Do you know that by the year 2022, the global market of the online fashion industry can reach a valuation of $765 billion, an increase of $281 billion, or 58% from the current year? Currently, nearly 27% of the fashion industry is on the web which can increase up to 36% in four years as per a recent report from Forrester.
It has been shown in the report that 58% of the global online population has made a purchase online this year, and nearly half of those make their shopping move in clothing, accessories, or footwear. We are observing a great impact of eCommerce in the fashion market than the broader retail one. It accounts for 27% of global fashion sales this year in comparison to 15% of global retail sales. In this article, we would be focusing on the interesting stats of the fashion eCommerce industry and how it is growing.
One of the most important reasons why we are seeing such a huge growth in the online fashion industry is the availability of high-speed internet and smartphones to the people. That’s why many fashion e-commerce players are adapting their business strategy with a change in consumer behavior.
The global fashion eCommerce market is predicted to reach $713 billion by 2020
In the USA fashion eCommerce accounts for a fifth of total fashion retail sales
Fashion retailing is evolving because of increased digitalization
95% of purchases will be made via eCommerce in 2040
Fashion eCommerce players are adapting their business strategy with a change in consumer behavior.
Global Key Players In Fashion eCommerce
Macy's and Amazon account for around 40% of fashion eCommerce sales in the USA
Amazon, Tesco, and Otto account for more than 30% of the market share in Europe
Alibaba and Tencent occupy more than 70% of the market share in China
Amazon, Flipkart, and Myntra are big players in India which occupy more than 80% of the market share
Amazon is a renowned eCommerce brand across the globe but do you know that in the USA, Macy’s is giving an edge-to-edge competition to Amazon. Both these brands account for nearly 40% of total fashion e-commerce sales.
In other developed e-commerce markets such as Europe, the picture is different. Here companies like Amazon, Tesco, and Otto account for nearly one-third of the market share. Amazon finds a lot of obstacles while settling up in China. And, in April 2019, the company had to shut its operations in China.
In China, Alibaba, and Tencent occupy more than 70% of the market share. India is currently an emerging market. Here some of the big players are Amazon, Flipkart, and Myntra. These are accountable for 80% of the market share.
Who Buys Fashion Items Online?
Affluent and urban households living in cities
Millennials account for 80% of customers
Early adopters of fashion and technology also constitute a significant portion of customers
According to Global marketing Insights, on average 10% of fashion retail customers are going from offline to online every year
If you delve into who buys the fashion items online then these are mostly the affluent people, urban households, who mostly live in big cities. But the answer doesn’t end here. People who are born between 1965-1985 and 1985-2000 accounts for the largest portion of online fashion customers. As per research firm, Global Marketing Insights, on average 10% of fashion retail customers are going from offline to online every year.
Do you know?
Zappos was the first online fashion retailer which started in 1999
60% of all the online fashion item orders are influenced by mobile in the USA
Asia Pacific is the number one market for B2C e-commerce in the world
Fashion e-commerce sales in Europe are increasing at 12-13% annually.
A customer takes only 3 seconds to judge a fashion e-commerce website
With the advent of budget-friendly smartphones and the availability of the internet everywhere, people are doing shopping with their mobiles. In fact, 60% of all online fashion items are influenced by mobile in the USA. Also, Fashion e-commerce sales in Europe are increasing at the rate of 12-13% annually. And one interesting fact is that a customer just takes 3 seconds to judge a fashion e-commerce website. It clearly shows that technology has reduced the attention span of customers. Hence, the companies are revamping their business model for catering to the customer requirements in a better manner.
Trends Disrupting the Fashion E-commerce Industry
Personalization: Now customers need fashion items tailored to their requirements
Artificial Intelligence (AI): AI-enabled chatbots are able to provide resolution of the query of a customer instantaneously
Influencer effect: Customers are mostly influenced by the fashion of a celebrity
Return Policy: Availability of return options remove a perceived risk from the mind of a customer
Post-Purchase Services: Customers find a retailer trustworthy if it listens to his customers even after making a purchase
Operational Challenges in Fashion E-commerce
According to IMF-World economy will witness negative GDP growth because of the COVID-19 crisis
Insufficient stimulus package by various governments
Government regulation and changing FDI limits in various countries
Over-dependence in US and European markets
Personalization is one of the most important trends which is disrupting the e-commerce business. If you are not providing customers with customized products, then they will not blink an eye while switching to another e-commerce store. Artificial intelligence is also helping the e-commerce stores to provide a better experience to the customers through several ways such as Augmented Reality, Virtual Reality, Chatbots, Voice Commerce, etc.
It is not surprising why many companies or brands choose influencers for endorsing their brands because the influencers resonate well with the customers’ emotions.
Return policy gives the customers assurance that if the product doesn’t well suited to them or they don’t like it, then they can have their money back.
Post-Purchase Services means customers find the retailer trustworthy if it listens to its customers even after making a purchase.
Fashion e-commerce retail is only going to increase in the future. With the advent of augmented reality, and virtual reality the customers can now even try clothes virtually. If you are looking for developing a similar e-commerce retail fashion store then we can help you with this. We, at Emizentech, the best e-commerce development company in India, are having expertise in developing such e-commerce stores. Let us know your requirements.