CHICAGO, June 6, 2023 Post-pandemic lifestyle changes coupled with a continuation of food inflation are leading U.S. consumers to spend cautiously and strategically, resulting in less discretionary spending on other categories including fashion. In April 2023, discretionary U.S. general merchandise retail sales revenue fell 7%, compared to April 2022, and unit sales declined 8%, as food prices rose 8%, according to Circana, formerly IRI and The NPD Group.

“Faced with higher food and grocery bills, consumers have had to make concessions, and forgoing fashion-related purchases has been a big part of this trade-off,” said Marshal Cohen, chief retail advisor at Circana. “For the fashion industry to reengage with the consumer, its value proposition needs to be clear. This value is manifesting itself in products and categories offering innovation and emotional connections which create demand.”   

Here are four ways the fashion industry can succeed at captivating today’s consumer: 

Be in-sync with replenishment cycles and fill the gaps

With 57% of U.S. consumers citing replenishment as the leading reason for their apparel purchases, and with 80% buying based on need, these priorities have led to growth in the apparel industry since 2019. Consumers’ wardrobe needs have evolved drastically over the past three years. Comfort-based clothing, including sweats, pajamas, and sports bras, were among the only apparel categories that grew in 2020; jeans, tee shirts, and other casual styles were top sellers in 2021; and, finally, dressier items, like dresses, suits, and blazers, topped consumers’ preferences last year and into 2023. 

“After replacing their entire wardrobes over the past three years, consumers today need to be enticed by something more,” said Maria Rugolo, apparel industry analyst at Circana. “Winning brands will draw in consumers by offering broader lifestyle appeal and introducing a wider portfolio of fresh, unexpected options for wardrobe expansion.”

Solve for the lack of newness and fewer innovations for consumers

When asked, “which of the following categories do you feel are currently offering the most new and exciting products,” 54% of consumers said “none.” In fact, the number of new apparel and footwear items added to the market each dropped in 2022 versus the prior year.   

“Fashion is an industry for which iconic and classic styles are extremely important,” said Beth Goldstein, footwear and accessories industry analyst at Circana. “However, style trends and brand popularity are cyclical, so it is important to keep up the pipeline of fresh product to keep consumers interested. With the footwear market forecasted to deliver minimal growth through 2025, a focus on promoting value and versatility, while prioritizing innovation, will give brands and retailers the upper hand at gaining market share.”

Remember consumers are making choices that reflect what’s important to them

With both sales revenue and unit sales growth, prestige beauty continues to be the top-performing industry, across all general merchandise and consumer packaged goods (CPG) industries tracked by Circana. Among beauty shoppers who reported cutting back on overall spending due to inflation, 70% said they are not reducing their spending on beauty products. 

“For many consumers, beauty is an indispensable category,” said Larissa Jensen, beauty industry advisor at Circana. “An industry seeped in emotion, beauty has proven its resiliency by creating connections that go deeper than the physical product. And, with consumers focused on their mental wellness more than ever before, beauty products are benefiting.” 

Live in the moment, but look towards the future

Consumers today are shifting their spending to product categories that satisfy broader lifestyle needs. In fact, apparel spending among consumers aged 18-to-24 declined by 11% in the past 12 months, which is faster than any other generation. Younger consumers, who were once the fashion industry’s bread and butter, are reallocating their spending to categories like beauty and toys.  

“With immediate fashion needs met, purchase motivators will likely shift focus to two things: innovation and joy,” said Kristen Classi-Zummo, apparel industry analyst at Circana. “By its nature, fashion instills the values of confidence and self-expression, but there is a need to bring these traits front and center. In the face of whatever economic instabilities that might come our way, consumers will consistently turn to products that uplift, instill confidence, and spark joy.”

Click here for more insights and perspectives stemming from Circana’s 2023 “Future of Style” event 

About Circana
Circana is the leading advisor on the complexity of consumer behavior. Through unparalleled technology, advanced analytics, cross-industry data and deep expertise, we provide clarity that helps almost 7,000 of the world’s leading brands and retailers take action and unlock business growth. We understand more about the complete consumer, the complete store, and the complete wallet so our clients can go beyond the data to apply insights, ignite innovation, meet consumer demand and outpace the competition. Learn more at

Press Contact