Iberia

Spain has borne the brunt of economic reversals in Western Europe and this in turn has had a dramatic influence both on consumers, manufacturers and brands. Potential luxury market size is 38 million consumers.

Market Size

  • The current population of Spain is 46.8 million and is highly urbanised and is expected to increase by 0.6% per year.
  • In 2011/12 the clothing market was valued at US$25.5 billion, and in 2012/13 this figure is expected to grow by 0.6%. The volume of clothes sold in 2011 was 745.3 million pesos and growth is estimated at 0.3% a year.
  • In 2010 Spain was ranked number eighth globally for clothing and footwear spend (Global Demographics Limited rank).
  • Wool consumption has grown 16% from 2008 to 2010 against a decrease in total textile consumption, due to both an incremental growth in market share and strong exports.

Insights

  • The recession has changed the behaviour of consumers. They are more value conscious and less likely to purchase large-ticket discretionary items.
  • There is a growing interest in natural fibres due to a changing of consumer expectations and a quest for authenticity.
  • The consciousness of eco-consumption is a growing trend but still of minor importance.
  • Spanish women are known to follow fashion and they want to buy the latest trends. Women aged 35–55 are the main buyers of apparel in Spain, mainly due to their greater purchasing power. The high unemployment rate amongst the youth has caused a decline in volume sales among women 16–34 years.
  • There is a marked trend both to dressing more casually and to an increased interest in fashion. These trends have continued in spite of the recession.
  • Comfort is more important to the Spanish than in the other major economies.
  • Baby and toddler apparel demonstrated the lowest decline versus other segments due to the fact that demand is more price inelastic. This is a result of the fact that parents prioritise the needs of their younger children. Spain is the leading exporter of childrenswear in the European Union. Brands made in Spain for childrenswear span all continents and many Spanish companies have businesses abroad. For the forecast period, it is expected that the international demand for Spanish childrenswear will continue to grow.
  • Retailers look for differentiation from competitors by having a good value and quality proposition for consumers, offering limited editions, highlighting natural fibres and providing a series of higher quality products.

Opportunity for Wool

  • Wool consumption in Spain has increased 16% while the total apparel spend has decreased by 7%. This wool increase happened mainly in women’s knitwear and for the autumn/winter season. Consumers seek affordable luxury and are more conscious when buying a product. Also wool is very prominent on the catwalks and this has had a strong influence on wool consumption.
  • Retailers look for differentiation through consumer preference for natural and quality products.
  • There is space to grow both for men and women in spring/summer season products. The presence of wool products for spring/summer seasons is almost nil. Wool summer garments could be introduced as something new in the market within a marketing strategy of differentiation through the Cool Wool sub-brand and with the appropriate marketing activities.
  • Babywear: While total textile consumption was decreasing (–7.8% in 2009), the babywear and childrenswear segments have been the only ones growing (5.8% in 2009). There are many barriers for wool in this segment that have to be broken down with fibre education to the trade, retailers and consumers as wool has attributes that satisfy parents’ expectations (natural, healthy, comfortable and easy care).
  • High to very high-end brands such as Carolina Herrera and Loewe, influence mid and low brands and use wool in their collections.