Teen retailers may have a run for their money this spring.
In the digital age, many consumers have become accustomed to getting what they want as soon as they click a mouse. The ever growing reliance on instant gratification could soon have profound impacts on the teen retailer space.
Unsurprisingly, teens and young adults have a tendency to change their minds often, and it’s no different when it comes to what they choose to wear. In an attempt to cater to the way younger demographics shop, highly recognizable companies have implemented a fast-fashion model. Fast-fashion is defined by rapid production rates of low cost items. This model has emerged as an extremely popular and profitable retail strategy in recent years.
As of late, retailers that rely on the fast-fashion model have hit their stride and have successfully maintained a strong following. For instance, H&M has risen to prominence in the retail world, due to its nearly sole reliance on fast-fashion. H&M has become known for churning over trendy merchandise at extremely quick rates and selling that merchandise at very affordable prices.
Additionally, the H&M brand has leveraged celebrity endorsements to their advantage, which has further enticed young shoppers to buy. Beyonce, David Beckham and Gisele Bundchen are just a few of the many prominent figures who have given their starpower to H&M ad campaigns. Utilizing celebrity spokespeople in conjunction with the fast fashion model sends the message to teens that they can easily look as trendy as their favorite celebrities for a fraction of the cost.
As evidenced by Compete PRO demographic data, the intended message is certainly resonating with young shoppers. The majority of Consumers that visit H&M’s website are between the ages of 18-24. In an article from ABC News Australia about H&M’s production strategy, retail analyst Caroline Finch states, “They’re coming in to reach a trend when it’s hot right now, when celebrities are wearing it and when it’s on the internet – and people might not want to wear the garment next year though because they’re that fashion conscious.”
Fast fashion is proving to be a grand scale success for brands like H&M, but the business model might be nightmare for fellow teen retailers this spring.
An article from CNBC about the upcoming spring retail season notes, “As consumers look to freshen up their wardrobes with the latest styles—all while keeping their budgets in check, of course—it’s the stores with on-trend merchandise that will emerge as the season’s winners, according to analysts.”
Based on this sentiment, H&M and retailers like it will likely have a clear advantage this spring.
So, what does this mean for retailers in the same space competing for the same young shoppers? Fellow teen retailers such as American Eagle Outfitters and Abercrombie and Fitch may want to focus on brand differentiation as opposed to making attempts to compete head to head with fast-fashion giants.
It will be important for teen retailers to produce and promote items that have a brand specific looks and feel. A focus on exclusivity may prove to be extremely beneficial, as fast-fashion retailers will always make the highest profit from trendy “basics”.
In addition to brand distinction, the key to success for fellow retailers may be a focus on increasing productivity in 2014 to ensure quicker production rates. Young shoppers move quickly and no matter what’s being sold, stores need to be ready to move with them if they want to lead industry.
Sarah is a member of the Syndicated Products Customer Success team at Millward Brown Digital. Sarah attended Northeastern University. Prior to Millward Brown Digital, Sarah worked in Advertising and Public Relations. Connect with her on Google+ or LinkedIn