If the unfavorable revenue of most sports brands in 2021 is due to repeated epidemics and insufficient supply chains, then in 2022, the overall saturated sports shoes and clothing market should be responsible.
A research report by the NPD Group, an American market research organization, shows that since the beginning of the epidemic in 2020, the sales of sports shoes and clothing have been saturated as a whole. “Consumers’ desire to buy sportswear products has declined significantly. Although the global supply chain will basically recovery, but the demand side has not been stimulated much.”
After a rather bleak 2021, sports brands all want to resume their performance gains in 2022 and regain their lost ground before the epidemic.
However, under such a big environment, most brands that want to stand up in 2022 are still unable to do what they want, and it is difficult to turn around the decline in revenue.
The overall market is saturated, and the growth of big brands is weak
If you want to know the market trend, the data of the top brands can provide the answer.
Adidas, the German sports brand giant, will be very frustrated in 2022: the growth “engine” Greater China has seen revenue decline for 6 consecutive quarters; in the second half of the year, it was forced to cut seats with the sales “main” Yeezy series, and the management also changed frequently.
In the last fiscal year, Adidas’ annual revenue reached 21.234 billion euros (about 127.1 billion yuan), a year-on-year increase of 15%. The annual revenue in the Chinese market rose only 3% year-on-year.
Industry insiders estimate that Adidas’ annual revenue in 2022 will only increase slightly, and the Greater China region is very likely to enter a negative growth stage.
The situation of American sports brand Under Armor is not optimistic. Its financial report for the first quarter of fiscal year 2023 shows that brand revenue was flat year-on-year, and net income plummeted by nearly 90%.
Tmall’s official data shows that Nike, Fila, Anta, Li-Ning and Adidas rank in the top five in the sales list of sports brands on this platform during Double 11 this year. Among the comprehensive sports brands, Puma, the German sports brand, ranks third in the world all the year round. It didn’t even break into the top ten, coming in at number 11.
This year’s Double 11, most sports brands did not put up posters to promote as in previous years. Even if individual brands still released the copywriting of “good sales”, they tacitly did not mention specific sales data.
24-year-old Li Yu has been collecting sneakers of various brands for 7 years. This year is the year when he and his friends have bought the least new shoes. How to buy shoes.”
Li Yu said that he didn’t want to buy shoes mainly because he already had enough shoes of all types, and there was no new demand for the time being.
“Besides, the entire shoe industry is not doing well now. Those shoes are not only difficult to resell after queuing up all night to buy them, but the price is also lower than in previous years.” Li Yu added.
Li Yu used Nike’s classic barb series as an example, “Barb 1.0 was released in July 2019, and the second-hand market cost about 10,000 yuan to buy. The 4.0 released this month, the second-hand market is only around 4,000 yuan. And 4.0 The launch price is 500 more expensive than 1.0.”
Online sales are no longer popular, and offline channels are also sluggish.
Ma Liang, a sports shoes and clothing buyer from Dongguan, Guangdong, has a local studio, providing local amateur sports teams and various units with sports clothing needed for competitions and team building.
Ma Liang told Jiemian News: “Sports retail is not doing well this year as a whole, and the large orders for group buying are much less than in previous years. Some customers also know that the industry is not too hot, so they lower the price when they ask us to give internal discounts, so they can earn more. not enough.”
The person in charge of a large shopping mall in Nanning, Guangxi also noticed the downturn in the sports shoes and apparel industry this year. There are only one or two left.”
Survival in the cracks depends on subdivision
Of course, sports brands have not been wiped out. There are still some brands that buck the trend and rise in the cracks.
While pointing out that the global sports shoes and clothing market is saturated, NPD also mentioned in the report that brands focusing on sub-categories such as running, outdoor hiking, and yoga are still growing.
NPD said in the report: “These segmented tracks have the potential to continue to expand.”
Such a brand temperature difference can be seen from the performance of companies with multiple sports brands.
VF Corporation, established in Pennsylvania, USA in 1899, has a history of more than 120 years. It owns Vans, The North Face (North Face), Supreme, Timberland, Jansport, Eastpak and other fashion and sports brands.
According to the Group’s latest results for the second quarter of fiscal year 2023, Vans, VF’s brand with the highest proportion of sales in the past, had a quarterly revenue of only US$1 billion, a 13% drop from the same period last year.
The revenue of The North Face, which focuses on outdoors, has been booming all the way. It also earned $1 billion in the quarter, but it continued to rise, with a year-on-year increase of 8%.
Other brands such as Dickes and Supreme also reported mixed results. Recently, there has been news that VF will sell Jansport.
In this case, VF has lowered its full-year forecast several times. In addition, the group has also carried out internal layoffs and carried out several rounds of blood changes to the brand management, hoping to clarify the situation through personnel adjustments and find new development directions.
In December, Taobao’s comprehensive quality, year-on-year growth rate, network popularity and other data indicators released the top ten treasures of the year. In terms of sports, four products including frisbee, camping, paddle board and yoga pants were selected. And these few products all come from the niche movement that has emerged in recent years.
Therefore, for brands, expanding the subdivision track becomes a breaking point. These niche sports are still in the early stages of development, far from reaching the apex of development, and there is still a large market demand to be discovered.
In terms of outdoor, Anta’s Descente, Kolon and other outdoor brands have seen an increase of more than 20% in revenue, gross profit and operating profit.
Thanks to the “bicycle craze”, in the spring and summer of this year, high-end bicycles such as Xiaobu appeared in many cities in China, where “one car is hard to find”. The Hermès bicycle with a price tag of 165,000 was also sold out quickly after it was released in mainland China.
In the high-end running shoes track, the French sports brand HOKA ONE ONE, which was founded only 13 years ago, has seen sales growth of about 50% in the last five fiscal years, an astonishing growth rate. Even during the epidemic, the brand’s revenue growth rate did not fall but rose, remaining at around 55%.
lululemon is the biggest winner of this year’s focus on segmentation.
Although it started by selling yoga pants, the market value of the Canadian brand has successfully surpassed Adidas this year, approaching 50 billion US dollars, and it is second only to Nike in the field of sports brands.
According to the brand’s latest financial report data, the company’s revenue in the third quarter was US$1.9 billion, a year-on-year increase of 28%, and the three-year compound growth rate reached 27%.
While the subdivision-focused brands are taking advantage of the trend, big comprehensive brands are also beginning to expand their categories.
Whether it is the boss Nike, or Adidas and Puma behind them, they have emphasized the importance of expanding product categories in their future development plans.
The American sports brand Skechers also believes that professional sports games will be an important growth point for the entire market in the future. In recent years, the brand has invested a lot of money and manpower in golf, e-sports, hip-hop and other subdivisions.
Chen Weili, CEO of Skechers China, South Korea and Southeast Asia, told Jiemian News: “Consumers’ demands for clothing are now more subdivided. For example, professional equipment is required for running and yoga. We have good expectations for professional sports. Put our The wider product line can better meet the needs of consumers.”
While the giants are trying to get a share of the subdivided track, brands that have already established a firm foothold on the track are also planning ahead: lululemon released a new shoe series this year, and HOKA has also begun to promote brand clothing lines.
2023? Still Unknown
What will the sports shoes and clothing market look like in 2023? It is still unknown.
However, in the view of Ms. Shui, who works for a head management consulting company, the overall trend of sluggish growth in China’s sports shoes and apparel market will change. “Although the market size has declined due to the impact of the epidemic since 2020, it is now recovering.” Turning stage. We are optimistic about the future of the market, and it is expected that the sports shoes and apparel market will maintain a double-digit growth rate in the next few years. From the data point of view, the market size will reach about 700 billion yuan by 2030.”
However, under this trend, the competition between brands will become more intense.
For brands that focus on subdividing the track, they just need to wait for the cake to grow bigger. For a comprehensive sports brand involving multiple fields, continuous innovation is the core competitiveness.
Nike started to test the Nike Style store this year.
In the first decade of this century, the growth momentum of the brand mainly came from the sponsorship of competitions and the endorsement of star athletes. In the second decade, the driving force for growth has shifted to channel distribution. In the third decade, in the face of the impact of diversified consumer needs and decentralized purchase decision-making links, this point will change again.