For any apparel and fashion retailer, it is very important to understand and identify the needs of their market. Market segmentation is a process they often indulge in to distinguish their customers into different categories based upon certain pre-determined characteristics. Delving into get consumer insights by gaining information on age, personalities, preferences, gender, professions, and income can help retailers target and promote their products better in a specific market.
Thanks to such market segmentations, fashion brands have created categories like maternity wear, kids wear, teen wear, and apparel for older generations. But many brands are now tapping new markets and creating a demand for their merchandises in not just their conventional demographics by conducting in-depth studies in order to reap better sales. However, one root cause for changing and focusing on different market segments is the change in demographics. The newest and the latest generation fashion brands across the globe are targeting are the new millennials or the "echo-boomers".
Echo boomers are widely defined as the generation born between the years 1980 to 2000. According to Accenture research, the approximate spending of this population will be $ 1.4 trillion by the year 2020 and will account to a share of 30 per cent of total retail sales. While on the other hand the study also reveals that the baby boomers generation will decline by 20 per cent in the next seven years. The current economic downturn has however, affected the upcoming next generation of spenders by causing unemployment and job losses.
The millennial are sought after to be the largest demographics spending on fashion apparels and electronic gadgets. Based on a study done by Bloomberg Business Week, shoppers aged between 25 to 34 spend 8 per cent higher on apparel than the ones aged between 35 to 44 years although they earn 22 per cent less. The amount of fashion brands focusing to market products to teens and the population in their twenties has been growing tremendously. Brands such as Abercrombie & Fitch, Urban Outfitter, American Eagle, Forever 21, Hot Topic, Rue 21, Pacsun, and Aeropostle are emphasizing on leveraging sales from a similar demographics.
Many luxury brands all over the globe so far have been marketing their products to urban adults but slowly their focus is shifting towards young urban males. Until now luxury clothing brands were making and selling products to rich middle aged women, but with time they have realized through analysis and research that young metro sexual men are the future of retail. They have grown to be extremely conscious of what they are wearing and do not hesitate in spending on expensive clothing. Moreover, this segment over the time has become nothing but demanding and these young men like to stay in trend. With young males marrying later in life and working in blue chip companies, they have enough income to dispose on high end garments. Brands like Burberry, Michael Kors, and Coach are all looking into the transition in demographics and gender keenly.