Tamara Sender
Tamara Sender is a Senior Fashion Retail Analyst at Mintel. She researches and writes for Mintel's UK Fashion Reports.

Whilst the clothing retail market has been struggling during the pandemic, online-only fashion retailers such as ASOS have benefited from the closure of physical stores. Here, we explore what online retailers can learn from this success, and what this means for store-based clothing retail.

Navigating the pandemic

Since the start of the outbreak, ASOS proved itself agile enough to rapidly pivot from one category to another, adding more leisurewear items at the expense of occasionwear in response to a major change in consumer lifestyles. ASOS stands out from its rival pureplays as being the most trusted online-only clothing retailer, as our upcoming clothing research suggests. ASOS’ focus on the customer experience, as well as its investment in the latest online innovations and its ongoing efforts to become more sustainable, have helped it to stand out from other clothing retailers. Consequently, in the survey of 15 clothing brands, ASOS is the one that consumers rate most highly as an excellent experience and that they would most recommend.

ASOS reacted to the pandemic by accelerating its focus on digital technology, scaling up its use of Augmented Reality (AR) for the fitting process, helping customers to find clothes that fit by allowing them to view items on different sized models. It has also looked to be ahead of the curve when it comes to sustainability, despite admitting that the issue isn’t shaping the majority of its customers’ shopping habits yet. 

While ASOS is in a good position to take advantage of changing shopping behaviour, it is aware that its young customer base is in an increasingly challenging financial position and that their lifestyles remain disrupted and that this will impact on future demand. In response to this, it will launch a budget clothing brand called ‘As You’ at the end of October 2020, priced between £8 and £28 to appeal to these cash-strapped consumers. 

The key takeaway for retailers

ASOS’ success highlights the importance for retailers to be agile in times of uncertainty, in order to adapt to changing consumer shopping behaviour. As newness becomes less important, retailers need to focus on investing in the right products that their customers want. This will help protect their margins, as well as diminish the need for constant and deep discounting to get rid of unsold stock. The pureplay has also demonstrated how imperative it is for all fashion retailers to invest in their online operations and in innovative technology such as digital fit tools in order to improve the customer experience and convert browsers into loyal shoppers.

What does this mean for store-based clothing retail?

While most generations currently favour buying clothes online, a significant proportion have also bought clothes in-store. Younger generations, Gen Z and Younger Millennials, who are the keenest online clothes buyers, are also the most likely to have visited a clothing store since they reopened after the lockdown. This highlights that despite the shift online that has been accentuated as a result of COVID-19, stores still have an important role to play. The future of fashion retail will require retailers and brands to focus on connecting online and offline in order to create a seamless experience for the customer.