Retro and classic styles drive slow year for US footwear industry
Is the US footwear industry witnessing a slowdown in growth? The NPD Group released a report on Monday that found American's footwear segment grew by 3% in 2016, generating $17.5 billion. However, the year's growth was at a much slower pace than past years.
“For more than a decade, U.S. sales of athletic footwear have averaged about a 4 percent annual increase, but 2016 will go down as a slightly below average year,” said Matt Powell, Vice President and Sports Industry Analyst, The NPD Group. “Given the sports retail landscape in 2016, it is understandable why this happened.”
Powell referred to bankruptcies from both Sports Authority and Sport Chalet that impacted the industry especially late in the year.
“The Sports Authority and Sport Chalet bankruptcies certainly shook the industry,” he said. “It is likely that we will still see the impact continue through Q1, but after that the drag should be over and trend should return to normal.”
The athletic specialty/sporting goods channel, which comprises 50% of annual athletic footwear sales, grew only 2% compared to 8% in the previous year. Shoe chains increased 7%, department stores grew 1% and national chains fell 1%. The report also found that the industry grew in each of the first three quarters but was hindered by a decline in the fourth quarter. Unit sales grew by 3% in the year and the average selling price remained flat at $60.81.
Though the athletic footwear channel’s growth has simmered, the Classics category offset its performance with dollar sales increasing 26%. The category grew in sales by $1.7 billion over the past three years due to a shift in trends moving towards retro styles. Styles that were inspired by performance such as running and basketball increased 36% and 27%, respectively, while running footwear was flat for the year and basketball footwear was down for the first time in years. The Casual Athletic category was up 11% after two years of decline.
“Retro will remain the dominant fashion trend, but success won’t come easy,” said Powell. “Competition will intensify and brands must constantly update their styles. To further distinguish themselves and stay ahead of the competition, brands should focus their innovation on the manufacturing side, emphasizing speed and sustainability, as this impact will be long-lasting, regardless of where fashion moves the market.”
Copyright © 2020 FashionNetwork.com All rights reserved.