A Glimpse into the World of Japanese Fashion

Trendsetters in the Asian market and seen worldwide. What sets Japan apart from other fashion giants?


Fashion in Japan can be said to be a refined blend of tradition and innovation. This development can be attributed largely to the country’s long history and culture, and the adoption of Western fashion business models. The market is volatile and competition is fierce. 

Japan’s fashion market has undergone substantial changes in the past decade, and even more so after the pandemic shook the world in 2020. In this four part series, we aim to provide a holistic view of the current state of Japan’s fashion industry, covering key market trends, consumer behaviours, success stories and the future of fashion. We hope that this series will give businesses some insights into how they can break into the market. 

The Fashion Industry in Japan Series

  • Part 1: Market Overview and Key Trends
  • Part 2: Consumer Insights 
  • Part 3: Success Stories
  • Part 4: Fashion’s Future

Source: https://unsplash.com/photos/fydgZecUkk0

Global Fashion Market Overview

The global apparel market is showing no signs of slowing now, and is estimated to grow in value from 1.5 Trillion U.S. dollars in 2020, to about 2.25 Trillion dollars by 2025 (Statista 2022). Over the past decade, China and Southeast Asia have experienced massive growth in numerous sectors due to rapid economic development which led to increase in disposable income and buying power. We’ll dive into the top three largest apparel markets: the United States, China and Japan. 

Japan Fashion Market Overview

Taking third spot in the global apparel market ranking is Japan, where the fashion industry is well known for being dynamic, innovative, but also highly competitive. Growth rate in the Japanese fashion industry has been relatively stable over the past few years, however, factors like ageing population, declining birthrate, and the COVID-19 pandemic will likely put a dent in future growth rates. 

According to a 2021 report by Yano Research, the retail apparel market in Japan grew by 81.9% YoY to 7,515.8 billion yen in 2020, a 17.4% dip from 2019 (Yano 2021). 

Caption: Growth rates in Japan’s retail apparel market (Yano Research) 

Department stores, once dubbed the “kings of retail”, were hit the hardest in 2020 after the pandemic exposed weakness in their traditional business model. Despite enjoying consecutive growth over the past 15 years, specialty stores are beginning to face saturation in distribution and also strong competition from online fashion retailers. A shift in consumer behaviour due to the pandemic and worsening business conditions would mean that the market is expected to see a downward trend in the mid-long term. 

In the next section, we will look at some of the key market trends that have shaped the industry.

Source: https://unsplash.com/photos/ZSTkMnVMWSQ

Decline in physical stores and EC Boom due to COVID 

Although specialty chains have been leading the charge with positive year-on-year growth for the past decade, market saturation, changing consumer habits and the pandemic has brought that to a halt and these chains are now facing a decline. 

In 2020, retailers in major stations and fashion shopping malls saw sales drop by 30-48%, while apparel brands and apparel chains saw their sales drop by 40-54% and 20-40%, respectively (MakeShop 2021).

Long-running Japan retailers are also closing physical stores and moving their business online. Cecil McBee, an iconic Japanese brand considered to be the representative of “gyaru” fashion since the 1990s, announced that it will close all its physical stores by November 2020 and focus on online sales (Japan Times 2020).  

On the other hand, e-commerce (EC) websites like Zozotown, Global Work and Lowrys Farm (both owned by Adastria) have seen accelerated growth since the start of the pandemic. 

As of October 2021, 8 out of 30 top EC websites in Japan are fashion EC websites. 

Caption : No. 4: ZOZOTOWN, No.5 : UNIQLO, No. 15: Adastria, No. 18: BAYCREW’S, No. 23: Onward Holdings (ONWARD CLOSET), No. 24. TSI Holdings (MIX. Tokyo), No. 25: WORLD (WORLD ONLINE STORE), No. 28: UNITED ARROWS (UNITED ARROWS ONLINE STORE) Source: Net Hanbai (月刊ネット販売)  

In early 2021, Adastria announced that their EC business achieved a 23% increase in revenue (53.8 billion yen) and almost half of the revenue came from 「Staff Board」, a platform launched by Adastria in 2018, where the staff from the physical stores will pose photos of themselves in the brand’s clothes (Netshop 2021). 

Source: https://unsplash.com/photos/gf8e6XvG_3E

Dominance of domestic brands and fashion ecommerce sites

It is a widely held view that Japan is one of the most challenging markets for foreign businesses to enter. And that still holds true. Language barrier, business customs, culture, unique consumer behaviours and the tendency to trust domestic brands are just some of the hurdles that foreign businesses have to overcome. 

In the fashion industry, this is no different. The market continues to be dominated by several strong domestic brands like UNIQLO, MUJI, COMME des GARCONS and ASICS . These companies have continued to grow exponentially and are highly entrenched in the domestic market. Moreover, these dominant domestic brands have built a very strong online presence over the years, giving them a sharp boost in revenue during the pandemic. 

Here are some domestic brands that have found incredible success in the ecommerce sphere.


Currently, ZOZOTOWN, Japan’s largest online fashion store, has more than 1,100 fashion retail partners and more than 7.39 million transactions annually (btrax). As pioneers in fashion-tech, ZOZOTOWN have been launching innovative, tech-driven initiatives and services to improve customers’ fashion experience. Some of their innovations include, ZOZOSUIT, a suit fitted with a full body marker recognition system, that allows the wearer to get a 360° view of his/her body size data with just a smartphone camera. ZOZOTOWN also refined their recommendation strategy for online users, by leveraging AI, deep-learning and more than one million data points. As a result, the number of shoppers in ZOZOTOWN increased by 1.21 million from the previous year to 9.48 million in 2021 (Nikkei). 

UNIQLO (Fast Retailing)

In 2020, UNIQLO surpassed the 100 billion yen mark for the first time in its EC business with a 29.3% increase in sales to 107.6 billion yen (Net Keizai, 2020). Despite the closure of its physical stores due to the declaration of a state of emergency in Japan, UNIQLO posted a significant 54.7% year-on-year increase. 

UNIQLO not only took steps to revamped its mail-order service, but also increased awareness of their online website through digital advertising and TV commercials, and launched various special campaigns targeting app users. These initiatives significantly increased the number of new customers and revenue. 

Finding success with the omnichannel strategy

The omnichannel strategy has become the gold standard for success in the retail industry. In a nutshell, an omnichannel strategy is a business strategy that helps companies create a seamless experience for customers across all the channels, platforms and devices. It encompasses the online and offline touchpoints of the brand, from a physical store to an Instagram shoppable post (Square Up).

Similar to many global players, brands in Japan have been embracing the omnichannel strategy to reduce their reliance on physical store sales and also provide customers with a fully integrated shopping experience.

In September 2021, Rakuten launched “Rakuten Fashion Omni-channel Platform,” a digital solution that centrally manages product inventory information across multiple sales channels, sales history, and buyer information such as gender and age linked to Rakuten ID for brands on Rakuten Fashion (Rakuten). 


Domestic brands like Adastria and UNIQLO have also found great success by leveraging digital advertising, content marketing, and social media.


UNIQLO IQ is an AI-powered assistant that is integrated into UNIQLO IQ mobile app where it serves as a one-stop ‘digital concierge’, providing everything from product recommendations to voice-enabled customer service. Customers looking for styling inspiration can filter products by hourly product rankings, occasion type, or items featured in Japanese monthly magazines.

UNIQLO is able to collect personal attribute data such as gender and age with purchase data, and constantly refine products and manage inventory based on the latest data (Econsultancy, 2018).


Adastria leverages on various cloud services like Google Marketing Cloud to gather customer data through their website and apps. Integrating LINE (Japan’s top chat messenger) x .st (Adastria EC website) allows them to provide followers with real-time updates (i.e. offers, restock etc). Customers who have added items to the cart but have not made a purchase might be more compelled to complete the purchase upon receiving information that stocks are running low or when they receive a discount coupon (Eczine, 2016) . 

In this article, we provided a bird’s-eye-view of the fashion market in Japan, covering some of the key trends that have shaped the industry. In Part 2 of this series, we will delve in the hearts and minds of the Japanese consumers and examine trends and behaviours unique to the market. Stay tuned! 


  1. https://www.statista.com/topics/5091/apparel-market-worldwide/#topicHeader__wrapper
  2. https://www.businessfinland.fi/48f391/globalassets/julkaisut/business-finland—japan-fashion-market-report-2021.pdf
  3. https://www.yano.co.jp/press-release/show/press_id/2807
  4. https://www.toki.tokyo/blogt/2021/04/30-glimpse-into-the-world-of-japanese-fashion
  5. https://www.makeshop.jp/main/know-how/knowledge/fashion-ec-site.html
  6. https://netshop.impress.co.jp/node/8598
  7. https://netshop.impress.co.jp/node/8583
  8. https://blog.btrax.com/fashion-tech-ux-japan/
  9. https://netshop.impress.co.jp/node/9126
  10. https://xtrend.nikkei.com/atcl/contents/18/00371/00003/
  11. https://www.fastretailing.com/eng/ir/direction/position.html
  12. https://econsultancy.com/how-uniqlo-is-personalising-the-shopping-experience-with-google-powered-app/ 
  13. https://squareup.com/us/en/townsquare/how-to-take-your-omnichannel-strategy-to-the-next-level#:~:text=An%20omnichannel%20strategy%20is%20a,not%20just%20for%20retailers%20anymore
  14. https://eczine.jp/article/detail/3326?p=2
  15. https://unsplash.com/photos/alY6_OpdwRQ

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Cherie Ng

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