Underwear Retailing - UK - April 2008

Abstract

In 2006, underwear sales grew by 2.3% and the year after by 2.2%, reaching an estimated £3.3 billion in 2007. However, within this, women' s underwear increased by 2.6% in 2007.

Deflation has been a key factor within underwear retailing as the grocers and value players - notably Primark - have expanded and kept prices low. Many other retailers, especially Marks & Spencer, have lowered their prices to remain competitive. Essentially, consumers have been able to buy more whilst spending less. However, there are now indications that consumers are increasingly interested in trading up to better quality.

The UK underwear market is crowded and intensely competitive, though it is still clearly regarded as having opportunities: there have been several new international entrants such as Intimissimi, and established specialists such as La Senza are expanding outlet numbers.

• Main topics of the report:
• The main focus for many retailers over the past few years has been sharpening entry price points. The trend for extending upwards with better-quality and even premium offers is now being seen as there are indications that some consumers are less enamoured with cheap-and-cheerful products.
• There has been strong growth in the D+ bra market as more women discover their ' real' size through being fitted. Being benefit-led, as well as increasingly influenced by fashion, this sector is less impacted by deflation.
• Fashion trends continue to be a key driver, and have helped drive growth in some areas of the underwear sector - notably hosiery, which has reversed its decline due to the rise of dresses and skirts, and the trend for bright colours and patterns.
• Innovation and differentiation are increasingly crucial for success in this crowded market. New fabric innovations drive benefits and interest, especially in bringing shapewear to a broader and younger audience.
• Online as a channel continues to grow, with Figleaves at the forefront. More retailers have launched or expanded their online offers, but many are still somewhat disappointing in the range of choice and/or service offered.