Insight Flash: Understand Shein’s growing market share of US online and global fast fashion markets with CE data

Chinese fast fashion retailer Shein is reportedly on the cusp of a London IPO following months of speculation. The IPO represents an interesting opportunity as Shein has gained significant market share both in the U.S. and abroad. Leveraging CE data, we track Shein’s market share of the U.S. online and global fast fashion markets, as well as its success across income cohorts compared to competitors.

Shein’s Online Spend: Fluctuations, Trends, and Market Dynamics

Shein’s share of total U.S. online spend remained steadily around 50 bps from June to November 2023, before dropping to as low as 25 bps during Christmas time. The Christmas drop is similar to fellow Chinese e-commerce giant Temu, which also saw a 25 bps drop.

It’s possible that this December decline was due to shoppers not willing to wait for longer shipping times from new market entrants as the Christmas holiday was rapidly approaching. This moderation was largely due to Amazon, known for its two-day Prime deliveries, gaining nearly 400 bps in share from the beginning of December to the week preceding Christmas, likely due to shoppers ordering items for friends and family from an established market player.

Following the decline, Shein’s share has steadily increased and is hovering around 55 bps, though this still trails Temu by 15 bps, which may be attributed to Temu selling a wider array of products. With its IPO generating a lot of buzz, it’s possible that Shein will attract new customers and gain share in the upcoming months.

Fast Fashion’s Global Market Surge

Shifting to the global fast fashion market, Shein has captured nearly a third of the market, trailing only Inditex’s (ITX-MCE) Zara and ahead of established players such as H&M (HM.B-OME) and Asos (ASC-LON). For Shein, this marks an increase in share of about 6% from 23Q1 to 24Q1, which comes primarily at the expense of Asos whose share is down 4% during the same time period.

This could be a sign of shifting consumer preferences, as Shein is an online only retailer, whereas Zara and H&M have both physical locations and an online presence. If Shein does choose to create a physical presence, Asos could serve as a blueprint as the retailer was previously online only before partnering with Nordstrom in 2021. 

Looking at spend by income cohorts, Shein’s aggressive pricing strategy has attracted a wide customer base, unlike Zara and Uniqlo, who derive most of their revenue from higher income customers. Shein’s success in capturing a broader demographic could force competitors to either adjust their pricing models or risk losing market share. It might also lead to a further segmentation within fast fashion, with some brands catering to higher-end, quality-conscious consumers, while others focus on the trend-driven, budget-focused market that Shein has capitalized on.

Consumer Edge is the leading provider of alternative data for consumer spending behavior, and the only provider of global revenue signals. If you’d like to benefit from using CE Transact US, CE Vision, or other products for fast fashion insights, market intelligence, and other industry data year-round to track trends and market hits like these, reach out to request a demo.

About the Authors

Michael Gunther is the VP Head of Insights for the CEIC. Explore more of his insights here and follow him on LinkedIn.

Harsh Masher is an Insights Analyst for the CEIC.