Fast Fashion Industry Constantly Adjusting Strategic Market Maturing

The idea of fast fashion originated in Europe in the middle of the last century. Since its entry into the Chinese market, fast fashion brand has been developing for more than 10 years, and it has become a common clothing category in people's daily consumption. Fast fashion brands are characterized by quick response and low price. At the same time, fast fashion's imitation of the international first-rate high fashion is in line with the latest trend of fashion. It is popular and popular among students, white-collar workers, etc. It is different from the new garment preparation brand's 4-12 month's new preparation cycle. The fast fashion brand product update rate is faster, the average weekly two times new, the vertical supply chain's rapid upgrading and integration, multi SKU, shallow stock, and keeping up with the trend mode has greatly improved the product's effectiveness and merchantability.

The international fast fashion brand is represented by Spain's ZARA, Japan's UNIQLO, Sweden's H&M and so on. Fast fashion brands in China are represented by Urban Revivo (UR), MJStyle, La Natsu Bell, Taiping bird and so on. International fast fashion brands have been established for a long time, covering a wide range of channels, and have a high brand awareness.

From a macro perspective, the domestic garment market in China maintained a steady and rapid growth in 2018. According to the measurement of the China clothing association, the total sales of clothing in China in 2018 amounted to about 3 trillion yuan. At the same time, the gap of clothing consumption between urban and rural residents is gradually narrowing. According to the statistics of the National Bureau of statistics, the per capita clothing consumption expenditure of urban residents in 2017 was 1757.9 yuan, which was 2.9 times the per capita clothing consumption expenditure of rural residents. In 2000, the per capita clothing consumption of urban residents was 5.2 times that of rural residents.

The basic demand of clothing in China has been fully satisfied, and the demand for consumption upgrading is obvious. Clothing consumption pays more attention to fashion, scene, quality, function, personality and so on. The high quality demand of clothing products is reflected in the expectation of the application and quality control of new fiber materials; the demand for high fashion is reflected in the hope that clothing will pay more attention to the design creativity, the integration of cultural elements, the grasp of the trend of fashion and the satisfaction of individuation.

Fast fashion garments, as an important part of China's clothing market, provide rich and colorful fashion choices for our consumers. The fast fashion brand has diversified styles, and can follow the trend of fashion while meeting all kinds of dressing scenes of consumers. According to the survey data from the data lab, in 2018, consumers spent most on fast fashion brands, spending 1 times a month and spending 2289 yuan a year. Fast fashion clothing consumers are more sensitive to costumes and popular information, the recommendation of trusted opinion leaders, and the star life scenes of variety and network homemade drama wear the wind vane of dress. Living in a second tier city, the 30 year old men and women who love beauty and love are the main consumers of fast fashion clothes.

Facing the increasingly mature Chinese clothing consumer market, the international fast fashion brands constantly adjust their strategies to meet the needs of market development.

The fast fashion representative brand ZARA from Spain can be said to be the "originator brand" of the fast fashion industry and entered the Chinese market in 2002. As of 2018, ZARA brand has 183 stores in China. Last year, ZARA brand's global operating income was 18 billion euros, or about 142 billion yuan, of which Asia's operating income was about 33 billion yuan, and China's market accounted for about 50%. However, compared with the past 5 years' performance, ZARA's business revenue growth has slowed down, and the expansion rate of stores has also slowed down significantly.

While slowing down the pace of expansion, ZARA's parent company Inditex has launched a multi brand strategy. Its fast fashion brands Pull&Bear, Bershka and Stradivarius have opened stores in China. At the same time, the high-end clothing brand Massimo Dutti has been vigorously expanded to 75 countries in the world, with more than 790 stores.

Sweden's global fast fashion brand H&M, as of 2018, has 530 stores in China (including other sub brands of H&M). In 2018, the global tax free business income of H&M group was 210 billion 400 million SEK, or about 153 billion 200 million yuan, of which the Chinese market contained no tax revenue of about 7 billion 800 million yuan, showing a relatively slow growth compared with the previous years.

H&M group has launched a multi brand strategy, with COS, WEEKDAY, Monki, H&M Home, &Other Stories, Afound, CHEAP MONDAY, and other brands. The women's clothing brand ARKET is positioned in the middle and high-end, the main quality of the "classic", from the fabric version, quality efforts, and the "anti fast fashion" concept to boost the brand.

H&M pays constant attention to "sustainable development" and social responsibility. In 2018, the cotton products used for sustainable use reached 95%. The group aims to use recycled materials and sustainable raw materials only in 2030.

The global fast fashion brand from Japan, UNIQLO, has 633 stores in mainland China as of 2018. In 2018, the sales revenue of UNIQLO parent company fast retailing group amounted to 2 trillion and 130 billion yen, or about 140 billion 900 million yuan. Fast selling group currently has UNIQLO, GU, Theory, J Brand, Princesse, tam.tam, Comptoir des Cotonniers and other brands. Compared with other fast fashion brands, UNIQLO brand products have more categories, more consumers, and the main brands, and the main products are Heattech, Airism, light and feather fabrics.

Japan is the largest market for UNIQLO brands, followed by the Greater China market. The performance of the Greater China region has maintained a relatively fast growth in the past 10 years, with a total sales volume of 439 billion 800 million yen in 2018. Of which, online sales accounted for about 15%, and in 2017, smart stores and virtual fitting services were launched in China. The UT T-shirt and Kando trousers designed by UNIQLO are the best selling products at present. XXX group set the sales target of UNIQLO brand in Greater China for 2022 fiscal year, reaching 1 trillion yen. In August 2021, it first reached 1000 stores.

As mentioned earlier, international fast fashion brands have entered China's market for more than ten years. During this period, China's fast fashion brands began to rise, and many brands such as UR, MJstyle, Taiping bird and La Natsu Bell emerged. At the same time, the fast fashion consumer market is also changing.

First of all, the development of fast fashion brands in the world has gone through the rapid growth period of the market and entered the slow growth period. This will inevitably cause more competition among brands, and require brands to catch the trend of the market faster, seize the opportunity, seize the consumption demand, and compete with others. At the same time, the international fast fashion brands also face "acclimatization" in the fast changing clothing consumption market in China. In 2018 and 2019, the fast fashion brand New Look and the fast fashion brand Forever 21 of the United States have withdrawn from the Chinese market one after another, to a certain extent, provided market opportunities for the development of China's fast fashion brands.

Secondly, in recent years, overseas light luxury brands began to enter China's clothing and apparel market. China's textile and garment enterprises, such as song Li Si, Ruyi group, Fosun Group and so on, have acquired a large number of foreign luxury brands in China, and actively expand their marketing channels. These extravagant brands have entered the domestic market in large numbers, striving for a number of consumers who want to pursue high-quality clothing.

Third, the consumption characteristics of the new generation in China have challenged the brand building of fast fashion brands. After 90, clothing consumers have become the main force. These young consumers generally pursue individualization, fashion, internationalization and have a high degree of dependence on the Internet. At the same time, offline experience is very important for cultivating the brand awareness of post-90s.

Fourth, the improvement of consumers' environmental awareness raises new requirements for the connotation of fast fashion brands. With the fast fashion brand H&M and UNIQLO taking the lead in setting up the concept of sustainable development in the industry, more green fiber materials are used, and clothing recycling system is established. Consumers pay more attention to the environmental protection concept contained in the clothing brand.

According to the financial data disclosed by various brands, by comparing the major fast fashion brands KPI at home and abroad, we can see that the top two brands in the domestic market are UNIQLO and Zara, among which UNIQLO products are the most category and the highest is the Ping efficiency, and ZARA has the highest net profit rate and fastest turnover. Benchmarking these two international brands, the domestic fast fashion brand enterprises want to seize market opportunities and surpass in the next few years, we can consider the following aspects of "cultivating internal strength" and improving their ability: first, increase product categories, optimize product display in physical stores, improve store efficiency; secondly, maintain fast and stable sales growth rate and raise the company's net interest rate; furthermore, continuously optimize supply chain management through information technology and maintain a faster inventory turnover speed; lastly, the same important point is to speed up the use of major electronic commerce platforms, net red goods and other means to increase the share of online sales and improve the integration of online and offline businesses.