A focus on the premium end of the fashion market is set to help retailers in the sector grow their businesses further over the next three years, according to a new study.
Research from Verdict Consulting on behalf of Barclays Corporate suggests that Britain’s ageing population, with their focus on choosing clothes based on quality over price, will lead the UK’s fashion firms to tailor their offerings to an older clientele.
The report states that the premium segment is expected to be worth an estimated £8.6 billion by 2014, which would represent an increase of £1.9 billion (29 per cent) on today’s estimated value of £6.7 billion.
Richard Lowe, Head of Retail and Wholesale at Barclays Corporate, said thatthe media attention on the Royal wedding and Prince William’s wife-to-be Kate Middleton will also have a serious impact on fashion retailing.
“Kate Middleton is expected to do for many British high street names what Michelle Obama did for J Crew in the US,” he explained.
“Shoppers really get inspired by these big glossy images of her in styles which are very accessible.”
Judging by the reaction to the happy couple’s official engagement photographs, which resulted in a surge in consumer interest in Whistles and Reiss clothing adorned by Middleton in the snaps, Lowe’s predictions could prove correct.
The research also indicates that the value market will expand from £9.9 billion to £12 billion during the next three years, which is slower than pre-recessionary growth rates but still a major factor in the overall expected clothing industry growth of nine per cent by 2014.
Findings from the report mirror some of the views held by Mark McMenemy, former Finance Director of Mothercare, Clarks and Monsoon, and now Head of Retail and Consumer at professional services group Alvarez & Marshal.
McMenemy told Retail Gazette that, unlike the aftermath of previous recessions, consumers are less likely to return to midmarket retailers because the value market now meets their fashion requirements.
With young consumers keen on the offering from the value sector, he warned that the shift in attitudes means it is unclear who the next generation of midmarket fashion shoppers will be.
“Businesses operating in midmarket fashion retail need to attract the younger generation and the premium players have a challenge too,” he stated.
“They cannot rely on their existing customer base being the same in the next ten years.”