from INSIGHT BUSINESS published by USC's Center for Management Communication
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Trends Plus

Fashion discovers a new market

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by Maria Matis

F-A-T, a three letter word that just sounds unflattering. Society has trained us to think fat is undesirable, and ultimately-ugly. Ironically, 60% of the Americans who represent this societal opinion are considered overweight (Colwell, par.15). News that airline companies are making overweight passengers pay for two seats may instigate snide comments, but silence prevails over the accepted reality that America truly has a weight problem. While media and marketing propaganda maintain the view that “thin is in,” current sources say American women are opting to “love the skin they’re in.” So how does this reality and new attitude relate to a recessive economy and a stagnant apparel industry? Indicators point to the widely ignored plus-sized market for a new source of opportunity. The plus-size market is growing, and in the next 5 years it is expected to continue growing as more brands respond to its demand. That’s right - the “trendy trend of the trends” is to march to the frontier of full-figured fashion.

ESTABLISHING HISTORICAL CONTEXT

Plus-size retailer Lane Bryant pioneered plus-size apparel, and slowly but surely other companies are catching on. Chris Hansen, Executive VP of Marketing for Lane Bryant, tracks the company’s competitive objective by claiming, “There has been a whole societal assumption that this customer was not interested in fashionable clothes. Most companies erred on the side of helping this woman disappear. We promote clothes that make her look as fabulously sexy and easily stylish as the thin woman next to her.” These “erred” established brand names, which purposely ignored this segment, now desire a recognized brand breakthrough. Companies like Ann Taylor, Tommy Hilfiger, DKNY, and JC Penny are some of the most recent to dabble in the plus-size division. Debra Goldberg, advertising director for Mode Magazine, a plus-sized fashion publication, says, “for years, the plus-size market was dominated by more moderate brands where you wouldn’t recognize the label, now you have more named companies coming into the market” (James, par. 2).

SUBSTANTIATING THIS TREND

As the most recent breakdown of the apparel industry indicates, the segment of women’s larger sizes is growing. While other divisions experience stagnant or negative expansion, the proportion of larger size growth is intensified within the industry. According to the NPD Group, a leading market research firm specializing in women’s apparel trends, in 2002 the plus-size category grew 10 percent ("Plus-Size Goes E-Tail," par. 8). Their analysis supports the fact that plus-sizes are the fastest growing segment in the apparel market. To put these statistics into real terms the NPD reports, “Since 1985, the average American woman has grown from a size 8 to a size 14!”
When volume and monetary value are considered, the magnitude of these growth indicators is phenomenal. Today, the plus-size apparel business is a $30 billion industry catering to 65 million American women who wear a size 12 or larger (Bermudez, par. 6). Facts prove that Americans are bigger, and are demanding more of the market. This catalytic claim has complex dimensions, but in retail terms, the response means larger volumes of larger sizes of clothes.

THE DRIVERS OF THIS TREND

According to the Center for Disease Control, almost two out of every three adults today are currently overweight, meaning they have a body mass index (BMI) greater than 251. Obesity, defined as being roughly 30 pounds overweight, has increased by nearly 60 percent since 1991 (Colwell, par. 13). There is no way to avoid these facts, and it seems that society is finally facing the mirror of reality. Studies show that 78 percent of American women are actively trying to lose weight (par. 14). And while many try to shed the pounds, many more are taking a complacent approach that a big and healthy lifestyle is perfectly acceptable.

“Our society is becoming more accepting of people of all shapes and sizes,” says Brad Adgate, VP of Research for Horizon Media in New York. With the help of celebrity endorsements to advocate a positive body image, the term “full-figured” is sounding more pleasant to a society with selective hearing. Slightly-larger-than-life media personalities like Oprah, Queen Latifah, and Rosie O’Donnell advocate their healthy-size lifestyle. It is hard to physically track the acceptance, so indicators are used; for example, the fact that a plus-sized model was featured in Vogue’s April fashion spread. Added exposure speaks volumes to American fashionistas who read these fashion magazines. The overall result is that plus-sizes are being accepted. Their acceptance also means a defensive attitude towards their discrimination. San Francisco has actually passed laws prohibiting discrimination against large-size people, placing obesity in the same category as race, gender, and age. So if weight is now acting as a demographic, and if profitable brand diversification is gained through growing demographics, then it only seems logical to respond to the growing plus-size market.

A great example of how the apparel industry has reacted to these drivers is Fruit of the Loom’s new “Fit for Me” campaign, a line of plus-size undergarments for women. Diane Fannon, the person responsible for the new Fruit of the Loom initiative, reported groundbreaking findings after their extensive psychographic research: “We are always being pummeled with diet gimmicks, so you assume everyone is dissatisfied with their bodies, but the majority of women we spoke to have accepted their size, and while they don’t necessarily want to be any bigger, they don’t want to be smaller either” (Gardyn, par. 28).

WHY THIS TREND IS IMPORTANT

The plus-size industry growth has been ignored for years, but with new and rising acceptance, it is proving to be in hot demand. Standard & Poor’s recent Industry Profile claims manufacturers and retailers feel pressure to follow demographics closer, reporting, “They are devoting more space and paying more attention to style in this category than ever before” (8). S&P believes companies are beginning to recognize the profit potential of this growing target market (15). One example is David Cole’s Big Girls’ Bras Etcetera, an online company selling larger sized intimate apparel. David Cole announced a 400 percent growth rate in the last two years (James, par. 8). Another company, Chico’s FAS Inc., has achieved +30 percent growth in 2000-02 by targeting the baby-boomer market with more generous sizing. These companies are achieving these financial feats in spite of terrorist attacks, price deflation, and S&P’s reportedly lower consumer confidence.

Retail growth in the US has declined with pressures from the economy, yet the plus-size niche has maintained consistent growth. Overall inventory/sales in the apparel industry has declined sharply after the events on September 11th. However, the plus-size segment had not been as harshly affected. The chart represents an example of one company’s report that sales for all sizes increased only slightly in their year-end reports, but plus-sizes experienced a huge growth margin.
Even prior to 9/11, the plus-size market was growing at a 4-6 percent margin compared to the 2 percent margin of apparel as a whole ( “Fashion Facts,” par. 4). And the growth does not seem to be slowing down. Currently, “the market for plus sizes is growing at a rate of about 10 percent a year compared with about 3 percent a year for regular sizes,” said Margaret Whitfield, an analyst at Brean Murray & Co.

ROOM FOR “PLUS-SIZED” RESPONSE

Indicated growth rates are underestimated because the market has not adequately responded to the segment’s demand. The 48.8 percent of the female population who wear a size 12 or bigger dominate the apparel industry. Almost half the nation is wearing larger sizes, but only 26 percent of women’s clothing is in the plus-size category (Seckler, par. 1). Dan Hess, CEO of a site catering to plus-size women [www.onlyreal.com], says the reason for the imbalance is that too few companies are willing to get into the plus-size business for superficial reasons. Marshal Cohen of the NPD Group confirms Hess’s statement as he recounts a recent conversation with a high-end designer in which they were discussing the opportunities in plus-size apparel for women: “He said to me: ‘I do not want to see a woman wearing my product who is a size 12 or 14. It is bad for my image.’ I thought, ‘wow, how disconnected can you be?’ There are a lot of people in this business who are far more concerned about their image than they are about a great business opportunity” (Gardyn, par. 29). Despite the valid attempts to respond to demand, the majority of the plus-size sector remains untapped.

THE FUTURE OF THIS TREND

The segment’s growth makes for a profitable ease of entry, and the growth is not expected to stop any time soon. NPD recently released a 2002 Special Sizes Report where experts claim: “The plus-size market has been one of the fastest growing categories in recent years, and as such, it presents the greatest opportunities for sales growth.” We can expect to see product diversification and brand response to specific markets within plus-sizes. CEO of the United Retail Group, Rafael Benaroya, says the gap between supply and demand is going to close quickly, so “a better strategy is to develop a niche within the plus-size market, just as chains catering to smaller sizes develop their own niche” (Verdon, par. 5). Traditional women’s retailers, such as Talbots, are opening new stores just for this market. And as designers like Dana Buchman, Liz Claiborne, Ralph Lauren, Anne Klein, Ellen Tracy, Jones New York, and Donna Karan are catching on, others are expected to follow (S&P Industry Profile, 5).

EXTREME EFFORTS CAN’T EVENT STOP THIS TREND

Over the next five years, assuming no miracle weight-loss potions are discovered, it is expected that Americans will not drastically slim-down any time soon. According to The Wall Street Journal, one of the national health objectives for 2010 is to reduce the prevalence of obesity among adults to less than 15 percent (“Super-Sized Stats,” par. 1). However, a similar ambitious project on the federal, state, and non-profit level called “Healthy People 2000” failed to reduce obesity rates in a single state between 1990 and 2000 (par. 14). The government may try different approaches, but their efforts are not proving to change attitudes. As Michael O’Donnell, editor of the American Journal of Health Promotion, confesses, “we have realized that as a society, 80 percent of people are not ready to change” (par. 5).

The majority of Americans feels like the government should not impose on their lifestyle choices. Free-market analyst, Daniel Hager, complains, “Obesity should disappear as a public policy issue” (par. 8). In Michigan, the country’s most overweight state, people agree. A survey done by Michigan State University found, “only one-third of respondents believed that overweight and obese citizens should be public health concerns; the rest would prefer government and the health care industry to stay out of their eating and exercise habits” (par. 9). So President Bush may call for $125 million to promote a “HealthierUS,” but the plan cannot be effective when the public disagrees. It goes to prove that nothing is standing in the way of this opportunity - even the government is savvy to recognize its powerful existence.

Notes
1. Body mass index (BMI) is a national guideline computed through a combination of weight and height.

Works Cited