New Delhi, June 11, 2021: Unicommerce, India’s largest e-commerce focused supply-chain SaaS technology platform, has released a report focused on the online fashion industry.
“Fashion E-commerce Report” covers insightful data-driven trends related to the fashion market mix, western & ethnic wear, and casual & formal wear. The report also reports the impact of new trends such as D2C and omnichannel shaping the growth of the online fashion industry. The report analyses fashion trends for the period of FY-2021 and FY-2020 with a sample size of over 70 million orders.
The fashion industry has always been the early adopter of technology, which has helped the industry stay ahead of the curve. The online fashion industry continues to grow upwards with order volume growth of 51% and GMV (Gross Merchant value) growth of 45% in FY-21 as compared to the previous financial year. The faster volume growth as compared to GMV has led to a marginal decline of 4% in the average order value.
Fashion labels have been at the forefront of re-inventing, re-strategizing, and re-aligning themselves to rapidly evolving business environments and changing consumer needs. The industry has also observed multiple retail brands establishing their niche in the e-commerce industry.
Key trends from the Fashion e-commerce Report
Brand websites driving fashion growth
The fashion industry is setting new benchmarks of innovation in the e-commerce industry. The rising adoption of D2C amongst fashion brands has helped them build a strong connect with the consumer leading to higher growth. The brand websites have reported 66% order volume growth and 77% GMV growth in FY-2021 as compared to the previous financial year. The strong order volume growth supported with higher GMV growth has led to a 6% increase in average order value. As compared to websites, marketplaces have reported 45% order volume growth and 33% GMV growth, with an 8% decline in the average order value for FY-2021. This strongly reinforces that the fashion brands are investing aggressively to build a stronger D2C presence.
Rising demand from Tier II and Tier III+ cities
The fashion segment is often the first encounter for consumers with e-commerce in Tier-II and Tier-III cities of India. The trend of shopping fashion online is getting prominent in Tier-II and Tier-III cities, with 118% order volume growth coming from Tier-II cities and Tier-III+ cities driving 192% order volume growth.
Omnichannel gaining momentum
In the last year, the fashion segment embarked upon the omnichannel journey, with an increasing number of fashion brands integrating their offline and online stores. Companies are now fulfilling 20-25% of their omnichannel orders from the store, indicating increased adoption of omnichannel across the majority of brand stores. While the majority of omnichannel orders (55-60%) are still being generated from the website, the marketplaces have grown omnipresence significantly in the last 15-18 months from being a negligible contributor last year to now contributing 40-45% of overall omnichannel orders. Interestingly, the fashion-focused marketplaces are the first ones to embrace omnichannel solutions and the other prominent marketplaces are now also adopting an omnichannel solution
Women wear dominate online fashion & Kidswear the biggest gainer
Women wear holds the majority share of the e-commerce fashion market with a 50% market share in FY-2021 and reported 30% order volume growth in FY-2021 as compared to the previous financial year. On the other hand, the kids wear segment took the industry by surprise with over 200% order volume growth and the market share significantly increased from 3% in FY-2020 to 17% in FY-2021. The menswear segment maintained consistent growth with 37% order volume growth and 33% market share in FY-2021.
Western versus ethnic
Western wear segment is growing rapidly 57% order volume growth in FY-2021 compared to the previous financial year, and it accounted for 65% market share in FY-2021. Interestingly, the men's apparel segment is the biggest contributor to the overall western wear segment and it accounted for 55% market share of overall western wear in FY-2021 and reported 40% order volume growth. The kid’s western wear segment reported a sharp order volume growth of over 300% and its market share increased from 3% in FY-2020 to 28% in FY-2021.
On the other hand, the ethnic wear segment reported an order volume growth of 41% in FY-2021 vis-a-viz FY-2020 and accounted for 35% market share in FY-2021. The ethnic wear segment is majorly led by the women’s apparel segment and it constitutes a 95% market share of overall ethnic wear in FY-2021 and reported 43% order volume growth.
Casual Wear continues to be a preferred choice of consumers
Casual enjoys the dominant position in the fashion apparel market and accounted for 84% market share in FY-21 and 49% YoY order volume growth in FY-2021 as compared to the previous financial year. However, the formal wear category is gaining momentum as the market share increased from 11% in FY-2020 to 16% market share in FY-2021 and over 100% order volume growth. The growth of the formal segment can be attributed to the increasing number of offline shoppers shifting towards online shopping platforms.
For infographics from the report and a comment from Unicommerce, see Image of the Day