What retailers need to know about the. Back to School FINdex for 2015
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1 What retailers need to know about the Back to School FINdex for 2015
2 What is FINdex? FINdex, or the Fashion Innovation Index, is a quarterly index used to measure US consumer sentiment toward fashion trends in the apparel, footwear and accessory industry. As the index is tracked over time, the data provides the retailers with a better understanding of the link between consumer sentiment and retail sales. Data is collected from a survey developed through a partnership between Kalypso, IU s Kelley School of Business and CollegeFashionista. 2
3 Does Retail Innovation Deserve a Failing Grade? 2015 Back to School FINdex Results. by Steve Riordan Overall, the Fall 2015 FINdex points to a lackluster back to school season for many retailers. Here s what we think retailers should know. Based on the most recent FINdex survey results, survey respondents still have ample dollars to spend relative to prior surveys, but they have had less incentive to actually part with these dollars for this most recent back to school season. While the respondents actually showed an uptick in enthusiasm for merchandise they see on line and in the stores, they are not motivated enough to shop early for this merchandise. Despite the respondents enthusiasm for the back to school merchandise, they were underwhelmed by the level of innovation demonstrated by this merchandise. 3
4 The 2015 Back to School FINdex has significantly decreased due to current customer sentiment. Spring FINdex Back to School Holiday Spring Back to School Holiday Spring Back to School 3.21 The FINdex calculations are based upon current sentiment and a spending index. Spending Index is based on survey question 1, the spending index is calculated by taking consumer perception of whether they have more or less to spend, then weighting and combining the responses. Current Sentiment acts as a multiplier for the Spending Index. Based on survey questions 2, 3 and 5, this multiplier is calculated based upon innovativeness, enthusiasm for current products and willingness to shop early. 4
5 The spending index remains constant, but the current sentiment has significantly decreased BTS 2013 Holiday 2014 Spring 2014 BTS 2014 Holiday 2015 Spring 2015 BTS Spending Index Current Sentiment 5
6 The overall sentiment decreased due to low product innovation perception this season. Enthusiasm has increased compared to last year. Respondents are asked 3 questions: Considering the apparel and accessory products you have seen offered this season, how excited are you about the items you have seen relative to last year? 0.6 Enthusiasm Considering the apparel and accessory products you have seen offered this season, how innovative are the items you have seen relative to past years? 0.2 Innovativeness How likely are you to shop early this year to make sure you get the items you ve seen? 2013 BTS 2013 Holiday 2014 Spring 2014 BTS 2014 Holiday 2015 Spring 2015 BTS Willingness to Shop 6
7 This season, the top three factors that shaped the perception of brands were: well organized products and displays, fresh merchandise and regular discounts. Respondents are asked: As you think about your favorite brands rank how important the following factors are in shaping your positive perception of the brand. Well organized products and displays Fresh merchandise all the time Regular discounts An interesting and informative website Fast, efficient checkout A beautiful store Lots of locations A good mobile app Employees that fit the brand Digital Receipts
8 Topshop and Zara continue to be favorites among young professionals. Respondents are asked to review the listing of brands and record their perception of them: 0 TOPSHOP ZARA STEVE MADDEN FREE PEOPLE URBAN OUTFITTERS H&M URBAN DECAY ANTHROPOLOGIE MARC JACOBS NASTY GAL MADEWELL KATE SPADE FOREVER 21 BRANDY MELVILLE BURBERRY AMERICAN APPAREL VERA WANG EOS MICHAEL KORS BANANA REPUBLIC EXPRESS GAP FOSSIL COACH TRUE RELIGION SPERRY
9 Visit kalypso.com/findex for previous FINdex results and analysis. Kalypso is a global innovation consulting firm. We work with organizations to deliver better results from innovation. For more information, visit kalypso.com. Follow Kalypso on and on Facebook at Facebook.com/KalypsoLP.
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