The term sports wear brings to mind the image of an athlete or sportsman. However, it is interesting to map the growth of Nike, Reebok, Adidas, Puma and Lotto - iconic, global sports footwear brands - over the last few years in India as they have expanded what was traditionally the sports category into a larger category called ‘sports-inspired casual wear’. These brands together have captured a large part of the casual wear branded ‘apparel’ market with consumer recall for them as brands worn for ‘everything outside office’. This coincides with a shift in the Indian consumer lifestyle to greater fitness awareness and health consciousness, thus paving the way for these brands to benefit from the prevalent consumer trend. With a well established distribution network and strong brand presence, these brands are upgrading consumers to newer concepts of fitness products, including special shoes for jogging, rock-climbing or gym-use, dry fit t-shirts, breathable apparel for active sports like football, swimming, etc.
Sportswear Brands in India: Understanding their ‘Casual’ Strategy
The premium sportswear market in India is dominated by global brands like Reebok, Adidas, Nike and Puma, with a collective market share of 84 per cent. Over the last 3-4 years, sportswear brands have tried to transform themselves into lifestyle brands. Almost all the brands are investing to orient young consumers to their brands as they understand that the potential for sportswear will be very big in the coming years.
Reebok is a good example of a brand which used its early mover advantage to penetrate into the casual and sportswear category through aggressive advertising and its marketing campaign. Reebok’s Lifestyle line targets the consumer interested in wearing a sports-inspired product without stepping into a field, court or track. About 80 per cent of Reebok customers in India have purchased something from the urban casual Lifestyle line. Reebok has a junior collection of athletic and casual shoes and apparel, sold at its own junior stores, which is designed to tap into India’s massive youth population both on and off the field. Reebok India sold approx 3 million pairs of shoes and ~8 million pieces of apparel in 2009. Other brands are also following suit by signing top actors and models to gain higher visibility.
Puma is focused on being categorized in the ‘lifestyle’ brand as a ‘sport-lifestyle’ brand and not as a mere sportswear brand. It is engaged in the development and marketing of a broad range of sports and lifestyle goods including footwear, apparel and accessories apart from apparel. Its mission is to become the most desirable sports lifestyle company in India.
Adidas has also recently launched a new brand called S&N, which aims to be a fusion of lifestyle and sporty edginess, reconfirming the trend that most brands see themselves worn not as high-performance sports wear, but more as a lifestyle casual wear category.
It is not surprising then that more than 50 per cent sales for these brands in India comes from apparel and the balance is split between footwear and related accessories.
Main Growth Drivers for the Industry
While the brands have expanded their product mix to include a larger part for apparel to suit Indian consumers’ casual needs, simultaneously, Indian consumers are also becoming more health and fitness conscious than before. They aspire to look and feel good by exercising, taking up active sports and experiencing the outdoors through treks, climbing, camping, etc. We expect the health and fitness category, which is currently in a nascent stage, to see more spending in the coming years.
Another growth driver for sports categories is the interest in sports. While cricket is still the most dominant sport, it has also seen great changes in the recent years, especially with Indian Premier League (IPL) which has commercialised it even further. India’s performance in wrestling, boxing and shooting at the Beijing
Olympics as well as hosting the 2010 Commonwealth Games, have rekindled interest in many other sports categories like swimming, football, shooting, etc.
With these growth drivers and the increased spending power of consumers, retailers are developing sports goods with very specific offerings. Adidas will be launching 95 products related to football including apparel, footwear and protective gear this year. Reebok has come up with a variety of new and specialised offerings in the shoe category and will also launch affordable soccer shoes for kids and adults in the Rs 2,500–3,500 price range.
Premium Sports Market in India: Current and Going Forward
At present, the premium sports goods retail market (apparel and non-apparel) in India is approximately Rs 2,525 crore of which ~45 per cent is the sports apparel market. The total market is expected to grow at a decent annual rate of 13 per cent to reach ~Rs 12,000 crore by 2020.
With such a large market and high growth going forward, this is the perfect stage for sportswear retailers to enter the segment or to expand their existing portfolio. However, to truly tap into this opportunity, the consumer needs to be initiated and his awareness regarding fitness, sports equipment and sportswear needs to be improved. The very idea that different sporting activities require different types of shoes is still not well established in India. There are no ‘footwear specialists’ to guide consumers about shoe types specific to their requirements.
The consumer is ready to make the move to high-performance sports options, it is now up to brands to make use of changing consumer habits and introduce products to suit their aspirations.
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