Sneakernomics: On the Contrary, Innovation is Abundant in the Sneaker World
Matt Powell, Vice President, Industry Analyst ;
I mentioned in my 2017 predictions blog that stock market analysts have criticized major sneaker brands including Nike, by saying that the footwear market lacks innovation. Nothing could be further from the truth, although the innovation might not be in the usual places.
I have said repeatedly that we are in the golden age of innovation in the world of sports. We have two very strong technologies in Nike Flyknit and Adidas Boost that are a long way from maturity and continue to grow. Brands are introducing new ideas all the time. For example, the Nike Air VaporMax, a shoe without a conventional outsole, will debut in a few months. There is no lack of technological innovation in footwear today.
Perhaps what is fueling what I consider a misunderstanding is that we are currently in a fashion cycle where the consumer is not seeing technology as fashion. That trend of “technology-as-fashion” in running ended at the close of 2013 and in basketball a year ago. Retro is currently ruling the fashion cycle. The most important message here is that the consumer, not the brand or retailer, is dictating what fashion is today. Even if the brand has great technology, the consumer is voting against that right now.
In addition, I believe analysts have overlooked the fact that much of the innovation today is happening behind the scenes. We are making amazing leaps in innovation in manufacturing. For example, Reebok’s “Liquid Factory” promises a whole new way to make an upper. Most brands are using 3D printing in prototyping and we are beginning to see finished shoes partly made with this technology. Feetz is creating custom-made footwear entirely using 3D printing.
As another behind-the-scenes example, Nike’s Flyknit has virtually zero waste and has taken hundreds of manufacturing steps out of production. Nike has also partnered with Flex to bring innovation to their supply chain and manufacturing techniques.
Brands are bringing some manufacturing to U.S. soil in an effort to speed up the production cycle. Under Armour’s “Lighthouse” center and the Adidas “Speedfactory” are but two examples.
Robotics also has the potential to take costly labor steps out of the manufacturing process. Every day we are hearing of a new method or technique that is on the horizon or actually in use.
Brands are also creating connected products that give users feedback on their health and on how to play their sport better. I’ll cover this in greater depth after CES 2017 .
There is also a ton of innovation going on at retail as well, as physical stores fight for a share of the market. Nike’s new store in Soho is filled with ways to bring the internet into the store to enhance the customer experience. Adidas’s new Fifth Avenue store represents the next level of concept retail. Footlocker is making great strides on curated assortments, and its new store on 42 nd street will take interactivity to whole new level.
We are seeing plenty of innovation in e-commerce as well, as brands and retailers begin to deliver on the promise of seamless, frictionless, transparent commerce that carries across multiple devices and into physical stores.
From where I sit, I see a continued commitment to innovation in the world of sports.
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