NEW YORK — Teenagers can give grown-ups fits, and this fall the kids are being especially recalcitrant toward their elders in the apparel business. According to the latest iteration of the “Taking Stock With Teens” study, conducted by Minneapolis-based investment firm Piper Jaffray, young men are spending less on fashion now than they have at any point in the last seven years, with the average male respondent copping to a measly $692 in fashion expenditures for fall 2007. Piper Jaffray’s analyst team blames a maturing product cycle, but points to strength among West Coast brands as a bright spot in its male-specific data.
The fall ’07 study is the firm’s 14th consecutive semiannual assessment of teen spending, and it indicates that teens of both genders are generally less willing to splurge on fashion (consisting of apparel, accessories and footwear). The $692 spending figure for young men is, so far, the nadir of a downturn in seasonal spending, which four years ago was significantly higher, at $1,534 per male high-school student. (The average age of teens surveyed was 16.6 years.) The analysts emphasize that their sample is a relatively affluent one, consisting of mostly suburban teens whose average household income is over $70,000 per year.
Senior research analyst Jeffrey P. Klinefelter, who heads the Piper Jaffray study team, says young men in affluent households are satiated, or “full on fashion.” He adds that the jeans cycle that started in 2003 has peaked, and no strong apparel trend has emerged as a substitute to drive wardrobe replacement purchases at retail.
“We’re in a transitional period, because young men have been buying distressed denim and premium denim for the last three years,” he explains. Besides that, trend-savvy teens spend less money during transitional fashion periods, the last of which Klinefelter said spanned from 2001 to 2003.
In addition to reported spending, the study also polled young consumers with respect to their retail and wholesale brand preferences. Young men’s preferences are more concentrated than ever, Piper Jaffray says, with the cluster of West Coast brands, American Eagle Outfitters and Hollister together commanding the highest preference of 47 percent of male respondents. (Piper Jaffray analysts amalgamate West Coast–themed retailers like PacSun and Zumiez with the brands they sell, including Volcom and Quiksilver, because the team has observed a conflation between the retailers and the wholesale brands in the minds of consumers.)
“The West Coast brands are doing well, even in an environment where teens are spending less,” Klinefelter says. He attributes the category’s performance to three factors: an increased number of labels; expansion of PacSun and Zumiez, the two major retailers of West Coast brands; and the “cumulative effects of years of exposure to media content highlighting individual action sport athletes,” like pro snowboarder Shaun White and surfing champion Kelly Slater. In other words, “kids are going to skate parks more than baseball diamonds,” Klinefelter notes.
Faring less well with upscale teen male shoppers are hip-hop and urban labels and the retailers who sell them, according to the study. The nation’s largest mall-based purveyor of urban fashion, Pacific Sunwear’s demo division, hasn’t appeared in the top 10 brands preferred by polled teens since spring of 2006. Piper Jaffray’s report goes so far as to suggest that demo’s parent company will likely close or divest the chain, which has been dogged by negative monthly same-store sales for more than a year.
“That prediction echoes what Pacific Sunwear management has stated publicly,” Klinefelter says, adding that the situation is reflective of hip-hop brands’ fall from the good graces of suburban teens. “And we really don’t see any emerging trends that would play into the demo concept,” he concedes.
Another glaring absence from teens’ top 10 lists is Gap, which ranked seventh with male shoppers just six months ago. Now the vertical retailer has all but vanished from young shoppers’ minds, Klinefelter’s team notes. “To be fair, Gap Inc. management has said it is moving the Gap concept to an older demographic, but with their large retail footprint they still need to attract some teen dollars,” he warns.
Across genders, the report indicates a major difference between young men and juniors in terms of their interest in so-called “fast fashion” concepts. Young women rated stores like Charlotte Russe, Wet Seal and Forever 21 among their top 10 preferred brands, while no comparable stores rated with males. The reason, Klinefelter says, is because there is no analogous demand among young men, nor are there stores supplying male fast fashion in volume.
“It’s really a function of availability,” he says. “Fast fashion concepts are almost entirely mono-gender, focused on juniors. The international players have men’s, of course, and Forever 21 is experimenting with dual-gender options, so young men are starting to be exposed to that category. But the bottom line is that women shop far more frequently for apparel—at least twice as often—and spend 2 1/2 times as much money on it.”
Fast or not, fashion is not generally appealing to tastemaking young men with disposable income, the report would seem to indicate. Teen males have declared that they’re spending 9 percent less than last season, and 14 percent less than one year ago. Only spring 2008 can bring the answer to the question of whether they’re willing to spend even less.