Customer behavior in the fashion industry with the Covid-19 crisis

While the Covid-19 crisis has changed many things in our lives, it is probably our shopping habits that have been turned upside down, especially for the fashion and apparel sector in general. 53% of those surveyed said that their shopping habits had changed permanently as a result of the pandemic. According to Census Bureau data released in mid-April 2020, clothing sales have fallen by 50.5% (Callahan, 2020). In addition, the COVID-19 pandemic has devastated the fashion industry's economic profit, which is expected to fall by 93% in 2020 (McKinsey, 2020). Thus, the pandemic has been particularly hard on the fashion and apparel industry.

Today, understanding the evolution of consumer apparel consumption in the midst of the global COVID-19 pandemic is essential for fashion apparel brands and companies to identify what value means to consumers and find opportunities for growth.

In any time of crisis, it is important to understand how consumer behavior is likely to change. Indeed, it can be observed that consumers tend to turn inwards and focus on their own values, which depend on internal factors (such as their personality, their aspirations or their representation of the world around them) and that they therefore aspire for their consumption and the brands they buy to be in line with their values (L. Salesses, B. Romain, D. Romain-Delacour, 2020).

But in concrete terms, what has this change in behavior looked like over the last few months? 

Firstly, we can observe that fast fashion is still present and remains a reassuring value for the consumer. In November 2020, Kantar carried out a study, reporting the fact that with the covid-19 crisis, the divide between the different social categories had become significantly accentuated and that the social divide was therefore increasingly strong.

This rupture is manifested, with the example of the food sector, by a return to favour of discount chains such as Lidl and Aldi. In other words, the middle classes have lost purchasing power during this Covid period. As a result, they will seek refuge in low-cost consumption. This is why fast fashion, which has been somewhat poorly conducted in recent years, will find itself in the front line of comforting a consumer in search of a restorative purchase.

As for luxury goods, they seem to be strengthened by the crisis. On the other hand, its discourse is changing, and brands have decided to become involved and active in order to retain their customers.

In addition, one of the most significant changes brought about by the health crisis is that many consumers have changed their preferences and are now shopping online. As a result of lockdowns, shop closures and the reluctance of some consumers to return to the crowds of shops, online sales and home delivery have expanded dramatically. Also worth mentioning is the online payment and in-store pick-up experience, which, according to a Klarna study, has improved the shopping experience for 81% of respondents to this study. Also worth mentioning is the practice of click-and-collect, which has helped to maintain the link between brands and their customers.

But how do we bring the customer back to the physical shop?

The shop must now become an extension of the digital experience. Brands must offer a global and unique experience to the consumer, who expects much more than a product. This applies to both the physical shop and the digital website.

According to a Klarna study, 83% of shoppers say that they would only buy from their favorite online brand if the brand opened a physical shop in their area. This means that the consumer still feels a need for proximity and that the link between digital and physical has been strengthened by the crisis. But also that the first encounter with a brand is now on the digital side. The challenge for the physical retailer is to ensure that the visitor finds the digital brand universe in the real place.

However, this study did not consider the possibilities for the retailer to provide additional services such as repairing used clothing or setting up masterclasses (with a small audience broadcast on Instagram) in the shop that would enhance the customer experience. Today, the physical retailer can no longer afford to be only a place; it is necessary to consider a global experience, both physical and digital.

It can also be noted that customers also have new expectations regarding in-store purchases. Klarna's survey found that 77% of shoppers would like to try on clothes in fitting rooms again this year, but only 36% would like to see the return of beauty and wellness product testing. Klarna's survey also found that safety measures would be the top priority for almost three quarters of consumers (74%) shopping in shops.

Shoppers lament the physical elements of the in-store experience that could not be offered during much of the health crisis, such as changing rooms. However, they also have new expectations for what the in-store shopping journey should look like. Today, trust, security and peace of mind are the major concerns of consumers, values that will likely remain embedded in our spending habits for quite some time. Retailers must therefore adapt their in-store experience to provide shoppers with greater confidence and peace of mind. Online shopping, in-store pickup, contactless payments, QR codes and security features as simple as hand sanitizer are simple solutions that have proven to be successful with today's shoppers.

Klarna's findings are based on the results of a U.S. survey conducted in January 2021 of more than 41,000 Klarna shoppers aged 18 and over. The definitions for each age group are as follows: Gen Z (18-24 years old); Millennials (25-40 years old); Gen X (41-56 years old); Boomers (57-75 years old).

In conclusion, the consumption behavior of customers has radically changed with the covid crisis in the fashion industry to such an extent that it is difficult to say whether we will one day return to our old habits. However, the pandemic crisis could also create opportunities for brands and businesses, as it has resulted in rapid and lasting changes in environments, markets and consumer needs and wants (Knowles et al., 2020). Once a routine in buying preference for a certain store or a particular brand is established, consumption becomes habitual and is difficult to change. In normal times, grabbing the attention of consumers and changing their preferences is an expensive endeavor. However, when consumers experience disruptions in their daily lives, they are more likely to change their consumption needs, wants, attitudes and behaviors, making them more open to new lifestyles and choices. changes in their consumption habits and more sensitive to the intervention of marketers (Andreasen, 1984; Moschis, 2007).

#marketing #webmarketing #fashionmarketing #digitalmarketing #consumerbehavior #fashionindustry

Elise Pluquin

References :

• Nguyen, K: "Consumer behaviour changes within the fashion industry due to the impact of the COVID-19 outbreak", 9th of June 202, Linkedin, Accessible here: https://www.linkedin.com/pulse/consumer-behaviour-changes-within-fashion-industry-due-karen-nguyen/
• DeLace, J: "The Psychology and Behavior of Consumers in the Fashion Industry", 2011, Accessible here: https://digitalcommons.uri.edu/cgi/viewcontent.cgi?article=1238&context=srhonorsprog
• Guinebault, M: "Covid-19: une consommation mode définitivement altérée pour 35% des clients", 1st of June 2021, Fashion Network, Accessible here: https://fr.fashionnetwork.com/news/Covid-19-une-consommation-mode-definitivement-alteree-pour-35-des-clients,1306692.html