Retailers must remember that while competitive pricing is important, remaining focused on their core offering and target market is essential.
It has been revealed that Asda’s clothing label, George, had an 11.1% share of the clothing market in the 24 weeks to July 6. This latest set of results means that George has overtaken Marks & Spencer (M&S) to become the second largest British fashion retailer by volume, with Primark still generating the most clothing sales in the UK.
Some have argued that this is merely a seasonal trend. In the summer months, value retailers such as Primark and George gain market share as consumers stock up on cheaper items such as strappy tops as well as back-to-school goods. Asda’s George is well known for offering good quality back-to-school items - as well as the every day basics - at an affordable price. On the other hand, in the winter, retailers such as M&S tend to outperform the rest, with coats and knitwear in greater demand.
Others have argued that this is not a seasonal blip, however, and that the retail market is undergoing a wider structural change towards value. Indeed, this trend is evident in the rapid growth of value supermarkets. Grocers such as Aldi and Lidl have been gaining market share in recent months, with consumers opting for these less expensive retailers – and sparking a price war amongst the supermarkets as a result. A similar trend could soon be on its way for clothing retailers.
Retailers must be careful about a price war in the fashion sector, however. The grocery sector has taken a hit with the price war hindering the retail sector’s recovery. While offering a competitive price is important, retailers must remember to stay focused on their core offering and target market. Competition is always healthy, but successful retailers should be focusing on their own strategy by looking at the areas in which their particular business needs to focus and grow and adapting their offering to meet current market dynamics.
- Dan Coen, Director, Zolfo Cooper