We plan to publish our annual figures for the so-called "brown shoe" market next month. Meanwhile, an annual survey already published in our sister publication, Sporting Goods Intelligence, shows that athletic brands continue to develop faster. The global branded sports shoe market, which had risen by 7.1 percent in 2002, grew by 10.8 percent in 2003 in terms of dollars to $18.7 billion at the wholesale level. In terms of local currencies, the growth was limited to 3.2 percent in the USA, 9 percent in Europe and 17 percent in Asia.
There are some signs that the European market will grow more slowly this year, as suggested by the latest quarterly figures from Adidas and Nike as well as Foot Locker. Retailers’ inventories of sports shoes are probably high as the sports footwear market rose by only 4.6 percent at the retail level last year in the 5 major markets, according to the authoritative census of NPD Sports Tracking Europe for the 12 months ended Dec. 31.
The Italian market sported the biggest sales increase - +10.8% - thanks to the retro and sports-inspired fashion boom, with average prices up considerably. The smallest growth - +1.4 percent – took place in the most mature market, the UK, which actually suffered a 0.3 percent decline in volumes. While Germany was flat, France performed well both in terms of pairage and value. The average price rose in every market except Germany, where it began to fall in the latter part of the year. Together, the big 5 nations had an increase of only 1.6 percent in volume to 179 million pairs:
Measured in terms of value, the growth rate at retail declined to about 2 percent in the 1st quarter of 2004 in Europe, with the UK joining Germany in going down in both value and average prices. France and Italy were more or less stable and Spain was up a bit. Lifestyle-oriented brands and stores performed the best. Similar trends are being recorded in other European markets such as Switzerland.
The SGI study of the 2003 wholesale market (see chart below) confirms that lifestyle sports-inspired footwear was the driving force in the market last year. Each of the three major fashion-oriented big brands – Puma, Converse and K-Swiss – raised its footwear sales by more than 40 percent. Together they gained almost 3 percentage points in their combined share of the world market, which rose to 12.58 percent. All three grew strongly in Europe. Recently acquired by Nike, the Converse brand, which trades through licensees in Europe, is believed to be generating sales of about €100 million in this part of the world and the growth rate is accelerating in Germany, where orders are up by about 80 percent.
Not including Converse, Nike grew last fast than the overall world market last year but continued to dominate it with a 33.27 percent market share, followed by Adidas with 15.97 percent. Reebok, New Balance and Puma came next, with New Balance decliniung for the first time in a long time and Puma getting very close to challenging its #4 position. In spite of Puma’s 45.1 percent growth, the combined market share of the 5 majors declined to 71.53 percent of the total market from 73.34 percent in the previous year.