The fast fashion industry is big business – and it’s only getting bigger.

According to new research, the industry has grown 21% over the past three years. When compared to the luxury market, which saw mediocre growth in 2016, it’s clear that fast fashion retailers are growing in favour.

So, what’s fuelling this boom? Here’s a bit of a deep dive into Hitwise’s research and how brands are capitalising on the consumer desire for instant and affordable fashion.

What is fast fashion?

Before we go any further – what exactly determines a fast fashion retailer? 

Essentially, it is when the production process is accelerated in order to get new catwalk trends into stores or online as quickly as possible. It also reflects the growing consumer desire for speed and value within retail. 

It means that, instead of waiting for new seasonal collections (i.e. spring/summer), consumers can get their hands on a continuous cycle of trend-led clothing, all year round.

Brands such as H&M and Zara were said to be among the very first fast fashion retailers. When the latter opened its first US store in 1990 (having first launched in Spain in the 1970s) it announced that it would only take 15 days for a garment to go from concept to completion.

So, what’s fuelling fast fashion brands?

Speed and agility

Hitwise data suggests that ASOS, New Look and Very are the most popular brands in the category, accounting for 47% of the UK’s fast fashion market share. 

For brands like ASOS, the ability to capture millennial consumers is key, with this demographic now reportedly having an estimated spending power of $2.45trn. One way it does this is by delivering on the demand for new fashion, as younger consumers typically spend around seasonal events (such as festivals) as well as after payday.

ASOS stocks over 60,000 items at any given time, allowing the ecommerce retailer to constantly update its inventory with ‘new in’ products.

Research by Goldman Sachs suggests that ASOS is able to do this by mastering its supply chain. The below screenshot shows the correlation between supply-chain lead times and like-for-like sales growth, with the results showing just how important speed is for both Boohoo and ASOS.

ASOS constantly tracks how well (or poorly) trends are selling online, before adjusting its inventory accordingly. This means that it reduces the risk of unsold stock, and in turn, delivers a steady stream of new trends for fashion-hungry consumers.

Celebrity endorsement

Hitwise data also shows that PrettyLittleThing.com is the fastest growing brand in the fast fashion category, with the site seeing a whopping 663% increase in online visits year-on-year since 2014.

For PrettyLittleThing, working with celebrities and influencers has allowed the brand to drive awareness of its products. A popular search term relating to the site is ‘celebrities wearing Pretty Little Thing’ – mainly thanks to endorsements from the likes of Kylie Jenner and Sofia Ritchie.

However, Pretty Little Thing does not only use celebrities to merely promote its clothing. Well-known names, like former TOWIE star Lucy Meck, have also created their own clothing lines with the brand. 

In doing so, it has allowed the ecommerce retailer to strengthen its connection with customers, offering them something more authentic and original than a shallow celebrity endorsement.

Sales through social

Alongside influencers, fast fashion brands have mastered the use of social media to drive sales. 

Today, consumers are constantly craving fashion and lifestyle-related digital content, not just to inspire their choices, but also for the purpose of entertainment. So, in order to deliver this, many retailers have started to act more like media brands – fusing the worlds of shopping, entertainment, and social media. 

Unsurprisingly, Instagram reigns supreme as the most effective platform for fashion brands, with many posting videos, Instagram Stories, and including links to shoppable content to allow users to smoothly transition from the act of browsing to buying. 

One brand that has effectively used social to increase sales volume is Missguided. It has even incorporated the recognisable user interface of another social app – Tinder – into its own.

With its ‘swipe to hype’ feature, consumers can dislike or like products to create their own wishlists.

 

This ‘tinderisation’ of ecommerce shows how fast paced the industry has become, with consumers making impulsive decisions – often based on the knowledge that there will be continuous stream of new products in the pipeline.

Sustainability and ethics

The fast fashion industry has come under fire in recent years for its impact on the environment, as well as suggestions that the demand for cheap clothing is driving poor working and labour conditions. 

Interestingly, research shows that 19% of the top fast fashion related searches are linked to the environment, ethics and sustainability. In order to counteract this, many brands are now displaying increased levels of transparency, with some also introducing initiatives relating to ethical and environmental issues.

H&M, for example, launched a conscious beauty collection in 2016 which included ‘planet-friendly’ products. Similarly, it has set itself the goal of using 100% sustainably sourced cotton by 2020.

Meanwhile, Zara has pledged to boycott Uzbek cotton, which is an industry linked to forced labour. The brand has also joined the Better Cotton Initiative to promote sustainability and best practices for workers in the cotton industry.

Of course, there is still a long way to go before fast fashion retailers prove themselves, however these examples are helping to satisfy increasingly conscientious consumers – as well as enhance their brand reputation.

Other brands playing catch-up

So, what impact has the fast fashion had on the wider industry in general? Interestingly, mid-tier and luxury brands are recognising that the consumer desire for fast fashion is not only based on low prices. 

Often, it can simply be because consumers do not want to wait for seasonal collections. 

As a result, some brands are introducing ‘runway to retail’ concepts to allow consumers to get their hands on clothes as soon as they’re seen on the catwalk. Elsewhere, JC Penney has accelerated the delivery of merchandise in order to update stock mid-season, while GAP has announced that it will be trialling a fast-fashion model to see whether it increases sales.

As the continued growth of retailers like Missguided and ASOS demonstrates, fast fashion could be a trend that’s here to stay.

Related articles:

Nikki Gilliland

Published 7 July, 2017 by Nikki Gilliland @ Econsultancy

Nikki is a Writer at Econsultancy. You can follow her on Twitter or connect via LinkedIn.

546 more posts from this author

You might be interested in

Comments (0)

Comment
No-profile-pic
Save or Cancel
Daily_pulse_signup_wide

Enjoying this article?

Get more just like this, delivered to your inbox.

Keep up to date with the latest analysis, inspiration and learning from the Econsultancy blog with our free Digital Pulse newsletter. You will receive a hand-picked digest of the latest and greatest articles, as well as snippets of new market data, best practice guides and trends research.