The Australian fashion sector contributes more than $27.2 billion to the national economy and employs a workforce of over 489,000, 77% of whom are women, says a report that assesses the changes in this industry since 2020.
- The fashion industry could also grow its economic contribution to $38 billion annually, by providing security to over 7% of Australia’s female workforce.
The Study: The report Australian Fashion’s New Era, by Afterpay, that came on board as title sponsor of the Australian Fashion Week in 2020 at the height of the pandemic, also examines the ripple effects of the Week on the country’s economy as it charts the progress made across sustainability, diversity and inclusion, and accessibility.
- Changing consumer behaviour, as well as new technology, is reshaping the fashion sector. A spending slowdown will test the industry’s resilience. Some key pointers from the report are listed below.
What do Aussie shoppers want in 2023? What are the biggest barriers to purchasing? Afterpay surveyed 1017 Australians to find out.
- Nearly half of Australians buy at least an item of clothing every month, with 8.8% of shoppers buying 21-30 pieces a year, and 6.1% purchasing more than 31 pieces.
- The number one consideration for Australians when clothes shopping is price (83.3%).
- However, 40.4% say they value sustainability and 43.4% look for garments that are made in Australia.
- Many (27%) say they feel social or peer pressure to buy sustainable clothing.
- While many consumers value ethically made fashion, many find it difficult to shop sustainably. Six in 10 shoppers say that sustainable clothing is too expensive, while 47.1% report it difficult to find sustainable brands. Some shoppers (40%) say there aren’t enough Australian sustainable brands.
Size does matter: Many (40.2%) Australians report that they struggle to find clothes in their size in some brands.
- Others (3.8%) say that their disability precludes them from purchasing garments they love, and 6.5% are prevented from purchasing by a lack of gender-neutral options.
- Another barrier? Two-thirds of consumers (67.8%) say that a lack of product or stock makes shopping a challenge.
Authenticity over aspiration: More than two-thirds of shoppers say they prefer authentic brand campaigns that showcase realistic beauty standards to marketing that is overly aspirational.
- In fact, the majority of Australians want to see themselves reflected in fashion campaigns, with 29.9% saying it is “very important” for campaigns to showcase Australian identity and feature local faces and landscapes and 53.8% saying it is “somewhat important”.
What’s in the wardrobes: Two-thirds of Australians keep clothing for at least three years, on average. However, more than one in 10 wear clothes for less than a year.
- Australians’ wardrobes are filled with clothes they’ve never worn, with a quarter owning more than six unworn garments.
Forget spring cleaning. Around half of Australians only clear out their wardrobes every two to five years (although some Marie Kondo types clear the clutter every six months).
- The vast majority of Australians (70.4%) head straight to their local charity when they no longer wear an item of clothing.
However, a sizeable minority turn to recommerce, with 17.8% reselling garments on platforms such as eBay, Depop and Facebook resale groups, and 2.5% renting or leasing items to others.
- Nearly one in 10 Australians bin the item altogether.
- 29.9% believe it is “very important” for campaigns to showcase Australian identity and feature local faces and landscapes
- Today, nearly one in five Australians resells garments on platforms such as eBay, Depop or Facebook groups, with 8.3% of consumers taking a product’s resale value into consideration when they buy new clothes.
Customer behaviour and new technology reshaping fashion: After a turbulent few years filled with store closures, supply chain issues and staffing shortages, a sense of normality is returning to the fashion industry. However, the pandemic has undoubtedly changed the business of fashion.
- Since the pandemic, the swing to e-commerce has slowed, but the boom in online shopping has left consumers with more sophisticated expectations around convenience and speed.
- As Australians rediscover their love of in-store shopping, many brands are weighing up their channel mix. Some, including those who started out as direct-to-consumer brands, are turning their attention to brick-and-mortar stores, which offer the opportunity to connect with consumers and reinforce their brand DNA.
- All brands are grappling with an explosion of sales avenues, from digital channels to domestic and international wholesale, physical stores, marketplaces and discount outlets.
- Another shared challenge for fashion brands is the rising cost of customer acquisition, which is being fuelled by growing competition and climbing social media costs. For some, the answer is a renewed focus on customer retention and a more sophisticated personalisation strategy.
Fashioning an eco-friendly future: This year will likely see increased pressure from regulators, and the Australian Fashion Council has led a consortium to design a National Clothing Product Stewardship Scheme.
- Some brands are focused on traceability and sourcing environmentally friendly fabrics; others are committed to local manufacturing or have launched take-back or repair programmes.
- Consumers, too, are becoming increasingly conscious of the ethical and environmental implications of the clothes hanging in their wardrobes.
- One in four Australians feels social pressure to buy sustainably.
- However, there is a two-track mentality to sustainability: some consumers value shopping sustainably (40.4%) or locally (43.4%). Others are less interested, with many (60%) citing cost as a barrier. Even among those prepared to pay more for locally made clothing, only 62% would pay up to 20% more.
- 6 in 10 shoppers believe sustainable clothing is too expensive.
- 47.1% find it difficult to find sustainable brands
- 40% say there aren’t enough sustainable Australian brands
- 74% are prepared to pay more for Australian-made clothes (26% wouldn’t pay more)
Recommerce is becoming an increasingly powerful force in Australian fashion, thanks to heightened environmental concerns among consumers, an accessible price point and the allure of scarcity, as well as increasingly sophisticated technology.
- In 2023, Australian fashion brands are taking a variety of approaches to recommerce, which encompasses rental and resale.
- Some are launching their own take-back or recycling schemes; others are renting garments, while still others are happy to keep recommerce at arms-length, allowing third-parties, including local and global online platforms, to recirculate their products.
WHAT THEY SAID:
‘From High Fashion to High Vis’, revealed that our industry contributes more than $27.2 billion to the national economy and employs a workforce of over 489,000, 77% of whom are women. This reinforces our resolve to focus on four pillars — promote the Australian Fashion Trademark to grow domestic and global demand for design-led brands committed to responsible practice; build the future local manufacturing capability of fibre and its derivatives, from yarn to textiles, fashion and uniforms, to close the supply chain loop and boost jobs and the economy; develop skills and career pathways; transition the sector to a circular economy by 2030 via the National Clothing Product Stewardship Scheme to create a just transformation towards Net Zero by 2050.
— Leila Naja Hibri
Chief Executive Officer
Australian Fashion Council
It was at the height of the pandemic that Afterpay received the opportunity to partner with IMG on Australian Fashion Week. At the time, the outlook for the Australian fashion industry was uncertain. In April 2020, a report from the Australian Fashion Council revealed that 43% of brands weren’t confident they could recover from the pandemic, while 23% were certain they wouldn’t. We signed on as title sponsor in September 2020, and from the beginning we have been laser-focused on helping the industry rebuild and return stronger than before. We’re proud of the role we’ve played in the past three years and the partnership we’ve established with IMG.
— Anthony Eisen
As the country’s economy continues to experience headwinds, it will be a somewhat challenging period for fashion retailers. These concerns are compounded by the industry’s permanent state of disruption – with supply chain disturbances, cost-of-living pressures, an increased cost of doing business and changing consumer habits all adding additional pressure. Retailers who respond to the needs and demands of consumers will be best placed for success.
— Paul Zahra
Chief Executive Officer
Australian Retailer’s Association