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MARKS : 80
RETAIL MANAGEMENT
N. B. : 1) BOTH CASE STUDIES carries eqa!
"ar#s.
2) A!! qes$i%&s are c%"'!s%r(
CASE NO. 1
THE OUTLOOK )OR SO)T GOODS S*ECIALIT+ STORES
I&$r%,c$i%&
Soft goods specialty retailers are on a quest to grow, with the high-
growth ``stars working to maintain momentum by rolling out
successful concepts nationally while inesting in new concepts that
o!er long-term promise" #he less stellar performers are reinigorating
tired concepts and strengthening margins ia better inentory and
promotion management" A saturated marketplace will motiate more
specialists at both ends of the spectrum to seek growth by building a
portfolio of concepts focused on eer-$ner customer groups" %oncepts
will ie for more attention by deeloping and applying deep customer
insights to their assortment strategy, the shopping e&perience, and
store brand building and communication"
T-e Re$ai! La&,sca'e
'any soft goods specialty retailers hae seen recent improements in
sales and pro$ts, but for most, the recoery is modest in nature and
has done little to negate the perasie price pressure on retail
margins" #he sustainability of the recoery is questionable gien poor
comparable stores sales performance"
M%,es$ Rec%.er(
Since bottoming out in the $rst part of this decade, sales hae
steadily improed in both the apparel and accessories specialty store
and shoe
specialty store channels" (et, growth remains modest compared to the
late )**+s"
,-,
#he long-term sales outlook for apparel and accessories
specialty stores is stronger than for shoe stores" Apparel stores are
forecast to grow in the . to / percent range annually through -++0,
while shoe stores are forecast to grow mostly around ) percent a year
oer the same time period" 'uch of the sale improement has gone
straight to the bottom line for apparel and accessories specialty
stores" #hough still well below its performance in the late )**+s, the
sector has improed another important measure of pro$tability,
return on net worth"
1n contrast, the ery modest sales improement among shoe
specialty stores has not translated to improed $nancial performance,
with the aerage net pro$t margin for publicly held shoe retailers
declining" #he $nancial struggles facing the shoe store channel are
eident in the closing of indiidual stores and entire diisions by some
of the channels leading players"
2erasie price pressure has contributed to the commoditi3ation
of apparel and footwear, particularly basic styles that are easily
sourced and widely distributed" %ommoditi3ation has also been
propelled by the growth of 4al-'art 5www"walmart"com6 and #arget
5www"farget"com6, both of which o!er wide assortments of basic and
fashion-focused soft goods at sharp price points that appeal to a
broad swath of consumers" #his has increased the pressure on many
retailer margins as their increasingly undi!erentiated assortment
goes head to head with price-drien retailer margins as their
increasingly undi!erentiated assortment goes head to head with
price-drien retailers o! the mall"
4hile apparel price de7ation has made it challenging for soft
goods specialists, many hae proen worthy of the challenge" #he
aailability of cheaper products allowed many of these specialists to
improe inentory
turns, resulting in a slight increase in their return on inentory ratio
since )**0" #his improement re7ects a focus by many apparel
specialty store ,8,
retailers on a combination of better markdown strategies, improed
inentory management, and introduction of higher-margin fashion
items"
A C-a!!e&/i&/ E&.ir%&"e&$
Soft goods specialty retailers face a crowded marketplace that is
steadily becoming een more competitie" 'ost shoe specialty stores
are faring far worse than the apparel specialists in the competitie
wars" 9!-mall retailers, including discount department stores:super
centers and ;ohls 5www"kohls"com6, are capturing apparel and shoe
share of preference at e&pense of mall-based retailers, including
specialty stores" %onsumer preference for purchasing apparel is
strongest at discount stores:super centers"
#he upward trend for discounters contrasts with a decline in
spending preference for clothing at apparel specialty stores, alue
department stores, and traditional : upscale department stores in the
same time period" <or shoe purchasing, shoe stores are actually
gaining spending preference, although the price-drien discount
store:super center channel is as well" Shoe, discount, and apparel
specialty stores are capturing shoe spending preference from alue
and traditional department stores, particularly Sears 5www"sears"com6
and =illards 5www"dillards"com6, as well as 2ayless
5www"payless"com6"
#he upward trend for discounters contrasts with a decline in
spending preference for clothing at apparel specialty stores, alue
department stores, and traditional : upscale department stores in the
same time period" <or shoe purchasing, shoe stores are actually
gaining spending preference, although the price-drien discount
store:super center channel is as well" Shoe, discount, and apparel
specialty stores are capturing shoe spending preference from alue
and tradition al
department stores, particularly Sears 5www"sears"com6 and =illards
5www"dillards"com6, as well as 2ayless 5www"payless"com6"
,.,
Although department stores hae su!ered the most at the
hands of o!-mall retailer growth, many are reinenting themseles"
;ey elements of the department store reinention include a stronger,
more e&clusie, and more di!erentiated brand and style assortment
supported by upgraded, easier-to-shop stores" #hus, department
stores now contribute to more competitie intensity in the apparel
and footwear playing $led, particularly for upscale customers" #he
pro$le of monthly shoppers at traditional:upscale department stores
is similar to that of monthly shoppers at apparel specialty stores in
terms of higher income and education leels > although apparel store
customers skew younger"
%ompetitie battles are also escalating due to the entry of a
number of foreign specialty store retailers to the marketplace" #hough
most of the new foreign players operate only a handful of ?"S" stores
at this point in time, seeral intend to ramp up their store openings
after establishing an initial base of stores"
Some suppliers are also branching out to target new customers
with new specialty store chains to attain growth in the face of modest
prospects at department stores" 2olo @alph Aauren 5www"polo"com6 is
launching @ugby, a new brand and chain of stores targeting college-
aged consumers" 9shkosh BGosh 5www"oshoshbgosh"com6 is testing
a family lifestyle store targeting men and women"
A $nal factor contributing to heightened competitie pressure is
the e&pansion of full-price specialty store chain s by seeral soft
goods suppliers" A number of catalog retailers that are fairly new to
retailing are also rapidly building store chains" Although the track
record of most soft goods suppliers has been spotty when it comes to
operating successful full-price retail stores > and seeral are closing
unsuccessful concepts > it is
clear that most of the maCors iew full-price retail as another aenue
for growth that most be pursued as a consequence of oerall retail
maturity"
,/,
Suppliers with the most substantial full-price store base include Dones
Apparel Group 5primarily shoe stores, www"Cny"com6, Ai3 %laiborne
5primarily ia 'e&& in Europe and %anada, www"li3"com6, and 2olo
@alph Aauren" #he two soft goods catalog retailers relatiely new to
full-price retailing that are most actiely building their store chain are
%oldwater %reek 5www"cpEdwatercreek"com6 and D" Dill 5www"CCill"com6"
Growing diersity is making it more diFcult for many specialists
to adequately address the needs and e&pectations of all of their
target customers > a critical requirement for success in the specialty
store arena" =iersity is also propelling more retailers to tailor
assortments and adCust merchandising tactics on an indiidual store
basis" 2reiously, many only altered the o!er to re7ect regional
seasonal ariations and market si3e di!erences"
Apparel and footwear are steadily capturing less of the
consumers total spending, #his is in part due to a shift in consumer
spending priorities toward necessities 5home, health, and
transportation6, as well as toward new eeryday ``lu&uries such as
eating out and entertainment > which including products such as
consumer electronics" sporting goods and toys, and the cost of
fees:admission to sporting eents, concerts, moies, clubs, and other
types of eents"
%onsumers are increasingly willing to cross channels to shop a
growing number of retailers > from mass to class > for apparel" #hey
are more apt to trade down on staple wardrobe elements while
trading up on aspirational, ego-intensie purchase and shopping
e&periences" #hus, alue retailers play an een more important role in
supplying the core of consumers wardrobes > from basics like
undergarments to wardrobe fashion ``staples such as causal pants,
casual shirts, and eeryday
sweaters" Aikewise, a number of soft goods specialty retailers and
,G,
department stores are taking steps to tap into the shoppers trade-up
mindset by upgrading store enironments, focusing on stronger
aspirational store brand images, and introducing more higher-end and
``a!ordable lu&ury products and labels to the assortment"
L%%#i&/ )%r0ar,
*%!ari1i&/ *!a(i&/ )ie!,
Although the soft goods specialty store channels is far more
fragmented than most other retail channels, it will continue to slowly
consolidate as big companies grow bigger, ``adding more banners to
their portfolio" Howeer, the nature of specialty retailing will also
ensure the continual entry of new, smaller, usually more 7e&ible niche
players able to e&ploit market gaps not being addressed by the
maCors" 9nly 8I percent to total ?"S" Soft goods channel sales are by
the top )/ retailers" #his re7ects a large number of independent
retailers and the presence of smaller $rms that operate on a regional
of multi-regional basis"
Growth at the ends of the si3e spectrum will cause the soft foods
channel to remain polari3ed into the ery big ersus the ery small
retailers" #hose in the middle will continue to be squee3ed by the
eFciencies and resources of the big retailers and by the 7e&ibility and
customer intimacy of smaller retailers and retail chains"
<irms with strong sales growth tend to fall into one of three
camps > hot, high-growth youth retailers like 2aci$c Sunwear
5www"pacsun"com6, ?rban 9ut$tters 5www"urbanout$tters"com6, Hot
#opic 5www"hottopic"com6, and Aero-postale 5www"aeropostale"com6,
mature but re-inigorated multi-brand mega-specialists like Gap 1nc"
5www"gapinc"com6 and Aimited Brands 5www"limitedbrands"com6E and
%hicos 5www"chicos"com6, which stands alone within the channel as a
result of caring out a ery well-de$ned niche targeting an
undersered baby boomer woman"
,I,
#he strong performance of these retailers indicates that most
will be in a position to further propel performance improements ia
continued inestments in technology and processes that enable them
to reduce costs, more e!ectiely allocate and manage inentory, and
more strategically manage price and promotional actiity" #hese
retailers will also be better positioned than their peers to focus on
increasing share of wallet among their highest-prospect customers"
#he soft goods specialty store channel will also continue to
polari3e with respect to new store-opening opportunities, with an
e&panding number of ``tapped-our retail concepts unable to grow by
opening more ?"S" stores" 4ith little international e&perience 5or bad
e&periences in the past6, most tapped-out retailers are unlikely to
moe rapidly or successfully into global apparel retailing, e&cept for
opening stores in %anada" 1nstead, they will focus on growing sales in
current concepts by getting more share of wallet from e&isting
customers through a combination of a more well-de$ned and releant
market position and e&tending their assortment into new products,
brands, and serices for the target customer"
=espite oerall channel maturity, there are seeral soft goods
specialty store retailers with substantial room to grow, particularly
those that hae only begun rapid store e&pansion within recent years"
Strong sales growth re7ects both a rapid pace of new store openings
and, for players such as %hicos and 2aci$c Sunwear, equally
impressie store-to-store sales growth"
Some soft goods specialists that operate a large base of stores
and that hae struggled will continue to weed out unpro$table, low-
prospect stores from their portfolio" 1n a few cases, retailer will diest
or close entire
chains to focus resources on higher-pro$t, higher-growth concepts"
#his trend has been under way for years, by $rms such as 2ayless,
Gap 1nc",
,0,
Aimited Brands 1nc", 4ilsons Aeather 5www"wisonsleather"com6,
%harming Shopper 5www"charmingshoppes"com6, Brown Shoe
5www"brownshoe"com6, and 'others 4ork 5www"motherswork"com6"
Re'%si$i%&i&/ 2%r Re!e.a&c(
#he recent economic downturn has made many retailers loath to
inest in maCor repositioning initiaties" Howeer, as slaes gain some
momentum and corporate purse strings sales gain some momentum
and corporate purse strings loosen a bit, more aging soft goods
specialty stores will undergo a facelift" <or some, this will inole a
long oerdue re-assessment of the target customer" 2erhaps the
highest-pro$le repositioning has been Gap 5www"gap"com6, 9ld Jay
5www"oldnay"com6, and Banana @epublic 5www"bananarepublic"com6,
and Banana @epublic 5www"banarepublic"com6 chains"
Banana @epublic has added more trend-drien fashions to better
distinguish it from Gap Stores" #his includes a stronger emphasis on
color, more feminine styles, and clothes for social occasions, as well
as its standard work-appropriate assortment" 9ld Jay is more $rmly
positioned as a alue-focused store for the entire family, with more
emphasis on sering the needs of each member of the family" #he
retailer has increased assortment segmentation based on customer
group" #he chain also has new $&tures that increase selling capacity"
Gap has been repositioned as the classic specialty store for a range of
fashion ``basics for casual occasions, supplemented by more
``occasion-oriented" merchandise for weekends, the workplace, and
stepping out" ?nderperforming Gap stores hae been closed, and
stores hae stricter inentory controls to increase productiity and
reduce markdowns" Gap is
reinesting in marketing, including deeloping a more consistent
message across all media"
,*,
1n line with si3e-related trends in the oerall population, more
specialty retailers will e&pand their standard si3e range to include
larger si3es, as well as petite:small si3es" Some may spin special-si3e
concepts o! as their own store banners, but most will choose to
simply e&tend the si3e range within the e&isting banners by adding
new si3es or by increasing the breadth of assortment within e&isting
special si3e lines" Ann #aylor 5www"anntaylor"com6 plans an oerall
focus on petites as one of its growth strategies" 2lans include
e&tending the product o!ering to all categories and more styles,
creating a store enironment that makes petites a preferred
destination, and boosting marketing to generate awareness" #he $rm
has rolled out petite adCacencies in current stores 5including some
with separate entrances6"
#o capture more sales from customers already in the store, a
growing number of soft goods specialty store retailers will e&tend
their assortments to include products that proide additional style
perspecties and meet the needs of additional wearing occasions"
E&press 5www"e&pressfashion"com6 strengthened its wear-to-work
appeal with the E&press =esign Studio line of clothing being rolled out
to all stores" #he line is designed by a Jew (ork-based team and
focuses on $tted pants, tailored Cackets, and key pieces that ``add
se&y sophistication and allow the line to moe from the ``work-place
to the weekend" #he mens line also includes suits sold as separates,
dress shirts, and ties"
Abercrombie K <itch 5www"abercrombie"com6 is repositioning its
brand to be less aggressiely se&ual in its marketing to customers
and to include higher price points and fewer promotions" As part of
this strategy, the retailer has a new higher price point collection
called E3ra <itch" #he
collection includes products such as L))0 to L).0 Ceans and
cashmere crew necks at L)I0"
,)+,
4hile the factors haing the most in7uence on trying a new
brand or store are the styling and price, followed by the in7uence of
friends and family, monthly specialty store shoppers are far more
likely than all shoppers to be in7uenced to try a brand or shop a store
based on fashion maga3ines and celebrity culture" #hey are also far
more willing than all shoppers to say that wearing designer brands
has a positie impact on their self-esteem and self-con$dence"
As part of their approach to new customers, most specialist will
choose to $rst moe up the age spectrum with the intention of
leeraging the knowledge they hae about their customers as they
``outgrow the e&isting concept and enter a new life stage" 4here
this opportunity has already been tapped out, they will be forced to
focus on concepts targeting an entirely new style, lifestyle, or
occasion of use"
Dri.i&/ Gr%0$- T-r%/- S$ra$e/ic I&.es$"e&$s
'ore specialty store retailers will inest in initiaties that allow them
to not Cust attain competitie di!erentiation but to also drie
pro$table top-line growth ia higher purchase conersion leels, more
multiple-item transactions, and increased destination store status
with targeted customers" ;ey areas of inestment will include new
technologies and high-alue serices, as well as alternatie marketing
and promotional enues"
Jew technologies are becoming more mainstream and less cost-
prohibitie, a trend that will motiate more specialty store retailers to
inest in technological solutions that ensure that the right products
are on the selling 7oor in the right quantities at the right time and
price" #echnology will also be used to proide more alternatie
shopping and
purchasing options for customers 5beyond Cust online selling6" 1t will
also be used to better track the 7ow of customer traFc in the store on
a real-time basis in order to design stores that hae higher sell-
through leels
,)),
and sta! stores in line with customer needs"
'any specialty store retailers will focus on improing their
serice programs and associate-customer interaction as a way to
build top-of-mind status with target customers" 1n some cases, this
will inole more personal shopping serices and stronger customer
``clienteling" 1n others, it will inole creatiely responding to the
serice and shopping e&perience needs of the best customers in ways
that are more meaningful to the customer"
#albots 5www"talbots"com6 has e&perimented with a ariation on
its popular Appointment Shopping serice with a serice called
4ardrobe E&press" #he serice targets busy, time-pressed customers
with highly eFcient shopping appointments by proiding a pre-
selected assortment of garments for the customer in the dressing
room at the prescribed time > along with a light snack for lunchtime
shoppers" =uring the isit, the store associate completes a
``wardrobing sheet including what was tried on and possible
coordinates" ?sing credit card information that is on $le, the associate
then completes the purchase after the shopper has left the store and
arranges for pickup or deliery"
3es$i%&s
1. 4-a$ ca& a& i&,e'e&,e&$ re$ai!er !ear& 2r%" $-is case5
2. 4-a$ are $-e '%si$i.e i"'!ica$i%&s %2 $-is case 0i$- res'ec$
$% $-e se %2 !ease, ,e'ar$"e&$s i& ,e'ar$"e&$ s$%res5
3. H%0 ca& a "i,6'rice, a''are! s$%re 7ec%"e a ,es$i&a$i%&
re$ai!er5
4. H%0 is Ga' I&c. $i!i1i&/ $-e 'ri&ci'!es %2 $-e 0-ee! %2
re$ai!i&/ $-r%/- i$s Ga'8 O!, Na.(8 a&, Ba&a&a Re'7!ic
,i.isi%&s5
5. H%0 ca& -i/-6'rice, a''are! s'ecia!$( s$%res sccess2!!(
c%"'e$e a/ai&s$ 2!!6!i&e ,isc%&$ s$%res5
6. 4-a$ r%!e s-%!, $-e I&$er&e$ '!a( 2%r a''are! re$ai!ers5
7. Ca& a& a''are! re$ai!er 'r%s'er i& $-e 2$re i2 i$ ,%es &%$
e&/a/e i& "!$i6c-a&&e! re$ai!i&/5 E9'!ai& (%r a&s0er.
,)-,
CASE NO. : ;T HE A **AREL S HO**ER <
INTRODUCTION
Seeral general obserations can be o!ered regarding apparel
shoppers M
1 High > income shoppers and younger shoppers underlie
recent sales growth"
2 Spending changes are more likely to be drien by needs not
wants" Although important, the adent of new fashion NlooksO
is not the main reason shoppers increase > or decrease > their
spending" 1nstead, changes are far more likely to be related
to ery practical reasons 5e"g", a change in si3e, replacement
of worn clothing, lower household incomes, more saings :
debt reduction6"
3 Also important in prompting changes in clothing spending is
te need to upgrade : update a work wardrobe or respond to a
changed work situation"
4 As own > market shoppers feel the need to pinch their
pennies for apparel, they spend more of their budget at 4al-
'art" Among these shoppers, 4al> 'art is oer whelmingly
seen as o!ering the best clothing alue, while its clothing
styles are a good match for their basic style preferences"
5 %lothing specialty stores and traditional department stores
bene$t from consistent or increased spending among up >
market shoppers" #he brands and styles o!ered at these
retail formats are most preferred by up > market shoppers"
1 'uch of the spending increases among younger shoppers are
funneled to fashion > focused clothing specialty stores, as
well as
retailers o!ering credible fashions plus a strong price for the
quality alue"
,)8,
1 =epartment stores and clothing specialty stores are the top
two choices for o!ering the most > wanted brands and the
most > wanted styles, both oerall and among key segments"
2 #he maCority of Americans wear ordinary:basic styles at work
and at play" Howeer, they seem a bit more stylish on the Cob
than o!" (ounger and higher-income shoppers skew toward
more fashion > drien looks for both wearing occasions"
4-% Is ,ri.i&/ A''are! S-%''i&/ Gr%0$- 5
Apparel sales grew G percent form -++8 to -++., following )".
percent growth the prior year" 4e proCect apparel spending to
increase about . percent annually during the ne&t seeral years"
'argins, howeer, will be seerely tested by accelerating price
pressure" #he -++. sales increase can be e&plained by our
ShopperScape
TM
data, particularly when iewed through the NliensO of
household income" Eery month, we surey .,+++ shoppers about
their recent and planned spending" 4e collect purchasing data for
oer )/+ retailers and more than )++ product categories"
#he maCority of Shopper Scape
TM
respondents say they spent
about the same amount on clothes for themseles in -++. compared
with -++8" #wice as many reported reduced spending than reported
increased spending" #hese proportions, howeer, drainatically aried
by upper-ersus lower income households and resulted in a net
increase in oerall spending"
%onsumers with the highest incomes were the most likely to
increase their spending for themseles, while those with lower
incomes were the most likely to reduce spending" According to ?"S"
personal consumption e&penditure date, the highest- income
shoppers account for
one-quarter of all apparel spending, although they make up only )-
percent of all households" #he lowest-income households account for
oer one-third of all households but only )0 percent of all apparel
spending"
,).,
4ith respect to race : ethnicity, 4hites were the most likely to
maintain their clothing spending for themseles, compared with
African-Americans and Hispanics" Aatines, more of whom reported
reduced spending" Spending trends on clothing also aried notably by
both gender and age" %hanges in spending > both increases and
reductions > were more pronounced among women and younger
shoppers than among their counterparts" 'en and mid > life to older
shoppers were most likely to hae an unchanged rate of spending on
clothing for themseles" 4omen were more likely to hae both
increased or decreased spending compared with men" 4orking-age
shoppers 5ages )0 to /.6 were more likely than older shoppers to
hae increased their spending on clothing for themseles"
4-a$ U&,er!ies S'e&,i&/ C-a&/es 5
S'e&,i&/ I&creases
Spending increases were most likely to be related to ery practical
reasons 5e"g"a change in clothing si3e, replacement of worn clothing6"
Spending decreases were most likely to re7ect a shrinking wallet"
4ork wardcobes also were important to spending changes, whether
related to updating the wardrobe or a change in work status"
Among those spending more on clothing, the most commonly
cited reasons were related to practical needs for new or replacement
clothing rather than to haing more discretionary income aailable to
spend on clothing or haing a desire for a new fashion look" #he need
for a new si3e was mentioned as the most important reason for
spending more on clothing by -0 percent of respondents" #he
replacement of worn > our
items was mentioned by -) percent" Eighteen percent increased
spending to upgrade the work wardrobe" <ew shoppers 58 percent6
increased spending because fashions were of greater interest than
preiously" A
,)/,
slightly larger percentage 5* percent6 attributed the increase in
spending to higher income"
Speci$c reasons for increasing clothing spending were highly
related to age but not as much to gender" #he only signi$cant gender
di!erences were that women were more likely than men to increase
spending on clothing due to a change in si3e, while men were more
likely in increase spending because of the need to replace a worn or
torn item" Shoppers in older age groups were more likely to spend
more because they were replacing worn > out clothing" #hose in their
mid-life NworkO years were more likely to spend more because they
were updating their work wardrobe" Aess debts, higher incomes, and
more time to shop were more likely to be reasons cited by younger
shoppers for higher spending"
@easons behind increased spending were not well e&plained by
either income or race" #he most notable di!erences by income were
among shoppers with household incomes of L-/,+++ to L.*,*** and
LI/,+++ to L**,***" Both groups were more likely than others to
spend more to upgrade the work wardrobe" #hose with incomes from
L-/,+++ to L.*,+++ also were more likely than others to spend
because they had more income and more free time to shop"
S'e&,i&/ Decreases
Among respondents cutting back on their clothing spending most did
so because their clothing budge shrank, either due to a decrease in
income 5-) percent6 or in an attempt to spend less so as to sae more
or pay down debt 5)0 percent6" 9ther frequent responses included a
change in a workplace situation that resulted in a decreased need for
clothing
spending a spending shift away from clothing to other items, and a
desire to wait to make new purchases until the respondent lost
weight" 9nly - percent said they reduced spending because they
were less interested in the latest fashions"
,)G,
#he most frequently mentioned reasons for reduced clothing
spending were closely related to age and gender" 4omen and
shoppers younger than // were most likely to say a decrease in
income caused them to cut back" 'id-life shoppers were more likely
to decrease their budget to sae money or pay down debt" (ounger
shoppers were more likely to reduce spending due to a shift in
spending priorities away from clothing toward other types of products"
'en and older shoppers were more likely to say a change in their
work situation triggered reduced spending, presumably re7ecting
retirement among the oldest shoppers" 4omen were more likely to
say they were holding o! on new clothing purchases until they lost
weight"
1ncome is modestly indicatie of the reasons why shoppers cut
back on spending" Howeer, race is not a good indicator" Aower-
income households were more likely to cut back because of a
decrease in income" Shoppers in the lowest income households also
were the least likely to postpone new apparel purchases until they
lost weight" Shoppers in the highest > income households that cut
back on spending were more likely to say they did so because they
had less time to shop or were shifting work wear spending toward less
e&pensie, more casual clothing" African > American were much more
apt to spend less because they shifted spending away from clothing
to other nonclothing items"
4-a$ Re$ai!ers Are Be&e=$i&/ 2r%" S'e&,i&/ Gr%0$- 5
9erall, 4al-'art 5w"w"w"walmart"com6 was the biggest direct
bene$ciary of recent increased spending > although primarily from
lower > income or mid > life shoppers" Higher income shoppers and
those at each end of the age spectrum shifted their spending to more
fashion > focused apparel
retailers" @egardless of whether their budget to any particular retailer"
An equal number of shoppers, howeer, said they were shifting more
of their clothing budget to 4al > 'art"
,)I,
#he retail recipient of shifting spending on apparel aried
notably by age and gender"
1 4al> 'art gained more of the budget of women than of men,
as well as of all but the youngest and oldest shoppers"
2 4omen were more likely than men to shift their clothing
budget toward all types of specialty stores, from full > price to
o!-price and alue > priced 9ld Jay 5www"oldnay"com6
3 'en were more likely than women to shift more of their
budget to Sears 5www"sears"com6
4 Eighteen to 8. years > olds formed a distinctie bloc, that
was especially likely to shift their budgets to all types of
specialty stores, as well as to #arget 5www"target"com6 #hey
were the most likely to shift their clothing budget among
retailers, re7ecting less > ingrained shopping patterns and a
greater desire to shop at retailers o!ering trend-right
fashions, particularly at alue price points"
5 Shoppers age ./ or older were more likely to shift their
budget toward traditional department stores, long the
domain of the mid
> life to older shoppers"
Shifts in the budget to arious types of retailers also are linked
to income and race" 4al-'arts eeryday low prices clearly attracted
shoppers on a budgetE .+ percent of consumers with incomes less
than L-/,+++ say they spent more on clothing there" Shoppers with
incomes of L-/,+++ or higher were more likely to shift their budget to
;ohls 5www"kohis"com6 and 9ld Jay" #he most > aPuent shoppers
5L)++,+++
and aboe6 were more likely than others to shift their budget to
traditional department stores"
African > Americans were more likely than 4hites or Aatinos to
shift their budget to 4al > 'art and clothing specialty stores" Aatinos
were more apt than 4hites or African > Americans to shift to #arget
and
,)0,
Sears" African > Americans and Aatinos were more likely than 4hites
were more apt than African > Americans or Aatinos to shift to ;ohls"
4-% Has $-e Ri/-$ C!%$-i&/ 3a!i$( 2%r $-e *rice 5
Apparel shoppers come in all shapes, si3es, ages, incomes, and taste
leels" Een though there are clear di!erences in retailer preferences
based largely on age and income, it is safe to say that 4al-'art is the
oerall clothing alue leader" Howeer, consumers hae di!erent
criteria for assessing alue, which is eident based on the ratings of
shoppers by key demographics such as age and income"
#he assessment of which retailer o!ers the best clothing alue
clearly di!ers by age but less so by gender" 4al-'art is seen as a
good alue by more men than women" 4omen are more likely to
perceie that #arget and 9ld Jay o!er a good alue, most likely
because of the ``fashion right orientation of these retailers, an
aspect of alue that women are more likely to use in their ratings"
9lder shoppers are notably more likely than younger shoppers to
perceie that D"%" 2enney 5www"Ccpenney"com6 and ;ohls o!er a good
alue" (ounger shoppers are more likely to perceie that #arget and
9ld Jay o!er a good alue, again likely including being ``fashion
right as a more important component of alue"
1ncome has a direct relationship with shopper rankings of quality
for the price paid" Qalue retailers receie higher ratings among lower-
income than upper-income households" @ace:ethnicity has less of a
relationship to shopper perceptions, although a few di!erences e&ists"
4al-'arts oerall
top ranking for clothing alue is directly linked to its high ranking
among lower-income shoppersE no other retailer comes close in terms
of perceied clothing alue" #he gap between 4al-'art and other
retailers also is large in the L-/,+++ to L.*,*** income group but
narrows among those with incomes of L/+,+++ to LI.,***"
,)*,
1n the highest income group 5L)++,+++ and oer6, only I
percent of shoppers feel 4al-'art o!ers the best clothing alue"
;ohls is perceied by the highest percentage of shoppers in this
group to o!er the best clothing alue" As income increases, traditional
department stores, 9ld Jay, clothing specialty stores, and #arget are
more likely to be perceied to o!er the best clothing alue"
4ith respect to race:ethnicity, 4hites are more likely than
African-Americans or Aations to feel that ;ohls o!ers the best
clothing alues" Aations are more likely to feel that #arget o!ers the
best alues" #his surpasses the percent of Aatinos who say that 4al-
'art o!ers the best clothing alues" Aatinos are more likely to feel
that #arget o!ers the best alues" #his surpasses the percent of
Aatinos who say that 4al-'art o!ers the best clothing alues-which is
not the case with 4hites or African-Americans, who gie 4al-'art the
highest rating on this measure"
4-% Has $-e Ri/-$ Bra&,s a&, S$(!es5
#he oerall ranking of retailers based on whether or not they o!er
more of the brands shoppers want to buy is ery di!erent from
retailer rankings based on whether or not they o!er the best alue"
#raditional department stores and clothing specialty stores 5e&cluding
9ld Jay6 are the most likely to o!er more of the brands shoppers
prefer" A smaller percentage say 4al-'art has more of the brands
they want to buy, followed by D"%" 2enney and ;ohls"
Because many brands are aimed at speci$c age groups and sold
at retailers targeting these groups, brands ratings of retailers
noticeably ary
by age" #here are few di!erences based on gender" 9lder shoppers
are the least likely to known which retailer carries the brands they
preferE they also are the most likely to say that traditional department
stores carry the brands they want" D"%" 2enney is rated highly on this
factor by the oldest shoppers" %lothing specialty stores receie high
ratings for carrying the
,-+,
``right brands by most shoppers, particularly younger ones" #arget
and Sears"
A$ 4%r# %r *!a(8 Basics R!e
American consumers are not trendy > either at work or play"
@egardless of wearing occasion, ``ordinary, ery basic styles were
preferred by a wide margin oer all other styles although more so far
casual : weekend wear than for work" Second in preference for both
wearing occasions were classic and traditional styles that neer go
out of fashion" Slightly more shoppers wear this style for work than for
weekend" Aess than a third of consumers said they wore
``contemporary or ``trendsetting fashions for work or for casual
wear" #he percent wearing the more fashion-focused styles for work
was higher than the percent wearing these styles for the weekend"
Age has a more noticeable impact than gender on the styles
worn by full-time workers" (ounger adults are more likely to wear work
wardrobes comprised of contemporary or trendsetting styles" @oughly
half of those younger than 8. are attracted to fashion forward types
of work wear, compared with l.ess than a third of all workers" 9lder
workers are more likely to stick to classics and basics for work, with
08 percent and 00 percent of workers in the // > to > G. and G/R age
groups saing they wear one of these two categories" 4orkers in the
oldest age group are twice as likely to faor basic styles for work
compared with those in the youngest" 4omen are more likely than
men to wear trendsetting styles for work"
9utside of the oFce, consumers are een more likely to wear
basic styles" Half of all shoppers say this is their faorite style to wear
on the
weekend or on other casual occasions" As shoppers get older they are
more likely to prefer basic casual looks" 'ore than G+ percent of the
oldest shoppers cite basic styles as preferred for weekend : casual
wear" %lassic:traditional styles are less preferred by younger shoppers
for casual wear than for workplace attire" %ontemporary looks are
most preferred by
,-),
younger shoppers for their casual wardrobe, with more than a third
saying this is their faorite casual style"
#here is a direct relationship between income and style
preferences for work attire, with preferences becoming less basic as
incomes increase" @ace : ethnicity is also related to work wardrobe
preferences" Higher-income workers are most likely to prefer a classic
work wardrobe" #hey, along with those in the middle-income range,
also are more likely to faor contemporary, but not trendy, work
wardrobes" #he lower workers incomes, the more likely they are to
wear basic styles to work" Basic styles also are more faored by 4hite
workers than by African-American and Aatino workers" Aatino workers
are the trendiest race:ethnic group with respect to work clothing"
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