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Market Analysis: How To Break The Fast Fashion Mode And Enter The New Breakthrough Field

2022/8/5 17:02:00 0

Fast Fashion

In the first half of 2022, in the trend of personalized consumption and brand diversification, fast fashion brands famous for "fast" and "fashion" experienced a difficult time.

According to the incomplete statistics of yingshang.com, the first half of 2022 includes UNIQLO, ur, Muji and I T. Eight fast fashion brands, including C & A, Forever 21, gap and Zara, have added 54 stores in the mainland (excluding upgraded stores).

Compared with 126 stores in the first half of 2021, the number of stores opened in the first half of 2022 decreased by 57%. Compared with the data of the previous six years, it only increased compared with the same period in 2020 in the first year of the epidemic, and decreased significantly compared with that before the epidemic.

In the first half of 2022, the expansion of fast fashion brands in mainland China has obviously contracted. Although the epidemic situation makes the survival and development of fast fashion brands in the Chinese market more difficult, fast fashion brands are also actively adjusting their strategies in order to make breakthroughs.

01、 UNIQLO leads with 30 new stores, Forever 21 returns to China for the third time

In the first half of 2022, UNIQLO has added 30 stores, which is the fast fashion brand with the largest number of stores; Ur followed closely, with 9 new stores ranking second; MUJI and I T ranks third and fourth, with the former opening 7 new stores and the latter 4 new stores; C & A, Forever 21, gap and Zara have opened one new store respectively, among which Forever 21 has returned to China for the third time. The first offline flagship store in China was officially opened in Jingjiang impression city, Taizhou, Jiangsu Province on June 18.

From the perspective of expansion from 2016 to 2022, UNIQLO and Muji are relatively stable each year, while gap, Zara, C & A and H & M of European and American brands have significantly decreased to 0-2 stores in the three years of the epidemic, including:

UNIQLO has maintained a relatively stable number of stores for several years. In the first half of 2022, UNIQLO has added 30 new stores, leading similar brands;

The number of ur and Muji stores decreased by more than half compared with the first half of last year, and the floating range was smaller than that of previous years;

C & A opened a new store in the first half of last year. In addition to accelerating the opening of stores in the first half of last year, C & A's expansion has remained below 5 in recent 7 years;

Gap has more than 10 stores in the first half of the last five years, and only one new store has been opened this year. This is mainly due to the transformation of gap group to the business model of combining e-commerce with offline stores of non shopping malls.

H & M and mjstlye did not open new stores in the first half of the year, while Zara only opened one new store.

02、 East China is the most popular region, Second in China

In terms of regional distribution, in the first half of 2022, the number of new stores of fast fashion brands in the mainland is still led by East China; Central China and South China followed closely; The number of stores in other regions is less than 10.

The East China region has attracted a total of 6 brands, mainly in Jiangsu and Zhejiang, with a total of 20 new stores. Among them, UNIQLO has 13, Muji has 3, Forever 21, gap, i T. One for each ur.

The second is the central China region, which also attracted 6 brands to settle in, a total of 14 new stores, including 8 in Hubei, 3 in Henan and 3 in Hunan.

South China followed central China with 10 stores and 4 new stores. Among them, there are 6 in Guangdong Province, 2 in Hainan and 2 in Guangxi. From the perspective of brand distribution, there are 5 UNIQLO stores, accounting for 50%.

There are 7 stores, 2 stores and 1 store in the southwest, northeast and North China regions respectively. New stores in Southwest China are mainly located in Sichuan and Yunnan, and two new stores in Northeast China are located in Shenyang and Harbin; A store in North China is located in Beijing.

03、 The competition among commercial quasi first tier cities is the most intense, Wuhan tops the list

In terms of the distribution of urban commercial lines, commercial quasi first tier cities are the priority of fast fashion brands, with 14 stores newly added in the first half of 2022, accounting for 26%; The second is the third tier commercial cities, with 13 newly added, accounting for 24%. In terms of cities, Wuhan has 7 stores, becoming the most popular city for fast fashion brands.

A description: urban commercial line level is a hierarchical division of the evaluation of urban commercial development degree by Yingshang big data, which integrates the basic level of urban development, the scale of commercial development, the commercial grade, the commercial popularity and the future commercial potential, and divides it into six grades.

The number of new stores in first tier commercial cities was 9, accounting for about 17%. Among them, the first one is URT and the other is Shenzhen.

There are 13 new stores in quasi first tier commercial cities. Among them, Wuhan is the only one with 7 stores. Zhengzhou and Hangzhou have 2 stores respectively, which are popular with fast fashion brands.

There are 10 new stores in the second tier commercial cities, 7 of which are UNIQLO. Ten stores are located in Wuxi, Changzhou, Wenzhou, Kunming, Harbin, Qingdao and Changsha.

There are 13 new stores in commercial third tier cities, including 6 UNIQLO and 3 Muji. The 13 stores are located in Jinhua, Zhongshan, Nanning, Taizhou, Taizhou, Zhuhai and other 10 cities.

There are 8 new stores in the fourth and fifth tier commercial cities, which are located in Jingmen, Huainan, Xiangtan, Yibin and Luzhou.

From the above data, it can be seen that commercial quasi first tier cities and commercial third tier cities are the key cities for fast fashion layout, followed by first tier commercial cities and second tier commercial cities. From UNIQLO, which has the largest number of stores, the number of commercial quasi first-line stores is the largest, reaching 8; Secondly, there are 7 stores in the second tier commercial city and the third tier commercial city. Ur, which has the second largest number of stores, focuses on first tier commercial cities and quasi first tier commercial cities, accounting for 67% of the total number of stores.

04、 Chain shopping center Japanese fast fashion brand "favorite" enters

In the first half of 2022, Wanda Plaza, Wuyue Plaza, Vientiane department, Longhu Tianjie and Bubugao Plaza series of shopping centers have absorbed nearly half of the number of UNIQLO and Muji new stores, becoming the "favorite" chain shopping center of Japanese fast fashion brands.

Specifically, a total of 14 UNIQLO and 3 Muji have settled in the above chain shopping centers. Among them, 3 UNIQLO and 2 Muji have settled in Wanda Plaza, 4 uniqlos have settled in Wuyue Plaza, 3 uniqlos have settled in Vientiane shopping center and Longhu Tianjie street, 1 UNIQLO and 1 Muji store have settled in Bubugao square.

05、 Channel reduction, Fast fashion brands enter a period of deep adjustment

In the first half of the year, except UNIQLO, the overall stores showed a shrinking trend. Although it is difficult for fashion brands to survive and retreat from the market in recent years, the rapid development of fashion brands and brands in China has become difficult.

In fact, since 2016, fast fashion brands have successively withdrawn from the Chinese market. British high street brands Topshop and newlook announced their withdrawal from China in 2018; Forever 21 announced its exit from China in April 2019.

During the three years of the new crown epidemic, more international fast fashion brands have entered a period of deep adjustment

In March 2020, old navy of gap announced to withdraw from the mainland;

In September 2020, Dutch fast fashion brand C & A announced that it would officially sell its business in China market to private equity company Zhongke Tongrong;

In January 2021, bershaka, pull & Bear and Stradivarius closed all physical stores in China. From July 31, 2022, the e-commerce channels of the three brands will be closed, marking the withdrawal of the three brands from the Chinese market.

After careful observation, it is not difficult to find that the product quality of fast fashion brands with low price is often criticized, and the homogenization is very serious. It is generally believed that withdrawing from the Chinese market is one of the measures to change the strategic layout of fast fashion brands, and the change of consumers' mentality, the change of fashion trend and the rise of e-commerce are the fundamental reasons for them to adjust their strategies.

On the one hand, the developed and convenient e-commerce platform can provide more high-quality and inexpensive clothing products, and fast fashion brands are no longer the preferred choice; On the other hand, with the millennials and generation Z becoming the main consumers in China, they are increasingly pursuing quality and personalized needs. Fast fashion mode determines that brands need to copy fashion elements in large quantities, which itself runs counter to "personality". This is doomed to make fast fashion brands difficult to effectively impress most young Chinese consumers.

The reduction of fast fashion channel is closely related to industry characteristics and low flat efficiency of brands. According to the report of Jones Lang LaSalle, the popularity and turnover of fast fashion brands are declining in recent years, and the flat efficiency of stores has been declining. Shopping centers are also limited by the consequences of low flat efficiency and long-term fast fashion stores, so they are increasingly cautious about introducing fast fashion brands.

06、 Transformation and survival: Develop medium and high-end brand lines to accelerate market sinking

When the low price is no longer suitable for the current market competition pattern, in order to find a new way out, fast fashion brands adjust their strategies according to the changes of consumer preferences, trying to sink channels to open up new markets, and make efforts to accelerate the transformation of medium and high-end brand lines.

//Develop medium and high-end brand line and increase brand premium

Throughout the development process of fast fashion brands in recent years, it is an obvious trend that fast fashion brands are taking off the label of "low price" and trying to develop medium and high-end brand line: from winning with low price and speed in the past, to relying on quality and design to improve brand premium.

In 2021, the high-end brands of "other" and "stories" will enter China. Among them, other stories, whose product price range is between 500 and 1000 yuan, currently has two stores in Shanghai and Beijing. Another brand, arket, which covers everything from socks priced at tens of yuan to women's wear worth thousands of yuan, will open new stores in Shanghai and Guangzhou this autumn after opening China's first offline store in Beijing last September.

INDITEX group has begun to transform Zara stores in recent years, aiming at opening more high-quality flagship stores in the city center, and accelerating the launch of medium high-speed brand. In September last year, Zara launched a new high-end brand, Zara origin. At the beginning of March this year, Zara studio, the high-end product line of Zara brand, launched its spring and summer 2022 men's and women's wear series, continuously betting on the middle and high-end market.

//Adjust the channel strategy and explore the market of low-level commercial cities

In addition to entering the middle and high-end brand line, accelerating the sinking of commercial low-end city market is also one of the channel strategies for fast fashion head brands. With the sinking trend of Wanda Plaza, Wuyue Plaza and Bubu shopping mall, UNIQLO, ur, Muji and gap have begun to sink to the third, fourth and fifth tier commercial cities, and further tap the consumption potential of low-level commercial cities.

UNIQLO plans to open 100 new stores every year. Now its goal is to focus on commercial third tier cities and gradually sink to fourth tier and fifth tier cities. From May 27 to June 17, UNIQLO announced that it would open 17 new stores in mainland China and march into Yueqing, Shengzhou, Yongkang in Zhejiang Province, Jingmen in Hubei Province and Huainan City in Anhui Province.

MUJI announced its medium-term plan in 2021 that it would open 50 stores a year in China from the fiscal year 2024 (up to August 2024), and would accelerate the opening of stores in cities with fewer stores. In the first half of this year, Muji opened stores in Taizhou, Luoyang and Zhuhai, the third tier commercial cities, while sinking into Yibin and Luzhou, the fifth tier commercial cities. It can be seen that Muji is speeding up the development of new markets in commercial third to fifth tier cities.

In August last year, Forever 21 released a signal to restart the Chinese market, announcing its presence in vipshop and pinduoduo, and preparing tmall flagship stores and physical stores. In June this year, in the Third World War of Forever 21, China focused on the sinking market and launched its first store in Taizhou, a third tier commercial city.

Recently, the financial reports of many parent groups of international fast fashion brands show that they are reversing the declining trend, but they are obviously under pressure in the Chinese market. At present, China's market consumption continues to upgrade and iteration is accelerating. Many domestic brands, fashion brands and even a small number of clothing brands are rising rapidly, which makes the competition pressure of fast fashion brands surge. In the face of fierce market competition, fast fashion brands not only need to adapt to changes and keep updating, but also seek innovation to break the shackles of fast fashion mode itself, so as to make new breakthroughs.


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