More players are fighting for a smaller market in the denim category - Glossy

Madewell is currently in the top position among U.S. denim brands, with $614 million in revenue in 2018, compared to $283 million from Levi’s. Since its split from J. Crew and its IPO, the company has continued to grow into other categories and through launching a men’s line. Notably, only 19% of Madewell’s revenue last year came from denim, with the rest coming from its combined other categories of apparel and accessories.

Simultaneously, the last few years have seen consumers moving away from denim. The overall market for jeans in the U.S. fell hard from nearly $19 billion in 2013 to barely over $16 billion in 2017. Instead, customers, fueled by the rise of streetwear, have embraced sweatpants, joggers and athletic leggings instead of jeans. But there is a silver lining. Euromonitor showed an upswing from 2017 to 2018, bringing U.S. denim up to closer to $17 billion. But as denim brands try to capitalize on the slow return of denim, they do so in a significantly crowded market. 

Sales in the “sport leisure” category of fashion surged in the U.S. last year by 17% to $9.6 billion, according to NPD. The rise of athletic wear has not totally overtaken denim, but it has fueled a more competitive market. 

“We’re still seeing retailers pushing denim online and in their social media content,” said Krista Corrigan, retail analyst at Edited. “Furthermore, denim was scattered across the men’s spring 2020 shows, highlighting colored denim, bleach effects and classic trucker jackets. This not only bodes well for the staying power of denim, but it also proves the consumer is still responding to the fabrication. While athleisure themes continue to rise and technical materials are soaring in popularity, there is still a customer that exists for both groups.”

Some denim brands have adjusted to this shift by expanding their product range. True Religion was one such brand — known primarily for denim, it pivoted in May to a more streetwear-inspired product mix including other types of bottoms.

“It’s moved away from denim to sweatpants and joggers,” said Allen Onyia, recently appointed artistic director at True Religion, who spearheaded the company’s pivot to streetwear. When he was appointed in May, Onyia’s first priority was finding a way to add styles outside of jeans to its classic denim products.

“Like many trends, the demand for denim ebbs and flows over time, but there will always be a place for this classic look in the market,” Corrigan said. “Heritage brands in the space like Levi’s and Wrangler have been the face of the denim resurgence in the market, and it’s reflected in the retail industry, as well.”

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