Online clothing sales are expected to grow faster than any other categories over the next five years

Online clothing sales are expected to grow faster than any other categories over the next five years

Online apparel sales are set to be boosted significantly by the entry of two giants in Internet retailing and a search engine company, who are all vying for growth in the global online apparel market.

Amazon and eBay have recently relaunched their apparel and clothing businesses, and are intent on aggressively building up their shares of the online apparel market. However, neither has banked on the entry of their new rival Google.

Online sales already account for a significant share of the market for clothing, shoes and accessories, according to a report in the latest issue of Global Apparel Markets. Indeed, in the US alone they accounted for almost 16% of the total market for these items in 2009.

Moreover, sales grew by a remarkable 17% in that year alone, and between 2009 and 2014 sales are expected to increase by no less than 58%, according to one leading consultant. Similar growth is expected in other advanced economies, such as Australia, Hong Kong and the UK.

In fact, sales of clothing via the Internet are expected to grow faster than sales of other categories via the Internet – including electronics – over the next five years.

For many firms, selling apparel online is a comparatively high risk business. But Amazon and eBay already have strong market shares, brand positions and reputations in online retailing worldwide.

It seems likely, therefore, that their respective ventures in the apparel sector will prove highly successful.

Recent initiatives by Amazon include the launches of its Outdoor Recreation Store and its Denim Store, its acquisitions of Zappos.com and BuyVIP.com, a refocus on high-end fashion retailing, and the launches of exclusive collections such as Heidi Klum for New Balance.

eBay relaunched its clothing sales in April 2010 under the eBay fashion brand, complete with videos and comments from fashion stylists and a "find similar items" image-matching feature.

One recent initiative has been to set up "storefronts" in the US in which retailers such as Brooks Brothers and Timberland sell excess and discounted stock directly to buyers. In addition, eBay has launched a fashion outlet site in the UK, and the company’s eBay Fashion LookBook has been billed as the first ever "shoppable, shareable digital style gallery".

In October 2010 eBay announced that the designer Derek Lam would introduce an original collection to be sold exclusively on the site.

Google is a newcomer to apparel retailing, having traditionally earned 97% of its revenues through advertising. But it is a huge spender on research and development and its market entry could change the rules of the game for everyone.

Google has formed a website called Boutiques.com which enables consumers to run their own "personalised boutiques" with the help of recommendations and advice from celebrities. As such it represents a significant new direction for the company and for the online apparel market in general.

The site is aimed primarily at teenage girls – and especially those most enamoured with celebrities. At first glance, it appears to be more like a fashion magazine than an online store.

However, Google claims that, through search engine fine-tuning, it has gone further than anyone else in personalising the online shopping experience and in making the choices available less overwhelming.

Looking ahead, acquisitions are expected in 2011. Younger and less stable online apparel sites will become increasingly vulnerable and stand to benefit from the platforms which giants such as Amazon, eBay and Google can provide.

"Amazon, eBay and Google battle for growth in the global apparel market" was published by the global business information company Textiles Intelligence in issue No 11 of Global Apparel Markets.