The world`s sports apparel industry is expected to grow and eventually exceed $ 126 billion by the year 2015. This is mainly due to a noticeable trend towards a healthier and more active life-style. Older demographic segments, as well as women representatives mainly accommodate the change. The global sports clothing industry is heavily fragmented with many different companies competing in it. Such brands range from basic discount brands to largely distinct high-end fashion names. Even the bigger already well-established brands have to change and adapt in order to keep up with the fluctuating needs of both wholesale and retail customers. This is extremely difficult, as consumers’ demands are becoming more and more versatile in terms of comfortable and functional apparel. This means that companies have to produce new styles of sport equipment to match those specific requirements. And pursuing such a strategy will ultimately preserve companies` market share in the industry. The sports apparel industry is comprised of various enterprises which are responsible for the manufacturing and retailing of sport apparel, accessories and equipment such as running and training apparel, golf wear, baseball apparel and merchandise, soccer and basketball uniforms etc. The industry is so diverse in terms of market players, that the top 5 companies hold approximately 22% of the whole market. More and more companies partner up with fashion designers in order to come up with new appealing clothing styles and widen their product lines. This is surely a good thing, as consumption is bound to increase due to the recent trend of substituting formal and uncomfortable clothes in the office with more casual and sporty ones. Sport Apparel Industry Today ... ... middle of paper ... ...formance. In 2010 Nike launched its Pro Combat jersey collection, affiliated with numerous universities in the US such as: Miami, Alabama, Florida, Ohio, Texas, Pittsburg, Oregon, Virginia etc. 1.4 Market Share Sports giant Nike is the leading player in the global athletic footwear market with an estimated market share of about 20%. The company is well positioned to grow its market share in the long run. Factors that are expected to benefit its position account of factors such as high growth rate in footwear sales, a strong competitive position and rapid growth in key footwear markets. The global athletic footwear market is forecast to grow at a rate of 1.8% to reach $84.4 billion in 2018. Growth is expected to be driven by factors such rising population, increasing disposable incomes, rising health awareness and launch of innovative footwear designs and technology.
Market Analysis Summary The global sports and fitness clothing market is expected to soon reach over $125 billion dollars (PR Newswire, 2015, June 26) and individuals across the U.S. are becoming more active (Institute for Health Metric and Evaluation, 2013, Jul 10). The breadth of the overall market covers many subsets of products and consumer groups. Target segment. There are two primary segments in the market; sports apparel and fitness clothing.
Demand these days for athletic apparel and shoes are off the roof because of the health conscious culture. This trendy culture is all cross the world which brings a large profit for companies like Nike, Under Armor and etc. As the companies start to compete with celebrity sponsors or sports teams in this market naturally investors demand and stock prices increase.
Since its creation, Nike has proven itself as a popular brand and it has created niches by selling products such as footwear, apparels and various types of sports equipment. This paper will attempt to trace the product development of Nike shoes from its origins in conception and design to the manufacturing and production process located in contract factories in developing countries to advertising and marketing of Nike as a cultural commodity and finally, the retailing of the footwear around the world.
Nike’s goal is to remain unique and different from others in terms of the items offered on the market. Arguably, Nike belongs to a monopolistically competitive market as there only a few organizations with the ability to regulate the amount charged for their product which means they cannot make their prices high as this is likely to make customers move on to other available choices (Nike, Inc., 2012). However, Nike can find a balance between the prices to charge for their products and remaining competitive with other companies in the industry. Nike has formed a distinction between the appearance and performance of their footwear and that of their competitors. Although products are differentiated from other companies, they still influence each other because they are items of the same
At the meeting, management revealed plans to address both top-line growth and operating performance. To boost revenue, the company would develop more athletic-shoe products in the midpriced segment3a segment that Nike had overlooked...
The sports apparel and accessories industry has a highly competitive market. Businesses are constantly competing for elite athletes to sponsor, raw materials, and every opportunity to expand. Under Armour is able to not only survive but thrive in this market because of their ability to think outside of the box. They are constantly creating new and exciting products that help athletes everywhere.
Nike will need to showcase our differentiating elements of the company as runners are very brand loyal customers. Even so, Nike has 60% of the market currently. You mentioned that you feel we can improve in this area, so this is what we’re going to do: massively increase innovation and development for our running shoes, and increase brand reputation. Nike has been a historic leader in running technologies. Recently we released the electronically tied running shoes, just like from the movie Back to the Future. We need to continue to push boundaries and see what new technologies can do to revolutionize the sport. The second focus for this market is to increase our presence in specialty running stores and in third party eCommerce sites. Making sure Nike is seen and heard by this market is going to increase our success with them. Dedicated runners were found to go to specialty running shops more often than making any purchases online. Nike needs to have a bigger presence where the customers actually
Analysis of sports clothing industry, including its main features, key market drivers and competition within industry.
Nike’s Asian operations had previously continued to soar generating US$300 million in 1994 in revenues to a whopping US$1.2 billion in 1997. However based on the Asian economic crisis, this had adversely affected revenues, while regional layoffs were inevitable. Nike also performed well in the European market generating about US$2 billion in sales and a good growth momentum was expected, however, some parts of Europe were only slowly recovering from an economic downturn. In the Americas (Canada and the U.S.A.), Nike experienced a growth rate for several quarters. The U.S. alone generated approximately US$5 billion in sales. The Latin American market at this point was exposed to economic volatility; however Nike still saw them as a market with “great potential for the future”.
Fast Fashion may be the most significant disruptive in the retail industry today. Troublesome novelties, or product or services, that alter an prevailing market by presenting minimalism, suitability, convenience and affordability, have the most positive influence on a company. Because fashion is ever changing and technology is always evolving the amount of production time it takes for something to be manufactured
Nike is the number one innovator in the world in athletic footwear, apparel, equipment, and accessories. This worldwide company operates in an extremely different organizational structure than other companies, such as Reebok and Adidas. Nike operates tremendous marketing strategies and develops inventive designs to inspire athletes around the world. This company is one of the largest suppliers in the world in athletic footwear and apparel, main producer of sports equipment, and making Nike the most valuable brand among sports companies. The task for Nike is to join diversity and inclusion to encourage ideas and innovation. Around the world, this company is a popular brand.
Nike’s source is America. It is a multinational company which is engaged for design, development and manufacturing of footwear, equipment, apparel, accessories and services. Nike is also famous for the worldwide marketing and selling of the same products.
The Shoe Industry consists of a multitude of footwear categories, varying in utility, style and occasion. When overseeing the market for the shoe industry, we must look at the influence of all shoe trades universally to comprehensively understand how the disparities in sales relate to the needs of specific regions. The global retail market within the shoe industry currently represents $185 billion, driven primarily by Asian and Latin American economies and is expected to reach $211.5 billion by 2018. The growth rate globally was 6% between 2004 and 2008, contrasting to the 2% compound annual growth from 2008 to 2012. The United States holds over 24% of the overall industry size it projected over $48 billion in annual revenue in 2012. Domestically, the growth rate has been flat at 0.3%. On a unit volume basis, global footwear consumption for 2012 is approximately 11,421.3 million (in pairs), where the United States makes up roughly 2,741.1 million (in pairs). By 2018 the U.S. Census Bureau has forecasted a steady decline within demand domestically of 3% and an increase of 1% globally.
In the case of Nike footwear they have segmented into the following groups: Running shoes, Soccer, Basketball, Football, Hockey, Golf, Tennis, Skateboarding, men’s training and women’s training. Nike footwear has a lot of target markets but their main target market is athletes and fitness professionals. The second target market are people who train, work out and play sports as hobbies or who are semi-professional. Nike also targets the fashionable people. Nike footwear is has further segmented their market according to the people that endorse the products. For example: Jordan, Kobe, Lebron and Durant to name a few. The footwear segment has also been segmented on the bases of brands like Jordan and Converse. (Nike website). According to Svezia Nike will continue to use “premium channels of distribution to family and value channels, it will continue to segment and take market share wherever it presents itself.” (Canadian
Nike American Sportswear generated revenue of 7495 million US dollars in 2014, which was almost double of 2009 revenue of Nike Sportswear (Statista, 2015).The sales of (Athletic) Sportswear of Nike 90 million US dollars, however, the sale of Adidas Sportswear (Competitor of Nike) was 25 million US dollars, which was not even one third of Nike Sportswear sales (Statista, 2015).Nonetheless, the return on assets and equity are 13.41% and 26.43% respectively (Yahoo Finanace, 2015).