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US markets gain online sales, but in-store purchase falls
24
Apr '15
A market study by global information company, The NPD Group has found that New York and Los Angeles are the largest US markets in terms of apparel sales, but smaller markets such as Orlando and Washington, D.C. are the top markets driving both growth rate and dollar volume increases for the industry. These two top markets had strong performance across in-store and online channels. Among the top 25 designated market areas (DMA) in the US, online dollar sales of apparel increased for most, but only a handful grew in-store sales in the 12 months ending February 2015.

Total apparel industry dollar sales grew 2 per cent in the 12 months ending February 2015, but sales of apparel purchased in a store declined 2 per cent. The downward trend of in-store sales was true for most of the top 10 US markets. Washington, D.C. is the only one with notable in-store sales growth (+14 per cent), according to the NPD Group report.

“The big regions are no longer leading apparel industry sales growth,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “When New York and Los Angeles don’t even make it into the top 10 list of DMAs driving apparel growth, we have a big opportunity gap in the market. We need to understand the cause in order for the apparel industry to regain traction moving forward.”

Online sales of apparel tell a different regional story. Overall, this segment, which now accounts for 17 per cent of industry dollars, increased 19 per cent in the 12 months ending February 2015. When looking at the top US markets (NY, LA, Chicago, Philadelphia, Dallas-Ft. Worth) each grew online sales by double digits. However, the biggest growth is, yet again, coming from smaller markets.

In most cases, the DMAs that are outperforming the industry as a whole are also the ones with more dramatic in-store sales growth than online sales gains. Online shopping delivers great convenience to the consumer, but it cannot yet deliver the level of impulse purchasing that in-store shopping can. Impulse purchases of apparel occur for 32 per cent of in-store sales, while online only generates impulsive purchases 22 per cent of the time.

“Impulse purchases are the big growth driver, so the strategy of driving traffic to websites needs to exist in tandem with efforts to drive traffic to the stores,” added Cohen. (SH)

Fibre2fashion News Desk - India

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