Fashion brands are experiencing a dip in online sales owing to the onset of the novel coronavirus (COVID-19) era. E-commerce sales of essential goods such as food and personal care products are gauging an uptick as consumers fear the exposure to the novel virus, while the online apparel market bleeds due to dropping online sales.
Sales Drop Owing to Unfavorable Consumer Sentiment amid Pandemic
Retail therapy seems to have taken a backseat due to the tough times ahead of the Coronavirus outbreak. Companies in the online apparel market are suffering heavy losses due to poor consumer sentiment. Right from fashion brands dealing in jeans to shoe companies, it has been found that online apparel sales are taking a beating due to the COVID-19 pandemic. This is because the world economy is experiencing a recession period due to lack of free revenue flow. Poor consumer sentiment against online apparels stems with the need to buy only immediate and important items amidst the lockdown period.
Inadequate Manpower Creates Ambiguity in Meeting Demand Surge amidst Coronavirus Outbreak
International fashion brands such as Benetton, who are heavily dependent on online apparel sales are predicting that market situations could plummet if the Coronavirus outbreak fails to subside. Governments in India are relaxing COVID-19 regulations in non-hotspot zones — an opportunity that companies in the online apparel market can capitalize on. However, restrictions in transport services are likely to delay deliveries for customers. Moreover, prime cities such as Mumbai, Delhi, Chennai and Hyderabad amongst others, who contribute a large share in online apparel sales in India, fall under the virus hotspot zones.
Manpower is another major concern that has slowed down growth of the online apparel market in India. Self-isolation and social distancing norms have become far stricter as the number of COVID-19 patients surge in India. Most delivery personnel are practicing self-isolation and social distancing, thus resulting in inadequacy of workers to manage warehouses. This is evident since more than 50% of the manpower in China took over a month to come back to work.
Will Online Apparel Sales Surge Post Lockdown?
Unique challenges such as huge wage inflation demands for meeting health and safety protocols are becoming troublesome for companies in the online apparel market. However, fashion brand stakeholders such as Siddharth Bindra, MD of BIBA India, are leveraging the opportunity through online apparel sales, as the brand’s brick-and-mortar stores are not generating any revenue due to the nationwide lockdown period. Positive indications from the manpower domain are reassuring certain level of revenue flow as most delivery personnel are sole earners in middle class and below middle class families in India.
Companies in the India online apparel market are breathing the air of new hope as many individuals place orders for non-essential items post Lockdown 3.0. However, inadequacy of manpower poses as a hurdle for brands in the online apparel market. Online apparel companies are now being permitted to circulate deliveries in orange and green zones of the country.
Circular Online Apparel Trend Gives Rise to Digital Hubs Sharing Industry-wide Knowledge
The concept of circular apparel is increasingly grabbing the attention of customers. For instance, in July 2019, Intellecap — a global pioneer in taking an entrepreneurship-based approach towards development, announced the launch of their online platform CircularApparel.co, to establish a sustainable ecosystem for sourcing circular textile and apparel innovations in India. Such novel initiatives are bolstering the credibility of stakeholders in the online apparel industry. Since the fashion industry is one of the top most polluting industry in the world, bringing environment and sustainability in the picture is helping to reduce the carbon footprint.
Sustainability and circular economy initiatives are helping brands in the online apparel industry to collaborate with like-minded entrepreneurs who are willing to innovate through circular fashion. Novel digital platforms are leveraging the business of the circular online apparel market with a list of curated innovators who have earned a significant presence in the global market landscape. Such digital hubs are helping brand owners to stay upbeat with the latest on goings and events associated with the sustainable online apparel industry.
AI-applied Fashion Innovations to Strengthen Supply Chains and Deliver Enhanced Customer Experience
Acquisitions and brand partnerships are becoming increasingly commonplace in the multi-billion-dollar online apparel market. Moreover, AI (Artificial Intelligence) is virtually penetrating in almost all industries, including the online apparel sector. AI-enabled shopping apps are helping customers to make the right choices when it comes to fashion, thus allowing its customers to take screenshots of clothes they see online. E-commerce giants such as Amazon and Walmart are using machine learning (ML) algorithms to analyze sales trends and understand the various dynamics of the online apparel market.
Online personal styling service provider Stitch Fix has also kept AI-applied fashion at its forefront to offer improved customer experience. Also, companies in the online apparel market are using ML algorithms to make supply chains more efficient.
Tech Innovations Increase Sales and Decrease Return Rates for Online Apparels
Tech innovations are redefining the online apparel space. Personalization and prediction are becoming the key focus points for companies in the online apparel market. For instance, Virtusize — an online fashion expert, is capitalizing on the trend of prediction and personalization by suggesting the right size of online apparels for buyers by allowing shoppers to measure their clothes kept in the closet with the help of intuitive AI algorithms. As such, there is a growing demand for exact-fit clothing, especially in the online apparel sector.
Tech companies are increasing their R&D efforts by innovating in AI algorithms that help to eliminate the uncertainty associated with clothing size for online shoppers. Such innovations are benefitting the business of online apparels, resulting in increased uptake of clothes and decreased return rates. A lot of mobile apps today help online buyers to identify different materials. AI and data capabilities are helping brands to identify customer’s shopping behavior and preferences. Moreover, the influx of social media and fast fashion models such as e-commerce platforms are generating incremental opportunities for brand owners.
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Regional analysis for Online Apparel Market includes
With the growing uncertainties in the COVID-19 pandemic, the online apparel market is witnessing a depression in the growth. The poor consumer sentiment led by the fear of contagion of corona virus is anticipated to create huge losses in the market. The increment in the lockdown period and travel restriction is drooping the sales of different online retails. However, the relaxation in certain regions on transport is supposed to be a huge relief for the e-commerce sector as the consumers are expected to prefer online orders over the physical stores.
The market is progressing towards creating a circular economy to introduce sustainability in fashion. Online platforms such as CircularAppral.co are built upon a circular ecosystem that includes circular textile and apparel.
The participation of technology companies is reviving the market with concepts such as an Artificial intelligence algorithm, of which virtualize, an online fashion expert is an evident example. AI-enabled shopping apps are experiencing high popularity amongst the demographics in making the right fashion choices. Many e-commerce giants including Walmart and Amazon are leveraging Machine Learning to analyze and understand different market dynamics such as sales trends to stay ahead in the competition. Moreover, these advanced technologies are sought by the companies to make their supply chain more effective and to improve their user experience.