The popularity of supermarket fashion seems to be slowing down the emergence of Chinese ultra-fast fashion for now

For a long time, the consumer market for fashion trade, i.e. clothing, footwear, accessories and sportswear, has developed very differently in Finland than in the other Nordic countries. In Norway and Denmark, the volume of clothing consumption increased by more than 20 per cent in 2011−2019, while in Finland the volume only increased by 7 per cent. In all the other Nordic countries, both the value and volume of the consumer market for fashion trade exceeded pre-pandemic levels in 2022, but development has been slower in Finland.

According to the Finnish Commerce Federation’s forecast, the value of the consumer market for fashion trade in Finland will not reach 2019 levels until 2028. In Finland, growth in the consumer market is being slowed down primarily by the ageing population as well as low economic growth and purchasing power. In the opposite direction, the popularity of fast fashion and ultra-fast fashion and the demand for premium brands, among other things, are influencing and increasing volumes in particular.

“The retiring population is not consuming clothing in the same way as younger people. On the other hand, the increase of people older than 50 makes it possible for premium brands to rise, as these people have the most purchasing power,” says Jaana Kurjenoja, Chief Economist at the Finnish Commerce Federation, about the organisation’s forecast.

Many domestic fashion and specialty goods trade operators have their own brands, unique business ideas and design, as well as a desire to internationalise, but it is challenging without support. Small companies do not always have the skills or resources to develop things like data analytics or AI-based logistics planning systems.

“However, for the entire domestic fashion industry, the internationalisation of companies is essential for the future of the industry, as the greatest growth will happen outside of the country’s borders. Otherwise, there is a threat that Finland will become the sole head distributor of foreign companies,” Kurjenoja says to emphasise the need for support.

Finnish people love comfortable clothes

For Finnish people, the most important criterion when purchasing clothing is comfort. Comfort is a much stronger driver of shopping for us than, for example, for Swedish people. At the same time, however, we are also more precise about our own style than Swedish, German and British people.

When shopping for clothes, Finnish people choose durable products more often than people in comparison countries and inspect the material of the product more intensively. On the other hand, Finnish people do not buy as much fast fashion as British or Swedish people, who also admit that they make unnecessary purchases that end up unused more often than us.

“One of the reasons why, despite its popularity, fast fashion is not as popular here as, for example, in Sweden, is that the strong position of supermarket fashion is likely to counteract the emergence of fast fashion somewhat,” Kurjenoja thinks.

Supermarkets strengthen their position as a provider of clothing to Finnish people

Supermarkets are the most popular places to purchase clothing among Finnish people, and their importance has grown over the past three and five years. The sporting goods trade also has a strong position as a provider of clothing and footwear, but the use of sporting goods stores as places to buy clothing has not increased since 2021.

“It’s pleasing to see that for women over the age of 45, traditional, domestic fashion stores and brands such as Sokos, Stockmann, Halonen, Marimekko and Nanso are among the most popular shopping destinations,” says Kurjenoja about the results of the study.

Finnish people make 29 per cent of their clothing purchases online. Zalando is the most used online clothing store in Finland, and the online stores of supermarkets and sporting goods stores are also highly popular. Temu.com has already made it to the top 10 and shein.com to the top 20 most used online retailers of clothing.

“For women over the age of 55, temu.com is the second most popular online clothing store, and for men over the age of 55, it is the most popular online clothing store,” Kurjenoja says.

Returns on the rise again?

In international comparison, Finnish people do not return online purchases often. However, with the increase in purchasing clothing online, returns seem to be on the rise again. This year, nearly a third of the online purchasers of clothing have also returned their orders. Women under the age of 45 who buy clothing online return their orders the most; nearly half of them returned their purchases.

“The main reason for returns is the difficulty in finding the right size or cut. In this case, stores should self-reflect and consider whether, for example, the size charts and labels are sufficiently informative,” Kurjenoja says.

However, there are reasons for returns other than the potentially incomplete size guidelines in the online stores. Only 37 per cent of online purchasers of clothing check out size charts and labels before making a purchase. The free return policy can therefore encourage one to order more products for fitting and then return some of them to the retailer.

“Some consumers – fortunately few – even order clothing for only a couple of uses and then return them. This is particularly evident in men under the age of 30. Of course, large amounts of returns are costly for companies, but they are also unsustainable for nature,” Kurjenoja says.

*The main sources of the Finnish Commerce Federation’s “Muotikauppa ultrapikamuodin aikakaudella” study include, e.g., Statista’s international consumer survey, Statistics Finland’s statistical databases and a consumer survey designed specifically for this research project by the Finnish Commerce Federation and conducted by Kantar TNS. Analysis of the results and various forecasts have been made in the Finnish Commerce Federation.

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For further information, please contact:

Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation, tel. +358 (0)40 820 5378, jaana.kurjenoja(at)kauppa.fi