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Mid season sales: The Fall 2013 tactics

A late summer is being blamed for poor sales of Fall collections. We investigate the sales tactics of apparel retailers looking to lure consumer spend on knitwear & outerwear.
Mid season sales: The Fall 2013 tactics | EDITED
  • New Look newsletter 1st October 2013 - EDITD
  • Market-Inight-Discounting-0ct-2013-EDITD
  • Whistles 9th October 2013 - EDITD
  • Matalan homepage update - EDITD
  • Kohls newsletter 22nd October 2013 - EDITD
  • Saks newsletter 3rd October 2013 - EDITD

Following a bumpy start to summer in the Northern Hemisphere, retailers were tested again in September, with an unexpectedly long reign of good weather detracting attention from their Fall deliveries. Matalan, Topshop and Marks & Spencer all posted concerns about their apparel sales in the start to the new season.

Increasingly, retailers are having to contend with the growing practice of buying for the moment and unpredictable seasons. Real-time data indicates how retailers can and have become more responsive to these things, reducing the risk when making in-season decisions. Here we reveal how retailers are dealing with that uncertainty with mid-season sales and promotions.

Level of discounting across segments

News headlines suggest that the womenswear segment is the most at threat from unseasonal weather and we’re well aware its customer is discount savvy. The current market reflects this; 29.2% of womenswear available online today is reduced. It is the segment with the highest number of products reduced by more than 50%, at 7.8% of all online products. The bulk of price drops on current products occurred on the 9th October for womenswear, but there had also been a glut of reductions on the 26th September.

As fickle as the womenswear market appears, childrenswear in fact has a far higher level of discounting at 38.5% of current kids products reduced, showing that it too is subjected to pressure during unseasonal weather. Childrenswear reductions kicked in early, with the biggest spike in reductions being on the 1st October.

Menswear is a marginally safer segment, with the lowest level of discounting, and lowest rate of reductions over 50%. It also has the highest restock rate, at 16.9% of products returning to shelves following sell out. That is reflected in the later reductions, with 10th, 11th and 12th October all being big days for reductions.

Who is doing what?

Drilling into the commercial data reveals which retailers are putting out the most discounts. At present, the top five discounters, with reductions of 50% or more are Kohls, ASOS, Saks Fifth Avenue, Debenhams and House of Fraser, all of which are multi-brand retailers, demonstrating the flexibility such retailers have with product price points (and often at the detriment of the brand).

Kohls, who have the largest number of reductions over 50%, have sent out 18 email newsletters promoting their sales so far this month, beginning on the 1st October. The bulk of their reductions kicked in on the 8th October and their constant stream of communications seems to be working: 63% of products which have sold out in the past week were from sales stock.

ASOS, the second largest discounter, have 38.9% of their offering on discount, 11.3% of which is over 50% reduced. The 7th October was their largest day of discounting this season and was also when the retailer sent out their 50% sale newsletter to subscribers. They’ve sent out 8 emails promoting their sale since the start of October, which has no doubt contributed to 59% of those products that went out of stock in the past week being reduced lines. Full priced sell outs in the last week are encouraging however, suggesting that consumers are now beginning to invest in wintery items now that the weather has changed; knits and cardigans, biker jackets and long-sleeved dresses have all sold out in the past week.

Saks Fifth Avenue is the retailer with the 3rd highest selection of products reduced by 50% and over. Due to the breadth of their offering, they actually have a relatively low ratio of reduced product to full priced product, at a healthy 13.9% being discounted. They discounted 7.5% of their entire offering on the 1st October this year, and have promoted modestly, with one very visual sales newsletter on the 3rd October, and not mentioning the sale overtly in their communications until the 20th October. It’s a classy approach from the US retailer, and one which resonates with their higher-end consumer; 66% of products that have sold out in the past week were full priced.

What is selling?

Outerwear will naturally be the hardest hit of seasonal products. At mass and value price points (here set to a maximum of £80), 27.6% of outerwear that arrived online in the last three months (representing Fall stock) is reduced, which massively outweighs the 12.4% of premium outerwear (£150-400) and 4.8% of luxury (£500+). The mass market’s offering better reflects the weather more than any other market, with biker jackets, blazers and parkas all selling successfully compared to premium’s activewear puffer jackets and performance fabrics and the luxury sector’s offering of furs, oversized padded coats, leather and longer length winter coats.

Knitwear has struggled less, with only 21% of the mass market Fall 2013 stock currently reduced, and a restock level of 8.3%, compared to outerwear’s 6.9%. The mass market knit consumer is more conservative than the luxury knit shopper; successful value lines have included cable knits in single shades, no-fastening cardigans and striped knitwear. The luxury market has seen a faster uptake on Fall 2013 knitwear trends, with diverse textures, slogan sweaters, bold print and embellishment all selling well so far.

Reactive retailers have successfully built simple ways to merchandise their offering to suit the moment. A simple way to do this online is to have several images on the homepage, with a scroll function or carousel. Topshop’s site design allows them to promote print, outerwear, a celebrity collaboration and the sale stock at any one time. They also use clever styling tricks in their shoots in order to keep their offering trans-seasonal: a homepage update on the 22nd September did feature outerwear, but styled with sunglasses. Since the 12th October, outerwear has been styled with gloves and hats. With full priced coats, cardigans and long-sleeved bodycon dresses all present in the past week’s sell outs for Topshop, it looks like their Fall 2013 is off to a bouyant, if a little late, start!