E-commerce is looking more and more like the tool men needed to improve upon their fashion game.
This story first appeared in the March 12, 2015 issue of WWD. Subscribe Today.
The ability to both keep up with fashion online and buy it without having to scour through stores and malls — or even wander far from home or work to return it — has helped propel men’s wear to one of the fastest-growing categories in online shopping. For fashionistas and couch potatoes alike, it’s addressed male consumers’ needs and wants.
In a study by research firm IBISWorld of 15 product categories — including men’s and footwear but not women’s or children’s wear — no sector showed greater growth in online sales over the last five years, or was expected to show faster expansion in the next five, than men’s.
Coming off a 17.4 percent compound annual growth rate between 2009 and 2014, raising online men’s wear sales to $9.6 billion last year, e-commerce men’s wear is expected to grow at a 14.2 percent clip in the next five years. Those figures compare with a 2.8 percent expansion of in-store men’s sales leading up to 2014 and projected growth of 3.3 percent a year in brick-and-mortar men’s wear sales for the rest of the decade.
Groceries, a category with less penetration than apparel, had both the second-highest CAGR (16.7 percent) and second-highest projected CAGR (12.2 percent), followed by shoes, a category that grew online at an annual rate of 13.6 percent and is projected to expand at an 8.3 percent clip in the five years ahead. While a more sensitive fit proposition than apparel, footwear has benefited from many of the same policies that have helped apparel in general and men’s wear in particular.
Will McKitterick, retail industry analyst at IBISWorld, noted that the penetration of grocery sales online remains lower than e-commerce’s overall penetration of about 7 percent of total U.S. retail sales, while apparel’s is comfortably above that level, close to 16 percent, according to estimates.
“Apparel really has moved to the head of the pack online,” McKitterick said. “Customers have warmed up to it, in part because, just as with shoes, retailers have removed a lot of the obstacles to it by doing things like offering free delivery and returns without either a fee or any questions.”
In men’s, the appeal in some ways is even greater than for apparel in general.
“In men’s, much of the sizing is small-medium-large, which leaves less room for fit or sizing problems,” he said. “It might not be like sunglasses or handbags, but it’s easier to handle than with women’s jeans, dresses or skirts.”
Fittingly, so to speak, men’s shirts have the greatest share of online men’s wear sales, generating 28.4 percent of men’s wear’s take, with just about one-fifth of that amount coming from dress shirts, which entail neck and sleeve sizing.
Casual slacks, jeans and shorts are next with 24.3 percent of sales, followed closely by activewear at 14.6 percent and accessories and other items at 14.4 percent. Blazers and outerwear account for 7.3 percent, sweaters and related items such as hoodies 6 percent and the items posing the biggest fit challenges and requiring the greatest amount of tailoring attention, suits and formalwear, the remaining 6 percent.
Rapid growth online has helped to lift men’s wear’s growth rates above those of women’s in recent years, although women’s continues to outsell men’s in dollars terms by nearly a two-to-one margin. The NPD Group in Port Washington, N.Y., reported that in 2013, the last calendar year for which figures are available, retail sales of men’s wear grew 5.2 percent to $60.8 billion while women’s wear advanced at a slower 3.7 percent pace to $116.4 billion in retail sales. NPD’s research showed a 19 percent growth rate for online men’s wear purchases in 2013, to about $8.5 billion or 14 percent of total sales in the category.
The Department of Commerce estimated that overall e-commerce sales last year increased 15.4 percent, plus or minus 2.3 percent, to $304.9 billion, accounting for 6.5 percent of total sales, up from 5.8 percent in 2013. Ten years ago, that figure was about 2.4 percent. (Revised figures for last year are due out in May.)
But Christian Lunoe, payment practices leader at ComScore, which now monitors e-commerce activity on both computers and mobile devices, noted that apparel and accessories grew far more rapidly than online sales overall last year and were the third fastest-growing category in the retailing world.
“Growth was about 20 percent versus 14 percent for retailing overall,” he said. “Those categories overindex in general and are among the highest total spend categories in digital, too. And we expect them to continue to overindex.
“Apparel came out of the gate strongly and quickly became one of the top categories in overall spend,” Lunoe continued. “Retailers have helped — companies like Amazon have provided return policies that you don’t necessarily see in other categories.”
IBISWorld’s McKitterick sees men’s wear and online buying as sharing something of a common heritage.
“If you think about it, men’s wear really started making its move around the same time e-commerce did, in the years just before the recession,” he said. “It’s sort of like they grew up together.”