Summary:
40 percent of shoppers are spending less on fashion in 2024.
Luxury brands must justify high prices amid competitive pressures.
Retailers must prove value beyond just the cheapest option.
Brands that communicate their value can gain market share.
Effective strategies include clear positioning and quality emphasis.
The Internal Negotiation of Shoppers
Before each purchase, an internal negotiation takes place in every shopper’s head: How much do I really want this, and is it worth the cost? It’s only gotten harder to persuade consumers to answer “yes.”
Declining Fashion Spending
Desire to spend on fashion is dwindling. In 2024, over 40 percent of shoppers in the US, UK, and Germany indicated they were spending less on clothing, footwear, and accessories compared to the previous year, according to The State of Fashion 2025 by The Business of Fashion and McKinsey. The primary risk fashion executives face is consumers’ appetite to spend, as competition for share of wallet heats up.
Challenges Across the Market
This concern spans every level of the industry. Luxury brands now need to justify their high prices while contending with emerging brands that undercut them. Conversely, lower-tier brands must work harder to stand out amidst a plethora of cheap and convenient options, ensuring customers that they’re not sacrificing quality.
Proving Value to Shoppers
Today, fashion businesses must prove to shoppers that they offer value — that what shoppers are receiving for their money exceeds what they are giving up. This is not merely about providing the cheapest option; consumers are willing to spend on what they perceive as the right product.
Retailers' Accountability
Neil Saunders, managing director of GlobalData Retail, notes, “A lot of retailers who have performed badly have pegged their performance on excuses... The honest truth is they’re spending. They’re just not spending with you because you haven’t added value.”
Opportunities in Challenges
While this situation presents challenges, it also offers opportunities. Brands that can effectively communicate their value stand to gain market share and earn customer loyalty.
Strategies for Communicating Value
The journey starts with a clear market position, selling a differentiated product that cultivates desire, and conceiving marketing that emphasizes quality and distinctiveness. The sales experience must reward the time shoppers spend with the brand, culminating in a product that aligns with the brand’s promise.
Case Study Insights
This case study draws insights from brands like Uniqlo, luxury upstarts Stòffa and Savette, and others on how to showcase value across every touchpoint — from product design to imagery and store experience. Strategies will vary based on market positioning, but the ultimate goal remains the same: to convince consumers their products are worth buying — and at full price.
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