The 2020/early 2021 pandemic has led to a revolutionary adjustment in consumers around the world buying clothes, as store/mall closures and restrictions on grocery shopping forced clothing consumers to embrace e-commerce at a point never before noticed, according to a new report from Trendex North America, a consulting and marketing research firm.
The 2022 Canada Apparel E-Commerce Report shows that global apparel e-commerce grew by 15% in 2021 to $759. 5 billion, while in the United States, apparel e-commerce grew 21. 8% to $181 billion.
“Canada’s apparel e-commerce expansion in 2021 slowed as malls/stores began reopening the last component of the current quarter of 2021. After growing 108% in 2020 despite a 26% decline, 4% of overall clothing sales, this has not been the case. It’s surprising that ecommerce apparel sales fell 10. 7% in 2021. Last year, e-commerce apparel sales in Canada totaled C$7300 million and accounted for 26. 3% of all clothing sales. All early symptoms suggest that clothing e-commerce growth in Canada will slow further in 2022, but thereafter clothing e-commerce sales will again have positive growth.
But the report warns that the advantages gained from the expansion will not be shared equally, but will gain advantages from a small organization of stores that “has gone out of its way” when it comes to investing in its e-commerce capabilities.
Randy Harris, president and owner of Trfinishex North America, said apparel e-commerce followed a four-step procedure. The first stage, before COVID, from 2015 to 2019, saw an industry expansion of around 10-13% each year. The Quebec market was underdeveloped and towards the end of the season, Shopify partnered with the Canadian government to help small shops enter the ecommerce market, which helped Quebec stores.
Then we move on to the stage of the moment, COVID, 2020-2021 with an astronomical expansion in the first year. It went up to 108%.
“The explanation for the expansion is obvious. The department stores were closed and the customer had no choice and if he wanted to earn something, he had to do e-commerce. The following year, especially when things started to open up in the current part of the year, the expansion rate of clothing e-commerce particularly slowed down and in fact, for the total of 2021, the clothing e-commerce industry fell 10. 7% and that after an expansion of 108%.
We are now in phase three, which Harris calls the return to normalcy, which will run from this year until 2025 with an expected expansion of 6-8% during that era each year. Digital marketing will become increasingly vital and the focus will be on profitability and not sales.
“The most attractive component of our forecast is phase 4 that I call maturation/consolidation and which will start in 2026 and what we’re going to see is that the customer at that point will be so overwhelmed with potential options that they go to Take a look at the markets to simplify their grocery shopping or buy directly from a supplier like Nike instead of going to The Bay and looking for the Nike product at your site or we’re going to see an expansion of niche products, niche stores like Knix, the underwear retailer. Harris said.
“At that point, what we’re going to see is real turmoil in the apparel e-commerce market and there will be consolidations, bankruptcies. All kinds of things will happen. Ultimately, an emerging tide, meaning the expansion of e-commerce may not rise. “all ships until 2026 or 2027. There will be consolidation. There will be bankruptcies. There will be other people who will step back. I think that’s a non-Pollyanna attitude towards clothing e-commerce. He still likes to move into shops. »
Harris said her long-term fear is that a number of Canadian stores may not be able to stay active and play in this market. They don’t have the investment capital to upgrade their sites. Unless you have a lot of money, you may not be able to keep up with this market.
He said overall e-commerce figures are skewed across players like Amazon and Walmart dominating the market.
“They have knowledge. So other people think of them first. In the long run, smaller players may not be able to keep up with the speed and amount of money that other people like Canadian Tire and Walmart, and even stores like Aritzia, are investing in e-commerce, are driving the market,” he said. “In the report, I mention that 15 stores in Canada will be the driving force of the apparel e-commerce market and all others necessarily fight for crumbs. “