Executive Summary

There’s a significant divide in the apparel industry between the sizes available in stores and the sizes women wear—a divide that’s becoming increasingly important as retailers seek to differentiate themselves from fast fashion and Amazon.

Over two-thirds of American women fit into the plus-size category, but plus-sizes represented just 17% of women’s clothing sales in 2015—a 50 basis point gap. At the same time, according to NPD data assembled by Bloomberg, sales of plus-size clothing have been growing at a faster rate than all women’s clothing since 2014. Today, the plus-size market is worth over $17.5 billion. If plus-size sales grow to close the gap, retailers could be looking at a $51.5 billion shift. Because 78% of plus-sized women say they would be willing to spend more money if more options were available in their size, this growth is definitely possible.

While many other brands and retailers are struggling with growth, what’s keeping retailers from grabbing this clear opportunity? There are a litany of possible reasons, ranging from the more difficult manufacturing process for plus-size apparel to historical industry elitism. But as consumer spending shifts away from apparel and brick-and-mortar shopping, retailers can’t afford to keep overlooking the plus-size demographic.

This report looks at the plus size industry through two lenses:

  • What’s happening in the plus-size market and why does it matter to the larger consumer ecosystem?
  • What do new developments in the plus-size market mean for brands, investors and real estate developers and what should they do to take advantage of it?

Takeaway

  • The plus-sized market stands to grow significantly if stores and brands offer more options for larger women, which have been historically (and sometimes purposely) ignored.
  • Many brands are worried that going into the plus-sized market will dilute their brand image, making it important for them to figure out how to align their core messaging with these products.
  • In order to succeed in the plus-size market, companies must chiefly focus on empathetic design, authentic marketing, and customer service. When done right, cross-selling between apparel and other product verticals and experimenting with emerging technologies can also drive up revenues for retailers.

Case Studies

Dia & Co., Eloquii, Forever 21, H&M, Lane Bryant, Stitch Fix and Zara  

The Market: What’s happening and why does it matter?

A bad shopping experience

For plus-sized women, the experience of going to a store isn’t always the most appealing prospect, as it involves searching for their size, only to learn that it isn’t available. When they do find the right products, plus-size clothes are often less fashionable and feature conservative cuts and muted colors. Styling sometimes feels like an afterthought. Even popular plus-size brand Lane Bryant has faced criticism for featuring boring clothes that lack flair.

Plus-sized women, however, are actually seeking a wide range of styles and even wider range of colors, according to Gwynnie Bee data in Bloomberg. In 2015, only 37% chose fit and flare cuts, and just 25% chose black clothing. Plus-sized women don’t want outfits that make them feel like they’re “trying to hide something,” as Eloquii creative director Jodi Arnold put it.

Exacerbating the issue even further, manufacturers usually grade—the process of creating a range of sizes from a prototype—apparel for only certain sizes. Plus-sized women bear the brunt of this inefficiency, as items aren’t necessarily created with them in mind as plus-size bodies have different requirements. This makes it even more difficult and disheartening for plus-sized women to shop.

Some larger companies have started to open their eyes. Amazon—now the third-largest source of US apparel sales, online or offline—supports a plus-size shop, featuring brands from Calvin Klein to Levi’s. Forever 21 has a major online plus size section; and Target launched its first in-house plus size line in early 2015.

However, many major brands, such as Lululemon, still do not carry any plus sizes and even those that do are likely to only have them online or relegate them to a corner in their stores. When the lines don’t sell well, the company will take away the wrong lesson—that plus-sized women aren’t interested in shopping at all. For example, H&M recently removed all of its plus-size assortment from its New York City stores, citing a lack of space and the need to make room for all of their fashion concepts. When plus size women enter the store, they find a sign that says “more sizes available at HM.com,” far from an inviting approach.  

Celebrities like Rebel Wilson and Khloe Kardashian have also spoken out. Wilson has said that shopping at retail stores as a teen was “mentally disturbing,” and Kardashian has vocalized the embarrassment she felt when she went to stores to shop with her sisters, only learn they didn’t carry items in her size.

Both have responded with plus-size lines of their own. Rebel Wilson collaborated with Dia & Co, creating her own box of contemporary clothes in June 2017 called REBEL WILSON X ANGELS. The line gives plus-sized women “chic” choices and exciting options to wear. Good American is Khloe Kardashian’s premium denim line that goes from sizes 0 to 24, which is sold exclusively at Nordstrom and focuses on self-love and body acceptance. All of the styles are available in sizes 00 to 24 and the larger sizes aren’t set apart or labeled any differently. “The line is all about empowerment,”Kardashian explained. “Making women feel great about themselves and embracing women of all shapes.” Celebrity has power, with the brand selling $1 million on its first day of sales in October, making it the biggest denim apparel launch in history.

Responding to these issues

While plus-size shoppers may have previously felt like they had few other options—especially in the days before the internet—today, social-media-empowered shoppers can be more vocal about their demands for on-trend clothing. As a result, companies are also starting to create more authentic marketing. A good example is plus-size retailer Lane Bryant’s “I’m no angel” campaign which takes a hit at Victoria’s Secret’s “angels” that tend to work out like professional-athletes and are much smaller than the average, size-fourteen American woman. Instead of covering them up, the campaign featured plus-sized models in traditional lingerie.

This is in contrast to what some called tone-deaf campaigns like Zara’s “Love Your Curves” which featured two, traditionally-sized models in jeans with the “Love Your Curves” line plastered largely on the poster. Plus-sized women and other shoppers took to Twitter to slam the campaign.

There are also vocal influencers that are gaining popularity such as Tanesha Awasthi and Nicolette Mason. These women give fashion advice and inspiration to their followers and authentically talk about their personal experiences around issues that plus-sized women face. Because it’s historically been more difficult for plus-sized women to create on-trend outfits, guidance and inspiration are especially important.

Leveraging the plus-size business

A number of new startups have found success targeting the plus size market. Plus size retailer Eloquii perhaps illustrates most clearly the way traditional players may overlook new opportunities. Shuttered by parent company The Limited in 2013, Eloquii re-launched as a private company in 2014 that went on to raise $21M from investors and become a leading name among new plus size brands. It grew revenue by 165% in 2015, and since then has launched a shoe line, a wedding collection, and, most recently, swimwear. The brand has amassed a passionate following, with 97,000 Instagram followers and 279,000 facebook fans after just three years, compared to The Limited’s 69,000 Instagram followers and 407,000 Facebook fans

Dia & Co. is another startup aiming to transform the way plus size women dress. The startup launched in 2014 as a subscription box, providing curated plus size fashion items to users based on personalized style quizzes. Since then, it’s amassed over one million customers and raised $26 million in venture capital from Sequoia Capital and other investors. But Dia & Co.’s aim is not just shipping boxes. Just as Amazon has begun using its data from past sales to design its own clothing lines, Dia & Co. has rolled out eight in-house brands since 2016.

Furthermore, Dia & Co. is hoping to provide infrastructure to help existing brands expand their plus size offerings—a sort of “plus size as a service,” or PSaS. Dia & Co. will work with brands to adapt their styles to the plus size market, leveraging Dia & Co.’s designers and proprietary fit technology. It will also help distribute products, in addition to tracking key metrics and customer feedback. Stitch Fix also provides plus size options, while Gwynnie Bee is another subscription focused solely on plus-size clothing, but for rentals rather than purchases: think Netflix, rather than Dollar Shave Club.

What does this mean for you and what should you do about it?

Brands

Use authentic messaging

Brands have long worried that showing untraditional models in their advertisements would dilute or damage their image, possibly hurting sales in the long run. This might be a reason many brands have dipped their toes into the plus-size industry with limited marketing resources and back-of-the-store displays. However, with a large and untapped community of plus-size women and plus-size influencers out there, brands have the unique opportunity to engage this community and promote authentic messaging around their brand.

  • How can you create marketing campaigns around your plus-sized clothes using influencers, bloggers, genuine narratives, style guides, and relevant marketing campaigns that authentically speak to plus-sized women?
  • Are the risks of diluting brand image or shrinking native customer base real? Is there a way to incorporate additional plus-size messaging as “body positivity,” as not to alienate your traditional base?
  • What talent should you bring into your team in order to create a diverse environment where you can engage this audience?
  • How can you respond to how the plus-size market has been traditionally treated by providing and evangelizing solutions for both brands and customers?
  • Have you performed the market research needed to tap into the plus-size opportunity for your brand? If not, how should you go about budgeting for customer surveys and other tools to determine the most effective and sensitive approach?

Improving merchandising and customer service

Classic customer service techniques are broken. Sales associates aren’t trained to deal with plus-size women or empathize with them. Many stores don’t hold plus-size clothes in house and dismiss the plus-size women that come into their stores. This is a big reason why plus-size women refuse to shop in the first place. As numerous retailers reduce their store count, customer service is more important than ever and can serve as a strong brand differentiator.

  • How can your store focus more improving customer service and matching shoppers with better fitting products rather than just filling racks with clothing?
  • What technology can you use to make plus-sized women more comfortable trying on your designs?
  • Does plus size clothing sit with traditionally sized clothing? If they are separate collections, how do you integrate both offerings on the floor?
  • How can you train your customer service team to become more empathetic and respond to the needs of plus-sized women?
  • Think through all of the touchpoints of your retail and/or online presence. How will a plus-sized woman feel throughout this experience and what can you change to make her feel more welcome?
  • How can limiting store inventory and ensuring you have each item in every size for try-on improve the shopping experience?

Opportunity to upsell and cross-sell

Upsells and cross-sells drive an estimated 10-30% of e-commerce revenues. Catering to the plus-size market will create goodwill with millions of women and result in increased opportunities to engage with new audiences. With these three needs met, an opportunity lies in creating ripple effects of plus-size offerings, which can increase sales across the board.

  • What other products can you sell after attracting a sizeable amount of plus-size customers? Can you create new and engaging beauty, lifestyle, and accessory products?
  • Are there partnership opportunities to enter the plus-size market without affecting your product portfolio? Could these create revenue shares or affiliate marketing opportunities?
  • What are the interests of your new audience? Which influencers, brands, products, media companies, and pop-culture phenomena can you partner with or feature on your items?
  • How can you make the goodwill you’ve created with plus-size spill over to jewelry, makeup, and other verticals so that these peripheral categories can magnify the impact of any body-positive moves you make and result in increased sales for the company?

Investors

Leveraging this untapped opportunity

When investing in new companies, the opportunity to collect the plus-size consumer’s untapped disposable dollars is a vital consideration. It’s important that marketing for the plus-size audience is authentic. These consumers will be quick to dismiss any branding that tries to co-opt their desire for fashion.

  • How can you adapt your sourcing pipeline to include more diverse companies, including companies that cater to the plus-size market?
  • How knowledgeable are the founders of the plus-size market? Which pain points and issues are they solving for the market?
  • How is the company’s branding authentic and does it reach the right women? Does the company know and empathize with the audience well enough to reach them effectively?
  • Are there acquisition opportunities to consolidate brands in your portfolio and/or add plus-size expertise?

Logistical and manufacturing changes

Existing companies that are looking to go after the plus-size market need to consider the logistical changes they need to make when serving this market. Retrofitting existing processes for the plus-size market will not work.  

  • When catering to plus-size are new products offered or are size scales expanded? Or both? How does this decision affect logistics like amount and type of raw materials needed, price points, and others ?
  • What are the margin implications from adding new SKUs and/or reducing fabric yield to accommodate larger sizes? How is this offset by increased conversion?
  • How can companies ensure the logistical processes of creating clothes for the plus-size market including grading fabrics, etc. are done correctly and efficiently? How can they build up this expertise?
  • Which other technologies should companies experiment with when targeting the plus-sized market? Could they be more open to futuristic experiences than other markets?

Mitigating risks of going after this niche

Existing companies in your portfolio may be fearful that targeting the plus-size market will upset their brand equity, leaving this clear opportunity to create sizes for everyone untapped.

  • How can you mitigate the potential risks that come with serving the plus-sized market? Are these risks real or imagined? How can brands make it clear that they’re not only plus-sized focused?
  • How can a brand redefine itself for existing and new consumers when going after the plus-size market? How can the brand expand what it stands for so that it can reach these new consumers?
  • Is there potential for mixed shopping cohorts (families with some plus size members and other traditional size members) and how does the end-to-end experience accomodate both simultaneously?

Real Estate

Catering to plus-size shoppers

If plus-size shoppers begin walking around your real estate properties, you’ll have a new audience to cater to—millions of women who have classically felt left-out of the shopping experience, especially offline.

  • Which other stores can you bring into your malls that also cater to this plus-size audience? If these shoppers are already walking around your properties, what synergies can you create with your store assortment to bring even more of them in or keep them in stores for longer periods of time?
  • Which type of accessories, beauty products, and other stores can you advertise and position around brands that cater to plus-size in order to get peripheral sales?
  • How can you test and learn by starting out with less-permanent store assortments for this audience and then leveraging these learnings when you focus on plus-size?

Empathetic in-store technologies

Brands that cater to plus-size audiences can benefit from experimenting with emerging, in-store technologies because these women have different needs and experiences. For example, augmented reality can help women avoid trying on a large number of ill-fitting items since there is more body variation in larger sizes than in smaller sizes. Additionally, 3D printing and robotics can help create custom pieces that fit women better.

  • How can you help companies provide the in-store technologies needed to cater to a plus-size audience? How can you leverage these so that these brands want to work with you?
  • How can you adjust the real estate and store space to better cater to stores that want to provide this technology to their customers?
  • What vendors could you bring in to help pilot these technologies and get tenants on board?

Marketing for plus-size consumers

As plus-size and body-positivity become cultural phenomena, it is important for malls to adjust their marketing and partnerships to promote this message and become culturally relevant.

  • How can you bring the online offline and partner with influencers and other plus-size advocates in your real estate properties through special events and permanent exhibitions? How would this bring in more of these women into your properties?
  • How can you ensure to keep all customers included and give out a message of diversity and inclusivity vs. focusing too much on just one audience?

Going Forward

Even though so many opportunities exist for the plus-sized market, most of the consumer ecosystem has not yet responded. If retailers can navigate existing industry constraints, they can attract strong, long-term loyalty from a demographic that’s looking for places to spend their money. When plus-size products come to the forefront, the stigma around this category will dissipate and the term “plus-size” might continue losing relevance as the traditional size range expands to include larger sizes. This will result in more options for shoppers and eager customers for brands and retailers. Companies specifically need to find partners and employees that are passionate about this market and can help craft winning strategies. An immense amount of money hangs in the balance.