Ecommerce Fashion in Malaysia

The Malaysian fashion industry has changed dramatically over the last two years.

The multi-billion-dollar market was one of the hardest-hit industries in the ongoing COVID-19 pandemic. With radical transformations in consumer behaviour and values, every fashion retailer needed to pivot fast and take major steps to adapt and survive.

In the past, brick-and-mortar stores have been the cornerstone of Malaysia's fashion industry. But with increased social distancing, there has been a significant shift towards online shopping. As a result, plenty of local labels and giant retailers are ramping up their online presence with popular offerings.

It’s not just the way Malaysian consumers are shopping that's shifting, but how they shop. Fashion trends have evolved beyond formal dresses, blending tradition and functionality. With the rise of fashion eCommerce, there's been a move from formal wear to ready-to-wear collections. And the ongoing impact of the pandemic means consumers have gravitated towards value-for-money or essential purchases over luxury wear.

So what are the local and global factors driving the Malaysian fashion industry? And what are the emerging and future trends?

Here's what you need to know:

The eCommerce Fashion industry in Malaysia

While the Malaysian fashion industry might not be as big compared to its neighbours, it’s growing and maturing rapidly.

Malaysia is home to a multicultural society with Malays, Chinese, Indians and other races. This cultural makeup means there's a wide variety of styles in the country. For example, Malays, who practice the religion of Islam, tend to favour modest wear while the Chinese tend to favour East Asian influences from South Korea or Japan.

As a result, the fashion industry in Malaysia has traditionally centred around cultural festivals rather than seasons, compared to Europe, US and Australia. Cultural festivities such as Hari Raya Aidilfitri (Eid), Chinese New Year, Thaipusam, and Deepavali contribute to a demand for traditional wear in Malaysia and the Ramadan period is the peak season for modest fashion purchases.

Another factor that has long influenced fashion is Malaysia’s politics. Over the past decade, the nation has frequently made the headlines with its prohibition or censorship of performances by global pop icons. For example, iconic singer Lady Gaga’s single Born This Way was “censored by Malaysian radio stations” for “offensive” references to homosexuality.¹ At the same time, pop singer Ke$ha's concert in Kuala Lumpur was called off in 2013 for “reasons of religion and culture”.²

But a recent change in the country's political momentum is empowering Malaysian consumers to express themselves in new ways, giving designers the impetus to explore their potential and offer customers what they want.

The last decade has seen the Malaysian fashion industry grow tremendously. New designers are entering the market each season with fresh ideas and, most importantly, a booming ready-to-wear line. These trends are further encouraged by giant online fashion portals such as Zalora and FashionValet.

eCommerce is enabling more local designers to reach consumers in new ways. In a recent analysis by Bain and Facebook, 47% of consumers throughout Southeast Asia reduced their offline purchases, while an astounding 30% increased their online spending in the first half of 2020.³ In addition, a report by research firm vase.ai found that 29% of Malaysians were still buying clothes online between March 2020 to April 2021, and 61% of those aged 24-34 were spending on clothes.⁴

As a result, Malaysian businesses embraced eCommerce to meet an ever-evolving consumer need. The Malaysia Digital Economy Corporation (MDEC) further drove this (by kickstarting a Micro and SMEs eCommerce Campaign under the PENJANA economic recovery plan to help revive local businesses affected by the pandemic. The initiative also enabled local sellers to sustain operations and enhance productivity while they transitioned to an eCommerce platform.

Shopping online for fashion isn't new for Malaysians.

Malaysians spend more on online shopping than other South-East Asian countries, according to a study from Global Web Index.⁵ More than 26 million Malaysians use the Internet, and a staggering 80% of them (between the ages of 16 and 64) are online shoppers.

It's the younger generations driving the trends.

Fashion is one of Malaysia's best selling product categories. Statista's fashion outlook report states that Millennials, those currently aged 25 – 34 years old, make up most of Malaysia's fashion shoppers.⁶ Besides that, most of Malaysia's millennials and Gen Z population are now in the workforce, which gives them the disposable income to spend on non-essentials and support their lifestyle.

Value for money is key.

Malaysian shoppers tend to be price-sensitive given the rising concerns over job security and the economy in a pandemic. So, while younger generations are still purchasing fashion online, Nicole Tan, Country Director of Facebook, says that people are visiting more sites as they look for value, especially in non-essential items.⁷

This sentiment is similar across Southeast Asia. According to the Toluna Global Barometer, 40% of consumers in the Southeast Asia region have tried a new brand since the onset of Covid-19.

Nielsen also found that Malaysians are willing to try new brands and may not be loyal to any one brand.⁸ They tend to be attracted to what they believe to be value for money and great promotions while still being conscious of brand strength and reputation.

Trust is an essential factor driving purchases, and Malaysian consumers want to be confident that the item is of the right quality and represents the best version of themselves.

Ecommerce Fashion trends in Malaysia

Modest fashion

Fashion in Malaysia is strongly influenced by the country's history, particularly by the historical fusion of Malay, Chinese, Indian and other indigenous cultures. Yet, with 61.3% of the population being Muslims, modest fashion is certainly at the top of the game, and Malaysian Muslim women do not hesitate to take out their wallets and spend on luxury clothes.⁹

Over the past year, forward-thinking fashion brands like Tangsi Tujuh and Anaabu are adding functionality to traditional Malay garments while staying true to Asian roots.

Online fashion retailers from other countries, such as Modanisa.com, are also determined to capture the Malaysian market by offering stylish modest fashion collections that exude fun and elegance to Muslim and non-Muslim women, opting for a stylish, trendy, yet still modest look. As a result, the Turkish platform is currently "the only dedicated online modest fashion platform in the world."

This is a big step forward for the multi-billion-dollar modest fashion industry, which puts the spotlight on clothing that doesn’t show much skin. Malaysia is one of the world's largest markets in the modest fashion space and is home to several designers who are pushing the boundaries of traditional dress and reframing it.

This is a big step forward for the multi-billion-dollar modest fashion industry, which spotlights clothing that does not show much skin. Malaysia is one of the world's largest markets in the modest fashion space and is home to several designers who are pushing the boundaries of traditional dress and reframing it.

For example, the latest collections from veteran designer Silas Liew includes a ‘baju kurung’, a Malay traditional ensemble, featuring Thai fisherman pants instead of a sarung.

Focus on functionality

One of the ways brands are bringing fashion up to date is with functionality. Younger generations see traditional clothing as uncomfortable, old-fashioned, and impractical. So, designers are taking on the challenge and creating fashion apparel that's easy to move in while still being stylish. This is done by adding practical details like pockets, which are perfectly sized for smartphones, and stretchable waistbands for changing bodies.

For example, a standard ‘baju kurung’ is sold with a matching top and bottom in the same size. But few women have a proportionate upper and lower body, which has always been a problem. So designers and retailers are now selling separate pieces to cater to all body sizes.

The same approach is being used for shoes too. The designer sister team Machino recently launched a collection of shoes with four designs in a range of colours, each available as heels or flats. The idea was to make timeless pieces that could be used for any occasion - whether for an outing or to run errands. At the same time, they feature a local Malay twist, such as using fabrics from traditional garments such as ‘songket’ and ‘cheongsam’ with lots of colour.

Ready to wear Malaysian fashion

One major change in consumer behaviour over the past year with Covid is a demand for simpler designs that emphasise comfort and value for money.

World-famous designer Khoon Hooi has created a lifestyle collection that offers a full array of beautiful, practical, and affordable items. Accessories are made using upcycled fabrics (yoga bag, bucket hat, tote bag), and there's a collection of basic unisex T-shirts made from quality mercerised cotton. These are items people can wear on a day-to-day basis, other than occasion wear.

Another Malaysian designer, Alia Bastamam, revealed that her design approach has changed.¹⁰ Instead of statement pieces for the runway and gowns, she's been creating "more wearable looks that are versatile and functional in terms of everyday lifestyles.”

Essential accessories

Scarves complete any look and transcend cultures and gender with their versatility. Both men and women wear scarves, and they can be worn around the neck, as a headscarf, tied around a bag or even around the waist. For the executive, a scarf offers the perfect finishing touch to their suits.

Malaysian designer Azila has recently teamed up with local fashion doyenne Datuk Seri Dr Farah Khan of the Melium Group to launch a limited edition of affordable scarves under the Caramel x FK Farah Khan label, which are targeted at the modern, modest woman.

Sunglasses are predicted to be one of the fastest-growing categories in the accessories sector during the next few years. There's a rising perception amongst the fashion conscious that they are a status symbol, and an increasing number of global fashion names have entered the Malaysian market to tap into this potential, including Longchamp, Celine, Muai Jim and Versace. Meanwhile, Kaca-Kaca is an emerging local brand that offers a wide variety of sunglasses at affordable prices - a so-called fashion statement for the masses.

Sustainable fashion

Bamboo fabric has been used for thousands of years in East Asia. Still, it is only recently that manufacturing processes have been modernised, and it is currently being used for everyday fashion.

This breathable, stretchable, hypoallergenic fabric is one that designers are choosing to give consumers a sustainable choice of clothing.

Luxury fashion brands

Despite Covid-19 and the drive for affordable fashion, luxury brands saw an increase in search traffic in Southeast Asia after the pandemic.

According to research by iPrice, there was increased interest in international icons like Chanel (274%), Saint Laurent (306%), Rolex (161%), and Louis Vuitton (555%).(6)

There was increased interest in international icons like Chanel (274%), Saint Laurent (306%), Rolex (161%), and Louis Vuitton (555%), according to research by iPrice.¹¹

Luxury watches like Rolex and Tudor (51%) also saw increased search interest, perhaps due to consumers using luxury watches as investment items.

Sportswear

In the same research, iPrice also noted an incredible jump in searches for sportswear giants like Nike (605%) and Adidas (577%) in Southeast Asia.

This is driven by emerging trends in other related categories. For example, Google Trends showed increased searches in Malaysia for fitness-related items like yoga mats, dumbbells, kettlebells and resistance bands, which suggests that more Malaysians were working out at home during the pandemic.¹²

The increasing popularity of running and other sports activities, such as hiking and cycling, has attracted a rising number of international sports goods stores and brands into the country. In addition, Malaysians are becoming increasingly attracted to new technology and innovative designs that connect footwear with their lifestyles.

Nike Malaysia launched its first ‘hijab’ for athletes in 2018, and Noor Neelofa, one of the pioneers of the modern hijab in Malaysia, launched her first sports hijab collection AURA under her company Naelofar Hijab.

Ecommerce Future of Fashion in Malaysia

The shift of more Malaysian businesses from brick-and-mortar stores to eCommerce platforms, combined with the shift in shopping habits over the past year, is a significant change for the Malaysian fashion industry.

But it is not necessarily here to stay.

Malaysians still have a strong preference to shop for fashion and apparel in person so they can touch and feel items before committing to a purchase.

This means there is an opportunity for omnichannel retail to bridge the physical and online shopping experiences. Improving engagement with customers online using eCommerce marketplace and social media is a wise move for any business that wants to engage customers and grow sales. Brick-and-mortar spaces offer labels the opportunity to draw the consumer into their story, deliver an immersive experience, and ultimately galvanise the relationship with consumers - which can then live across multiple buying channels, both online and offline.

Commission Factory is not only the Asia-Pacific region’s largest affiliate network, working with more than 800 of the world's biggest brands, but is also a performance marketing platform that allows bloggers to earn money and retailers to increase sales.