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Clothing Retailing: Brand vs Own Label - Ireland - November 2007

ISSUES IN THE MARKET
Key themes of the report:
INSIGHTS AND OPPORTUNITIES
Creating an all-year-round buzz
Size matters
‘Mobile fashion’ – success elsewhere, why not in Ireland?
Male shopping experience must be more tailored
Irish consumers want to stay younger for longer
The untapped ‘green’ market
MARKET IN BRIEF
Key Points
Confidence is slowing down the consumer boom
Minor increases keeping the overall market stable
Young no longer the principal target
UK picture sets a familiar scene?
Figure 1: UK clothing specialists, market positioning, 2006
M&S customer base going grey
Value retailers not just for less affluent
Value market crowded
Dunnes is leading the market
Is there a future for Matalan’s out-of-town outlets?
Who’s innovating?
FAST FORWARD
What is Fast Forward Trends?
Trend 1: Sense of the Intense
What's It About?
What We've Seen
What’s next?
Bordering on too-personal shopping
No time to try things on?
Trend 2: Shopping Comes Alive
What's It About?
What We've Seen
What’s next?
Trend 3: Instant Gratification
What's It About?
What We've Seen
What’s next?
Bringing the personal shopper online
Recycle it?
INTERNAL MARKET ENVIRONMENT
Key Points
Falling prices across the market
Figure 2: UK: Inflation on clothing and footwear, 2001-05
Will this continue?
Profit margins squeezed
NI and RoI textile companies have suffered
Impact of widening waistlines
Buying into the celebrity lifestyle
Any press is good press?
Take That – the new face of M&S
A-Wear using Irish Celebrities
BROADER MARKET ENVIRONMENT
Key Points
RoI forecast economic downturn affects consumer confidence
Figure 3: RoI, health of the economy Sept 2007
Consumers thinking twice before spending
Interest rates affecting NI industry
Figure 4: UK and Eurozone interest rates, 1998 to 2007
The Stormont ‘feel-good’ factor – economic myth?
Danger of the weak dollar
Figure 5: Dollar exchange rate versus UK pound, 2003-07
Online retailing: the new frontier?
Winning older customers – the new challenge
Figure 6: Population change by age group, NI, 2000-2020
Figure 7: Population change by age group, RoI, 2000-2020
Tomorrow’s 35-54-year-olds are today’s 15-34s
The disastrous summer of 2007
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
COMPETITIVE CONTEXT
Clothing sales outstrip other markets in
Figure 8: UK breakdown of sales through clothing, footwear and textile retailers, by sub-sector shown as a percentage of total sales, 1994-2006
Figure 9: Annual UK percentage change in retail price index for selected product groups: Jun 2006-Jun 2007
Clothing competing well in Republic of Ireland market
Figure 10: Consumer spending on clothing, Ireland, 2001-05
Figure 11: RoI, percentage of total consumer spending, by sector, 2001-05
WHO’S INNOVATING?
Key Points
Own brand re-invention
Rise of ethical/green issues
E-fashion hitting the big time
Dorothy Perkins’ organic range
Asda ponder microchips
M&S has big and tall range for the larger gentleman
MARKET VALUE AND FORECAST
Key Points
Irish clothing retail market is still reasonably healthy
Figure 12: All-Ireland clothing retail market, by value, 2001-12
Figure 13: Indexed growth in retail clothing market, 2001-12
Supermarket retailers to be winners
E-commerce – the future
MARKET SEGMENTATION
Key Points
Menswear market continuing to grow slowly in NI
Figure 14: Menswear retail market, by value, 2001-07
NI womenswear growing very slowly but expected to fall again
Figure 15: Womenswear retail market, by value, 2001-07
INDUSTRY VIEWS
Online opportunities
Resisting the signs of ageing
Supermarkets threatening traditional clothing powerhouses
Irish consumers getting fuller figured
The decline of brand loyalty and the rise of celebrity status
 WEATHER ISSUES
Ethical trading concerns
COMPANIES AND BRANDS
Key Points
Figure 16: Profiled retailers
Asda (NI only)
Arcadia Group
Market Positioning
Arnotts (RoI only)
Benetton
Figure 17: Benetton group, outlet data, 2001-05
Bhs (NI only)
The Bhs brand
Brown Thomas
Clerys
Debenhams
Figure 18: Debenhams Product Mix (as % of turnover), 2006
 THIRD-PARTY BRANDS
Dunnes Stores
Figure 19: Dunnes: Group financial performance, 2001-07
Gap Inc
Figure 20: GAP Inc group financial performance, 2002-06
H&M Hennes & Mauritz
Heaton’s
Matalan (NI only)
Marks & Spencer
Figure 21: M&S turnover and net profit in the UK 2001-06
Next
Figure 22: Next retail UK and RoI outlet data, 2002-06
Primark/Penneys
Figure 23: Primark own brand portfolio
River Island
Figure 24: Comparison of operations between tesco in UK and RoI
Figure 25: Tesco UK sales  and profit figures 2001-06
TK Maxx
Figure 26: TK Maxx: Group financial performance, 2001/02-2005/06
THE CONSUMER
Key Points
Where are people buying their clothes in NI and RoI?
Figure 27: Where people are buying their clothes from in NI and RoI
Dunnes cornering the older market
Primark takes second place with M&S not far behind
Supermarket chains eating into specialists’ sales
Sports casualwear very popular in Greater Belfast
Mail order catalogues fail to penetrate
Figure 28: Where clothes have been purchased in the last 12 months, by social class, NI, July 2007
Debenhams fails to attract less affluent
Primark attracts all economic backgrounds
Loyalty to Dunnes and Primark among lower economic backgrounds
Clerys failing to attract young consumers
Low take-up rate for online retailing
Arnotts and Clerys failing to attract custom from beyond Dublin
Penneys failing to dominate the less affluent market
CONSUMER ATTITUDES TOWARDS CLOTHES SHOPPING
Key Points
Figure 29: Shopping preferences, NI and RoI, July 2007
Women still more fashion-conscious than men
Worried about shopping online
Men less wary of online retailing
Women fuelling “disposable clothing” boom
Young more fashion-conscious than old
Less affluent more tempted by bargains than style
Young shop as a social activity
Shopping as a leisure activity
Wives filling the role of personal shopper
Less affluent consumers attracted by “The Sales”
Lower social classes not worried about style, but price
Rural prefer shopping on their own
 TARGET CONSUMER GROUPS
RoI Clusters
Figure 30: Consumer typologies relating to attitudes towards shopping for clothes, RoI, July 2007
NI Clusters
Figure 31: Consumer typologies relating to attitudes towards shopping for clothes, NI, July 2007
Bargain Hunters – 11% of RoI consumers – 17% of NI consumers
Social Shoppers – 18% of RoI consumers – 21% of NI consumers
Reluctant Shoppers – 35% of RoI consumers – 18% of NI consumers
Sole Shoppers – 26% of RoI consumers – 33% of NI customers
Fashion Victims – 10% – of RoI consumers – 11% of NI customers
APPENDIX
Figure 32: Clothing inflation, UK, 1995-2005
Figure 33: UK: Inflation on clothing and footwear, 2001-05
Figure 34: Sterling to euro conversion rates
Figure 35: Dunnes: Outlet data, 2002-06
Figure 36: RoI, Leading clothing specialists, estimated market shares, 2005
The Consumer
Figure 37: Where clothes have been purchased in the last 12 months, NI, July 2007
Figure 38: Where clothes have been purchased in the last 12 months, NI, July 2007
Figure 39: Where clothes have been purchased in the last 12 months, by age, RoI, July 2007
Figure 40: Where clothes have been purchased in the last 12 months segmented by social class, RoI, July 2007
Figure 41: Where clothes have been purchased in the last 12 months segmented by social class, RoI, July 2007
Figure 42: Shopping preferences, NI, July 2007
Figure 43: Shopping preferences, NI, July 2007
Figure 44: Shopping preferences, NI, July 2007
Figure 45: Shopping preferences, NI, July 2007
Figure 46: Attitudes towards clothes shopping, by gender, RoI, July 2007
Figure 47: Agreement with attitudes towards clothes shopping, by age, RoI 2007
Figure 48: Agreement with attitudes towards clothes shopping, by socio-economic group,  RoI 2007
Figure 49: Agreement with attitudes towards clothes shopping, by region,  RoI 2007
NI clusters by demographics
Figure 50: Consumer typologies relating to attitudes towards shopping for clothes, NI, July 2007
Figure 51: Consumer typologies, by shopping attitudes, NI, July 2007
Figure 52: Consumer typologies, by shops bought clothes in for self/partner, NI, July 2007
RoI clusters by demographics
Figure 53: Consumer typologies relating to attitudes towards shopping for clothes, RoI, July 2007
Figure 54: typologies according to shops bought clothes in for self/partner, RoI, July 2007
Figure 55: Consumer typologies according to shops bought clothes in for self/partner, RoI, July 2007

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