Fast fashion drops in value post-covid, sportswear brands reign supreme

The Brand Finance Apparel 50 2022 report, which was published this month reveals sportswear brand Nike and some of its main competitors are continuing to benefit from the casual and sportswear trend that started during the Covid pandemic.

However, the results are not as positive for the fast fashion brands featured in the list, such as Zara and Uniqlo as fast fashion dropped 7{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} overall in terms of brand value from US$44bn to US$41bn over the past year.

Sportswear brands reign supreme

The sportswear brands achieving significant brand value growth in 2022, include Nike, which has kept the top spot since the report started eight years ago and whose brand value has gone up 9{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} this year to reach US$33.2bn. Nike’s closest sportswear competitor on the list is Adidas in fifth place, which has a brand value that has gone up 2{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $14.6bn. Other sportswear brand success stories include Puma, which has gone up 13{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $4.5bn and Lululemon which was up by over a quarter (28{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}) to reach $4.2bn.

Smaller sportswear brands are some of the fastest-growing brands in the list with Skechers brand value going up 68{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $3.2bn and Li Ning’s brand value also up 68{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to US$2.0 billion).

The report states: “Over the course of the pandemic, sportswear and athleisure brands have seen a steady growth in brand value as consumers spent more time at home as consumers selected brands for comfort rather than style.”

The decline of fast fashion brands

Fast fashion brands have faced a tough time during the pandemic with brand value either remaining steady or dropping for brands this year. For example, Zara sits in seventh place with a brand value decline of 1{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $13bn, and H&M sits in eighth place with a brand value up 3{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $12.7bn. However, Uniqlo dropped by over a quarter (26{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}) to $9.6bn and Primark/Penneys’ brand value was down 10{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $2.2bn.

The report points out that many fast fashion apparel brands rely on physical stores for high volumes of sales, but over the past few years stores needed to close due to pandemic induced restrictions.

It states: “Fast fashion apparel brands faced difficulty with the fundamental disruption of their brand model as the difficulty of selling low-margin products online is further exacerbated by the additional logistics and delivery costs. This caused the drop in value of brands in the fast fashion sector of the apparel industry.”

Luxury fashion brands boom

The combined value of luxury brands in this year’s report is up 21{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} this year from $103bn to $125bn with nine of the top ten luxury brands moving back into growth after a challenging two years.

The report explains that consumer sentiment is strengthening with a higher spend on clothing due to people being unable to spend their money on luxurious vacations.

It says: “Like across many other sectors of the economy, with people unable to spend money on events such as travel, more consumer discretionary spending has been dedicated to things such as clothing, especially in high-end luxury products. As opposed to fast fashion brands, luxury brands in the ranking were more resilient to the dramatic changes the industry went through during the pandemic.”

In fact, half of the brands in the top 10 most valuable apparel brands list in 2022 are luxury ones with Louis Vuitton sitting in second place after Nike with a brand value up 58{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $23.4bn. While, Gucci sits in third place with a brand value up 16{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $18.1bn.

Other luxury successes include Armani with a brand value up 9{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $3.3bn and a number of new luxury entrants in the top 50 such as Boss with a brand value up 54{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $1.7bn and Bottega Veneta with a brand value up 25{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547} to $1.7bn.

The report explains that Boss is a new brand that has arisen out of the split of Hugo Boss into two separate brands – Hugo and Boss. To promote the brand during the pandemic, Boss launched a range of athletic wear with a ‘phygital’ campaign that leveraged its online social media platforms such as TikTok and e-commerce marketplaces. The campaign led to a boost in its social media following and impressions and resulted in high volumes of sales. By increasing accessibility via online shopping many luxury brands such as Louis Vuitton and Armani welcomed a new demographic of customers during the pandemic.

The top 10 apparel brands for 2022

Brand valuation consultancy Brand Finance ranks brands across all sectors and countries each year and the apparel industry’s top 50 most valuable and strongest brands in the world are included in its Brand Finance Apparel 50 ranking.

The top 10 most valuable apparel brands in 2022 are:

1. Nike (non-mover), worth $33.2bn with brand value up 9{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
2. Louis Vuitton (up 3 places), worth $23.4bn with brand value up 58{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
3. Gucci (down 2 places), worth $18.1bn with brand value up 16{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
4. Chanel (up 5 places), worth $15.3bn with a brand value up 15{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
5. Adidas (down 4 places), worth $14.6bn with a brand value up 2{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
6. Hermes Paris (up 10 places), worth $13.5bn with a brand value up 16{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
7. Zara (down 6 places), worth $13,0bn with a brand value down 1{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
8. H&M (non-mover), worth $12.7bn with a brand value up 3{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
9. Cartier (non-mover), worth $12.4bn with a brand value up 3{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}
10. Uniqlo (down 7 places), worth $9.6bn with a brand value down 26{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}

Last year Brand Finance reported that the total value of the world’s top 50 most valuable apparel brands had declined by 8{a0ae49ae04129c4068d784f4a35ae39a7b56de88307d03cceed9a41caec42547}, decreasing from $301.9bn in 2020 to $276.4bn in 2021.