Global market review of active sportswear and athletic footwear forecasts to edition

Transcription

1 Global market review of active sportswear and athletic footwear forecasts to edition

2 Page i Global market review of active sportswear and athletic footwear forecasts to edition By Malcolm Newbery January 2008 Published by Aroq Limited Seneca House Buntsford Park Road Bromsgrove Worcestershire B60 3DX United Kingdom Tel: +44 (0) Fax: +44 (0) Web: Registered in England no:

3 Page ii Single-user licence edition This report is provided for individual use only. If you would like to share this report with your colleagues, please order additional copies or sign up for a multi-user licence by contacting: Kathryn Wedgbury Research manager, just-style.com Tel: +44 (0) kathryn.wedgbury@just-style.com Copyright statement 2008 All content copyright Aroq Limited. All rights reserved. This publication, or any part of it, may not be copied, reproduced, stored in a retrieval system, or be transmitted in any form by any means electronic, mechanical, photocopying, recording or otherwise without the prior written permission of Aroq Limited. This report is the product of extensive research work. It is protected by copyright under the Copyright, Designs and Patents Act The authors of Aroq Limited s research reports are drawn from a wide range of professional and academic disciplines. The facts within this report are believed to be correct at the time of publication but cannot be guaranteed. All information within this study has been reasonably verified to the author s and publisher s ability, but neither accept responsibility for loss arising from decisions based on this report. Incredible ROI for your budget single and multi-user licences We understand the pressure your research budget is under and price our reports realistically. You won t find our reports with four, or even five-figure price tags, but you will find that they make some of the competition look expensive. Each title is available to you on a single-user basis, supplied on the strict understanding that each title is not to be copied or shared. Alternatively, titles can be shared within departments or entire corporations via a costeffective multi-user licence. Multi-user licences can also save you money by avoiding unnecessary order duplication. To further add value, all multi-user

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5 Page iv Contents Contents Single-user licence edition... ii Copyright statement... ii Incredible ROI for your budget single and multi-user licences... ii just-style.com membership...iii Contents... iv List of figures... vi List of tables... vii Chapter 1 Executive summary... 1 Report scope... 1 This sporting life: Report introduction and theme... 1 The active sportswear and athletic footwear market... 1 Market estimates... 2 The market in 2005 and The market in Supply to the market... 4 Developments in sportswear...5 Chapter 2 Introduction and report theme... 7 The theme of this edition... 7 Clothing and footwear sporting definitions... 7 This sporting life: Live the dream...8 Report contents and coverage... 8 Chapter 3 The active sportswear and athletic footwear market... 9 Source of the definition of active sportswear and athletic footwear... 9 Total sports apparel... 9 Active sports apparel... 9 Sports licensed apparel Sports and their participants...10 Apparel, footwear and equipment The sports/product matrix...14 Sportswear, population, regions and the propensity to purchase Sources of data Units and exchange rates...19 Chapter 4 Market estimates The active sportswear and athletic footwear market, Growth, Market estimates, International background... 24

6 Page v Contents World market estimates, Population Combined market value and spend per person The active sportswear market The athletic footwear market Market estimates, Future drivers of the active sportswear and athletic footwear markets World market estimates, Population Combined market value and spend per person The active sportswear market The athletic footwear market Market growth, Active sportswear growth, Athletic footwear growth, Annual time lines Chapter 5 Supply to the market Channels of distribution Retailers, brands and no-name merchandise Global brands Other important companies in the sportswear sector Competition from the casualwear pretenders Chapter 6 Current and future developments in sportswear Sports and the clothing and footwear that is worn Attitude, aspiration and product Converse...66 Toray Fila Nike Celebrity, the cult of celebrity and sponsorship The retail situation Supply and the control of costs Licences and joint ventures...70 Brand ownership and acquisitions... 71

7 Page vi List of figures List of figures Figure 1: Percentage split of active sportswear and athletic footwear in the world, 2005 and 2007 (%)...22 Figure 2: Global regional population share, 2007 (m people and %) Figure 3: World market and spend per person, for active sportswear and athletic footwear, 2007 (US$m and US$) Figure 4: Active sportswear by region and population, 2007 (US$m and %) Figure 5: Active sportswear spend per person by region, 2007 (US$) Figure 6: Athletic footwear by region and population, 2007 (US$m and %) Figure 7: Athletic footwear spend per person by region, 2007 (US$) Figure 8: Athletic footwear by region and population, 2007 (m units and %) Figure 9: Global regional population share, 2014 (m people and %) Figure 10: World market and spend per person, for active sportswear and athletic footwear, 2014 (US$m and US$) Figure 11: Active sportswear by region and population, 2014 (US$m and %) Figure 12: Active sportswear spend per person by region, 2014 (US$) Figure 13: Athletic footwear by region and population, 2014 (US$m and %) Figure 14: Athletic footwear spend per person by region, 2014 (US$) Figure 15: Athletic footwear by region and population, 2014 (m units and %)... 40

8 Page vii List of tables List of tables Table 1: US top sports ranked by participants, 2006 (no. of participants and %) Table 2: The sports/product category matrix Table 3: Estimate of the propensity to purchase in the developing world, Table 4: Exchange rates as of 11 October Table 5: Main regional consumption of active sportswear and athletic footwear, 2005 and 2007 (US$bn and %) Table 6: World and regional markets for active sportswear and athletic footwear, 2007 (m people, US$ and units) Table 7: World and regional markets for active sportswear and athletic footwear, 2014 (m people, US$ and units) Table 8: Active sportswear growth by region, (US$m and %) Table 9: Active sportswear growth in spend per person, by region, (US$ and %) Table 10: Athletic footwear growth by region, (US$m and %) Table 11: Athletic footwear growth in spend per person, by region, (US$ and %) Table 12: The combined sportswear market by region, (US$bn) Table 13: The active sportswear market by region, (US$bn) Table 14: The athletic footwear market by region, (US$bn) Table 15: The athletic footwear market by region, (m units) Table 16: The combined sports market by region as an index, (US$ percentage growth, 2007=100) Table 17: The active sportswear market by region as an index, (US$ percentage growth, 2007=100) Table 18: The athletic footwear market by region as an index, (US$ percentage growth, 2007=100) Table 19: The athletic footwear market by region as an index, (unit percentage growth, 2007=100)... 51

9 Page viii List of tables Table 20: Branded, own-label and anonymous merchandise US dollar share, 2005 and 2007 (%) Table 21: Adidas and Nike shares of world active sportswear and athletic footwear markets by region (US$bn and %)... 56

10 Page 1 Chapter 1 Executive summary Chapter 1 Executive summary Report scope This report concentrates on consumers who enjoy a sporting lifestyle, and garments that will be used in active sport. This includes competition, recreation and exercise. It does not include wearing a fleece, sweat or shirt in team colours to the ball game or the soccer match This sporting life: Report introduction and theme There are a number of themes and arguments running through this report, of which the prime one is that we have all become available for sports brands and retailers to reach with their marketing material. The prime reason why, as consumers, we are now so available is that sport is a huge business, and particularly, a huge business for television. The purchasing choice is frequently determined by the sportsman or woman you admire, or the team that you follow and hence the brand that you aspire to wear. It could be called live the dream. The active sportswear and athletic footwear market just-style has chosen to use the view of the Sports Goods Manufacturers Association (of the US) to define what constitutes the market. Its view is that the market is defined as sports apparel that consumers say they purchased with the intent that it will be used in active sport. SGMA published a list of no fewer than xxx single sports in its Sports Participation Survey for It now believes that: Sports on the rise include low and no impact activities such as elliptical motion trainers, fitness swimming, Pilates training, bicycling, yoga, and walking on a treadmill. Sports that are not growing at a quick rate are those activities which feature high intensity, lots of body contact and body pounding...and they include highimpact aerobics, step aerobics, stair-climbing machines and tackle football. One of the challenges facing all sports is that there are so many sports out there competing for the time and attention of all athletes!

11 Page 7 Chapter 2 Introduction and report theme Chapter 2 Introduction and report theme The theme of this edition Although, inevitably, there are a number of themes and arguments running through this report, the prime one is that we have all become available for sports brands and retailers to reach with their marketing material. The prime reason why, as consumers, we are now so available, is that sport is huge business, and particularly, huge business for television. In that context, the report will question whether that is making consumers of sports clothing and athletic footwear: active participants in performance sports; active participants in soft sports (more of that in Chapter 3); passive couch potatoes watching their sport; consumers who know what they want, and who can interact with brands (more of that from the Nike ID Design Studio in Chapter 6); consumers who buy what their sporting idols tell them to buy. Clothing and footwear sporting definitions In this, the third edition of the report, just-style has remained faithful to the definitions used before. In the first edition of this report, a definition was offered of what the product category was. This was necessary because, as in some other apparel product categories, the boundaries between fashion and function are not clear. The apparel industry in general has difficulty with its terminology concerning product definitions. It is unclear where formalwear ends and casualwear begins. What is the difference, for instance, between a tailored jacket, a structured jacket and an unstructured jacket? What is the dividing line between formal and casual trousers? The sportswear product segment is one of the most confusing. Most consumers (see previous just-style reports) know what they mean by jeans or lingerie. This report on sportswear has to start by stating how sportswear is to be defined and this is done in Chapter 3, which explains the market. The definition turns out to depend more on the manner in which the garments are

12 Page 9 Chapter 3 The active sportswear and athletic footwear market Chapter 3 The active sportswear and athletic footwear market Source of the definition of active sportswear and athletic footwear As the (English) writer sits typing this manuscript at his PC, he is wearing a Nike replica rugby shirt (the 2007 Rugby World Cup was recently played in France), a pair of Nike tennis trainers (he is a well past his best club tennis player), a pair of Wilson tennis socks that go with the Nike shoes (but create brand competition) and Fruit of the Loom fleece jog suit bottoms. And yet, he is involved in nothing more athletic than writing for just-style. So, how is the market for active sportswear and athletic footwear to be defined? The solution lies in the use of the word intent as explained by the Sports Goods Manufacturers Association (SGMA) of the US. As the industry trade and lobbying body for the sports clothing, footwear and equipment brands of the largest national market in the world, its experience and opinion matters. Its view, expressed by VP of marketing Mike May, is that the market is defined as sports apparel that consumers say they purchased with the intent that it will be used in active sport. In its 2004 annual report (referred to in an earlier edition of this report), SGMA spelt its position out carefully and clearly by defining sports apparel in three ways. Total sports apparel This is apparel that consumers define as clothing designed for, or that could be used in, active sports. This is an extremely broad definition, encompassing clothing that people wear for many different occasions. Active sports apparel This narrower definition of sports apparel describes apparel that consumers say they purchased with the intention that it will be used in active sport. This does not mean the apparel was purchased for that exclusive use. The intention may have been to wear it on other occasions as well. While such apparel may

13 Page 21 Chapter 4 Market estimates Chapter 4 Market estimates The active sportswear and athletic footwear market, The world market in 2005 represented sales of US$xxxbn of active sportswear and athletic footwear, bought by a world population of xxxxxbn people. This means that US$xxxxx was spent on behalf of every man, woman and child in the world on active sportswear and athletic footwear in This world personal consumption figure both combines active sportswear and athletic footwear, and inevitably contains huge imbalances of purchasing power across the world. These differences have been analysed in our database and shown in the various regional figures which follow for 2007 and The world active sportswear market for 2005 was worth US$xxbn. This means that US$xxxx was spent on behalf of every man, woman and child in the world on active sportswear. The world athletic footwear market for 2005 was worth US$xxbn. This means that US$xxxxx was spent on behalf of every man, woman and child in the world on athletic footwear. Figure 1 illustrates how the world market was split between active sportswear and athletic footwear in both 2005 and in 2007.

14 Page 52 Chapter 5 Supply to the market Chapter 5 Supply to the market Channels of distribution Historically, the sportswear clothing and footwear industry was unique, as far as apparel in its broadest sense was concerned. It had its own retail channel of distribution to the market. Unlike ordinary street clothing which was sold through a variety of retail formats, sportswear was sold through specialist sportswear retailers. They sold specialist sportswear product to dedicated sportswear consumers. Of course there are specialist sports retailers still. Principle examples from just three country markets are Foot Locker and Sports Authority in the US; Sports Direct, JJB Sports and JD Sports in the UK; and Decathlon in France. Many of the independent specialist shops, especially in continental Europe, are part of buying groups such as Intersport. What makes these retailers of sportswear different from other clothing retailers is that they are retailing brands rather than own-label merchandise. The brand and its attendant consumer loyalty are stronger in sportswear and sports footwear than in any other product category. This historical approach, however, is under threat. Decathlon pushes its ownlabels aggressively in both France and the Netherlands. JD Sports is on record as recently as October in stating its wish to grow its own brands and get out of its shop-in-shop arrangements with Nike and Adidas, which have been of little impact (Retail Week, 5 October 2007). At the same time, the leading market players are integrating forwards into retail to control their own distribution. This includes strong investments from both Nike and Adidas which will be considered in Chapter 6. Retailers, brands and no-name merchandise There are no statistically proven and reliable data for the share of branded, retail own-label and anonymous sportswear. As mentioned earlier, and unlike the situation in most clothing categories, where there is a balance of retailer own-brands, manufacturer brands and no-name merchandise, active sportswear and athletic footwear are still the preserve of the sports brand. The manufacturer in manufacturer brands has been put into inverted commas, because very little of the manufacturing is done these days in the

15 Page 64 Chapter 6 Current and future developments in sportswear Chapter 6 Current and future developments in sportswear Sports and the clothing and footwear that is worn As this, the third edition of Global market review of active sportswear and athletic footwear, is produced, it appears that there may be a reaction to professional performance sportswear. The SGMA 2006 Sports Participation Survey (in Chapter 3) has suggested that there is a resurgence of interest in less strenuous sports activities, which generate a feeling of wellbeing. If the evidence for this is correct, then there must be an effect upon the type of sportswear worn. The suggestion is that the sportswear will be less professional and less extreme. However, it is in the commercial interests of the equipment, clothing and footwear providers to up the value of their products by relating them to real or perceived benefits. Consequently, they tend to concentrate upon, and sometimes enhance, the technological elements of their products. Examples of this from the trade press over the period since the publication of the second edition of this report (2006) concern moisture management and the new technology of nanogenes. It is clear from the press that one of the key performance criteria in modern sports and active outdoor wear is moisture management the ability of a garment to transport moisture away from the skin to the garment s outer surface. This provides comfort to the wearer, regardless of the extremes of effort that they are putting in to their sport. The market is currently dominated by Invista s portfolio of moisture management fabrics which include CoolMax, Tactel Aquator, ThermaStat, Thermax and Thermolite Base. However, the pace of development has accelerated over the past ten years, and a growing number of other companies have started to compete. They include sports apparel companies as well as fibre specialists. This is a sure sign that the consumer is taking a clear interest in the physiological properties of sportswear.

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