Designer Apparel and Footwear (Ready-To-Wear) in Germany

2021 DEVELOPMENTS

Brands highly dependent on store-based retailing focus on local shoppers

Designer apparel and footwear grew strongly over the last decades in Germany, alongside economic expansion and the increasing proportion of high-income individuals in the country. In addition, as more tourists shopped in the country, brands started to equally ensure that these customers would feel well-treated, therefore ensuring not only that employees would be able to communicate with them, but also in anticipation advertise their products in key areas of cities and in travel hubs.

Higher concentration amongst the top players

Brand performances in Germany were highly disrupted by the pandemic, since local shoppers’ preferences are quite different from those of foreign tourists. While niche brands benefited relative to major brands, the top players in the country performed strongly from 2020.

E-commerce accelerates its pace of growth

E-commerce performed well in designer apparel and footwear in 2021, after an already strong year in 2020. With the lockdown at the beginning of the year, this channel was able to boost its sales once again, as players were further motivated to move into this channel.

PROSPECTS AND OPPORTUNITIES

Designer clothing accessories and hosiery expected to see the strongest growth

Designer clothing accessories and hosiery is forecast to see the strongest growth between 2021 and 2026. This category showed a strong decline in 2020, which partly explains the strong rebound from 2021 onwards.

Unit price rises expected to drive value growth in the forecast years

Continuing a trend that started during the pandemic, as consumers reduced their volume demand due to retailing restrictions, unit prices are expected to increase further in the coming years. As demand for many consumers of luxury goods is relatively inelastic, meaning that purchases take place despite increases in prices, brands opted to increase prices strongly in this category to boost revenues and the sustainability of their respective businesses.

Digitalisation and virtual interaction between brands and consumers

Even though the prospects for the future in Germany point to a reality where COVID-19 is under control, mostly due to the implementation of a vaccine programme, which will theoretically allow businesses to operate normally, the reality is that consumers have permanently changed how they shop and their relationship with physical stores. Also, as the possibility of further lockdowns or softer restrictions cannot be ruled out down the road, the connection between brands and consumers digitally will be fundamental.