The Business Behind That Perfect Party Dress

So we’ve been an entire month into the New Year, and while we were still in the post-party season detox mode, retailers across the US were already out with up to 80% discounts on the merchandise that was “fresh” and “new in” just before Christmas. The holiday season of 2016 saw an overall surge in discounts after the Black Friday/Cyber Monday sales; a shift in the dynamics of retail sales calendar in the States accounted to be driven by millennials who apparently shopped way early before Thanksgiving, and more later.

As Black Friday virtually stretched over for two months in 2016, e-tailers have been more cautious than ever in rolling out new stock. How has that affected the party-wear business? Intelligence Node investigates with its proprietary SaaS-based tool, Incompetitor™ analyzing data points derived by mapping 1 billion unique products across 130,000+ brands for more than 1100+ categories every day.

Traditionally party wear dresses are broadly categorized as ‘evening dresses’. Google search queries for ‘evening dresses’ decreased by 4% for the US and 3% for the UK in 2016. But it doesn’t necessarily confirm a declining interest in party dresses. ‘Cocktail dresses’ in the US went up by 13%  and ‘party dresses’ up by 13% in the UK. Off shoulder  ‘bardot dresses’ were searched 162% more this past year.

If we have to describe the mood for party wear business in 2016, we’d use “cautious”.

We looked at the generally favored timeframe for introducing new stocks in partywear, which is early December, just at the hem of Black Friday weekend in November. Our data indicates a mere 2% increase in average in stock dresses compared to Dec 2015, despite in stock in the apparel category going up by 35% overall. This could be attributed to Black Friday looming over since September and the fact that this is the year ‘see now, buy now’ business model was adopted in one form or another by a rising number of brands and retailers. It renders the time-frame for buying partywear hazy, giving rise to continual discounting and simultaneous collection launches since as early as September first week.

Jumpsuits and skirts fared slightly better, 3% & 5% respectively, giving how velvet overalls and metallic pleated skirts have been a rage in the evening wear category. Search queries for ‘jumpsuit’ went up by 49% in the US; zooming in, ‘black jumpsuits’ have been searched 51% more according to Think with Google Report. Pleated skirts were having a moment, with a 33% increase in interest by end of 2016.

Discounting trends across different price/market segments for the last four months show an interesting insight into how conventional retailers differ from fast fashion brands and luxury e-tailers when it comes to holiday discounts. Macy’s, JC Penny, Barney’s, Nordstrom etc. still give heavy discounts over Thanksgiving weekends, whereas the newer, more dynamic players like Zara waited it out until the 2nd week of January to push sales. Luxury e-stores had a foot on both sides of the Holiday season, extending discounts from Black Friday right up till the end of January.

Dresses have been discounted more than skirts and jumpsuits in 2016 compared to 2015. Overall the “occasion wear” and “evening wear” have seen more slashed price tags than last year. Discounts were up by 11% in dresses and 8% in skirts. For a 2016 trend, discount rates on jumpsuits were not very encouraging. We saw an increase of 10.5% from 2015; just as much as dresses, indicating a failure to spike enough, considering the pre-Fall confidence in the category.

On the upside, the Luxury segment did quite well in the dresses department. 97.9% were out-of-stock at full price by end of December. Significantly more than accessible brand stores (87.3%) and way more than fast fashion brands (36%). Overall 45% of the stock in dresses wasn’t discounted at all in the Nov-Dec holiday season.

Compared to 2015, e-tailers were well-stocked this year. Average out-of-stock items were down by 16.77% for dresses and 14.92% for jumpsuits. Skirts saw the average out-of-stock rate decreasing by 19%. Could this mean that 2016’s pleated skirts were more successful than 2015’s voluminous midis? Maybe, for we saw velvet dresses neck-to-neck with pleated metallic skirts to gain the top spot, even during a colder last week of December.

2016 has seen some very strongly defined trends, dresses being on of the favored categories. Velvet dresses, off-shoulder/cold-shoulder dresses, slip dresses, metallics, sequins & ruffles made a splash this fall and overlapped across occasion wear, evening wear, and casuals- making them prevalent everywhere you laid eyes.

The overlap was not just confined to categories. About 39% of styles had a combination of two or more of these attributes. Off-shoulder velvet dresses, sequined slip dresses, ruffled velvet dresses, metallic ruffled dresses- and so on. The 90’s influence was heavy this holiday season, with Kate Moss’s iconic slip dresses making their mark alongside velvet Bardot numbers.

While this holiday season has seen ambiguous trends in holiday discounting and sales, across the past four months, retailers have been able to cash in on a handful of styles in dresses and skirts, thanks to ‘star’ items that hadn’t been around the past few years. It would be wise to gear up for the coming year with pricing strategies that tie-in discounting seasons as well as full-price (virtual) shelves to hit the sweet spot in e-commerce buying trends. Take note that your customers will expect bargain deals all year-round, and will spend on new collections, albeit cautiously. Now is the time to get a dynamic pricing automation strategy to feed both the proverbial beasts.

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