By  on June 30, 2008

The dwindling economy has yet to stifle the demand for casualwear.

Gas and food prices have skyrocketed and the real estate market is suffering, but Americans are still purchasing casual apparel, based on the 85 percent of those surveyed who said they bought this category of clothes in the past year. It represents a 2 percent gain from 2007.

Consistent with last year's report, casualwear is the apparel category that the greatest percentage of people said they bought and remains 12 points ahead of denim, which also experienced a growth of two points (to 73 percent from 71 percent) in this year's survey.

Despite the small boost in this sector, the weak economy is still a major factor determining where shoppers are buying their weekend duds. Discounters saw the greatest growth in the category, up two points from 2007 and gaining ground on department stores, where just over one-third of those surveyed said they shopped most often for weekend wear.

Specialty stores fell behind, down two points to 15 percent, as shoppers may be sacrificing the on-floor customer service at stores like Old Navy in favor of reduced prices at discounters.

Internet/catalogues remained unchanged at 13 percent. However, mail-order shopping could see big changes in the near future. Although shipping prices may be augmented due to rising gas prices, this may become a valuable option for customers who don't want to drive to stores. In addition, many online retailers are offering incentives like free shipping to draw shoppers.

Wal-Mart led the pack once again as the store shopped most regularly, with 30 percent, as well as the retailer shopped most often for the category, with 16 percent. Both marks were up slightly from last year.

Kohl's came in second for both questions, showing a 2 percent gain among customers' regular shopping destinations to 29 percent, and holding steady at 14 percent saying it was the one store shopped most often for casualwear.

Target picked up three points to 24 percent among stores shopped most frequently, followed by J.C. Penney, which lost a point to 23 percent.

Target gained 2 percent from last year as the store most often shopped, to 10 percent, and Penney's held steady at 8 percent.This coming season, Penney's plans an aggressive marketing campaign for back-to-school, hoping to maintain its position as the nation's biggest market share in junior denim, a statistic Penney quoted from The NPD Group, the Port Washington, N.Y., market research firm.

As reported, Penney's Myron E. "Mike" Ullman 3rd, chairman and chief executive, said last week, "We feel good about our offers, good about our marketing and our pricing proposition....We're well prepared. It's the time of the year when Mom has to shop. Most kids need new clothes for back-to-school."

Its juniors category has been doing well, and the company is launching Decree and Kimora Lee Simmons' Fabulosity junior lines for the season.

Macy's saw no survey growth in 2008, landing with 14 percent behind Old Navy, which tacked on one point to 15 percent this year.

Wal-Mart avoided the drastic nine-point plummet it took last year while recuperating from its 2006 fashion fumble with hipper clothes that didn't meet its customers' needs. Today, the Bentonville, Ark.-based giant is on the rebound and has a new strategy to refocus its apparel on mainstream value, specifically zeroing in on the under-$10 price point.

One new collaboration for the world's biggest retailer is with Norma Kamali, who is set to release an exclusive lifestyle brand for Wal-Mart, including a women's line she believes will be rife with fashion essentials.

Kohl's closely trailed Wal-Mart in both categories and despite lowered earnings in the first quarter has seen steady growth in the survey over the past two years. The moderate-priced department store, however, is reacting to the harsh retail environment by slowing its store expansion. In recent years Kohl's has opened 95 to 100 stores annually but will add only 75 new locations this year, reaching the 1,000-store mark by the end of 2008.

The Menomonee Falls, Wis.-based company prides itself on its development of exclusive merchandise. Recent deals include a junior lifestyle brand by Avril Lavigne. Sold exclusively at Kohl's, the brand hopes to keep customers interested by updating the collection with new styles every 60 days. Additionally, Hang Ten struck a deal for Kohl's to be its exclusive U.S. retailer, which, according to Kevin Mansell, president of Kohl's Corp., will improve the store's position in the sportswear category when it launches in 2009.Target's growth may be the result of over 80 new store openings since fall 2007 and its successful collaborations with several big names in the food, fashion and home industries. Yet, Target's point increase does not reflect the worrisome headlines surrounding the store that preaches, "Expect more, pay less." With the departure of longtime collaborator Isaac Mizrahi, the retailer is under tremendous pressure to replace what analysts are estimating to be $300 million to $500 million in lost revenue. Mizrahi's line did about $300 million at the discounter, but analysts estimate customers bought another $100 million to $200 million in other merchandise while shopping in the store. This is a difficult task given that Mizrahi not only generated significant sales, but also helped define a large part of the women's apparel. Criticized for a lack of focus in women's fashions combined with a public perception of being higher-priced than rival Wal-Mart, Target is working to revive its identity and appeal to customers.

Recent efforts included a quick stint with Barneys New York, which sold the Rogan for Target line in May, as well as announcing plans to introduce new beauty sections that will feature affordable cosmetics from up-and-coming makeup artists. Additionally, Target is now paying closer attention to its Go International label, which recently launched its own private collection that will be in stores between the label's guest designers.

Times are tough for these national stores, yet there are still strong efforts to bring new, innovative and, most importantly, wallet-friendly casualwear to the customer.

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