Apparel and footwear distribution is heading towards a more symbiotic space, where off-line and online boundaries are disappearing. Specialist retailers remains the most important retail channel, boosted mostly by the continued athleisure trend. However, internet retailing saw a 22% CAGR during the review period. Achieving convergence between off-line and online in order to create a unique environment in terms of experience, price and convenience will be essential to drive consumer demand.
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Apparel and footwear continues to produce robust growth, predominantly fuelled by Asia Pacific, including emerging markets such as India and Vietnam. Sportswear has been driving growth within apparel and footwear for almost a decade, a trend that has intensified in recent years. Healthier lifestyles and more relaxed dress codes are boosting demand for more comfortable and sporty outfits.
Despite the rapid growth of e-commerce over the last decade, store-based retailing continues to dominate the distribution landscape, accounting for an 83% value share of global sales of apparel and footwear in 2017. Going forward, store-based retailers will have to continue merging online and off-line environments to connect and engage with consumers. Experience in the store will be key to drive consumer demand.
Apparel and footwear specialist retailers remains as the most important retail channel in the industry, accounting for 58% of all store-based retailing sales in 2017. Department stores rank second, with a 15% value share. However, the rise of fast fashion and internet retailing have placed pressure on department stores, leading to a fall in share over the review period.
Non-store is dominated by internet retailing, accounting for a 93% value share of global apparel and footwear non-store retail sales in 2017. The growing number of consumers with access to the internet, in addition to heavy investment from retailers to add online services to their traditional off-line reach, has fuelled e-commerce growth.
Going forward, the industry is expected to continue producing robust growth ,with a CAGR of 2% over 2017-2022 and absolute value growth of USD187 billion. Growth within the industry will be sustained by fast fashion retailers evolving to a more sustainable and online structure, combined with a greater presence of affordable luxury players.