Sports Market Research & Business Solutions

In today’s world, it seems everyone is an athlete, an outdoorsman, and a yogi. Or wants to be. Or at least wants to look like one.

To help you win in this growing market, The NPD Group provides the broadest and deepest global view of the sports and recreation marketplace available today. With NPD you get the most complete, accurate, and comprehensive information about your products’ sales and your consumers to help you track trends, identify business opportunities, and grow sales.

The NPD Group’s data delivery tools equip you to dig into your products’ performance at the category, brand, and item levels. And you can take a step back to understand the macro view of sales trends by looking across relevant categories (apparel, footwear, equipment, and accessories), for a complete industry view.

A team of dedicated sports industry analysts will help you put the data in context. They mine our consumer and point-of-sale (POS) research to tell you who buys your products – and your competitors’ products – and where, when, how and why they use them.

Interested in becoming a retail partner? Learn more now

Learn more about our industry expertise


December 15, 2016

Join us at Winter OR 2017

Going to the Winter Outdoor Retailer Show? Meet us at Market Booth #111! There’s so much to look forward to at Winter OR in Salt Lake City. See why we’re excited – watch Sports Industry Analyst Matt Powell’s new video.

0:37 | Play

July 28, 2016

Here Comes Gen Z

Discover how Generation Z is set to shake up the sports and outdoor retail markets in this video featuring industry analyst, Matt Powell.

3:10 | Play

July 18, 2016

The Importance of Gender in the Sports Industry

Sports Industry Analyst Matt Powell weighs in on the importance of gender in the sports space. Learn how the development of products geared specifically to women will impact the marketplace.

2:12 | Play

July 5, 2016

Millennials and the Sports Industry

In this new video series, NPD Sports Industry Analyst Matt Powell discusses Millennials' impact on sports industry trends. See how Gen Y behavior is changing the golf, cycling, and camping industries, and what it means for your business.

1:13 | Play


Sports
Products


Retail Tracking

The NPD Group has the largest POS footprint in the industry. NPD collects weekly and monthly sales data from over 30,000 doors globally, spanning all industry channels of distribution, including independent specialty stores, sport specialty stores, sporting goods, department stores, mass merchants, and ecommerce. This allows you to continuously monitor sales of men’s, women’s, and children’s sports apparel, footwear, equipment, and accessories.

The Retail Tracking Service delivers the most detailed point-of-sale information available to guide your critical business decisions. Standard measures available at the category, brand, and item levels include unit sales/share, dollar sales/share, and average selling price. Advanced measures available for specialty channels include inventory, margins, and GMROI.


Consumer Tracking

Stay on top of shifting preferences and trends with insights from consumer panelists who have agreed to provide information about their purchasing habits, usage, and attitudes.  You can use this information to analyze consumer behavior, preferences, and purchase drivers as input for product development, brand management, and marketing strategies.


Athletic and Outdoor Segmentation

Identify and reach specific consumer groups so you can efficiently target and capture your most valuable consumers. Use NPD’s Athletic and Outdoor Segmentation to drive more sales using targeted messaging. It also can help you refine your merchandising mix and assortment once you understand the differences among key consumer segments. Seven athletic segments and four outdoor segments are included.


Geo-Level Information

Assess regional strengths and opportunities, monitor competitive performance by region, and plan and evaluate effectiveness of targeted activities. Call on NPD’s insight into retail sales in specific regions or store groupings using Geo Level information from our Retail Tracking Service.


Checkout Tracking℠

Checkout Tracking℠ uses a new approach called “receipt harvesting” to help you understand and address shifting consumer tastes and changing retail dynamics. It can give you a winning advantage – access to the most detailed information about what’s in consumers’ market baskets, based actual receipts from both online and brick-and-mortar retail purchases. Its data covers purchases at the category, brand, and item levels, so you can analyze competitive shopping carts and identify purchasing patterns. Plus, you get precise purchase and demographic details linked to individual footwear buyers.



Sports
Solutions


You have opportunities. You face threats. What you need are smart, quantifiable methods of distinguishing one from the other and maximizing your chances of success. NPD’s Analytic Solutions Group includes a team of senior leaders with extensive experience developing and delivering analytic solutions that address strategic marketing, sales, and planning issues.

We combine NPD POS and consumer information, industry expertise, and custom survey research – then add state-of-the-discipline research techniques and methodologies to explain the "why behind the buy.” Through advanced modeling and analytic services, we offer insight into what will happen in the future, not just what has happened in the past, answering your most pressing business questions:

See how clients have used our analytic solutions to solve their business challenges in our Analytic Solutions Case Study Library.


Sports
Reports


Get To Know Outdoorsmen

New consumer segmentation — the only source for insight about attitudes, behaviors of consumers who buy outdoor apparel and footwear


Get To Know Core Athletes

New consumer segmentation — the only source for insight about attitudes, behaviors of consumers who buy fitness/athletic and outdoor apparel and footwear


Footwear Brand Focus Report

How can you move up the ranks when it comes to consumers’ favorite fashion footwear brands? In both women’s and men’s, word of mouth and recommendations are major influencers on consumer purchase decisions. Our Footwear Brand Focus Report shines a light on brand awareness, ownership, perceptions, purchase intent, affinity, consumer profiles, and more.


Leisure Trends and The NPD Group — Together

Building the best-ever view of the global sports and recreation marketplace


Skiing and Skiwear

Sales performance, pricing, and brand insights for skiwear in France and Germany


Sports
Press Releases


September 19, 2016

Bicycle Parts and Accessories Categories Influenced by Shifts in Technology and Consumer Purchasing Behavior, NPD Group Reports

Key trends within the $6.4 billion U.S. cycling market tied to technology launches and pragmatic purchasing on the part of consumers have heightened the importance of specific categories within the industry, namely tires and tubes, wheels and wheel parts, and lubes/cleaners, according to global information company The NPD Group.


August 19, 2016

The NPD Group Finds Art of Matching the Right Athletes With the Right Brands a Challenge for Marketers

Choosing Olympic athletes for endorsement deals depends on more than just aligning with the right product category; the athlete’s fan base and the brands they use are equally critical to a successful partnership between brands and athletes, according to global information company, The NPD Group.


July 26, 2016

As More U.S. Consumers Take Road Trips this Summer, Sales of Camping-Related Products Increase, NPD Group Reports

More Americans are hitting the road this summer, and as they prepare for their family vacations and outdoor adventures, sales of outdoor and camping-related products within the $19 billion industry are on the rise, according to global information company The NPD Group.


May 31, 2016

The NPD Group Expands Sports Retail Tracking Service to Offer the Broadest View of U.S. Cycling Marketplace

Global information company The NPD Group today announced that it has expanded its Retail Tracking Service to provide the most comprehensive view of the $6.4 billion U.S. cycling market.


April 28, 2016

As Warmer Weather Approaches, Recreation Kayak Sales See Double-Digit Growth, Driven By Fishing Kayaks, NPD Reports

As water sport season draws near, sales of recreation kayaks were up 21 percent, or over $42 million, and 18 percent in unit sales in the 12 months ending February 2016, according to global information company The NPD Group. Looking at the top items that make up this increase, the vast majority of those items are fishing kayaks.


April 5, 2016

The NPD Group Reports On Consumer Viewing Habits of eSports And Streaming Gameplay

According to eSports and Streaming Gameplay, the latest report from global information provider, The NPD Group, 44 percent of current gamers have watched either formal eSports competitions or informal video streaming of gameplay in the past six months.


March 7, 2016

Warmer Weather and Interest in the Outdoors Spurs Growth in Camping Equipment Sales

The fall and winter months are more commonly associated with warm coats than camping tents, but with 2015 being the second warmest year on record in the U.S. (behind 2012), annual outerwear sales were flat and camping-related equipment helped to grow the outdoor industry in 2015, according to global information company The NPD Group.

Sports
Insights


December 15, 2016

Join us at Winter OR 2017


October 18, 2016

The Power of Athletic and Outdoor Consumer Segmentation

In the U.S., we’re seeing a movement that’s about the purity of foods, rather than the absence or presence of particular nutrients or attributes. For example, people are seeking out minimally processed items and expecting labels to highlight recognizable, natural ingredients.


October 10, 2016

How We Predicted Sales for the Under Armour Curry 2 Low Basketball Shoe

Want to make killer products people love? If so, you need to distinguish the winning ideas from the losers, move fast to keep ahead of trends, and prepare yourself for the possibility of a hot category’s decline. 

That’s where new product forecasting comes in. 

By examining cultural context, looking at historical market trends by category and segment, and building a forecast model with survey research, we can assess the appeal and estimated sales potential of competing products. 

Recently, we uncovered consumer opinions about four hot basketball shoes

See how we did it, and what we found.


July 28, 2016

Here Comes Gen Z


July 18, 2016

The Importance of Gender in the Sports Industry


July 5, 2016

Millennials and the Sports Industry


March 17, 2016

Connecting with Generation Z


February 26, 2016

The Future of the Sports Business in the U.S (Video)


February 25, 2016

2015 Run Specialty Year-End Review (Webinar)


November 10, 2015

Segment And Sell To Gen Y: 10 Ways Younger and Older Millennials Shop Differently

10 Ways Younger and Older Millennials Shop Differently

The retail world is obsessed with Millennials.

It wouldn’t be a normal day if newsletters, tweets, and the media didn’t overflow with headlines on the latest Millennial trend, how to “harness” their alleged power, or how to reach this malleable and unpredictable segment.

Who are these Millennials? Do a quick Google search, and you’ll learn they’re foodies. Social media savants. Selfie experts. Experience seekers. Value hunters. Convenience junkies. Savvy shoppers. They’re “authentic.”

In demographic terms, they’re people between the ages of 18 and 34 who reached young adulthood around the year 2000.

But Millennials don’t like to be stereotyped as Millennials. We get it, Ryan Seacrest—they’re tired of being generalized into a broad demographic box and find the label patronizing. They just want to be treated as unique individuals.

When it comes to the wide-spanning age bracket, they do have a point—the difference between life in your late teens and life in your early 30s is pretty substantial. Do 18-year-old you and 34-year-old you want the same things, behave in the same way, or buy the same stuff?

With this in mind, we decided to divide the group into two smaller segments for study: younger and older Millennials. We set out to learn how these groups differ, both attitudinally and behaviorally, in their retail choices. We learned a lot, like the fact that older Millennials over-index in loyalty apps. And younger Millennials shop more at department stores.

If you’re a retailer or manufacturer looking to better understand the complexities of these highly-coveted sub-segments across the retail and foodservice spaces,

The Gen Y Gold Rush

Before we dive into retail specifics, let’s review an economic reality to set the context: U.S. Millennials haven’t had it so easy. Coming of age during the Great Recession, 13.8 percent of those 18-29 are unemployed or out of the workforce, far above the national jobless rate of 5.1 percent. And they’re a “boomerang” generation—33 percent stay at home with their families and fewer live independently. (Who can blame them? Seven out of 10 college grads from 2014 have a student loan, owing an average of $28,950 per borrower.)

But debt and other deterrents haven’t kept Millennials from buying things.

Any obsession with the Millennial demographic—also known as Gen Y—is with good reason. U.S. Millennials outnumber Baby Boomers by nearly 10 percent, surpassing them as the nation’s largest living generation in 2015, according to the U.S. Census Bureau. They’re estimated to reach $1.4 trillion in annual spending by 2020—roughly one-third of all retail spending. So retailers and manufacturers need Gen Y’s share of wallet to increase their market share. And this dependence will only intensify as Boomers continue to age and the Millennial segment gains purchasing power. Frankly, if you’re a retailer who’s not focused on this budding segment, we’re seriously concerned. (Please call us immediately and we’ll help.)

Given that Millennials are such an expansive, diverse group, our Chief Industry Analyst Marshal Cohen reminds us that there are many ways to divide up this set for study; segmentation by age is just one way to showcase their differentiated spending. But make no mistake about it: age really does matter. As consumers navigate through shifts in life stage, it reflects back in their purchasing behavior.

Age Matters

When we divide the group into two segments (ages 18-24 and 25-34), there are already some major demographic differences to note. For one, older Millennials are more educated and have a higher income, shown by data collected by our partner, CivicScience. But with more than one-third of 18- to 24-year-olds still in college, they can’t be expected to have the same level of education or earning power. Older Millennials are less racially diverse and are primarily white (74 percent compared to 68 percent of young Millennials). A greater percentage of young Gen Yers are single/never married (80 percent compared to 44 percent of older Millennials), fewer are married (only 10 percent compared to 40 percent of older Millennials), and fewer parent a child (10 percent compared to 40 percent of the old Gen Y segment).

The two groups think and behave differently, too. Younger Millennials are more optimistic about the state of our economy. They’re less likely than their older counterparts to think Donald Trump would make a good president, and more likely to see the new “Star Wars” movie. Younger Millennials are more likely to applaud Bernie Sanders’ performance in the first Democratic debate. And they eat granola with a higher frequency than their elder Millennial brethren.

So how do these differences play out on the retail floor? Here are 10 ways the groups differ in their shopping behavior:

1. Young Gen Y Specialize in Beauty

We studied the receipts of 8,766 Millennials through our Checkout TrackingSM service, following the purchases they made during the first half of 2015, both online and offline. This revealed younger Millennials devoted a greater share of spend to specialty beauty retailers compared to the total Gen Y population. The younger set significantly over-indexed at retailers like Lush, meaning they are more likely than the senior Gen Y group to visit a specialty beauty retailer when they need new concealer or mascara.

But there were also some “neutral” beauty brands that earned consistent share of wallet across the Millennial age bracket. Both Gen Y groups devoted about 20 percent share of beauty spend to Bath & Body Works and 22 percent share to Sephora. The only specialty beauty retailers where older Millennials significantly over-indexed compared to their younger comrades were The Body Shop and bareMinerals.

But it’s not all about specialty shops when it comes to cosmetics. In an online poll of 15,031 U.S. adults conducted from January 2014 through January 2015 through our partner CivicScience, we asked respondents where they buy most of their makeup and cosmetics. The result? Millennials do the majority of this shopping (49 percent) at superstores like Walmart, Target, and Costco—a greater share compared to that of the total U.S. adult population (45 percent). And younger Millennials demonstrate a slightly greater affinity for superstore makeup than older Millennials.

When it comes to how Millennials shop for beauty products, their purchasing behavior is pretty consistent throughout the segment, but there are also some differences. Our Shopper Engagement survey fielded in August 2015 showed Millennials old and young are equally likely to browse in store and buy in store (58 percent). Younger Millennials are more likely than older Millennials to browse and buy online (20 percent vs. 17 percent), less likely to browse online and buy in store (14 percent vs. 15 percent), and less likely to browse in store and buy online (8 percent vs. 10 percent).

 


"With so many retailers and brands trying to court this segment, it becomes very competitive and challenging to win share of younger Millennials’ discretionary, hard-to-come-by spending"

Marshal Cohen


2. Young Millennials Shop More Specialty Apparel

The Millennial segments demonstrated the biggest discrepancy when we looked at share of wallet devoted to specialty apparel stores. Young Gen Yers like shopping in specialty stores for specific items, devoting 3.2 percent share of wallet to this retail channel, compared to older Millennials’ 2.1 percent share and the total adult population’s 1.9 percent share, shown by Checkout Tracking receipt data.

Marshal Cohen thinks reaching younger Millennials requires laser-like focus. “With so many retailers and brands trying to court this segment, it becomes very competitive and challenging to win share of younger Millennials’ discretionary, hard-to-come-by spending”, he explains. Millennials want to shop and play at places that market their products directly to them. If they feel you’re “for real,” or in other words, not only including them, but genuinely speaking directly to them—they will be more inclined to shop with you.

Specialty fashion retailers are the perfect example. We took a deep dive into data on some of these top retailers to see at which specific retailers younger Millennials over-indexed compared to more senior Millennials over a 12-month period. One look at the over-indexing stores on this list, and you’ll see just how these specialty stores fared with the younger Millennial.

Here we see very clearly how young Gen Yers spend a significantly lower share of their apparel spend at children’s retailers (Carter’s and The Children’s Place) compared to the older Millennial segment. The data reflects young Gen Yers’ preference for stores like Hollister and American Eagle over places like Ann Taylor and Banana Republic.

What we found particularly significant was the fact that two of the most neutral apparel retailers—Lululemon and The North Face—earned similar wallet share among Millennials of all ages, demonstrating activewear’s ability to transcend ages 18 to 34.

But Department Stores Aren’t Dead
Given younger Millennials’ affinity for specialty apparel retailers, perhaps we can understand Macy’s decision to mimic this specialty/boutique feel by opening a basement floor dedicated entirely to the younger consumer (Gen Z and young Millennials), only showcasing the brands most relevant to this age group.

But it is important to note that across the entire channel, Millennials of all ages devote a greater share of wallet to department store spend than the rest of the U.S. adult population. And younger Millennials are also more likely than older Millennials to have shopped at department stores. While the younger group is more likely to have shopped at Nordstrom, the older group is more likely to have shopped at Sears.

Interestingly, while younger and older Millennials differ in their likelihood to have shopped at Nordstrom (26 percent vs. 15 percent), the likelihood of the groups to have shopped at Nordstrom Rack, the fashion retailer’s off-price subsidiary, is not as polarizing (25 percent versus 22 percent respectively). Though less significant, younger Millennials are slightly more likely to have shopped at Marshall’s, while both age groups are equally likely to have shopped at TJMaxx.

3. Younger Millennials Are Sportier

Though activewear share of spend is consistent across the Millennial spectrum, budding Millennials are more likely than older ones to have shopped at sporting goods stores (29 percent vs. 20 percent reported to have shopped at one in the past year). The differences were significantly pronounced at REI (49 vs. 16 percent). There were also marked differences at footwear retailers Nike (40 vs. 19 percent) and Finish Line (32 vs. 19 percent).

So does this mean younger Millennials are more active than their older counterparts? Our Sports Industry Analyst Matt Powell shed light on this question. “I’ve been talking a lot about viewing the generational changes on a spectrum (from the oldest Boomer to the youngest Gen Zer), rather than as distinct and dramatic changes,” he explained. For example, Boomers are mostly white, conservative, less technically inclined, lavish, and not particularly focused on health or fitness. In contrast, Gen Z is less white, liberal, tech-reliant, frugal, and very health/fitness focused. And Millennials fit somewhere in between on this spectrum.

“So when we think of changes moving along a spectrum over time, it is logical that younger Millennials behave somewhat differently than older ones, and in this case—have a greater focus on fitness and health,” Matt explains.

That’s not to mention that as older Millennials buy homes and start families, they spend less money on themselves (and less on things like sports equipment), while the younger Gen Yers do not yet have those financial obligations.

4. Younger Millennials Eat Healthier, Cook Less, and Shop Wholesale

When it comes to the food and beverages they order, younger Millennials are more likely than older Millennials to look for benefits they can obtain by eating healthier, seeking items that provide energy, are filling, reduce stress, and build muscle. These are messaging opportunities for building a younger Millennial customer base.

In addition, young Gen Yers are more adventurous than older generations in their food choices, with 47 percent of younger versus 40 percent of older Millennials claiming to choose something new (compared to only 34 percent or less for older generations). And younger Millennials have other considerations when trying something new. For example, convenience is at the top of the list. Items that are quick to order, prepare, and consume with easy portability and little mess satisfy this need.

An analysis of data from CREST®, our flagship restaurant and foodservice information service, found the Millennial segment experienced the greatest decline in restaurant visits of any generation from 2007 to 2014. This decline was greatest among the older Millennial segment (the group more likely to have kids under age 13 in the household). And if you’ve ever been responsible for a child at a restaurant who is having a meltdown or making a concoction out the table condiments, you get it. Not to mention the impact of having more mouths to feed; the relatively cheaper expense of eating at home was the primary reason for the decline in visits among older Millennials. Healthy eating concerns also played an integral role in the decision to eat at home.

Older Millennials are also more into cooking than are younger Millennials, with just over half of the older segment saying they love or like to cook. It may be easier to attract younger Millennials back to restaurants because they are not as tied to cooking at home.

Last month Whole Foods revealed it will open a line of grocery stores specifically targeting the Millennial shopper. These smaller stores will offer curated, limited selections of products at value prices. While research indicates Millennials do like to specialize, our Checkout Tracking receipt data indicates an affinity for wholesale clubs across this segment. When it comes to at-home food purchasing, younger and older Millennials devoted the greatest share of wallet to wholesale clubs Costco and Sam’s Club, and were similarly likely to have shopped at each grocer. Younger Millennials over-indexed at BJ’s and Publix, but under-indexed at Safeway.

 


"When it comes to accessories, younger Millennials are not the robust market one would think they are..."

Marshal Cohen


5. Young Gen Yers Devote Less Spend to Accessories

Accessories are growing fastest among the Millennial segment. These consumers are responsible for the greatest share of the category’s purchases, with spending up 15 percent from one year ago. Younger Millennials, however, under-index (compared to total Millennials) in the share of wallet they devote to this category. We found this stat surprising, so we asked our Chief Industry Analyst, Marshal Cohen for his thoughts on the trend.

“When it comes to accessories, younger Millennials are not the robust market one would think they are,” Marshal explains. “Traditional thinking has younger Millennials spending more on accessories, as they tend to be more affordably priced than apparel items. But with less discretionary funds, young Millennials need to be very picky about what and when they buy. Spending across a wider scope of ‘necessities’ like phones, data plans, and even food competes for young Millennial spending on experiences—and that means things like accessories will fall short on the priority list for spending.”

6. Older Millennials Use More Loyalty Apps

Older Millennials are more likely than younger Millennials to be a member of a retailer’s loyalty program. But one surprising trend is that older Millennials are more likely than tech-reliant younger Millennials to have at least one retailer’s app downloaded on their mobile device (48 percent vs. 33 percent). The older group is also more likely to frequently use the downloaded app (46 percent often use their app to browse, look for product information, or shop compared to 38 percent of young Millennials). Older Gen Yers substantially over-indexed for use of mobile apps from Target, Walmart, CVS, Dollar General, eBay, Rite-Aid, Best Buy, Gamestop, and Costco.

7. Millennial Youth Need Less Stuff and Shop Less in Store

Younger Millennials are more likely than older Millennials (28 percent vs. 23 percent) to say they have shopped at brick-and-mortar stores less often than last year, primarily because they don’t need to buy as much as they used to (41 percent). This is also a factor of Millennials’ attraction to experiences, and their desire to do more and buy less.

Older Millennials are more likely than younger Millennials to shop less at brick-and-mortars because they cannot afford to shop as much as they used to (32 percent vs. 25 percent)—perhaps a reflection of the financial demands of parenting.

Both groups are similarly likely to have shopped at Amazon and to be members of their loyalty program, though younger Millennials are more likely to be familiar with Amazon as a place to buy consumer electronics. Older Millennials are more likely to have shopped at direct mail/e-commerce sites like eBay.

When it comes to shopping for apparel, younger Millennials are more likely than older Millennials to browse in store and buy in store (62 percent vs. 51 percent), but less likely to browse online and then buy in store (10 percent vs. 16 percent). Younger Millennials are also less likely than older ones to browse in store and buy online (8 percent vs. 14 percent).

8. Younger Gen Yers Are More Adam Levine, Older Are More Metallica

Our BrandLink® solution reports that if you’re looking for a celebrity endorsement that would appeal to Millennials of all ages, B.o.B. and JT are your guys (that’s Bobby Ray Simmons, Jr. and Justin Timberlake to all you non-Millennials). Both would be good fits to target younger Millennials (index 225 and 132 respectively) and older Millennials (index 167 and 137 respectively).

If you want to home in on younger Millennials, Adam Levine and Daniel Radcliffe are good choices (index 138 and 134 respectively), but they could miss the mark for older Millennials.

Only trying to target older Gen Y consumers? Metallica and Guns N’ Roses would fit the bill (index 130 and 121 respectively), but might not have the same recognition, let alone impact, with young Gen Yers.

9. Older Millennials Buy More Kids’ Stuff

Younger Millennials under-indexed compared to the total Millennial segment in child-related categories: baby products and toys. Specifically, older Millennials are more likely to have shopped at Babies R Us, The Children’s Place, Toys R Us, and Party City. This isn’t surprising, since the 18-24 segment is less likely than the 25-34 segment to parent a child. And in today’s day and age, baby photos don’t really start to take over your Facebook or Instagram feeds until you hit your mid-to-late-20s.

The same trend applies to pet products: older gen Yers are more likely than Millennial youngsters to have shopped at pet stores like PetSmart and Petco.

10. Older Millennials Have More Home-Related Expenses

We know it might sound shocking, but younger Millennials also under-indexed in home improvement, appliances, tools, and home textile purchases. Older Millennials are more likely to have shopped at home hardware stores like Home Depot and Lowe’s in addition to home specialty stores like Bed Bath and Beyond, Crate and Barrel, West Elm, and Pottery Barn. But, really—no surprises here. What 20-year-old do you know who is remodeling her new home, buying a fancy KitchenAid, investing in a state-of-the-art power saw, or ordering a new line of linens? Let’s face it, whether you’re in school or starting your first job, it’s all about scrounging up repurposed furniture from older family and friends or simply sticking with mom and dad for a few more years until you get your feet on the ground. And when young Millennials finally do uproot themselves, typically this means moving to an urban environment where there are more jobs and inhabiting smaller, rented, and/or shared homes that require fewer furniture expenses.

Older and Younger Millennials: Two Distinct Segments

In the world of market research, people aged 18-34 are typically grouped into one giant segment for study. But they do not share the same experiences, think, or act the same. Half the group grew up on Britney Spears, the other on Justin Bieber. Some grew up with Facebook in middle school, while the rest didn’t create an account until after having their first child. Moreover, this 16-year span represents a pivotal coming-of-age period, and the differences between the oldest and youngest Millennial can be great, as evidenced by our top 10 list. It’s time to start treating these segments as two distinct groups, to better get to know them and to speak to them directly if we want to earn their precious spending power.


Sports
Insights and Opinions from our Analysts and Experts


February 23, 2017

Sneakernomics: How Golf Lost the Millennials

2016 was not kind to the golf industry. Nike announced it was exiting the equipment business, Golfsmith went bankrupt and shuttered, hundreds of golf courses closed, and Ben Hogan filed for bankruptcy (again). The largest brand, Taylor Made, with the greatest share and best roster of players, is for sale and seemingly cannot find a buyer. What’s going on?

Golf rounds fell sharply at the beginning of the Great Recession, but as the economy has improved and the recession officially ended, rounds have not bounced back. Some elders lost too much of their retirement savings in the recession to spend on golf, but the real issue is much deeper than that.

In order to offset the decline in rounds, golf manufacturers released too many new and competing technologies. New releases were coming out so frequently that the consuming public could not keep up. This created a glut of deeply discounted products that were not moving off the shelves.

Big-box golf retailers showed nice growth in the early days of the recession, but that growth largely came from industry consolidation. As courses closed, so did the pro shops. The failing golf business forced mom-and-pop golf shops to shutter. Market share flowed to big-box, masking the underlying trend.

What happened to create this reversal of fortune? The golf Industry failed to attract Millennials to the game. The National Golf Foundation reported that there were 400,000 fewer golfers in 2013, with 200,000 of the decline coming from Millennials.  Since Millennials represent 25 percent of the nation’s population, this decline is devastating to the sport.

So, why don’t Millennials play golf?

Millennials value ease, speed, and efficiency in their endeavors. Raised on the internet, “instant gratification” is the expectation. Over four hours of essentially doing the same thing over and over is against the idea of speed and efficiency.

They are also the most inclusive generation. Millennials want to share their experiences with as many friends as possible. Golf says, “all of you can play, as long as it no more than four. Boomers, on the other hand, value exclusiveness. The idea of paying to have the privilege of exclusive membership to play golf is counter to Millennial values.

Millennials are the most diverse generation ever, and they have embraced diversity like no other generation. The lack of diversity at Augusta National, the crown jewel of the sport, is just one example of how golf does not qualify as diverse. Mark King, former President of Taylor Made/Adidas Golf cited the lack of “minorities playing, women coming into the game” as reasons for golf’s decline.

Millennials’ most important crusade is the environment. Golf is not green. Many courses smell like a chemical factory. Courses require tremendous amounts of water to stay in shape.

Millennials were hit hard by the recession. This caused them to seek value in every purchase. They are willing to spend on things they think are important, but always look at purchases with a value lens. Spending big money on rounds and equipment apparently does not connote value to Millennials.

Golf rules are Byzantine. Compare the USGA regulations to the “Spirit of the Game” in a favorite sport among Millennials, Ultimate Frisbee: “Spirit of the Game. Ultimate relies upon a spirit of sportsmanship that places the responsibility for fair play on the player.” This is essentially the only rule in Ultimate.

At least for the time being, the values of golf do not match up with the values of Millennials.  Golf has lost the Millennials.



February 14, 2017

Sneakernomics: Tax Refund Delays Can Hurt the Sports Business

In 2015 Congress passed the Protecting Americans from Tax Hikes (PATH) Act. One of the main provisions of PATH was to slow down taxpayer refunds for the Earned Income Tax Credit (EITC) and/or the Additional Child Tax Credit. The slowdown was intended to give the IRS more time to investigate for fraudulent claims. It is estimated that about 28 million taxpayers filed for EITC in recent years.

The effect of this slowdown in payments means that the IRS will not be issuing EITC refunds until February 15, 2017. Taking weekends, processing time, and the Presidents’ Day holiday into account, estimates are that refunds will not begin to be received until February 27, and many may extend into March.

EITC benefits low to middle income households with children. It allows parents to claim up to $3,300 for one child and more than $6,250 for three children. The magnitude of the credits is in the tens of billions of dollars.

Since most low to middle income families are living paycheck to paycheck, this tax credit is a financial windfall. Many low to middle income families spend their tax refunds as soon as they receive it.

The timing of the refund has a profound impact on sports retail, particularly sneaker sales. In years past, processing glitches have delayed refunds and the industry suffered until the refunds hit.

We can expect a soft February for sales of athletic footwear and apparel due to this new law. While the industry will make up these sales in March, it will make trending difficult and retailers and brands anxious. Coupled with a late Easter this year, Q1 will be a challenging one for the sports industry.



February 7, 2017

Sneakernomics: Sports is Catching the Disease that’s Killing Retail

My colleague Marshal Cohen recently wrote a blog, “An Urgent Message for Retail,” and in it he states that during the holiday season, “…consumers appeared to have grown numb to the early and constant promotions” and “[w]e have witnessed the demise of promotion’s reign as king of shopping influencers.”

The sports industry has been relatively immune to the cancer of relentless promotions – at least until Holiday 2016.

Sure, there has been discounting in the sports categories that are in systemic decline. Golf and fitness equipment like treadmills are two that come to mind. For the most part, though, the sports industry has been able to avoid counting on deep discounts to drive sales. Until now.

Holiday 2016 will go down as one of the most aggressively promoted years in sports retail. Here are some examples as to why, and what it means for this year.

While the massive sweatshirt category has been in decline for more than a year, brands and retailers seemed to think that it would magically bounce back. Instead, it took “40% off” pricing to produce a meager sales result and clear distressed inventory. With such deep discounting this leads me to think, what will it take to grow the business in 2017? Also, mid-market footwear retailers began boot promotions with “Buy One, Get One Free” starting on Black Friday. No one makes money with deals like that. Some brands also began to weaken or ignore their own “Minimum Advertised Price” policies in an effort to spark sales and clear stocks. This led to a free-for-all discount environment, which will continue into 2017.

On another note, NPD has found on several occasions that consumers are not purchasing products, including clothing and accessories, adorned with giant logos the way they used to do. Yet, sports brands and retailers trotted more of the same, in the hopes of achieving a different result. This caused markdowns to ensue.

In addition, an athleisure “bubble” was created as more fashion brands and retailers tried to grab a piece of the still strong category. Hundreds of new brands tried to jump in on the performance apparel boom. As they fail in 2017, the market will be flooded with deep discounts on poor imitations of activewear.

Of course, the ongoing retail rationalization has yet to improve this toxic situation. We won’t see any relief for this in 2017 either. More sports stores will likely close in 2017.

The sports industry is headed down the path of the teen retailers, where steeper discounts are no longer effective in clearing stockrooms, let alone driving sales and profits.

So how does the sports industry avoid this slide? We must get back to the core principles that built this business.

The sports industry is an inspirational and aspirational business. We inspire others to get fit and to improve their sports. Participants aspire to make themselves better. A race to bottom on price does neither.

Unrequited demand is another fundamental strategy in the sports business. If demand is not met, there is no need to promote.

Innovation has always been a cornerstone of the sports industry. Even in the distressed sweatshirt category, innovative and more technical products sold well this holiday and posted big increases. We must find ways to keep innovation strong. This will help fend off the athleisure bubble as well.

The sports industry has always been about premium and exclusive products. We must emphasize the premium nature of our business and avoid trying to grow by the lowest prices.

Segmentation has also been a core principle in sports. We must double down on having clear and distinct lines for different categories of retailers. Brands must also intentionally rationalize the number of retailers in the space, buy elevating the winners and letting the others improve or fall by the wayside.

Finally, the sports industry must stop chasing artificial targets set by Wall Street. Driving to an arbitrary growth target is a recipe for disaster. Brands and retailers must do what is right for the long term health of their businesses, rather than a short term and inconsequential goal set by the stock market.

If the sports industry can return to its core values, it has a much greater chance of being healthy once again.


January 26, 2017

Sneakernomics: Are Sneakerheads Important?

About every month or so, someone in the mainstream media will “discover” that sneakerheads exist. They often seek me out to ask what drives this phenomenon and what their value is to the market.

A formal definition of a sneakerhead is a person who collects, trades, and/or admires sneakers as a form of hobby. Sneakerheads, like most collectors, are passionate and dedicated to their subject. Many are very knowledgeable about the origins and history of sneakers. Many spend a great deal of time and money studying the category and its past, while building their collections.

I have a deep respect for the passion, commitment, and knowledge that sneakerheads possess.

Sneakerheads have been around since brands began to associate athletes with particular shoe styles. In the 1970’s, the best New York City street ballers had the coolest and rarest shoes, which were supplied by the brands. When Nike reintroduced the Air Force 1 at the behest of East Coast urban retailers, the fervor ratcheted up a notch. Serious collecting started with the first Jordan shoe, banned by the NBA. Other brands entered the act by signing players and creating special shoes just for them. Later, when Nike began re-issuing “retro” Jordan’s, new and old collectors sought to start or fill in collections. Then sneaker collecting was off to the races.

With the advent of the internet, we reached a whole new dimension in the world of sneakerheads. Isolated collectors could now connect with each other. Rumors about releases and special products bounced all over the web. Opinions about favorite shoes could be shouted (and shouted down) across time zones and continents. All of this helped heat up the sneakerhead world even further.

And then came ways to buy and sell your favorite sneakers through peer-to-peer websites like eBay. This changed the game dramatically. Soon, rare styles were selling for multiple-times their original retail value. Prices escalated, which brought on opportunists.

Finally, brands began to do collaborations with artists, musicians, and celebrities, creating specially designed, extremely limited edition styles. The brands intended for such shoes to give them further hype and credibility within the sneakerhead community. Because collaborations were very limited in quantity, they became highly desirable. Collaborations created yet another market for collectors.

Very quickly the sneakerhead world went from collecting for fun to profiteering. As resale prices escalated on limited edition shoes, a new type of “sneakerhead” came into being: the speculator. Looking merely to make a quick buck (or hundreds of quick bucks), many more buyers got into the game with the sole intent of flipping limited edition shoes, sometimes on the same day they bought them.

Sneakerheads have always sold and traded their shoes, but never to this degree and intensity. The introduction of a large number of resellers has raised the resale prices of shoes and kept traditional collectors from acquiring the shoes they coveted.

Sneakerhead sales information has always been a little tough to pin down, but one angle is to look at the sales of the kinds of shoes that sneakerheads are interested in and make an estimate. These shoes are generally Brand Jordan retro or marquee basketball shoes (endorsed by big-name players), or shoes tied to collaborations (though these are very limited in terms of the number of pairs available and don’t amount to much in sales). Of course, we cannot assume that every one of these shoes went to a sneakerhead; however, even if we take all of these shoes into account, the portion is still less than 3 percent of the total U.S. athletic footwear business, which is hardly a substantial number.  

Since sneakerheads have a rather minor impact on overall retail sales, how else can we assess their impact on the business?

The sneakerhead “press” has little influence outside the sneakerhead community. The sneakerhead media is comprised of everything from very large and sophisticated publishing organizations, to guys doing YouTube videos in their mom’s basement. All live in fear of offending the brands that they depend on to keep them fed with pictures and information about upcoming releases. In the sneakerhead press, there is very little original content and frequent cut-and-pasting of content from other sources. Because the sneakerhead media is unwilling or unable to speak the truth to power, their influence is very limited, except inside the echo chamber that is sneaker culture.

Individually and for the most part, sneakerheads lack a voice outside the echo chamber. Nevertheless, astute brands and retailers are listening to their collective voice. If the overall sentiment is very good or very bad about a particular product, color, or material, brands and retailers should adjust their plans accordingly. As I have often said, the most important thing to remember in using social media is not to talk, but to listen.

Sneakerheads are a deeply committed community of collectors and aficionados. They do not represent a major portion of sneaker sales, and while they do create a lot of hype and buzz that can be good for brand equity, this brand equity is difficult to measure. Within the echo chamber, the voices of sneakerheads are loud, but those voices do not carry.


January 11, 2017

Sneakernomics: The State of the Outdoor Industry

It was a rocky year for the outdoor industry. The void created by the bankruptcies of Sport Chalet and The Sports Authority had a huge impact on the industry, and the warm weather did not help. But an underlying cause was very much self-inflicted.

From my point of view, the industry needed to focus on newness and shifting to a more lifestyle approach, and less on continuing along the same path and expecting to reach a different destination.

Overall sales for the outdoor industry (including athletic specialty, sporting goods, outdoor specialty, and sport specialty e-commerce) were soft in the 12 months ending November 2016. Dollar sales declined in the low single-digits. The last three months were particularly difficult, with sales down in the low double-digits. The decline primarily stemmed from the athletic specialty/sporting goods channel, which saw sales fall in the mid-teens. This is no surprise as the Sport Chalet and The Sports Authority bankruptcies closed over 20 million square feet of sporting goods retail, or about 10 percent of the market.

Looking at specific categories, we see that the vast majority of the top-selling outdoor footwear styles sold from September through November were the same as in 2015. The lesson here is, if we don’t give the customer newness, we become a replacement business. Further, if you covered the logo on most of the shoes, you would be hard pressed to identify the correct brand. Too much sameness is the kiss of death in retail today.

Outerwear sales were up in the 12 months ending November 2016, yet flat in the latter three months compared to the prior year. While part of this was warm weather, a sea of sameness at retail had to have a negative impact. We are seeing major share shifts away from the traditional share leaders as consumers are on the hunt for fresh ideas.

Camping, which had been a driving force for outdoor, has also slowed and sales have now been down. Again a lack of newness has hurt this category.

Even hot categories like coolers, which had been experiencing exceptional growth, have now begun to cool off. Coolers and cookware saw sales slow dramatically over the last three months.

The outdoor industry has a great opportunity to capture the hearts and minds of Millennials and Gen Z. The values of the industry are well aligned with these cohorts. But these cohorts also demand new, fun, and “good enough” products. The industry is just not providing that right now.

The outdoor industry can rebound from this difficult time, but it will take changing the business model and altering the way we view the consumer to achieve it.

Source: The NPD Group, Inc. / Retail Tracking Service, Outdoor Industry View, 12 months ending November 2016



January 4, 2017

Sneakernomics: On the Contrary, Innovation is Abundant in the Sneaker World

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.



December 19, 2016

Sneakernomics: Predictions for the Sports Business in 2017

It’s the end of another fascinating year for the U.S. sports business, so that means predictions time! But before we get into that, let’s set the stage by recapping how we did on our 2016 predictions. Most of the predictions I made a year ago came to be true, but there were some surprises along the way.

Overall, the positive sales trend in athletic footwear and activewear did continue, but not quite as strong as I anticipated. Looking at brand performance, Nike and Skechers did not have as great of a year as predicted, but things seem to be turning for both late in 2016. Adidas remained on fire and earned the title, “Brand of the Year.” In terms of equipment, this business was indeed challenged; however, the minimum wage increase did help propel sales growth. Social trends including social fitness were huge influencers over the last couple years, and this remains a critical concept in sports.

Now let’s turn to 2017.

First, get ready for possible price increases in sneakers and other products manufactured overseas. The promises that the President-elect made on the campaign trail can potentially lead to strained relations with China, which may cause prices on foreign-made products to increase. I talked more about the election’s potential impact on footwear sales in my post-election blog.

Given the highly charged political atmosphere, we can expect consumers to focus on ‘ethical shopping,’ giving their business to brands and retailers that share their values and shunning those who do not.  Consumers will demand to know where brands and retailers stand on issues and will shop accordingly.

Based on the current retail landscape, the void created by The Sports Authority bankruptcy will have a lingering but diminishing negative effect on the industry. I expect that most of the impact will be over by the end of Q2 and trend should improve for the industry. In the meantime, this vacuum will force brands to be more promotional. The 24/7 Minimum Advertised Price (MAP) policy at Nike will add fuel to an already overheated promotional market.

Looking at the major players, Nike’s trend continues to recover, but it will be slower than it needs to be. While Nike will be a share donor, sales will return to growth. Nike’s direct-to-consumer business will remain robust. Adidas and Puma should stay hot in 2017. Both brands are working hard on diversifying from their narrow base of hot styles. This should keep the trends in a positive direction. Under Armour (UA) will likely hit a soft patch, particularly in footwear, as the fashion headwinds around marquee and performance basketball hit. Footwear brands of UA’s size often seem to stumble on their path to growth. While I agree with the strategy, UA’s expansion in the mid-market will be tricky, especially for the big box partners. I’m confident in the long term trajectory for UA, but 2017 could be a rocky year.

Given the rush to try and capture some of the athleisure business by non-performance brands, we can expect the athleisure category to grow but to be very noisy. The bubble created by all these new, opportunistic brands will burst and the market will return to the core brands and retailers.

Retro will remain the dominant fashion trend, but styles must constantly be updated. Brands that try to drive on style for too long will face markdowns and margin pressure. Casual athletic footwear and sport slides will reap the benefits of the retro trend. Retro in apparel will become even more important.

On the other hand, the performance categories will remain challenged in 2017. One possible bright spot will be the mash-up of retro uppers on performance outsoles. We’ll see the first of these products hit store shelves this spring.

Some have tried to scold certain big brands for a lack of innovation, but this is misguided. We have been on a sturdy trajectory for technical innovation in footwear for the last few years, so it makes sense to now take a pause and let current technologies seek their own level. But, more importantly, much of the technical advances are happening behind the scenes. Advances in manufacturing techniques will make it possible to get shoes to market more quickly and more sustainably. The ability to truly make customized shoes is not that far in the future. Advances in manufacturing will have a far greater and longer lasting impact on the industry than a new cushioning system for shoes.

Brands are also making huge innovation gains in “connectedness” and the “quantified self.” Helping athletes be better athletes and to share their experiences will continue to be a source of growth for the sports industry.

Finally, innovations to the in-store experience will prop up the sinking brick-and-mortar side of retail. Smart stores, contextual marketing, and augmented/virtual reality all have a role to play in slowing the decline of physical retail.

E-commerce, which is already a force in the industry, will continue to rise. According to NPD research, one-in-four athletic shoes were sold online last year. Over time I expect that contribution to rise to two-in-five. The physical limitations of brick-and-mortar stores will continue to drive this growth.

Retailers will quickly figure out that ‘buy online, pick up in store’ will be another way to leverage e-commerce to help save physical stores. Retailers will use this additional store visit to create add-on sales.

We can expect retail rationalization to continue. We still have far too many stores than we need in the U.S. Much of the rationalization will be silent as small chains, specialty, and “mom and pop” shops shut down without much fanfare. This rationalization is both needed and inevitable.

Demographically, I hope 2017 is the year the sports industry finally figures out the women’s business. Women’s sports retail remains woefully underserved, and this has allowed brands from outside our industry to capture significant sales and share. (Hint to sports brands and retailers: “win the bra; win the woman”). Another demographic trend the sports industry must embrace is plus sizes in women’s apparel. Research by The NPD Group says the most common size in women’s apparel is 16. Brands that focus on the S-M-L-XL consumers will never win the women’s business.

Finally, Hispanics remain a great untapped audience for the sports industry. Hispanics are projected to represent a quarter of the U.S. population in a few years. They have a great affinity for all things sports and spend their money on sports products. Brands that embrace this change will win.

In my opinion, 2017 presents many opportunities and challenges for the sports industry. I expect it will be another good though not great year, with trends improving as we move into the second half of 2017.



December 14, 2016

Sneakernomics: The Sales Void Created by The Sports Authority

When The Sports Authority (TSA) filed for bankruptcy last spring, it was the largest failure we had ever seen in the sports industry. The overleveraged TSA represented about 20 million square feet of sporting goods retail – nearly 10 percent of the industry's square footage. Proportionally, TSA represented more than 10 percent of the industry’s apparel and equipment sales while it under-indexed in footwear.

NPD’s Checkout Tracking correctly identified the primary recipients of TSA’s business: e-commerce (brand, retail, and pure play), adjacent big box sporting goods, and national discounters. But what was not anticipated was that some of its business would simply evaporate.

It is now clear that some of TSA’s business came from its Sunday flyer marketing strategy. Even if the customer did not need what was advertised, some came out and bought goods simply for the discount. Now that those flyers are no longer running and with no traffic going through their stores, a portion of TSA’s business has vanished into thin air.

It is easy to see this in the outdoor industry numbers, where TSA was a major player. Outdoor sales through the athletic specialty/sporting goods channel decelerated from down in the low single-digits in the first half, to down in the high single-digits in the third quarter. Sales in the outdoor specialty channel actually improved in the third quarter from the first half, as it picked up some sales given up by TSA.

In activewear, we see a similar trend. Nike and Under Armour are the largest brands in activewear.  Their sales for Q3 were up sharply in department stores and national chains, but were down sharply in athletic specialty/sporting goods. Adidas, who did not have a big presence at TSA, saw sales rise sharply.

In footwear, where TSA was not as significant a player, the shift is less visible, but still exists nonetheless. Changing fashion categories also mask the shift in the business. Running shoes was a category where TSA had a strong position. Sales there decelerated sharply after TSA stores closed. Categories including classic footwear, where TSA was not an influential factor, were not impacted at all.

It is clear that the closing of The Sports Authority stores last summer has left a vacuum in the market. The greatest impact on the business will come in the fourth quarter, as this was when TSA was fighting for its life. After that we should see this void created by TSA’s closings begin to abate.



December 13, 2016

Sneakernomics: NYC Adidas Store Raises the Bar for Sneaker Retail

Adidas has opened its largest store in the world on Fifth Avenue in New York City and it is amazing.

On the morning of the grand opening, my phone started to light up with messages saying there were hundreds of people in line to get into the new store. I rushed over and found a huge but orderly crowd of Adidas fans waiting in line.

When I returned that afternoon for my tour with Adidas executives, the lines still had not gone down.

The design of the store is meant to emulate a football stadium, complete with chain link fencing, ramps, rough concrete floors, and exposed beams. Adidas made an effort to retain and expose the building’s original raw design, creating authenticity as well as maintaining a commitment to sustainably.

While there are elevators in the back of the store, the primary means of moving between floors are metal stairs, just like at your local field. Even the fitting rooms were designed to look like a locker room.

At 45,000 square feet and four floors, the Adidas branding is overwhelming. The 350+ employees were well-trained and extremely enthusiastic.

On the lower level, customers can find the Turf, where they can test and experience Adidas cleated footwear. There is also a custom print shop to create your own jerseys. The men’s assortment was featured on this level.

The first floor highlighted a launch zone showcasing the new Harden V.1, which released there ahead of the rest of the country by two days. The first floor also had a juice bar and personal trainers.

Women’s is the focus of the second floor, with a track to test running shoes and a bra and pant bar. The assortment in women’s was well thought out and curated.

The top floor is home to Young Athletes and Originals and had the greatest crowd during my visit. This floor also had a “miadidas studio” where customers can customize more than a dozen styles of top-selling adidas shoes. At the grand opening, fans, for the first time, could customize the highly sought after UltraBoost shoe.

Adidas executives told me the hottest-selling products in the store were the Parley products, which are made of the recycled plastic ocean waste.

All in all, the new Adidas store in mid-town represents a clear brand message and a focused assortment of fashion right products. It was a complete Adidas experience.

Job well done!


December 5, 2016

Sneakernomics: It’s All About Retro

The hottest trend in the U.S. athletic shoe market right now is classic, or retro, footwear. The overall classics category is growing at a +29 percent pace for 2016 so far through October, according to retail sales data from The NPD Group – five percentage points greater than this time in 2015 and currently the strongest player in the athletic footwear market. While retro basketball shoes have been hot for more than a decade, retro running and retro tennis are now growing quickly as well. 

To further illustrate the power of this trend, classic footwear was among the top-five performing categories, in terms of dollar sales, the week before Thanksgiving, according to NPD’s Holiday Shopping Bag 2016 Weekly Report. Retro styles are sure to drive sales for the athletic footwear industry this holiday season, just as they did for back-to-school. If back-to-school is any indication, the #1 selling shoe was a retro model and, in fact, six of the top-selling models were retro styles.

One of the most interesting aspects of the retro trend is how broad-based it is by brand. Virtually every major brand with older styles in their vault is participating. Typically, when a new trend emerges, it is based only on a few brands.

In order to capture the customer, however, brands cannot simply resurrect shoes from the archives; today’s consumers demand that the products they wear be modern.

Manufacturing techniques have changed over the years, allowing “new” retro styles to be made in a modern way. This means the old methods cannot be used anymore. We have also seen many advances in materials since the original shoes were first introduced. The consumer has become accustomed to lighter and more breathable materials, so brands have had to update their materials as well. In addition, fits have changed in the years since the shoes were first introduced. As one example, kids are a lot bigger than they were decades ago. Brands have had to modernize the original fit as well.

Exploiting this trend was not an easy task. Brands had to essentially rebuild the styles while making them true to their original concept.

While the epicenter of the retro trend remains the athletic specialists, there is an opportunity for every channel to participate. Brands will want to segment products, but all channels can share in this success.

There is also an apparel opportunity here. Brands should develop “retro” apparel products to match their footwear offerings. Track pants, wind suits, and crewneck sweatshirts are just some examples of potential retro apparel.

As with any trend, I often get asked, “How long can this last?” While I think the fashion cycles are becoming shorter and shorter, given how many footwear products are available to re-release, this trend can hold on for a while. Combined with the public’s lack of interest in performance footwear, I think we will be in this cycle for some time to come.


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