

0%

10%

20%

30%

40%

Most Often Shopped Retail Category for Footwear (Excluding Internet, July 2016)


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Macy’s and Nordstrom are Relatively More Popular Among Heavy Online Shoppers

Source: Prosper Monthly Consumer Survey – USSample: Women’s Clothing: All Women / Men’s Clothing: All Men / Children’s Clothing: Moms with kids aged 9 or below / Shoes: All respondents

0%

10%

20%

30%

40%

50%

Retailers Shopped at in the Past 90 Days for Women’s Clothing (April 2016)

0%

10%

20%

30%

40%

50%

Retailers Shopped at in the Past 90 Days for Men’s Clothing (June 2016)


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In the Children’s Clothing Category, Specialty Stores are Relatively More Popular Among Heavy Online Shoppers

Source: Prosper Monthly Consumer Survey – USSample: Women’s Clothing: All Women / Men’s Clothing: All Men / Children’s Clothing: Moms with kids aged 9 or below / Shoes: All respondents

0%

10%

20%

30%

40%

50%

Retailers Shopped at in the Past 90 Days for Children’s Clothing (October 2016)

0%

10%

20%

30%

40%

50%

Retailers Shopped at in the Past 90 Days for Footwear (July 2016)


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Consumer Purchase Behavior: Attitudes

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Nov-11 Nov-12 Nov-13 Nov-14 Nov-15 Nov-16

44% 43% 42% 43% 44% 43%

37% 38% 38% 39% 37% 38%

19% 19% 21% 18% 19% 19%

Newest trends and styles are important to me

I prefer a traditional conser-vative look

Fashion is less important than value and comfort to me

Consumers’ Attitude Toward Fashion has Changed Little in the Past Five Years

Feelings about Fashion (2011–2016)


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50% 50% 49% 50% 50% 47%

50% 50% 51% 50% 50% 53%

Important

Not important

Slightly More Consumers Regard Labels as Important Compared With Last Year

Importance of Labels When Buying Clothes (2011–2016)


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23% 23% 22% 22% 23% 22%

63% 62% 61% 63% 62% 62%

13% 15% 16% 15% 15% 16%

Sales are not important to me when buying clothing

I usually buy clothing when it is on sale

I only buy clothing when it is on sale

The Majority of Consumers Usually Buy Clothing When it is On Sale

Importance of Sales (2011–2016)


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Media Influence on Apparel Purchases

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Retailers are Shifting Their Focus to Digital Advertising

Advertising Spending of the US Retail Industry, 2013 vs. 2015 (US$ million)

Source: Total Advertising Spend - Kantar Media

2013 20150

5,000

10,000

15,000

42% 38%

25%15%

11%9%

8%

6%

10% 27%4%

4% 11,827

13,295

Column2

Other

Internet display

Magazine

Radio

Newspaper

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The Influence Power of All Major Media Channels has Decreased for Apparel Purchases, Except for Social Media and Mobile Video

Source: Prosper Media Behaviors & Influence™ (MBI) Study

Email Advertising Internet Advertising Social Media Video on Mobile Device

TV/Broadcast Magazines Newspaper Radio0%

5%

10%

15%

20%

25%

30%

35%

25%

20%

10%

6%

24%26%

20%

10%

25%

18%

14%

9%

19%18%

12%

8%

Dec '10Jan '16

Those Who Were Influenced by the Respective Media Channel when Purchasing Apparel, 2010–2016

Digital Media Traditional MediaNew Digital Media

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5%

10%

15%

20%

25%

30%

35%

25%

18%

14%

9%

19%18%

12%

8%

32%

26%

23%

18%

22%23%

11%12%

All Respondents

18–34 (Millennials)

Influence of Social Media is On Par with TV and Magazines Among Millennials


Those Who Were Influenced by the Respective Media Channel when Purchasing Apparel, Jan 2016

Traditional MediaDigital Media New Digital Media

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5%

10%

15%

20%

25%

30%

35%

25%

18%

14%

9%

19%18%

12%

8%

18%

12%

5%

2%

15%13%

16%

4%

All Respondents

55+ (Boomers and Silvers)

Boomers are Less Influenced by Both Digital and Traditional Media Channels, Except Newspaper


Those Who Were Influenced by the Respective Media Channel when Purchasing Apparel, Jan 2016

Traditional MediaDigital Media New Digital Media

Find our research at www.FungGlobalRetailTech.com

http://www.fgrt.com/

US Consumer Analysis: Apparel and Footwear

Retail

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