NEW YORK — Apparel brands are losing traction on the slippery slope of customer loyalty as consumers grow ever more demanding.
Indeed, adults rated apparel as the least satisfying among three dozen categories of products and services — less able to give them what they want than even perennial laggards such as airlines, long-distance providers, car rental companies, mobile phones and wireless providers.
“The sense is all [apparel] product is pretty good and I want it better,” observed Robert Passikoff, president of marketing consultant Brand Keys, which provided its annual fashion customer loyalty and fashion brand loyalty indexes exclusively to WWD. “The depth of the slide in the ability to satisfy people is due to consumers’ high expectations and brands’ lack of ability to differentiate. This contributes to an opening for the Wal-Marts and Targets of the world.”
Fashion players have slid to last as evaluated by consumers who indicated how satisfied they are with various brands in 36 business segments and, subsequently, how loyal they are to them. The findings are reflected in the annual fashion indexes, developed in the first quarter by Brand Keys, which determined apparel had lost ground. Apparel’s last-place finish this year compares with its standing as the fourth least-satisfying category last year among the three dozen products and services.
Shoppers are increasingly straying from one brand of clothing to another, rather than staying true to some favorites, mostly for reasons of price and, secondarily, style.
People reported they’re focusing more on well-priced clothing that’s easy to find than they were a year ago, a condition that is calling for brands to execute a tricky balancing act in offering value without reducing themselves to commodities.
At the same time, apparel customers are developing a bigger appetite for designs that are stylish and look great on them, tightening the squeeze on apparel players to keep providing more for less. Those rising expectations are built, in part, on consumers’ propensity to more carefully consider specific occasions for which they’ll use various articles of clothing they might purchase, observed Michael Silverstein, a senior vice president at Boston Consulting Group and author of “Treasure Hunt: Inside the Mind of the New Consumer.”
“People are very functional; people have become very demanding about the use of their apparel, which is why price is number one,” Silverstein said, citing his findings over the past three years in consumer research conducted for apparel companies.
People’s expectations of clothing brands to be reasonably priced and easy to find rose nine points in the Brand Keys Customer Loyalty Index this year, notching 189, versus 180 last year, and were up sharply from 155 in 2004. The clamor for looks that are stylish and flattering climbed five points to reach 157, up from 152 last year and 150 in 2004. The customer loyalty index, which reflects what drives people’s loyalty to various apparel brands, and the fashion loyalty index, which rates consumers’ subsequent attachment to specific brands, are both pegged to a baseline of 100. Each stems from the responses of 2,600 men and women, ages 18 to 60, from the country’s nine census regions, during the first quarter.
More broadly, consumers’ overall expectations of apparel rose by 3 percent this year and there was a 32 percent decline in the ability of apparel brands to satisfy them, resulting in a 35 percent gap between what people want from those fashion brands and what they’re getting. Those expectations are based on four loyalty drivers, which include quality materials/well constructed, fits well, price/availability and style.
The field of apparel brands doing a noteworthy job of satisfying customers was limited to seven players this year, as in 2005, Passikoff said in defining a group of labels indexing at 111 or higher this go-round. The list was led by Ralph Lauren, which indexed at 128, followed by Chanel at 125; Polo, 120; Nike, 119; Christian Dior, 118; Louis Vuitton, 113, and Perry Ellis, 111. Those assessments by consumers came against a backdrop of their overall expectations for apparel that indexed a considerably higher average of 157, up from 151 last year.
The remaining 35 of 41 clothing brands considered — brands that were named by the study participants themselves — fell shy of the 111 mark, bottoming out with Gap at 90; Teri Jon at 93; Elie Tahari and Levi’s, each at 94, and Marc Jacobs, Lacoste and Izod, each at 95.
Asked whether consumers are growing more demanding about price, among other things, a Prada spokesman said: “In the luxury arena, we don’t really compete on price. Consumers mix more than they did 10 years ago — wearing Levi’s jeans with a Prada shirt — but we don’t compete with the Zaras of the world.
“We listen to our customers on a daily basis,” Galli noted. “Generally, the most important thing for luxury is quality of products, quality of design and quality of service.” Prada indexed 100 in the fashion loyalty index.
Other apparel brands contacted by WWD, including Christian Dior, Louis Vuitton and Gap, declined comment, while officials at Nike and Chanel were unavailable.
The gap between people’s expectations of and satisfaction with apparel brands at 35 percent stands significantly wider than the next four business segments least able to give people what they want: airlines, with a divide of 22 percent; long-distance providers, 21 percent; car rental companies, 20 percent; mobile phones, 19 percent, and wireless providers, 18 percent.
With the proliferation of apparel offering a good value — and at widely ranging prices — it’s growing more difficult for shoppers to decide how much a particular piece of clothing is worth to them, contended Marshal Cohen, chief industry analyst at NPD Group. As a result, Cohen noted, shopping for apparel can be a frustrating experience, “unless [people] have a good idea of what they want and where to go to get it.”
It’s not so easy anymore for people to tell the difference, he said, between “designer jeans at $200 and product that looks unbelievably the same at Target for $29.99.”