Monthly Archives: November 2017

Recap of “Trends in the US Retail Landscape”

On October 10th, 2017, The Underfashion Club had the pleasure of hosting Don Unser, Group President of Retail with NPD, at the Harvard Club of New York for a discussion on “Trends in the US Retail Landscape.” The NPD Group is among the top 25 market research companies, providing marketing information and advisory services to companies. After an hour of cocktails and networking, attendees took their seats  to learn about the modern retail climate in the United States.

Don began his presentation by highlighting macro trends across industries and categories before digging deeper into apparel and intimate apparel. Based on tracking $1.8 trillion dollars spent by consumers in the US, Don Unser commented that “There has never been a more tumultous time in retail in the 30 years I have been in the industry.” The overall growth rate is -0.2%, the only time we’ve seen a negative growth rate in US retail since the recession. Apparel sales are now flat, which is a first given that a growth rate of 1-3% is typical in this industry.

Where is consumer spending being shifted? Though there is a downward trend overall, there are several industries that are experiencing a marked increase in sales. Prestige beauty, home improvement, cruises, national park attendance, and RVs are seeing positive growth rates. Don theorizes that this shift toward spending on memories and experiences may be influenced by millennials’ mobile use, online presence, and search for uniqueness. With platforms like Instagram being enormously popular, millennials are always on a search for the “money shot” to share on their profiles. A life that’s personalized and picture-perfect is high on the modern consumer’s priorities.

Even e-commerce growth rates have been slowing for the past few quarters as various categories reach their online maturation points. Don reminded the audience that brick-and-mortar stores are still key for growth, feeding the relevancy of a retailer’s online sales.

Despite its lack of overall growth, there are clear distinctions between the top and bottom performers in apparel. Woven shirts and dresses are the biggest drivers in apparel, while T-shirts and sweater sales are significantly declining.

The large number of store closings over the past year is a big factor contributing to the difficulty in retail. Don predicts that apparel space will continue to decrease for another two years. To adapt and to stay relevant as Amazon grows, manufacturers are ramping up their direct-to-consumer services. The majority of retailers are using data to figure out how to appropriately distribute their brand outside of stores.

The intimate apparel industry has remained relatively flat for the past few years. Sports bras and swimwear are seeing improved sales while shapewear is facing a slight decline. Bras have more online penetration than women’s apparel, though panties fall short.

Amazon has grown to become the top online retailer in intimate apparel, with nearly 22% of bra sales and 42% share of the underwear market – almost 8x the runner-up. Intimate apparel brands should take note, especially if they plan to partner with Amazon.

With the nature of the modern retail climate and its inevitable changes in mind, Don Unser concluded his presentation with a call to action for both brands and retailers with advice on how best to compete and adapt to this volatile retail environment. We thank Don and NPD once again for an interesting and insightful evening.

See photos from “Trends in the US Retail Landscape” in our Facebook album!

Watch a clip of the seminar on YouTube: