APPAREL AND FOOTWEAR IN
CHINA
Euromonitor International
February 2017
APPAREL AND FOOTWEAR IN CHINA Passport I
LIST OF CONTENTS AND TABLES
Executive Summary ......... 1
Although Decelerating, Value Growth Remains Steady in Apparel and Footwear ........ 1
Sportswear Delivers the Stellar Performance ... 1
Nike (china) Leads A Highly Fragmented Market ......... 1
Internet Retailing Thrives in China ........ 1
Growth Momentum Forecast To Remain Modest ......... 1
Key Trends and Developments .... 2
Fully Implemented Two-child Policy Has A Positive Influence on Children’s Apparel and
Footwear ........... 2
Upgraded Outlets Provide A Brand-new Lifestyle Experience .. 2
Smart Wearables Lead the Sports Fashion Trend ........ 3
Market Data .......... 4
Table 1 Sales of Apparel and Footwear by Category: Volume 2011-2016 .... 4
Table 2 Sales of Apparel and Footwear by Category: Value 2011-2016 ....... 4
Table 3 Sales of Apparel and Footwear by Category: % Volume Growth 2011-
2016 . 4
Table 4 Sales of Apparel and Footwear by Category: % Value Growth 2011-
2016 . 4
Table 5 NBO Company Shares of Apparel and Footwear: % Value 2012-2016 ....... 4
Table 6 LBN Brand Shares of Apparel and Footwear: % Value 2013-2016 .. 5
Table 7 Distribution of Apparel and Footwear by Format: % Value 2011-2016 ......... 6
Table 8 Distribution of Apparel and Footwear by Format and Category: %
Value 2016 ... 7
Table 9 Forecast Sales of Apparel and Footwear by Category: Volume 2016-
2021 . 8
Table 10 Forecast Sales of Apparel and Footwear by Category: Value 2016-
2021 . 8
Table 11 Forecast Sales of Apparel and Footwear by Category: % Volume
Growth 2016-2021 ... 8
Table 12 Forecast Sales of Apparel and Footwear by Category: % Value
Growth 2016-2021 ... 9
Definitions . 9
Sources .... 9
Summary 1 Research Sources .... 9
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APPAREL AND FOOTWEAR IN CHINA Passport 1
APPAREL AND FOOTWEAR IN CHINA
EXECUTIVE SUMMARY
Although Decelerating, Value Growth Remains Steady in Apparel and
Footwear
Although decelerating, apparel and footwear maintained steady growth momentum in 2016,
driven by consumers’ rising pursuit of a better outer appearance, along with rising disposable
incomes. Womenswear continued to outperform menswear in terms of value growth and total
value sales, thanks to the greater product choice in the market and more frequent purchases by
women to stay trendy. Benefiting from the two-child policy in China, childrenswear registered a
faster pace of value growth than womenswear and menswear, leading to a more robust
performance in terms of new market entries and aggressive marketing activities.
Sportswear Delivers the Stellar Performance
With growing health-consciousness amongst local consumers, and fuelled by the Rio 2016
Olympics, sportswear recorded double-digit value growth in 2016, in line with the growing
number of consumers engaged in sports activities to keep fit. In addition, sports apparel and
sports footwear are also increasingly accepted by locals as casualwear, to be worn on less
formal occasions. Moreover, professional sportswear is also seeing rising demand, such as tight
sports suits for gym-goers.
Nike (china) Leads A Highly Fragmented Market
Nike (China) overtook Bestseller Fashion Group in 2015, and continued to lead the highly
fragmented apparel and footwear market in 2016, thanks to the more robust growth of
sportswear, particularly sports footwear, in China. In fact, sportswear-centric manufacturers
represent three positions within the top 10 players in the apparel and footwear market in China
in terms of value sales, namely, Nike (China), adidas Sports (China) and Anta (China).
Internet Retailing Thrives in China
Internet retailing thrived in the distribution of apparel and footwear in China in the review
period, to account for a quarter of overall value sales in 2016, up from a minimal market
presence in 2011. Leading B2C online sales platforms such as JD, Tmall and VIP
have grown buoyantly, thanks to their wide selections of apparel and footwear products,
competitive pricing and convenient home delivery services. Manufacturers have also been
active in jumping on the e-commerce bandwagon, reaching out to consumers in lower-tier cities
where their brands and products are not available.
Growth Momentum Forecast To Remain Modest
Apparel and footwear is expected to increase by a modest value CAGR in the forecast period,
underpinned by the steady demand for trendy, quality products. Although market saturation may
decelerate the overall forecast growth momentum, consumers’ growing sophistication in pursuit
of personal wellbeing, such as stylish apparel and footwear, is anticipated to be the major
growth engine, in addition to the favourable two-child policy and rising health awareness, which
will support the steady growth of childrenswear and sportswear respectively.
APPAREL AND FOOTWEAR IN CHINA Passport 2
KEY TRENDS AND DEVELOPMENTS
Fully Implemented Two-child Policy Has A Positive Influence on
Children’s Apparel and Footwear
The growing number of newborn babies underpinned the healthy growth of childrenswear in
China, as a result of the execution of the two-child policy, enforced since October 2015 by the
Chinese government to combat the greying population. Compared with the previous partial
relaxation of the one-child policy, this fully implemented two-child policy served as the direct
driving force for the rising number of newborn babies in China, and the strong growth of
childrenswear accordingly. Furthermore, 2016 was the Year of the Monkey; perceived as one of
the luckier zodiac animals by Chinese parents, leading to the comparatively higher birth rate in
this year.
Childrenswear and children’s footwear recorded current value growth rates of 7% and 9%
respectively in 2016, with baby and toddler wear even growing by 13% in 2016, resulting in
buoyant market entries. Mark Fairwhale launched a childrenswear series and opened a flagship
store in Tmall in March 2016, whilst the trendy womenswear brand MO&Co announced the
launch of its childrenswear brand Little MO&Co in the same year.
Outlook
The full implementation of the two-child policy is expected to have a positive influence on the
number of newborn babies in China in the forecast period, particularly in the first three years of
this period, which will further boost sales of childrenswear. Baby and toddler wear and children’s
footwear are anticipated to have upbeat outlooks, with both expected to see value CAGRs of
6% at constant 2016 prices in the forecast period. On the other hand, children’s footwear is
likely to see a trend towards smartness, with leading players such as Li Ning targeting smart
wearables for children, represented by its joint efforts with Tencent Holdings to launch co-
branded smart children’s footwear with a location indicator in early 2016. The smart trend is
projected to enhance the performance of children’s footwear in the forecast period.
In addition, young parents usually adopt a more cautious attitude towards products for
children, expecting higher safety standards for materials, for instance, which may lead to
upgrading in children’s apparel and footwear. Moreover, the rising middle-class in China and the
rising disposable income of the average household, as well as the increasing number of families
with young parents, are expected to boost expenditure on children’s apparel and footwear,
leading to the strong value growth of these categories.
Upgraded Outlets Provide A Brand-new Lifestyle Experience
Affect