Although inflation pressures are easing, consumers worldwide are still feeling a wallet crunch. One of the areas most affected by this pressure is Apparel, Accessories, and Footwear spend, which contains a mix of both discretionary and necessary purchasing. In today’s Insight Deep Dive, we find that as consumers have cut back in recent months, they haven’t necessarily been shopping at less expensive retailers, but rather focusing their spend on basics that can be worn again in later seasons. This takeaway becomes apparent using the recently launched Industry functionality on our Global dashboards, allowing users to see industry-level transaction and average ticket growth by market in our Comparison dashboard, as well as to filter highest and lowest growth brands by industry in our Discover dashboard.

Both the US and EU have seen a deceleration in Apparel, Accessories & Footwear y/y transaction growth since January. US growth has decelerated -7% to -5%, while EU growth has decelerated -5% to 5%. Interestingly, UK growth has accelerated after a summer slump. The trends become even more stark when examining how the average basket has changed as transactions have decreased. In the US, the average ticket growth has been decelerating for the past 12 months. Both the EU and UK had already been suffering from declining average tickets last spring, accelerating to flat y/y growth in December, but with growth declining into negative territory again in recent months. Even as UK transaction growth has accelerated, the average ticket growth has fallen precipitously, ranging from -4 to -5% y/y growth in each month since the beginning of the year.  

Industry Growth

Note: Average ticket in local currency

Given the declines in transaction and ticket growth, it may be tempting to assume that all apparel companies are feeling a slump.  However, the top 20 brands by market in our Global Discover dashboard all saw y/y spend growth above 20% in the first calendar quarter of 2023.  One theme that emerges is that brands focused on basics that can be reworn from season to season have fared particularly well in the recent consumer climate.  Brands like Pull&Bear, Uniqlo (in all three markets tracked by CE), Cos, Bonobos, Superdry, Reformation, and Primark are all seeing high sales growth from selling timeless items that customers can count on, saving them shopping trips next year.  Primark is especially notable as it is one of the top growth companies in its new US market but not its home market in the UK.

Meanwhile, fast fashion and lower-priced retailers selling trendy apparel like Forever 21, boohoo, PrettyLittleThing, Urban Outfitters, and Asos have experienced the largest declines in spend.  (Although fast fashion powerhouse Shein is notable for being among the top growth brands in both the UK and EU.)  This suggests that the functionality of the apparel, and not the price point, has been making customers open their wallets.

Top Growth Companies

Note: Calendar 1Q2023; all growth in local currencies; only includes companies with at least ~5000 local currency spend per day in current and year ago period; apparel subindustries only

Bottom Growth Companies

Note:  Calendar 1Q2023; all growth in local currencies; only includes companies with at least ~5000 local currency spend per day in current and year ago period; apparel subindustries only

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Stacie Rabinowitz is the VP of Product Research at Consumer Edge. Explore more of her insights here and follow her on LinkedIn.