The footwear market in the U.S. has reached a turning point. In 2021, unit sales recovered to near pre-pandemic (2019) levels, while higher prices, driven by both base price increases and reduced promotional activity, pushed sales revenue well above, according to NPD retail tracking data. But early 2022 has been a different story. Average prices are still climbing, driving dollar volume higher, but units are now falling — not only compared to last year, but also versus the pre-pandemic period. The bottom line is consumers are buying less footwear, but they are spending more money.

Promotional activity is now starting to pick up in some areas of the footwear market. In the fashion category, where base prices have risen the most, both the percent of units sold on promotion and the average promoted discount rate are now higher than in the first quarter (Q1) of 2019. In select performance and outdoor categories, promotional activity is still lower than it was before the pandemic. However, as unit sales fall from their early-pandemic highs, we can expect this situation to change.

In the months ahead, a return to pre-pandemic behaviors, such as more in-person work, travel, and attendance at events and gatherings, will continue to boost demand for several footwear categories; however, consumers are also likely to be affected by rising costs in other areas, including gas and groceries, which will put pressure on footwear-industry growth this year. While Q1 unit sales decreased, versus last year, across all income groups, NPD consumer data shows households earning less than $100K accounted for almost two-thirds of the decline. Also, while logistics challenges have eased, they are still a factor in some areas and will continue to impact inventory flow. Brand and retailer promotional decisions will likely need to be more fluid than in the past as consumer demand remains volatile.