Competitor Strategies in Apparel and Footwear

October 2021

With pent-up demand turbo-charging recovery and domestic consumption in the spotlight, global sales of apparel and footwear are bouncing back after a sharp decline in 2020, when the COVID-19 pandemic forced store closures and transformed consumer lifestyles. In that context, industry players are reassessing their procedures from manufacturing to retail, while implementing risk mitigation strategies to future-proof their business in case of new waves of infection.

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Key findings

Apparel and footwear companies challenged to adapt to a “new normal”

Companies are being forced to rethink their strategies after COVID-19 exposed the fragility of the industry across the supply chain. The narrative in fashion is also changing to reflect newly emerging priorities and consumer spending patterns through the lens of COVID-19. Digitalisation, price and value for money, and a redefined view of sustainability are expected to shape the industry moving forward.

Digitalisation takes centre stage

The pandemic has generated further momentum for the already rapidly growing e-commerce channel. Brands and retailers alike are being forced to develop or strengthen their digital strategies to respond to the new environment. From subscription services to curated products to digital engagement, companies are focused on create a unique shopping experience both in stores and online.

Price and value for money back to consumers’ top of mind

The widespread global recession and rising unemployment rates will make price and value for money much more important for consumers. Unbranded products and private label could benefit from offering basic items at low prices amid the depressed economic environment. Discounts and promotions were already a common marketing strategy in the industry, but the pandemic has pushed the limits further as companies aim to get rid of inventory. Brands across the price spectrum have used discounting despite the risk of harming margins and brand equity.

Sustainability goes beyond environmental responsibility

Consumers prioritise brands holding sustainability as a purpose. From adjustments to their supply chain to launching upcycled garments, companies are stepping up their eco-friendly commitments. Sustainability is no longer an option but a must, and consumers expect ever more from their brands. Consumers will choose brands that commit to the greater good, brands that take a stand on social issues, brands with purpose, and brands with values aligned to theirs.

Introduction

Scope

State of Play

Fragmentation creates intense competition globally
Companies at a glance
Industry dependence: Top 10 apparel and footwear companies
From survival towards growth
COVID-19 impacts emerging and developed market opening strategies
Category specialisation supports position of Nike and adidas
Brand portfolio
COVID-19 footprint influences future movements in company rankings
Enhancing experience in-store and online through digital touchpoints
Inditex’s omnichannel approach ensures a seamless shopping experience
Nike creating an integrated retail experience to connect with consumers
Consumers look for overall quality as economies open up
adidas putting consumers at the heart of its “Own the Game” strategy
Luxury fashion brand Gucci communicating to the young generation
Transformation towards a seamless and efficient value chain
Proximity sourcing benefits fast fashion retailer Zara
Holistic sustainable fashion
H&M takes a holistic approach to sustainability
Levi Strauss & Co consistently builds on being a sustainable brand

Key Takeaways

Fierce competition to persist during long-term recovery
Key findings

Appendix

Treemap
Overlap matrices
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