In a bold move that’s been making waves in the fashion industry, Shein and Forever 21 recently announced a strategic partnership. This partnership promises to redefine the shopping experience for fashion-forward consumers. In this post, we’ll dive into some key insights from this recent collaboration.
Demographics: Meeting the Needs of the Youth
Forever 21 and Shein have built their empires by catering to a predominantly young audience. According to Attain’s consumer-permissioned commerce and panel data, both brands attract Gen Z shoppers, with Shein buyers are 1.3x more likely to be Gen Z, and Forever 21 buyers 1.8x more likely. While Shein shoppers under-index within the Millennial generation, Forever 21 shoppers are 1.1x more likely to be Millennial. This presents an opportunity for Shein to introduce more Millennial buyers to their brand. Similarly, when it comes to household income, both brands find their core customer base within the mid-income range, earning between $50,000 to $100,000 annually. This demographic alignment will likely simplify cross-shopping behavior for consumers between the two brands.
Cross-Purchase Behavior Among Shein and Forever 21
When it comes to cross-purchase habits, 16% of consumers shop at both Shein and Forever 21, revealing reasonable overlap in their customer bases. Impressively, 66% of shoppers are exclusively loyal to Shein, indicating a strong and broad customer base for the brand.
Customers who shop exclusively at Shein tend to spend more per transaction ($50) and have a higher purchase frequency (3x per year), showcasing their high buying power and loyalty. This represents a great opportunity for Forever 21 to attract Shein shoppers into their fold, especially given the potential for increased spending.
Online vs. In-Store Sales: A Changing Landscape
Forever 21 has predominantly relied on in-store transactions, with a staggering 93% of their sales occurring in person. Similarly, H&M follows suit with 87% of sales happening in-store. Prior to this partnership, Shein was an online-only retailer; however, Forever 21 will soon offer Shein clothes in their physical stores, marking a significant shift in strategy. This partnership is a particularly great opportunity, as Shein will have a net new channel, in store sales, that is evidently popular among fast fashion shoppers.
On the other hand, Zara boasts a strong online presence, with 28% of its sales occurring online, versus 72% in-store. As Shein and Zara shoppers share a common interest in online browsing, the convergence between Shein and Forever 21 presents an opportunity for the brands to attract Zara shoppers who have a strong online presence.
The Shein and Forever 21 partnership represents a significant opportunity for both brands to broaden their customer base, leverage common demographics and shopping trends, and complement each other’s digital and physical storefronts. Amidst the ongoing transformation of the retail industry, this partnership holds the potential to become a trendsetter among fast fashion retailers.
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