Building a new story based on fashion colour trends or forecasts is often a hit or miss.
Colour forecasts are most influenced by Pantone Colour of The Year announcement, runway trends and historical information. This is why oftentimes colour forecast fails to accurately capture current market demands, and serves more as a direction, rather than certainty.
Investing in the wrong colour story can contribute to massive overstock issues, leading to deep markdowns and loss of profit. Therefore, it is imperative for brands to understand consumer colour preferences accurately in product development and assortment planning.
Historical data or social media may provide some broad clues, but most brands lack in-depth information on consumer colour preferences, especially by market or sales channel.
To ensure a colour story generates high commercial value, brands must allocate time in the assortment planning process to start researching colours in demand and adapting these for the right products while aligning with brand positioning.
Also Read: Identify Consumer Demand by Validating Category Trends
Fashion market insights have the ability to bridge this gap by validating colour trends against stock movement and sell-out performance so brands can identify best-selling colours, rising trends or variation opportunities for merchandise planning and buying.
Here’s how,
Step 1: Identify Own Brand’s Best Selling Colours
Firstly, look through internal sales data to analyse the previous product assortment and evaluate the popularity of colours at market level, category level and product level. Consider the ratio of basic colour palette versus seasonal colour palette in past collections.
Given the unprecedented crisis with Covid-19, ensure that evaluation is carried out at the recent 3 months’ performance or previous period, in addition to the same period last year.
Step 2: Conduct Research on Colour Trend Information Externally
After compiling your internal findings, refer to external sources such as fashion analytics tools, trend reports, magazines or runways to get inspiration and stay updated with macro industry trends.
Step 3: Identify Potential Colour Trend Performance Among Leading Market and Aspirational Brands
To validate these potential fashion colour trends against consumer preferences, we study the performance of key market leaders in the US or Europe to understand consumer readiness.
In this example, we analysed colour trends in the UK over a period of three months.
The chart above illustrates the trend performance of key colours in the UK market from April to June 2020. Blue was identified as one of the uptrending colours tagged with the second-highest number of SKUs.
A deeper dive into the trend performance of blue shows the colour consistently outperforming all other colours in a positive trajectory throughout the timeline.
Next, looking at the three lower charts, we can see that outerwear is the category with the most blue products at 21.9% contribution. Further analysis of the outerwear category shows the top blue products by SKU to inspire the design process – in terms of selecting a silhouette, pattern or shade.
Besides solid blue colour shades, the chart indicates checks and stripes commanded 40% of the total SKUs. The findings also include key materials used for blue coloured-products such as cotton, spandex, polyester and denim which helps to inform key product development decisions in the assortment planning process.
Step 4: Validate Colour Opportunities by Sell-out Rates
Next, validate the colour trend against sell-out rates to understand its performance in the market and gauge consumer demand.
This chart revealed that blue contributed 16% of the colour mix in the overall UK market and Yoox was the retailer with the highest number of SKUs at over 63,000 products – stocking half of the total blue SKU count of 84,600.
After the top six retailers were identified, we analysed the sell-out performance and contribution level by colour. Blue was the second-highest stocked colour behind black but achieved greater sell-out performance – cementing its position as a key performing colour in the market.
Key Takeaways
Data-backed validation on fashion colour trends increases confidence in decision-making, especially in product development, assortment planning and replenishment strategy. As a result, the risks involved in trend forecasting are greatly minimised.
In summary, the main steps for identifying fashion colour trends with data are:
- Understand your own brand’s historical performance to identify strengths and weaknesses in product offerings.
- Spot uptrending colours from leading markets and aspirational brands.
- Validate colour opportunities against data insights to ensure it is aligned with consumer demand and brand positioning.
