Sneakernomics: Fast is the New Normal
Matt Powell, Vice President, Industry Analyst ;
Apparel Sports Footwear
Everything seems faster today. Change is happening more quickly than ever, and nowhere is this need for speed more evident than in the sports industry. Let’s examine the impact.
One of the greatest weaknesses in the sports industry is speed-to-market. The industry is using the same business model that Phil Knight created 40 years ago. Products still take more than a year to move from concept to retail. Prototyping and sampling are time consuming and expensive. Goods spend months on boats from Asia.
But with some manufacturing breakthroughs, speed-to-market is improving. 3D printing has improved the time it takes to make prototypes and changes can be implemented quickly. Someday soon, 3D printing can actually be a part of the manufacturing process.
Brands are also taking labor steps (and therefore time) out of the manufacturing process. The Nike FlyKnit and Adidas Primeknit processes are great examples. The single-knitted upper is much simpler (and more sustainable) than traditional manufacturing techniques.
Brands are also starting to produce shoes on U.S. soil again. Under Armour has already sold shoes made here; Adidas announced its speed factory in Atlanta; and Reebok is doing some amazing work in their Liquid Factory. We can expect Nike to enter this arena soon.
When we look at the consumer/brand interface, we also see that speed has had an impact. Ordering online, especially on your smartphone, used to be a tedious and failure ridden process. Now that many retailers and brands have adopted a “mobile-first” strategy, shopping on your phone has never been easier.
Order delivery speed has also increased. “Free both ways” is the price of admission today. Amazon continues to find ways to get products to people faster. Companies that hope to compete must respond with quicker and frictionless delivery.
Last but not least, the speed of fashion change has also stepped up. We used to talk about fashion trends in the sports industry lasting decades. The 70’s was the running decade and the 80’s the basketball decade. Then we saw timelines begin to shrink to 5-8 years. The recent crash of the ‘performance basketball as fashion’ market proved that that trend lasted only three years. The speed of change is accelerating in the world of fashion.
Brands and retailers that embrace this increased velocity will succeed. Those that don’t will fail.