Men’s branded young fashion could be in terminal decline, with spend among under-25s falling as buying habits shift towards cheaper own-label alternatives.
Spending by under-25s is the only age category to have fallen in the 24 weeks to February 13, down 5.1% according to research firm Kantar Worldpanel. Within the age group, even online spend frequency has dropped 1.1%. Menswear has taken the brunt of the falls, plummeting 11%, while womenswear dropped 2%.
Falling spend on brands has driven much of this, with consumers instead opting for retailers’ own labels that have improved product quality and style while remaining relatively price-competitive.
Kantar’s strategic insight director Ian Mitchell told Drapers branded goods made up 40% to 50% of purchases made by men under 25, but warned this was moving towards the wider market average of 10% to 20%.
“Men’s young fashion is the last bastion of the branded market, and what we are seeing is young men trading across from brand to own label, and therefore paying less,” he said.
“There are different social and economic factors – unemployment, tuition fees kicking in, less disposable income … but long term there has been a switch away from brands to retailers, who have upped their game. Label as a motivator is now down the pecking order, compared with price, quality, look.”
Mitchell said it was a structural change that would ultimately make it harder for brands to charge a premium when competing against similar-quality own brand from retailers.
It is a trend borne out by the number of brands or multi-branded retailers that have gone under in the past 12 months.
Republic entered administration in February – with figures published this week suggesting it left total debts of £33m – while Gio-Goi collapsed in January. Indie young fashion retailer Hoi Polloi also went bust earlier this year.
Firetrap’s retail division went under in March 2012, with the wholesale arm saved by Sports Direct, while Miss Sixty teetered on the brink last summer before being saved in February, although the wholesale brand has exited the UK.
Nick Hood, business risk analyst at financial research firm Company Watch, warned more young fashion businesses could suffer, arguing the weather was exacerbating the sector’s problems.
“The whole fashion world is season sensitive but particularly young fashion.”
Andy Tompsett, UK head of young fashion brand Merc, said brands should be trying to set themselves apart from the high street instead of competing.
“How many ice cream-coloured chinos does a man need?” he asked. “It’s about being individual. Brands have a heritage they can use in their products.”
But one source noted that even successful brands such as Superdry were faced with problems as retailers’ own labels mimic their style. “The name of the brand doesn’t really have any staying power,” he said.