“In fashion, we observe large disparities between brands and different market segments”

2023-10-20 14:00:04

Clothing has become one of the lowest priority consumption items for French households. The erosion of this market is not new: in fifteen years, it has fallen by 15% in value and 10% in volume. Over the first eight months of the year, it lost even more than 6% in value compared to 2019, according to the French Fashion Institute (IFM). This general trend, however, masks large disparities between brands and different market segments.

The entry level is holding up well, with a broad and renewed offering, which captures customers looking for the lowest prices. Historical players in France (Kiabi, Gémo), who must face Web players (Amazon, Shein), have been able to modernize their collections and improve their customer experience in store or online. However, they must reconcile the profitability of their mass model with the challenges of social and environmental responsibility.

The midrange contracts and focuses. For five years, a succession of crises has led to the disappearance or difficulties of the most fragile brands, such as Camaïeu, Naf Naf and others. On the other hand, Zara, H&M and Uniqlo remain world leaders thanks to their scale, the clarity of their positioning (respectively “accessible fashion”, “eclecticism of trends” and “timeless minimalism”) and the performance of their organization. On October 12, Uniqlo published results above targets, with profits up 8.4%.

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The premium and affordable luxury segment (Lacoste, ba & sh, Soeur, Balzac, etc.) has, on average, been growing for fifteen years. Its success is due to the ability of this category of brands to create an identity affinity with their customers, who are looking for exclusive and qualitative collections. This segment has reached maturity in France: its growth driver is international development.

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Finally, French luxury and “creative brands” remain the most dynamic segment: it brings together players who are distinguished by a singular vision and significant means to arouse the desire of their customers through fashion shows, boutiques, communication or collaborations. They cover the highest price brackets and reach an international clientele through a diversified offering, where fashion accessories such as leather goods and shoes play an important role.

Two big challenges

To complete this overview, the second-hand segment is expected to grow eleven times faster than the traditional market in the next five years. In 2022, it represented 6 billion euros for clothing, shoes and leather goods (IFM, November 2022), compared to 45 billion for new goods (including shoes and leather goods) (Insee).

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