Online apparel sneak peek: 2022 projections, ecommerce's share of spending and Amazon's role [Member-exclusive content]

The last several years have been a rollercoaster ride for the online apparel market, with retailers navigating both big surges and declines as the country has tried to weather and then recover from COVID-19. And Digital Commerce 360 expects 2022 to be a low-key year for most category merchants selling online, with single-digit year-over-year web sales growth.

As a sneak peek at the upcoming 2022 Online Apparel Report, here’s a look at how some of the category’s biggest players fared online during the past several years, the pandemic-fueled rise in digital penetration, and how Inc. and other mass merchants figure into consumer shopping behavior.

The context

How’d we get here?

Early in the pandemic, offices closed, events were canceled, and travel was postponed. So merchants selling 9-to-5 workplace attire, formalwear and fashion items struggled mightily. Meanwhile, as consumers settled in at home — including spending more time outdoors overall and especially in their backyard sanctuaries — sleepwear, athleisure apparel and swimsuit sales soared. The overall category was a mixed bag in 2020, but merchants benefited from the shift to ecommerce.

Once a large swath of the country was vaccinated and COVID-19 somewhat receded, the trends reversed. Shoppers needed to update their Zoom-friendly wardrobes for conference room meetings, find outfits for rescheduled weddings, shop for overdue trips and generally feel ready to re-emerge into society. So online sales rebounded for this group of apparel retailers, although at a slower rate since in-store shopping simultaneously bounced back.

Since then, the market has normalized.

By the numbers

Will online apparel sales growth slow in 2022?

There are 242 retailers devoted to selling apparel online ranked in the 2022 Digital Commerce 360 Top 1000, a list of the leading North American merchants on the web. This group is expected to grow global web sales by X.X% in 2022, Digital Commerce 360 projects.

It’s worth looking at the performance of the biggest names, which have a disproportionate impact on the overall group. There are 23 public apparel retailers that break out quarterly ecommerce guidance and are ranked in the Top 500, the upper echelon of the Top 1000. This group includes Nike Inc. (No. 10), Macy’s Inc. (No. 16), The Gap Inc. (No. 19), Nordstrom Inc. (No. 20) and Kohl’s Corp. (No. 21).

These 23 merchants collectively will grow online sales just X.X% year over year in 2022, Digital Commerce 360 projects.

Online penetration

What share of apparel sales are online?

While some apparel retailers were unable to maintain big gains from early in the pandemic and have seen their online sales decline, digital’s share of total retail sales — or penetration — has remained elevated vs. 2019.

COVID-19 greatly accelerated ecommerce adoption, and consequently, pushed online penetration forward as consumers turned to the web to shop in record numbers. In the five years leading up to the pandemic, the median annual rise in penetration for the overall U.S. market was X.X percentage points, according to a Digital Commerce 360 analysis of U.S. Department of Commerce retail data. In 2020, the year-over-year jump soared to X.X percentage points, and while it was a far more moderate uptick last year at X.X percentage points, penetration hasn’t snapped back.

The median penetration of the top 10 public apparel retailers that break out ecommerce penetration on a quarterly basis was X.X% in 2019, according to a Digital Commerce 360 analysis of public documents. Amid the pandemic, that skyrocketed nearly X percentage points to X.X% in 2020. Although online’s share of sales through all channels shrunk a bit in 2021 as shoppers returned to stores, the median X.X% for this cohort was still more than 10 percentage points above 2019 levels.

Through the first half of 2022, penetration continued to retreat a little for the group of 10 apparel retailers, dipping to a median X.X%. Even so, that’s an X.X-percentage point gain for digital revenue share vs. pre-pandemic times. And that means shoppers now spend more than X of all apparel dollars on ecommerce sites, up from just X in 2019.

Lululemon Athletica Inc. (No. 32) was the biggest winner online among this cohort, increasing penetration to X.X% in the first half of 2022 from X.X% in 2019. That’s a X.X-percentage point surge. The Gap also was a top penetration performer, with online’s share reaching X.X% year to date, up X.X percentage points from X.X% in 2019. Nike rounds out the top three in this group, with an X.X-percentage point penetration spike to X.X% so far in 2022 vs. X.X% in 2019.

The Amazon angle

Where do consumers shop online for apparel?

But retailers that focus primarily on selling clothing, shoes and accessories — a cohort Digital Commerce 360 calls apparel specialists — aren’t the only ones vying for consumer dollars in the category. A significant share of online apparel sales come from mass merchants that offer shoppers a variety of merchandise, including groceries, home goods, toys and more. And the option of a one-stop shop has proven to be enticing, affording busy consumers the convenience of consolidating shopping lists with a familiar merchant.

Shoppers increasingly are relying on the big three online mass merchants — Amazon (No. 1), Walmart Inc. (No. 2) and Target Corp. (No. 5) — for their apparel needs.

Nearly X — X% — of consumers recently reported having shopped on Amazon for clothing, shoes or accessories, up X percentage points from just X — X% — the prior year. That’s according to a Digital Commerce 360 and Bizrate Insights survey of 1,064 online shoppers in September.

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