3 Reasons Why No One\'s Making Money Off Plus Size

Recent news that plus size brand Eloquii (previously of the Limited Brands family) is relaunching, albeit virtually this time, its 14-24 fashion-forward line has reignited the most recent discussion, nay, debate, about the best, most efficient, and most profitable way to break into the plus size market. 

And, really, it all makes sense. The plus size consumer currently represents a unique intersection of opportunity and commerce: depending on who you ask, plus size (female) consumers account for more than 100MM of the American apparel-purchasing population. Not only that, the industry stands poised for a retail revolution: a significantly fragmented market, only a few real (if significantly unpopular) giants own the majority share of this (predominately unsatisfied) apparel-buying group. Consequently, unlike other segments of the apparel industry (i.e. fast fashion), there exists a significant opportunity to “shake up,” and eventually “own,” the plus size market.

The only issue is…no one’s really figured out how.  Here are 3 common misconceptions that continue to prove why:

1)     

Not Every Brand Is a Plus Size Brand: The delayed leak of a 2006 interview with Abercrombie and Fitch Mike Jeffries in which everyone’s favorite sartorial bully fat-shamed those-who-fail-to-fit-in-his-fading-fashions succeeded in sparking a reasonable (if quickly forgotten) debate: Why DON’T more retailers produce and provide apparel for the plus size purchasing public?

The answer is simple: not every brand makes sense for plus size.  Take the ANF example (and consequent (rightfully so) flogging of Mike Jeffries).  In order to successfully design, produce, and distribute pieces for the plus size consumer, ANF would not only have to significantly invest in different materials and processes (after all, “Material can be the largest portion of a garment’s cost — up to about 60 percent — and larger sizes require not only more of it, but sometimes different production processes.”), but also invest in more floor space or, if done right, entirely new/separate locations through which to display and sell new, plus size product.  Consequently, the addition of a plus size line isn’t simply a matter of making existing clothes bigger for existing retailers. Instead, the process involves organizational, financial, and personnel decisions that cost retailers big bucks before a penny is made from a sale. 

Could Mike Jeffries (and his ilk) have made the ANF point more coherent, less abrasive to not only plus size consumers, but the entire market? Yes, of course.  Still, financially and business-wise, ANF is right to stay out of the plus size market. At least for now.

(Much like ANF’s mis-fit with the plus size industry, retailers such as Lululemon have actually made the right (if not entirely popular) decision to limit sizing for product.  After all, one consumer’s casual options is another retailer’s expensive experiment).

2)     

Online Isn’t The Only Answer: There’s no doubt about it. E-commerce is the future of retail.  The big issue here? It’s not the ONLY future of retail. Particularly when it comes to the plus size market.

 

Ecommerce is what I like to call the supporting strategy/player of the retail game: a necessary component, but not exclusively so. When it comes to the plus size industry, this axiom holds doubly true, particularly with the recent trend of online-only brands and retailers (see Eloquii above) proliferating the market.  Here’s the issue: at the end of the day, despite a few outliers (which aren’t comparable in this case to the exclusive apparel industry, anyway), the majority of retailers (both plus size and not) that succeed include both a successful ecommerce strategy AND a bricks and mortar presence.  Why?

At the end of the apparel day – and despite the ease and accessibility of online shopping – women enjoy shopping, trying on clothes, and deciding there and then if that dress/pair of jeans/blouse is worth having.  It’s an experience.  An opportunity to browse and touch and feel fabrics and pieces and product.  Consequently, a bricks and mortar presence (even a skeleton one) is necessary to fully complete the “shopping experience” (and tie a consumer to a specific brand/retailer).

Now, this isn’t to say an exclusive ecommerce strategy can’t be profitable: but it’s my prediction that the next “big thing” in plus size retail will ultimately combine a successful boutique bricks and mortar experience with an interactive and convenient ecommerce platform.  An expensive buy in?  Most likely.  But a necessary and potentially very profitable one.

3)     

 Size 12 Isn’t Plus Size. Neither’s 14: I’m privy (and lucky) to receive at least a few business plans tackling the “plus size problem” a month for review; what’s always struck me as a significant misread in most strategies is the simple phrase “For Real Sizes, 14-28.”

Look, I’m not saying that sizes 14-28 (and beyond) don’t deserve well-made, easily accessible clothing.  Actually, I’m positing the exact opposite: by catering to such a wide variety of sizes is to miss the apparel mark. Size 14’s (and, as time goes on, 16’s) rarely visit plus size boutiques and sites: enough “traditional” brands and retailers are making 14’s and 16’s to make such trips unnecessary (also, whether fair or not, one thing I’ve learned from my work in the plus size industry is the impact of the psyche on where and when women shop).  Instead, it behooves retailers and entrepreneurs looking to maximize success in the plus size market to focus in on a specific (and more limited) “band” of sizes. A 12 is not an 18 is not a 28. Focus, in the case of the plus size market, makes more sense. And profit. Hone in on a size band and move out from there.

So there we go.  Is there some great mystery to the plus size market? No.  Sure, no one’s quite got the market right.  At least not yet. But what’s perhaps what’s most important to remember is that women – whether plus size or not – deserve the right to access to beautiful, well-fitting clothes that are affordable, aesthetically-pleasing, and, perhaps most importantly, accessible.

Margaret Bogenrief is a partner with ACM  Partners, a  boutique crisis management and distressed investing firm  serving  companies and municipalities in financial distress.  She can be   reached at margaret@acm-partners.com.

 

Read the original article on ACM Partners. Copyright 2014.

Source : http://www.businessinsider.com/3-reasons-why-no-ones-making-money-off-plus-size-2014-2

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