The new state of play
Over the past decade, fashion and lifestyle brands have redefined the e-commerce experience. In fact, more than half of the top 20 direct-to-consumer (DTC) brands in the world are in the fashion and apparel industry, according to consultancy 2PM. With e-commerce offering so many growth opportunities, more and more brands are questioning the traditional wisdom that opening a physical store should be an inevitable part of their growth journey.
Let’s take the remarkable story of the Gymshark brand as an example. This big-hitting e-commerce champion has been in business for twelve years and has an annual turnover of more than £349 million, despite operating only a handful of brick-and-mortar stores. So, why would they disrupt a winning formula?
Indeed, many thought that the pandemic would spell the end of traditional high-street shopping altogether. So, is there still a need for a physical footprint in the channel mix of a modern fashion and lifestyle brand?
Bricks and mortar: A risky proposition?
There’s no denying the continued and growing popularity of e-commerce. In 2022, the percentage of total retail sales conducted online rose to 19% of total retail sales worldwide. According to Boston Consulting Group, this is expected to rise to a staggering 41% by 2027. And while high street footfall has gradually recovered in the years since the pandemic, consumers are also steadily cutting back on non-essential spending. This means that the cost of setting up and maintaining a physical store can seem like a luxury that few brands can afford. It may make sense, then, that many of them are continuing to invest more heavily in their e-commerce offerings at the expense of their physical locations.
