GlobalData analysis finds that the apparel sector avoided what was expected to be a bleak Christmas period in 2022.
Despite the effects of the cost-of-living crisis and postal strikes, multichannel clothing and footwear retailers saw increased sales. While partly boosted by price rises, retailers who offer in-store and click-and-collect services excelled.
Which retailers saw profits?
Marks & Spencer saw its UK clothing & home sales rise by 8.8% in the 13 weeks to 31 December.
JD Sports was another beneficiary. Its global group revenue rose by over 20% in the six weeks to 31 December. Although growth will likely have been lower in the UK, it is a clear outperformer, boosted by consumer appetite for branded sportswear and the 2022 FIFA Men’s World Cup.
What trends impacted the apparel sector in the 2022 Christmas period?
A key trend in the apparel sector was the channel shift. This was due to the impacts of the postal strikes in the UK. Online pure plays bore the brunt of this as they had to bring their final order dates forwards to guarantee delivery by Christmas and other carriers became overwhelmed.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
GlobalData retail analyst Emily Salter states that “These declines can partly be attributed to the normalisation of shopping behaviours. Omicron forced many shoppers to switch online last Christmas. Additionally, many consumers are falling out of love with fast fashion. They are now seeking apparel that represents greater value for money.”
However, fast fashion still offers support for consumers struggling with the cost-of-living crisis. Indeed, Primark had a strong Christmas, with its UK sales rising 15% in the 16 weeks to 7 January.
What is the forecast for apparel retailers in 2023?
Consumers’ discretionary incomes and savings will become increasingly stretched and depleted. As a result, low prices will increasingly trump other drivers of retailer choice.
While most apparel retailers pulled through Christmas 2022, some spend will have been protected by consumers willing to splash out on the first festive period without COVID-19 restrictions since 2019. Many will likely cut back in Q1 of 2023.
“2023 will be a tough year for the UK apparel sector, as many consumers start to run out of savings. This will be compounded by a lack of government help as they feel the full force of higher energy bills, with the market forecast to fall by 5.1%,” says GlobalData retail analyst Emily Salter.
“Although the pressures on retailers’ margins and consumers’ incomes will start to ease in the second half of the year, there will be casualties. The upper mass market is especially set to be squeezed as consumers trade down and struggle to justify higher price points.”.