After a year unlike any other, I was more compelled than usual to go back and review my outlook from one year ago. I wrote about how shifting priorities would shape fashion footwear and accessories sales in 2020. Looking back, that seems like the understatement of the century, but I came to the realization that the more things have changed, the more they have stayed the same. The shifts in consumer preferences we’ve seen during the pandemic are accelerated extensions of those we were seeing before, and these trends will continue during the year ahead.
Consumers began prioritizing comfort well before 2020. In fact, fashion footwear (particularly dress) has been losing share to more comfort-oriented and athleisure categories for years, aligning with similar trends in apparel. These trends became even more pronounced during the pandemic – in the U.S., slippers are on track to grow +50% for the year, and brands like UGG, Crocs, and Birkenstock were bright spots in an otherwise tough year for footwear.1 As consumers begin returning to workplaces, attending events, dining out, etc., brands have an opportunity to capitalize on the more casual, comfort-focused features that consumers have become accustomed to wearing inside of the home, and adapt for use outside of the home. Back in September, 70% of consumers surveyed told us that once they can return to work, activities, etc., they plan to dress just as or more casually than they did prior to the pandemic.2 With that in mind, the industry should not plan for a major resurgence in fashion footwear. While we will surely see an uptick in sales as society gets moving again, NPD’s Future of Footwear report projects that in 2021, the fashion category will recoup less than half of the volume it lost in 2020.
Seeking Long-Term Value
In the years prior to the pandemic, consumers not only began to prioritize comfort but also function for their fashion products. In 2020, they took this to a whole new level by dramatically shifting their spending to products that enhanced their new work, school, and play from home lifestyles. This is largely why the home, tech, toys, and sports equipment industries fared so well. Within footwear and accessories, styles that supported comfort at home or outdoor activities were the winners. In 2021, consumers will likely continue this calculated, prioritized spending on functional and durable products that offer solutions, and are therefore perceived to be good investments. To earn more share of wallet, our industries need to refocus on the innovation and messaging to support this.
Shopping My Way
A year ago, I wrote that in 2020 I expected to see more initiatives further connecting the offline and online worlds, but it turned out that this alignment became a necessary retail survival tool beginning in March. The proliferation of shopping, pickup, and delivery options initiated digitally was a key driver for many of the successful retailers during the year. Online penetration jumped 12 points to 40% of total fashion footwear sales and 8 points to 34% of accessories sales3 as consumers embraced shopping online due to safety concerns and store closures, but the percentage of online purchases picked up in-store remains among the lowest of the industries we track. 4 To start 2021, brick-and-mortar retail will continue to be more transactional rather than experiential – and even as shopping in-store becomes less of a health concern, the dependence on digital will likely remain. As an industry, we should accelerate efforts to bring that experiential element to the digital world via enhanced technology and imagery. This does not, however, mean we should abandon progress in the physical world; while store closures will continue, there will be unique opportunities in the brick-and-mortar space as well. Plenty of real estate will be available for pop-ups and temporary installments – allowing brands and retailers to reach new consumer groups without long-term commitments.
Many analysts and the general public at large refer to a “new normal” that we will eventually experience as the COVID-19 pandemic winds down, but I contend there really is no such thing. As was the case pre-pandemic, our “normal” will continue to evolve, shaped by forces that were both present before 2020 and those that intensified during last year. Recovery will differ among consumer groups – and we’ll likely see behaviors such as working from home and increased online shopping stick. The brands and retailers that thrive in 2021 will be those that refuse to settle for just one new normal.
The NPD Group/Retail Tracking Service, January-November 2020
2Source: The NPD Group/September 2020 Omnibus
3Source: The NPD Group/Consumer Tracking Service, January-November 2020
4Source: The NPD Group/Checkout, January-September 2020