Clothing store sales growth declines overall, but jewelry is going strong
U.S. consumer spending at clothing stores has declined 0.5 percent over the past year (August 2016 to July 2017) relative to the previous 12-month period, according to the Visa Retail Spending Monitor, which reports spending on all forms of payment. More recently, however, the downward trend in clothing has worsened—with store sales declining 1.8 percent since the start of the year (January-July 2017, year-over-year). While most sub-categories mirrored this trend (see biggest sub-categories in chart below), jewelry posted 6.7 percent year-over-year (YoY) growth during the same period, and 3.2 percent growth in July alone.
Low inflation is hitting clothing stores hard
Industry leaders reportedly expect record retail store closings this year, adding downward pressure to sales. Similarly, low inflation is hitting clothing stores hard. In the last year, inflation was up just 0.1 percent for clothing, compared to 1.9 percent for all items. This trend could be due partly to price competition from online-only retailers, which benefit from consumers’ growing preference for purchasing clothes through the digital channel. According to a recent survey,* 28 percent of consumers said they would likely buy apparel on a mobile device, while shoe purchases (23 percent of consumers) and accessories (20 percent) were strong enticements to the mobile channel as well.
Clothing store sales continue to decline (year-over-year growth, clothing and the biggest sub-categories, January-July 2017 unadjusted)
Source: Visa Retail Spending Monitor (reports spending on all forms of payment)