- Report reveals that despite tough times for the UK’s high streets, overall sales of clothing and accessories have seen a 2 per cent growth year-on-year to June 2018, bolstered by rapid growth in online sales
- Barclays Market and Customer Insights service, now available to non-Barclays corporate clients, enables businesses to make strategic decisions on where to set up shop
Barclays has today released a report into the UK fashion retail market using data aggregated from more than 8 million customers by its Market and Customer Insight service. Delving into the data, which covers consumer spending between July 2016 and June 2018, the report reveals how a tumultuous time for British high streets has affected the business of fashion.
Bricks and clicks still reign supreme
Whilst in-store purchases continue to make up the majority of sales, 63 per cent, the growth in transactions has been driven by online, with its share increasing rapidly from 30 per cent to 37 per cent over the past two years. In fact, 45 per cent of all purchases from women-only fashion brands are now made online.
It’s not just women’s fashion brands that have fared well online, online sales have grown in every clothing category. The biggest success story is for combined men’s and women’s retail brands, where the online growth of 26 per cent has negated an in-store drop of 5 per cent over the past year.
Brands that have successfully leveraged their bricks and clicks presence are dominating the market, with sales growth of 3.4 per cent over the past two years. By leveraging their physical presence and offering a high-quality customer experience, coupled with a multi-channel approach, these retailers have managed to stay competitive.
When looking at the buying behaviour of different age groups, the analysis revealed that younger customers (25-49) prefer shopping both in-store and online, rather than exclusively online, reflecting the popularity of shopping as a leisure activity. Online-only shopping had been boosted by the silver pound, with a higher percentage of over-65s than 18-24s, due in part to transport and mobility challenges making it more convenient to shop online.
No earn on returns
On average, 11 per cent of fashion sales (online and in-store) were returned, with 41 per cent of customers receiving a refund over the last two years.
The yearn to return has had the biggest impact on online sales. While online fashion retail attracts an ATV of £57, 46 per cent higher than in-store this is reduced significantly, to just £46, or 27 per cent higher, when refunds are considered.
Unsurprisingly, refunds spike at Christmas and summer sales. However, there has been as overall upward trend in refunds over the past year, perhaps indicating that free delivery and returns policies may become a bigger drain on net sales in future, as shoppers become accustomed to habitually over-ordering and then returning unwanted items.
Raj Pattni, Head of Insights Platform at Barclays, said:“It’s no secret that the fashion retail market has had a tumultuous time. Our report has highlighted the need for retailers to be agile and react quickly to changing customer preferences to keep afloat. Barclays Market and Customer Insights can help retailers get the information they need to make informed decisions. Whether it’s analysing the spending patterns of key demographics or looking at location specific data from bricks and mortar outlets, the service can offer retailers powerful insights based on hard transaction data, helping business shape and transform their strategy.”
Barclays Markets and Customer Insights service is now available to Barclays and non-Barclays corporate clients. It provides analysis of customer transactions, pinpointing precision data of where people spend. To find out more, head to https://insights.uk.barclays/MCI
Contributor: Barclays Market and Customer Insights
