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Report: Small Markets Drive Apparel Growth and Sales

New York and Los Angeles might be dictating the fashion trends, but smaller cities are eating them up in terms of sales and growth. The NPD Group reported that, from February 2014 to February 2015, smaller markets such as Orlando and Washington, D.C. were the top designated market areas (DMA) driving the apparel industry’s growth rate and dollar volume increases. Both markets performed strong online and in stores.

During the 12-month period, apparel sales in the Orlando-Daytona-Melbourne market climbed 23 percent. Washington D.C. saw sales increase 18 percent, Phoenix and Cleveland, both had 16 percent increases, and Detroit rounded out the top five DMAs with an 11 percent bump in apparel sales growth.

“The big regions are no longer leading apparel industry sales growth,” said NPD Group chief industry analyst Marshal Cohen. “When New York and Los Angeles don’t even make it into the top 10 list of DMAs driving apparel growth, we have a big opportunity gap in the market. We need to understand the cause in order for the apparel industry to regain traction moving forward.”

Total apparel dollar sales increased two percent, but sales of apparel purchased in brick-and-mortars dipped two percent—a trend the NPD Group said was evident for most of the top 10 U.S. markets. Washington D.C. was an exception, notching a 14 percent increase in store apparel sales. Overall online apparel sales increased 19 percent from February 2014-2015, totaling 17 percent of all industry dollars.

The NPD Group noted that while online shopping delivers convenience to consumers, online retailers miss out on the benefit of impulse purchases, which occur for 32 percent of in-store sales, compared to 22 percent of the time online.

“Impulse purchases are the big growth driver, so the strategy of driving traffic to websites needs to exist in tandem with efforts to drive traffic to the stores,” Cohen said. “Regardless of regional market size, or method of purchase, the apparel industry needs to engage consumers with something new and different–something they can’t find everywhere.”

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