Fashion marketplaces: growth driver & impact of COVID-19

CBCommerce1 forecasts that fashion sales in Europe will grow to a value of €525bn by 2025 from the figure of €475bn in 2021. This includes apparel (including casualwear but excluding specific sports clothing), accessories and footwear.

One of the factors is the increasing exposure customers have to digital purchases. Buying from Zalando or ASOS is quick and easy. Most people have a smartphone and can purchase online fashion and accessories in seconds.

Whilst the damaging effect of COVID on retail sales initially caused a slowdown in purchases due to uncertainty, when people were in lockdown and unable to visit their favourite fashion stores in person, they soon realised ordering online was the solution.

Whilst consumers didn’t need to dress up to go out to restaurants and leisure events, they still wanted to look good while at home by lounging in a cosy dress or wearing the latest sportswear, which is why casualwear saw growth. This is reflected in the womenswear sector of the casualwear market, which showed a revenue of $170.6bn USD in 2020, amounting to 52.6% of the total market value.2

This convenient way to shop continued when life returned to ‘normal’ as consumers realised the convenience of online fashion shopping.

The disruptions experienced by the industry due to a shortage of raw materials, increased transport costs and logistical problems have been a challenge for the fashion industry. According to a survey by McKinsey, 84% of executives are addressing this as a priority.3

The reality is that smaller businesses are likely to have to increase costs unrealistically to combat the supply chain problems. Selling on a marketplace shares the responsibility of this issue.