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Lifestyle retailers battle to stand out from the crowd

The lifestyle sector is heading for a spring 11 shake-up as retailers and brands diversify to stand out in an increasingly saturated market.

A string of lifestyle businesses, including White Stuff and Joules, have injected capital into retail roll-outs and product development over the past two years and there are few market towns left in England that have not been graced by their fascias, or those of Fat Face or Jack Wills.

However, as more lifestyle stores have popped up in these towns, established names are looking for ways to grow sales in a saturated market. Whether they are extending their reach by targeting larger cities, moving into new product categories or focusing more on wholesale, the big boys have realised it is no longer enough just to provide cargo shorts and chunky sweatshirts to the 40-plus market.

Maureen Hinton, senior retail analyst at Verdict Research, said there was growth potential for lifestyle retailers, which sit at the “premium” end of the high street - an area Verdict said is set to grow 17% to £5.5bn by 2015 - and companies such as Joules and White Stuff, which offer contemporary product for an older customer, are performing strongly because they “fill a void”.

However, she added: “The surf and seaside-focused brands became ubiquitous and need to be careful.”

Last week, Joules founder and managing director Tom Joule said the lifestyle sector had become “overcrowded” and that Joules would shift its focus to its contemporary trend-led womenswear ranges, which include the Collection and higher-priced Boutique sub-brands. The latter will make its wholesale debut for spring 11. The strategy is similar to that adopted by White Stuff, which launched its retail-only So Glad And Very contemporary womenswear sub-brand for spring 10 and has expanded its footwear and nightwear lines for autumn 10.

Fat Face, where pre-tax profits fell 19% to £8.8m in the year to May 30, 2009, is hoping to win back market share by returning to its roots with high-quality, outdoor-focused pieces, while Jack Wills said recently it would stay true to its British heritage roots with pieces that twin formal fabrics with casualwear fabrics and cuts.

Fat Face chief executive Anthony Thompson said the retailer’s product had become “too high street” and that the handwriting had previously been “schizophrenic”. He added: “Fat Face’s heritage is in the outdoors and customers associate it with wind, air and snow, not formalwear, delicate fabrics or fine knits.

“We are reintroducing classics such as our Airlie sweatshirt but are adding more detail and returning to a rugged look.

“I expect to see improvements in underlying performance next year but it will be a gradual process to win back trust.”

Lifestyle brands Henri-Lloyd and Weird Fish have also said investment in quality and detail, and reworking classic best-sellers, were their priorities in product development. But while Weird Fish is diversifying into kidswear and footwear that has a similar rugged styling, Henri-Lloyd has no plans for new categories.

Henri-Lloyd fashion director Gareth Jones said: “There is no point in attracting volume in our market, because it’s a bun fight. Customers have told us that the most important factor is quality, but heritage is also becoming increasingly important in reconnecting with the customer and making the brand stand out.”

Weird Fish chief executive John Stockton said the brand’s major tool in diversification was a commitment to strengthening its wholesale distribution channel.

Although the lifestyle sector was built on wholesale foundations, retail has been the growth route of choice recently, with ambitious international store roll-out plans under way at Crew Clothing, Jack Wills and White Stuff.

Stockton said: “The market isn’t growing but we’re stealing share from firms that have done a retail push and alienated the stockists that built them up.”

Whatever their strategy, those lifestyle brands which have created and retained a strong and individual brand image are likely to be the ones that continue to grow the fastest.

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