DEPARTMENT STORES STILL CAPTURING TEENS
Byline: Melanie Kletter
NEW YORK — While Hot Topic may have more pizzazz than Macy’s for today’s teens, young shoppers are not abandoning department stores.
At the same time, multiclassification labels such as Nautica, Tommy Hilfiger and Reebok have lost favor to newer, hipper brands, including Ecko Unlimited and Roxy.
Those are some of the findings in two research reports about teen shopping that came out recently from U.S. Bancorp Piper Jaffray and Banc of America Securities.
The results contain some surprising information. For example, while teens are considered to be casual dressers, athletic apparel is not as popular as it used to be for everyday wear, and dressier, more structured looks have gained popularity.
The department store finding is also notable since many industry observers often say that the big, traditional department stores are unappealing to teens.
“Our results indicate that in smaller markets and urban markets, department stores continue to be an important destination for apparel purchases,” said Jeffrey Klinefelter, the U.S. Bancorp Piper Jaffray analyst who conducted that survey. “While we believe this is partly due to a narrower offering of specialty stores, it could also point to a lasting ‘mind share’ for department stores. We also believe the department stores are important in urban markets due to the unique assortment of brands, many of which are only available in this channel.”
Overall, specialty stores remain the top channel preference at 50 percent, although department stores and discount stores also ranked high at 39 percent and 11 percent respectively.
Among the other findings from his report:
The top three favorite places for teens to shop are Gap, Abercrombie & Fitch and Limited Express.
Teens average monthly spending on apparel is about $110, and the average number of mall trips per month is 2.5.
Lifestyle brands are adding new categories such as beauty products, personal care and home accessories.
Teens prefer to shop for apparel during the summer season first, spring season second and back-to-school season third.
Price is important, and teens ranked product pricing nearly as high as they did fashion.
Parents contribute 50 percent of spending on teen apparel purchases, far lower than the widely accepted average of 70 percent.
Both studies note the important place that Gap has among teens. While the company has had its share of difficulties recently, and even announced it would close some of its New York stores, the company still has a firm hold on young shoppers.
“It is clear that the Gap brand remains ‘top of mind’ with teenage consumers, and we expect this to translate to an accelerating top-line growth for the company once its product assortments get back on track with trend-right and differentiated product,” Klinefelter noted.
Klinefelter’s study involved nine high schools in nine states and included about 300 teenagers in total. Generation Y, generally defined as the children of baby boomers who are between the ages of 10 and 24, are estimated at around 60 million, and are growing faster than the overall population, he said.
“We believe the Generation Y population is likely to change the landscape of fashion retailing during the next several years due to the delicate balance between value and trend that most teens seem to be walking,” the report states. “Generation Y is the largest demographic group since the baby boomers went through their teen years, and as such are wielding substantial clout throughout all of the retailing channels.”
Meanwhile, the Banc of America Securities report lists brands that are considered “hot” by participants in its recent focus groups. Among the most popular brands for teen girls are Limited Express, Rampage, Roxy, Theory and Sean John, the latter of which does not yet have women’s apparel. For women aged 19 to 25, the favorite brands are Express, Banana Republic, Kenneth Cole, BCBG, Theory, Laundry and Club Monaco.
This study involved three separate focus groups held in three cities: Los Angeles, New York and Chicago. Express remains “the hottest brand” for young women, the study notes.
“Young women consistently applaud the retailer for its consistently new styles, versatility and large product offering,” the report states.
However, young shoppers didn’t respond well to Limited’s plans to rename the Structure stores Express Men.
“Almost universally, men and women were opposed to the brand extending into the men’s category,” the report said. “Most felt the brand had been built upon the female customer and feminine styling and should remain that way.”