I don't count that Xi losing, but Xi winning. He's very conservative in China's sense, and he's basically crushed less conservative forces in the Party. A crackdown on clothing "detrimental to the spirit of the Chinese people." doesn't serve any real interests of Xi other than enforcing the ideals of China's conservatives.

Similar to how the Republican party always try to inhibit abortion wherever they can. You won't say that Republican party successfully passing an anti-abortion law indicates they are losing, will you?