“The fashion industry is saturated,” remarked former head of Nina Ricci and Rochas, Olivier Theyskens, earlier this year.
Whether retailers agree with his statement or not, it’s certainly one of retail’s most competitive sectors. Fashion brands are constantly changing trends to contend with increasing consumer expectations.
The appearance of new garments and accessories is frequent, which means sales strategies need to be amended regularly – which can still become irrelevant as economic, environmental and cultural influences start impacting customer buying decisions.
So, with all of this to consider, how are fashion retailers actually performing?
Our Fashion Conversion Benchmarking Report examines the conversion rates of these businesses across 21 countries during 2014, revealing some interesting findings.
Overall, APAC saw an average conversion rate of +7% from its fashion retailers during 2014 – performing well across the board. In fact, the Republic of Korea is the only country in the region to have suffered negative Year-on-Year growth compared to 2013.
Hong Kong is leading the APAC countries in its performance from mixed fashion retailers, enjoying an average conversion rate of +9.3%. This is followed closely by Singapore with +9.1%.
However, Hong Kong also experienced the most varied level of conversion throughout the year, seeing a high of +21.5% and a low of +4.9%.
When further breaking down the figures, Hong Kong performed particularly well in the mid-market retail sector, coming second to Australia in this category. Much of the country’s success is due to strong growth in wages and earnings, coupled with low unemployment, boosting disposable income.
Consumers in Singapore have the biggest appetite for premium fashion retailers, followed by Hong Kong and Japan. Yet, the findings report a lower conversion rate for such retailers compared to mid-market – largely due to a consumer tendency to spend longer considering high value purchases.
European interest in shopping for fashion items proved higher than APAC, displaying an average conversion rate of +11.4% throughout 2014.
Belgium displayed the highest average conversion rate of +14.2%, followed closely by Ireland and the Netherlands; +13.8% and +13.7% respectively. Austria had the lowest with 6.1% – despite the country weathering Eurozone insecurity much more strongly than many of its neighbours.
Yet, unlike APAC, consumer shopping habits in Europe lean further towards budget spending, with value retailers experiencing extremely high conversion rates during the last year – hitting +22.9%. The Netherlands and the UK make the most regular purchases from value retailers, demonstrating that although consumers feel more confident about fashion spending, they’re still being careful with their cash.
Mid-market retailers also performed well in 2014, converting +13.9% of its visiting customers into sales. However, premium retail does not seem to be as popular in the region, reaching just +5% in average conversion.
For a full rundown of global fashion activity in 2014, download our Fashion Conversion Benchmarking Report. You can also access the latest figures across all sectors by visiting our footfall trends centre.