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Apparel and consumer electronics could get a boost from the back-to-school and holiday seasons. But home improvement may have a ways to go before the category rebounds.

Why this matters: Clothes and accessories are a major volume driver for buy now, pay later (BNPL) providers like Affirm. Fashion and beauty accounted for 15% of Affirm鈥檚 gross merchandise volume (GMV) in Q2 FY 2025 (ending December 31, 2024). GMV in this segment shot up 20% YoY during the quarter. Affirm partnered with more than 45 fashion merchants in the past six months.

71% of US adults prefer to take their time while shopping online for clothes and shoes, according to November 2023 Kearney data.

That hasn鈥檛 yet dampened sales, if only because more consumers are going into debt or using buy now, pay later (BNPL) options to finance the purchase. 86% of Gen Zers admit to overspending during live events, not only on tickets but also on adjacent categories like food and beverages as well as apparel and accessories, per a survey by Merge.

Though apparel and accessories is the third fastest-growing product category we measure鈥攇rowing 3.9% to reach $616.37 billion in US sales this year鈥攔etailers need to find creative ways to court consumers as they remain price-sensitive.

On today's episode, in our "Retail Me This, Retail Me That" segment, we discuss the opportunity for China-based companies like Shein, Temu, and TikTok in the US, and how they can compete with Amazon. Then for "Red-Hot Retail," our analysts give us some spicy predictions about how fashion retail will change in the US as a direct result of Chinese manufacturers. Join our analyst Sara Lebow as she hosts analysts Sky Canaves and researcher and Asia-Pacific lead Man-Chung Cheung.

Higgsfield鈥檚 Soul offers fashion-grade realism for AI images and videos, helping marketers produce campaign-quality assets faster and cheaper鈥攚ith over 50 customizable presets. As YouTube Shorts hit 200 billion daily views, the company added Google鈥檚 Veo 3 AI video-generation tool to help creators improve their content.

Hispanic consumers reduced their purchase frequency for categories like clothing, haircare, and beauty products in Q1. Interest in staples like frozen foods, snacks, canned goods, and dairy products also declined鈥攁 problem for CPG brands that have relied on outsize spending from Hispanics to drive growth.

On today's episode, we discuss whether it's too early to talk about Gen Alpha, delivering things without the box, what's happening on TikTok Live, fast fashion looking to repairs, what websites will look like in the future, the most popular theme parks in the world, and more. Tune in to the discussion with our vice president of content Suzy Davidkhanian, analyst Blake Droesch, and forecasting director Oscar Orozco.

In January, Shein relaunched in India as 鈥淪hein India Fast 贵补蝉丑颈辞苍鈥� under a production and sourcing licensing partnership with India-based Reliance Retail. And Chinese apps like Xender, TanTan, Alibaba鈥檚 Taobao, and Youku are once again allowed in India鈥檚 app stores.

It could also help someone find a specific piece of clothing on a marketplace, negotiate the price, and pay for it all at once. Gauging interest: More than three-fourths (76%) of retailers are increasing their investments in AI over the next year, per Salesforce鈥檚 March 2025 Connected Shoppers Report.

For example, shoe and apparel brands could launch a branded VR experience where users 鈥渢ry on鈥� (and maybe customize) clothing, or brands could offer early-access codes to new item drops to users who complete a VR scavenger hunt. Recommendation for media platforms. Optimize ads for both standard video and mobile. Gen Zers鈥� tendency to juggle screens means covering all possible bases.

The news: Chinese fast-fashion retailer Urban Revivo will open 25 international stores this year鈥攊ncluding in the US and Europe鈥攖o help offset the challenges of China鈥檚 ailing economy and highly competitive fashion industry.

Outdoor cookout essentials, including grills, accessories, and patio furniture, are similarly caught in the crossfire. For example, about 80% of Traeger鈥檚 grills were made in China in fiscal 2024, with the remainder produced in Vietnam.

Doubling down on top performers like Vince, Hoka, and Vuori helped the retailer grow comparable sales at its main banner by 4% YoY, with particular strength in the women鈥檚 apparel, active, shoes, and men鈥檚 apparel categories.

This feature uses AR to help users visualize clothing and accessories鈥攄own to the shadows, wrinkles, and draping鈥攁nd now includes pants and skirts in sizes from XXS to XXL. Google says this technology can lower return rates, which are a pain point for retailers. Multi-brand AR makeup testing.

During peak shopping events, such as high-demand concert ticket sales or limited-edition clothing drops, AI agents could risk being blocked by fraud-prevention systems.

Off-price accounted for the majority of visits to apparel retailers in Q4鈥�51.9%, according to Placer.ai. That share is likely to grow as department stores reduce their footprints, and declining consumer confidence and market volatility push shoppers to seek out cheaper options.

Automotive, clothing and accessories, and food and beverages experienced the biggest linear TV ad spending declines in the 25 days after 鈥淟iberation Day,鈥� when President Trump announced a 10% duty on nearly all US imports starting on April 5th, according to EDO. An exception was the furniture and home decor category, which experienced the largest ad spending gains along with utilities.

Wardrobing: A form of returns fraud where consumers buy clothing, use it, and then return it. Consumers promoting these behaviors or "hacks" for returning on social media have worsened ecommerce return issues. It's not just a consumer behavior issue. Inaccurate product information, inconsistent sizing, and quality issues lead to more returns. Paying the price.