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E-commerce and New Silhouettes Spark Opportunities for the Denim Market

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Denim is poised for its retail revival. And after plodding through a lackluster 2019, U.S. retailers couldn’t be happier about the timing.

In the 12 months ended November 2019, total U.S. dollar sales of jeans declined 1 percent to $16.6 billion, according to The NPD Group. While the men’s segment inched up 1 percent in both units and dollars, women’s dollar sales declined by 1 percent and unit sales were even year over year.

Although this flat performance is underwhelming, it’s important to note that total apparel sales were down 3 percent for the same period, with the bulk of declines coming from categories outside of jeans, NPD industry analyst Maria Rugolo said.

Sunnier skies are ahead, however. The global denim market is expected to reach $79.2 billion by 2023, according to ResearchandMarkets, which cited the transformation of the Asian retail clothing industry, the growing e-commerce industry, and the expansion of organized retail as key market drivers. Figures from Statista echo this growth forecast, which anticipates the global jeans market to reach $85.4 billion in retail sales by 2025, up from $66 billion in 2018.

The cause of the recent dreary denim performance? A dearth of innovation.

“It’s interesting [because] for a number of years, it used to be that everybody was looking for ‘What’s the next thing in denim?’” Rugolo said. “A couple years ago, in the early 2000s, it was all about the colors, and they had all the different colored jeans. Then skinny became so popular, and it was all about skinny. And then, recently, it was all high-waisted and cropped denim, and that was what everybody was looking to replenish in their closets.”

“We haven’t seen what the next thing is yet, but I think it’s cyclical and goes that way,” she continued. “So that’s why we’re seeing that little bit of a dip.”

Amy Leverton, denim trend forecaster and consultant, and founder of Denim Dudes, attributed the downturn to non-denim pants and excitement coming from different categories. “Military and workwear is trending hard, and utilitarian pants, carpenters and cargos are all in the spotlight right now,” she said. “When the trending silhouettes, fabrics and details are synonymous with pants that are not your classic five-pocket jean looks, then it stands to reason.”

The good news, Leverton said, is that these are quick trends that may not impact the market for long.

Inside the fitting room

Although in-store purchases accounted for the majority of total U.S. industry sales during the 12-month period—76 percent total dollar sales and 81 percent unit sales—this marked a decline from the previous year, as e-commerce, perhaps unsurprisingly, continues to gobble share of denim sales.

Lyst, a global fashion search platform that tracks 12,000 brands and retailers, and features more than 5 million products, said jeans were one of the most searched for fashion pieces globally on its site in 2019. Denim can stake the claim as third most popular searched-for clothing category on the site, falling just below sneakers and dresses.

Data also shows a 30 percent increase in denim sales made through Lyst during the same period.

When it comes to buying jeans online, the trend for the past few years has been that higher-end denim traditionally sells better than its mass market counterparts, as that consumer is more used to buying online, Rugolo explained. However, this has shifted and it’s expected to continue to do so as mass market retailers put more effort into selling jeans online. Although more mass market consumers are buying jeans online, they don’t do so at the same rates as consumers shopping for high-end denim.

“Channels that had more premium denim offerings (i.e., specialty and department stores) traditionally had more of their share of jeans sold online than channels with more moderate and lower price offerings (i.e., mass),” Rugolo said. “But now we are starting to see everyone look to grow this space and looking to make purchasing seamless.”

The success of denim e-commerce growth hinges heavily on the convenience factor, she said, with limitless aisles and fewer stock issues. Sellers who have invested in their commerce platforms are now reaping the rewards as fit guidelines become more accurate.

“[Online retailers] are getting so much more detailed with the descriptions now that you can almost figure out exactly what you need even if you haven’t tried on the product,” said Rugolo, who noted that jeans are typically a category consumers—especially women—like to try on beforehand. “However, online is getting better with their descriptions. You can [also] read reviews, and people put a lot of trust and value in that.”

Inventory management, of course, plays a key role in selling success here, and it’s something Leverton described as a pain point for today’s denim brands.

“We have never experienced such diversity in silhouette as we do today,” she said. “Ten years ago, silhouette trends would be quite rigid, and it would be about the skinny or the boyfriend, etc. Now the consumer wants individualist product, so they might wear a flare one day, a skinny the next. This means a diverse and complicated inventory, which is high-risk for brands.” Beyond e-commerce pure-play and manufacturer-owned retailers, NPD’s research shows the off-price channel is also exhibiting dollar growth for denim, which Rugolo attributed to the value of consumer perception.

“It’s not to say that other channels aren’t offering these types of values, but I think there is that treasure-hunt mentality that we do see with that consumer who shops in the off-price space,” she said. “Jeans is one of the top categories that grows during even the holiday time of year in off-price, so it’s something to recognize.”

When it comes to priorities, both men and women cited fit, reasonable pricing and comfort as priorities for their denim purchases, NPD noted.

Female consumers who purchased premium jeans, (which NPD defines as jeans that regularly sell for $75 or more when not only sale) are willing to pay extra for style, said the research firm. Men who purchase premium jeans, meanwhile, will shell out more money for high-quality jeans that are also comfortable.

For adults, nearly three-quarters of women and more than half of men cited fabric as their No. 1 influence when deciding what pair of jeans to buy, according to NPD.

When broken out by demographic, children’s and infant/toddler jeans sales declined across the board in 2019, regardless of gender, according to the market research firm, and sellers can blame the activewear trend for taking that bite out of sales.

“Boys are wearing shorts year-round,” Rugolo noted, “and it’s hard to get them to wear pants ever.” Girls, meanwhile, are choosing both activewear and leggings over jeans.

“It’s really a comfort thing at the moment, and we as a society—and in general—are okay with more casual clothing,” Rugolo said. “Our kids are dressing that way too, and it’s kind of influencing up, and so that’s tougher for a category like jeans.”

But as jeans become more comfortable and increasingly incorporate stretch properties, this style is trickling down to the children’s market, and Rugolo sees a lot of future opportunity for jeggings in the sector.

Plotting the future

Although apparel retail sales have experienced a dip, U.S. sales are expected to rebound in 2021, according to NPD. As a top three product category in total apparel, denim will play a significant role, said Rugolo, who again cited the cyclical nature of denim trends. (The No. 1 and No. 2 apparel classes are knit shirts and pants, respectively.)

“Denim is now more sustainable. It lasts, and if the styles stay the same and what you have in your closet is on trend, you’re not giving them a reason to repurchase or want to revise,” Rugolo added. “Because we’re making better denim [and] product that lasts, you have to give consumers the next reason why they want to replenish and the next style that they want to purchase.”

In order to provide this motivation, companies should examine where their consumers look to spend their time and adapt the denim to their lives. For example, if they’re spending more time at home, denim that’s more comfortable with stretch properties is likely to resonate, while consumers who are spending on travel may be drawn to denim that packs easier, Rugolo said.

“Obviously denim isn’t going anywhere,” she said. “Denim has a lot of opportunity, and [it’s about] constantly looking to reinvent what’s happening in this space and staying fresh for the consumer.”

Retailers, meanwhile, can further spur excitement through experience and FOMO cultivation.

“Exciting a consumer with limited-edition product, special in-store events and exclusive drops will help to engage,” Leverton said. “It also helps to sell a brand image so that customer is going to end up buying other, more everyday product because they have been ‘won over’ by the retail excitement created around a drop, line or event.”

“Figure out how to create that ‘I gotta have it’ feeling,” Leverton said, “and you are halfway there.”


This article is from Blueprint, a state-of-the-industry report, sponsored by Informa. In the report, Rivet presents the only comprehensive outlook for this year’s denim market, including an in-depth examination of why it’s poised for a retail revival. Download the report here to read more.

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