Clothing Retailing - Germany - October 2017

OVERVIEW
What you need to know
Areas covered in this report
EXECUTIVE SUMMARY 
The market
Spending on clothing and footwear
Figure 1: Germany: Spending on clothing and footwear as % all retail sales, 2011-17
Inflation
Figure 2: Germany: Consumer prices for clothing and footwear – Annual % change, 2016-17
Consumer confidence
Figure 3: Germany: Consumer and retailer confidence levels, November 2016-August 2017
Channels of distribution
Figure 4: Germany: Estimated distribution of spending on clothing and footwear, 2016
Sector size and forecast
Leading players
Key metrics
Market shares
Figure 5: Germany: Leading clothing retailers, Sales as % all spending on clothing and footwear, 2014-16
Online
Figure 6: Europe: Proportion of people saying they have bought clothing or sports goods online in the last year, 2011-16
The consumer
Where they shop
Figure 7: Germany: Where people shopped for clothing in the last 12 months by type of retailer, in-store vs online, September 2017
Figure 8: Germany: Profile of clothing shoppers by type of retailer used, whether in-store or online, September 2017
Figure 9: Germany: Profile of clothing shoppers, by retailer, whether in-store or online, September 2017
Attitudes to shopping for clothes
Figure 10: Germany: Attitudes to buying clothes, September 2017
What we think
ISSUES AND INSIGHTS
The market is changing
The facts
The implications
Online and in-store sales – Understanding each other’s strengths
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Consumer confidence
Clothing and footwear spending underperforming
Inflation low
Clothing and footwear specialists take over half of category spending
SPENDING AND INFLATION
Economy and consumer confidence
Figure 11: Germany: Consumer and retailer confidence levels, November 2016-August 2017
Inflation
Figure 12: Germany: Consumer prices of clothing and footwear, Annual % change, 2012-16
Figure 13: Germany: Consumer prices of clothing and footwear, annual % change, 2016-17
Consumer spending on clothing
Figure 14: Germany: Consumer spending (inc VAT), 2012-17
Figure 15: Germany: Spending on clothing and footwear as % all retail sales, 2011-17
MARKET SEGMENTATION
Figure 16: Germany: Clothing market, estimated segmentation, 2012-16
CHANNELS OF DISTRIBUTION
Figure 17: Germany: Estimated distribution of spending on clothing and footwear, 2016
SECTOR SIZE AND FORECAST 
Clothing specialists recovering
Figure 18: Germany: Specialist clothing retailers’ sales as % all spending on clothing, 2007-17
Figure 19: Germany: Specialist clothing retailers, sales (excl. VAT), 2012-17
Too early to forecast if the recovery will be sustained
Figure 20: Germany: Specialist clothing retailers, forecast sales (excl VAT), 2017-22
LEADING PLAYERS – WHAT YOU NEED TO KNOW
Young fashion retailers are growing
Older focussed retailers are often struggling
Price-led retailers also doing well
Fragmented market
Online is growing
LEADING PLAYERS
Figure 21: Germany: Leading clothing specialists, sales (excl Vat), 2014-16
Figure 22: Germany: Leading clothing specialists, Outlets, 2014-16
Figure 23: Germany: Leading clothing specialists, sales per outlet, 2014-16
MARKET SHARES 
Figure 24: Germany: Leading clothing retailers, Sales as % all spending on clothing and footwear, 2014-16
ONLINE
Shopping for clothing online
Figure 25: Europe: Proportion of people saying they have bought clothing or sports goods online in the last year, 2011-16
Online clothing market size
Leading online players
Figure 26: Germany: Online clothing sales of leading online clothing retailers (excl. Vat), 2014-16
Figure 27: Germany: Leading online pure players, Clothing sales as % all spending on clothing and footwear, 2014-16
THE CONSUMER – WHAT YOU NEED TO KNOW
Specialists losing out
Sales per customer lower online
Shops and home shopping used interchangeably
Shopper profiles
Younger shoppers use more outlets
Quality more important than fashion
Green attitudes
WHERE THEY SHOP
Figure 28: Germany: Where people shopped for clothes in the last 12 months, by type of retailer, September 2017
Figure 29: Germany: Where people shopped for clothes in the last 12 months, September 2017
Online growing
Figure 30: Germany: Proportion of shoppers at department stores, in-store and online, 2014, 2016, 2017
Figure 31: Germany: Proportion of online shoppers, 2014, 2016, 2017
Customer profiles by type of retailer
Figure 32: Germany: Profile of clothing shoppers by type of retailer, whether in-store or online, September 2017
Customer profiles by named retailers
Figure 33: Germany: Profile of clothing shoppers, by retailer, whether in-store or online, September 2017
Number of retailers used
Figure 34: Germany: Repertoire of where people shopped for clothes, whether in-store or online, September 2017
Figure 35: Germany: Profile of customers by number of clothing outlets used, whether in-store or online, September 2017
ATTITUDES TO SHOPPING FOR CLOTHES
Figure 36: Germany: Attitudes to shopping for clothes, September 2017
Figure 37: Germany: Profile of those who agree with attitude statements, September 2017
Attitudes by retailer
Figure 38: Germany: Attitudes to shopping for clothes, by people who shop at mass market multiples, September 2017
Figure 39: Germany: Attitudes to shopping for clothes, by people who shop at department stores (incl. P&C), September 2017
Figure 40: Germany: Attitudes to shopping for clothes, by people who shop at online pureplayers, September 2017
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Data sources
C&A
What we think
Restructuring aims to return company to growth by 2021
New European boss brought in to develop omnichannel
Company background
Company performance
Figure 41: C&A: Group sales performance, 2012/13-2016/17
Figure 42: C&A: Outlet data, 2012/13-2016/17
Figure 43: C&A (Europe): Outlets by country, October 2017
Retail offering
ESPRIT
What we think
Downsizing is happening but slowly
Time for menswear exit?
Online pause hopefully a temporary blip
Where now?
Company background
Company performance
Figure 44: Esprit Europe: Group financial performance, 2012/13-2016/17
Figure 45: Esprit Europe: Outlet data, 2012/13-2016/17
Retail offering
H&M HENNES & MAURITZ
What we think
Looking beyond fast fashion
A more seamless shopping experience
New designer collection aims to appeal to fashion conscious male shoppers
New loyalty scheme with exclusive offers and brand experiences
Focusing on offering sustainable finishing processes and eco-friendly materials
Company background
Company performance
Figure 46: H&M Hennes & Mauritz: Group financial performance, 2011/12-2015/16
Figure 47: H&M Hennes & Mauritz: Outlet data, 2011/12-2015/16
Retail offering
GRUPO INDITEX
What we think
Inditex retains strong position but must continue to innovate
Brand extensions
Figure 48: Stradivarius menswear collection, 2017
Figure 49: Pull&Bear beauty range, 2017
Digital innovations
Company background
Company performance
Figure 50: Grupo Inditex: Group financial performance, 2012/13-2016/17
Figure 51: Grupo Inditex: % share of sales, by retail brand, 2015/16-2016/17
Figure 52: Grupo Inditex: Sales and operating profit, by major retail brand, 2012/13-2016/17
Figure 53: Grupo Inditex: Outlet data, by region, at January 2017
Figure 54: Grupo Inditex: Store numbers, by retail brand, at January 2016 and January 2017
Figure 55: Grupo Inditex: Outlet data, 2012/13-2016/17
Retail offering
KIK
What we think
KiK17 store concept
Charles Vögele stores acquisition
Entering the US market in 2019
Bridging the gap between in-store and online shopping
Bolstering eco and social responsibility credentials
Company background
Company performance
Figure 56: KiK: Group sales performance, 2012-16
Figure 57: KiK: Outlet data, 2012-16
Retail offering
TJX INTERNATIONAL (TK MAXX EUROPE)
What we think
Room for growth
Attracting a broad demographic
Launching new loyalty scheme in the UK and Ireland
Company background
Company performance
Figure 58: TJX International (TK Maxx Europe): Group financial performance, 2012/13-2016/17
Figure 59: TJX International (TK Maxx Europe): Outlet data, 2012/13-2016/17
Retail offering
ZALANDO
What we think
Mobile is at the heart of the business
Prioritising delivery to drive customer loyalty
Geo-localised delivery being trialled
Moving from following to leading
Integrated commerce links up online and offline channels
Fulfilment service reaches out to brands
Company background
Company performance
Figure 60: Zalando: Group financial performance, 2012-16
Figure 61: Zalando: Key metrics, 2015-H1 2017
Retail offering