The EditHow can we encourage consumers to buy less?

By Bethany Watson

Contents

2

3-4 Introduction & Methodology

5-6 Department Stores

7 UK Shopping Habits

8-11 Target Market

12 Recommendations

13 Conclusion

14-16 References

IntroductionIn a world dominated by consumerism - it is unsurprising that UK consumers purchase 2.15 million tonnes of clothing and throw away over 900,000 garments every year (Business of Fashion, 2012).

The rise of ‘fast fashion’ – cheap, on-trend clothing - is a large factor in this statistic, fuelled by constant decreases in clothing. With cheap, low quality clothing readily available, consumers are becoming irresponsible with their purchasing decisions and shopping has evolved into a leisure activity (Business of Fashion, 2012).

From this trend comes an array of problems. Cheap clothing must be manufactured cheaply, and this often happens overseas where sweatshops are prevalent. There are environmental issues relating to the production of cheaper clothing and the way it is disposed of – usually in overflowing landfills.

There is no easy way to persuade consumers to buy less. Mass-market retailers like H&M and Primark are profit driven and will not raise their prices and consumers have become accustomed to this way of life. Recent economic downturns have left households with little disposable income and for many cheap clothing is the only thing they feel they can afford (WWD, 2012). Attempting to change this behaviour is difficult.

One market that may be interested in reducing overall levels of consumption is department stores, selling high quality, expensive goods. If consumers were persuaded to adopt a ‘quality over quantity’ approach to fashion consumption, overall levels of purchasing would decrease. Consumers could switch from fast-fashion retailers to department stores, increasing their profits.

This report covers market research on department stores, a specific consumer, ways to change their spending habits and potential technological solutions.

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4

Methodology

Primary research for this report was collected by a survey of 51 females aged 18 to 24 in November 2014. The respondents were asked questions on subjects such as their shopping habits, opinions on department stores and ways they would be persuaded to visit them. Data was then analysed into text and graphs. (Appendix 2)

Further primary research was gathered in a small focus group carried out in November 2014 with two females aged between 18 and 24. The individuals were asked questions based on results from the survey and gave their opinion on six potential recommendations. Data was then transcribed and analysed into text. (Appendix 3, 4 and 5)

Secondary research came in the form of studies into austerity, e-commerce, ethical issues, mobiles, social media, millenials, teens, fashion, department stores and women using Mintel resources.

Extra information was sourced from web sources such as Business of Fashion, Business Insider, WWD, and various department store websites.

UK Department Stores

Department stores are a key sector to focus on when aiming to reduce overall clothing purchasing. No company wants to see a fall in profits as people buy less, therefore it is important to redirect consumers to a sustainable way of shopping that reduces the temptation to over-indulge. Department stores work with fashion designers using the highest quality fabrics and craftsmanship. This is necessary when trying to encourage the quality over quantity approach to shopping.

The key players in the UK sector are:

-John Lewis-Marks & Spencer-House of Fraser-Debenhams-Fenwick-Harrods-Harvey Nichols-Liberty-Selfridges

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Store Selection

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For this goal, it is important to highlight the department stores that most appeal to those required to switch from fast fashion retailers to high-quality retailers. The most likely consumer is 18-24 year old women, who are accustomed to throwaway consumerism (Business Insider, 2014).

This rules out John Lewis, Debenhams and M&S, three of the leading department stores, as their clothing ranges are aimed towards those aged 35 and over, who are already loyal customers. (Mintel, 2014). House of Fraser caters to a younger consumer, but many of its brands fail to meet the quality necessary to convince consumers that higher prices will lead to an infinitely better product.

The most relevant stores are Harrods, Harvey Nichols, Liberty and Selfridges.

The pros for these stores are that they:

-Focus strongly on high quality fashion-Stock a range of brands that appeal to varied consumers-Are renowned for good customer service -Have the budgets for investing in technology and in-store experiences-Have high segment growth (Mintel, 2014)

The main drawback is that most of these stores are situated in London, with a small number of other stores around the UK, making them less accessible than their competitors.

The focus now is to find new ways to appeal to a customer that they are lacking – the 18-24s. This consumer may visit department stores already, but encouraging them to purchase investment pieces will set them up as loyal, long-term customers.

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UK Shopping HabitsBeing aware of general shopping habits is a good starting point for working out how young women can be persuaded to buy less clothing. In the last 7 years, the UK has struggled with economic downturns, leading to recessions, which has deeply affected the finances of its shoppers.

Despite this, a 2013 survey revealed that clothing and footwear purchases have increased (Mintel, 2013). Instead of opting for quality clothing, however, shoppers are actively seeking out cheap clothing. Fast-fashion retailer Primark remains one of the most popular high street stores. Between April 2011 and 2012, 60% of 18-24 year olds purchased footwear from the store (Mintel, 2012).

Discounts are important to UK consumers, with two thirds of individuals regularly using loyalty cards and almost half using coupons (Mintel, 2012). This suggests that individuals need to feel rewarded for parting with their cash in these difficult economic times.

When asked to rank the factors that most influence their purchasing decisions, UK consumers placed the ethical treatment of garment manufacturers and environmentally friendly retailing low on the list, beaten by low pricing and quality clothing (Mintel, 2014). This reveals that quality can be important to the UK consumer, even if where their garment comes from is not.

This data suggests a slight change in attitudes, potentially because of an upturn in the UK economy. As households’ disposable incomes are beginning to rise, quality is valued more.

In a 2013 survey, 70% of respondents said they prefer to spend more on high quality footwear (Mintel, 2013). Furthermore, in a 2013 survey of women’s attitudes to shopping, 41% said they buy clothing to replace worn out items and 31% said they would spend more on quality clothing, suggesting that women could be wising up to overspending on low-quality clothing (Mintel, 2013).

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Target MarketIn order to profile the average 18-24 year old female, it is necessary to consider their spending power, propensity to buy clothing, influences and their attitudes to department stores.

Spending Power

According to a survey, 67% of 16-24 year olds live at home with their parents (Mintel, 2012), therefore not needing to pay bills. In terms of finances, 46% of youths described themselves as being ‘financially OK’, despite not having much money left

over after any outgoings, and 26% stated that they had spare cash each month (Mintel, 2013). This suggests that three quarters of young people are not struggling financially and that they have a certain degree of disposable income to spend on luxuries like clothing.

Propensity To Spend

Without much disposable income, young people search for the best deals, with 60% stating they dislike paying full price for things (Mintel, 2012). This does not stop them from spending money on clothes, shoes and accessories. In a November 2014 survey, nearly all females aged 18-24 said they spent over £21 a month on apparel with 28% of those females spending more than £81 a month (Appendix 6). Brands that show empathy with this consumer’s financial situation and offer them rewards for being loyal customers are likely to be favoured.

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Target MarketInfluences

All of the women in surveyed in November 2014 followed trends in some way (Appendix 7), and a focus group revealed that fashion magazines and general media often place pressure on them to buy fashionable clothing.

Young women feel pressurized to look good for each other (Appendix 7), however it is reassuring to know that 41% of 18-24 year old women said they do not feel under pressure to wear something new every time they go out (Appendix 7). This, combined with the fact that half of the respondents are interested in quality over quantity, suggests that a buy less, buy better approach could potentially be adopted with this consumer.

One interesting point is that although this consumer spends a vast amount on clothing, nearly all of them admitted that they ‘never have anything to wear’ which could suggest that they struggling with impulse buying and styling

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Target Market

Young Women and Department Stores

When questioned about department stores, the overriding response from the target consumer was that they visit department stores very often – over half of them visited 11 or more times in the last year (Appendix 8) - but these visits are not often converted into purchases. Only 10% of respondents made 11 or more purchases – the most common number of purchases was between 0 and 5 (Appendix 9). The most popular purchases at department stores for young women were beauty products, followed by clothing, which is positive when trying to convince a younger woman to buy less, but better quality clothing (Appendix 10).

The target consumer generally likes the same aspects of a department store that the average UK consumer likes. What they dislike is the high price points, the overwhelming choice, confusing store layout and feeling intimidated and unwelcome due to their age and spending power (Appendix 11). One individual went as far as to say, “I only go in department stores if it is raining and I need shelter”, showing that there is still work to be done in order to convert young women into long-term customers (Appendix 4).

Some areas that the target consumer was interested in for department stores were loyalty schemes, in-store events, better technology and personalised services (Appendix 12).

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Target Market

Technology

When focusing on women aged between 18 and 24, technology appears to be a good way to engage them with department stores. In April 2014, 85% of 18-24 year olds owned a smartphone and a fifth of smartphone users shop on their phone and read product reviews (Mintel, 2014), so creating department-store-based smartphone technology is a smart move.

Young people favour innovative technology, proven earlier in the report and by the fact that Selfridges have previously featured a technology pop up concession, and Harrods have a technology-based make up experience, which have been popular with a younger consumer.

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RecommendationsCollating all research together showed that the key issues with the target consumer and overconsumption were lack of styling skills, impulse buying and pressure to be fashionable because of the media but also each other. Issues with department stores included high prices, overwhelming choice and feeling intimidated. The recommendations are made with these factors in mind, aiming to persuade young people that shopping consciously in department stores is the right way to reduce clothing consumption. They were selected as favourites from a list of six recommendations by a focus group.

Recommendation 1 is a department store app, focusing on interaction and community - key in the life of the consumer. It aims to assist young women with styling, as they ask each other’s advice on styling pieces from the department store. The more tips a user contributes, the more virtual points they receive. Points can be cashed in for store gifts, offers and discounts. This taps into the rewards and technology that appeals to the consumer, whilst promoting the store’s products and was favoured by the focus group.

Recommendation 2 is another department-store app that focuses on styling, aiming to reduce impulse buying and promote the ‘capsule wardrobe’. All of a department store’s products are available to buy from the app, and when a user views an item they receive professional styling tips. Dressing for particular body shapes, pairing colours together, styling the piece with wardrobe staples and reviews will all be included.

Recommendation 3 is a department-store cost-per-wear app, where a user can select an item from the store’s collection and view examples of the cost per wear over 5, 10 and 15 years for example. Users can also input their own timescales, proving how quality clothing works out much cheaper than constantly replacing fast fashion.

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Conclusion

To conclude this report, as 18-24 year old women continue to consume more fast-fashion, it is necessary to adopt an approach that fits within their lifestyles in order to persuade them to change. In this case, the approach is smartphone technology and the notion that department stores could potentially help them to shop “less, thoughtfully and with purpose” (Recovering Shopaholic, 2013). By assisting them with styling, giving them community support and rewarding them for their loyalty, this approach could be adopted successfully and clothing consumption could decrease.

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References-- LUTZ, A (2014) This Consumer Trend Could Be Terrible For Fast Fashion Brands Business Insider [Online] Available from: http://www.businessinsider.com/ consumers-prefer-quality-over-quantity-2014-9?IR=T [Accessed 02.11.14]

-- MINTEL (2014) Department Store Retailing [Online] Available from: http://academic.mintel.com/display/679627/ [Accessed 02.11.14] -- MINTEL (2014) Digital Trends [Online] Available from: http://academic.mintel.com/display/705820/?highlight#hit1 [Accessed 03.11.14]

-- MINTEL (2014) Do British Shoppers Care About The Ethical Sourcing Of Clothing? [Online] Available from: http://academic.mintel.com/insight_zones/2/ [Accessed 02.11.14]

-- MINTEL (2013) Footwear Retailing [Online] Available from: http://academic.mintel.com/insight_zones/11/ [Accessed 03.11.14]

-- MINTEL (2013) Teens [Online] Available from: http://academic.mintel.com/insight_zones/14/ [Accessed 04.11.14]

-- MINTEL (2013) What Are Squeezed Shoppers Spending Their Money On? [Online] Available from: http://academic.mintel.com/display/670045/?highlight [Accessed 02.11.14]

-- MINTEL (2013) Womenswear [Online] Available from: http://academic.mintel.com/insight_zones/21/ Accessed 02.11.14]

-- MINTEL (2012) Lifestyles of Young Adults [Online] Available from: http://academic.mintel.com/insight_zones/15/ [Accessed 02.11.14]

-- MINTEL (2012) Primark Footwear Customers Demographics [Online] Available from: http://academic.mintel.com/insight_zones/15/ [Accessed 03.11.14]

-- MINTEL (2012) The Savvy Shopper [Online] Available from: http://academic.mintel.com/insight_zones/1/ [Accessed 03.11.14]

-- RABKIN, E (2012) Op-Ed – Making The Case Against Fast Fashion Collaborations Business of Fashion [Online] Available from: http://www.businessoffashion.com/ 2012/11/op-ed-making-the-case-against-fast-fashion-collaborations.html [Accessed 01.11.14]

-- WWD (2012) Quality Over Quantity: Consumers Weigh Well-Made Apparel Vs. Fast Fashion Womenswear Dailly [Online] Available from: http://www.wwd.com/ markets-news/textiles/quality-over-quantity-consumers-weigh-well-made-apparel- vs-fast-fashion-6549343 [Accessed 05.11.14]

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Images ReferencesIn order of appearance:

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