Changing lifestyles, the comfort seeking middle class with high disposable income, and increasing urbanization has lead to casualization of both men and women’s wardrobes in India. As the segment continues to grow further, Amit Gugnani, Senior Vice President – Fashion (Textile & Apparel), Saima Nigar, Associate Consultant – Fashion & Textile Division and Anil Sharma, Consultant, Textile & Fashion Division, from team Technopak define and size the current casual wear market in India and forecast its future.
The apparel market size in India in 2016 was estimated to be Rs 2,90,000 crore which is expected to grow at a CAGR of 9.7 per cent to reach Rs 4,66,000 crore and Rs 7,48,000 crore by 2021 and 2026 respectively. Of the total apparel market in 2015, men’s wear accounted for 41 per cent, women’s wear accounted for 38 per cent and kidswear accounted for 21 per cent.
Casual Wear Rising
Within the overall apparel market, the Indian casual wear market has evolved significantly over the last couple of years. The industry has witnessed rapid growth, triggered by increasing usage of casual wear by fashion conscious employees of major MNC’s due to the relaxation of dress codes. The change in work culture is offering immense potential for the manufacturers of casual wear. These brands are growing across all segments of the Indian market (premium, medium and value for money). International brands like Tommy Hilfiger and Espirit have seen steady growth over the years in their casual wear segment. Other brands such as Calvin Klein and Guess are increasing their footprints in this segment. Even premium brands such as Mango, Zara and Arrow have introduced casual wear at the entry level to attract first time consumers.
Casual Wear Categories
Casual wear is a broad movement in India and is seen manifested in the following sub- categories:
Rugged Casual: The rugged casual category includes garments for outdoor sports, like hunting, fishing, backpacking, rock climbing, etc.
Dressy Casual: This form of dress is more casual than that associated with a cocktail party. Dressy casual is a form of attire that involves a slightly more elegant style of normal casual wear, such as dress slacks and a sport coat or blazer.
Business Casual: A comfortably relaxed version of classic business attire, with no sacrifice of professionalism or personal power.
Smart Casual: This category demands a pulled-together, harmonious, complete look with colours, fabrics, shoes and accessories, for both men and women.
Active Casual or Sporty Casual: This category is not about playing a sport, but more about the relaxed look of a spectator. This category encompasses functional sports, apparel for gym, running, roller blading, biking and other fitness activity.
Men’s Casual Wear
Men’s wear market in India in 2016 was Rs 1,24,423 crore and is expected to grow at a CAGR of 9 per cent to reach Rs 2,95,795 by 2026. Owing to the gradual shift of men’s apparel market towards casual wear such as denims, activewear and t-shirts/polo are growing at a much faster CAGR of 14 per cent, 14 per cent and 12 per cent respectively. This is also a result of growing fashion consciousness and aspiration beliefs, higher disposable income, increasing brandisation, and acceptance of specialised clothing with features such as odour resistant jeans etc., not just in metros, but also in Tier -I and -II cities across India.
Women’s Casual Wear
Women’s apparel market in 2016 was Rs 1,11,467 crore and is expected to grow at a CAGR of 9.9 per cent to reach Rs 2,86,456 crore by 2026. Denim, t-shirts and inner wear represent the three fastest growing categories growing at a CAGR of 17.5 per cent, 17 per cent and 14 per cent respectively.
A women’s casual wear collection largely comprises tops made out of chiffon, cropped or utility pants, fashionable skirts, silk, velvet, cargo, capris and shirts made out of denim, silk and chambray, different washes of denim, leather or denim jackets, etc. Because comfort and functionality are of utmost importance, casual wear is quickly replacing the traditional sarees and salwar kameez in a woman’s everyday wardrobe. Complimentary accessories like scarves, hats, mittens, handcrafted belts, etc. have made the women’s casual wear market much more versatile and dynamic.
Key Products Driving Casual Wear
Denims: The Indian denim market is exhibiting continuous growth over the years. With new technologies, trends and higher market reach, this sector has promising growth potential. Even in rural areas, denim is becoming highly fashionable with most men and teenager girls opting denim wear over traditional outfits.
Denim is a high growth category as it is fashionable and comfortable, and enhances style quotient. The value growth within the denim wear owes to increased demand for stretch and light weight fabric, varying colours, styling and detailing. This trend is emerging across all categories (men’s, women’s and kids).
In 2016, the denim wear market was estimated at Rs 20,205 crore and is expected to grow at a CAGR of 16 per cent to reach the market size of Rs 77,999 crore by 2026. The market in India is dominated by men’s segment, which accounts for ~85 per cent of the total market size accounting for Rs 17,066 crore in 2016 and is estimated to grow at CAGR of 14 per cent to reach Rs 63,268 crore by 2026. Whereas, the market size in 2016 for women’s denim was Rs 2,035 crore and is estimated to grow at CAGR of 17.5 per cent to reach Rs 10,209 crores by 2026.
T-shirts: T-shirts is considered as one of the most comfortable and dynamic categories of casual wear. Due to its soft knit fabric, fits, and the versatile use, it is highly acceptable to a wide segment of customers. The market size of men’s t-shirts in 2016 was Rs 8,527 crore and is estimated to grow at CAGR of 12 per cent to reach Rs 26,484 crore by 2026 and for women the market size for t-shirts was Rs 933 crore in 2016 and is estimated to grow at a CAGR of 17 per cent to reach Rs 4,484 crore by 2026.
Casual Shirts/ Tops/ Trousers/ Skirts
Due to comfort choices for fabric, designs, fits – this product category of casuals has been quite popular with youth in both urban as well as rural areas. In 2015, the market size for men’s casual shirts and trousers was Rs 23,885 crore and is estimated to grow at CAGR of 9.8 per cent to reach Rs 38,118 crore in 2020. Whereas, the market size for women’s casual shirts and trousers in 2015 was Rs 2,500 crore and is estimated to grow at CAGR of 13 per cent to reach Rs 4,608 crore in 2020.
Consumer Preferences & Key Trends
Due to abundant style options, changing life styles, actively growing middle class with high disposable income, and increase in brand awareness and exposure to western fashion, the average Indian apparel consumer has become much more picky and aware of their fashion needs. Increasing urbanisation, higher discretionary spending and evolving lifestyle is leading to casualisation of both men and women’s wardrobes. Smart casuals with a few do’s and don’ts are becoming more and more acceptable on a daily basis and are not strictly restricted to a Friday dressing format anymore. With an increase in the fashion conscious population, growing working women populace in the country, the segment shall continue to grow further. Even the older consumers have also experimenting with casual wear category.
Focussed Approach for E-tailing
The Indian online fashion retail industry has hitherto exhibited a great success story mainly due increasing Internet and smartphone penetration, convenience of in-home shopping, aggressive promotion and pricing strategy (mainly led by discounting) by online players and easy options (cash on delivery, free return, etc.). Online retailers like Amazon, Flipkart, Myntra, Snapdeal, Jabong, etc., are aggressively building fashion category since this category is key growth driver. Online retail helps brand reach in untapped market where brands will find it difficult to open and sustain exclusive brand outlets. Also individual fashion designers are able to leverage online platform for their exclusive designs.
Considering the above reasons many casual wear brands and retailers are venturing into the e-tailing space. Convenient options, like cash on delivery, try-and-buy, easy returns policy, etc., are making the e-tailing space more competitive and dynamic.
Rise of Private Labels
Private labels are win-win solution for both big retailers and value for money first time consumers as these labels ensure that a certain minimum quality and image. Young population from middle class India is becoming image conscious and is a significant contributor to the casual wear market.
The Way Ahead for Casual Wear
The Indian casual wear market is booming and the rural markets will play a pivotal role in this growth story. Factors including a growing middle class population, rising disposable income, increasing brand awareness among the consumers in terms of quality and up-gradation of service standards, rapid shift from tailored to ready-to-wear suits, the growing service sector ensure promising future for casual wear segment. There is a huge scope for product innovation within the casual wear segment. India has become a market with a plethora of opportunities and brands and retailers who understand the needs of Indian customers better are expected to leverage the opportunities to derive growth.