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1) Provide an overview of the industry. What is the $ size of the market in the USA? Is it considered a high growth or slow growth market (percentage growth in dollar sales, unit sales, etc.)? What are the categories in the industry that are showing most growth (e.g. casual, retro), which are showing a decline (e.g. basketball, running). How many competitors are there? Who are the market leaders, and what is the market share for each of the three brands? (2) Identify the key product attributes and benefits that the consumer uses to infer the value of each brand (e.g. price, comfort, durability, etc.). (3) Identify the key consumer segments in the industry and develop a profile for each segment (minimum of 3 segments, maximum of 5). What key product attributes and benefits does each segment prioritize? (4) Compare and contrast the three brands: a. Identify the strengths and weaknesses for each brand. b. What is each brand’s POD and POP? c. What consumer segment(s) does each brand target? d. Articulate the positioning statement for each brand. (5) Develop a perceptual map based on two key attributes/benefits and determine where the three brands and the key consumer segments are placed on this map (based on your opinion). (6) Which of the three brands do you think has the best strategy? Why?
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Running head: ATHLETIC FOOTWEAR INDUSTRY IN THE US
Athletic Footwear Industry in the US
Institutional Affiliation
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ATHLETIC FOOTWEAR INDUSTRY IN THE US
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Athletic Footwear Industry in the US
Overview of the Industry
In the United States, the athletic footwear industry has become one of the most booming
industries as a result of growth in the population’s health conscious behavior (Technavio, 2018).
This health consciousness has been brought about by rising health issues and obesity levels that
have propelled people to want to engage in more fitness related exercises such as running and
gym related activities. As a result various groups and categories of people ranging from gym
goers, people who seek to popularize the lifestyle of althleisure, customers who are fitness
conscious, and people who simply like to use this kind of footwear as they engage in mild fitness
routines all seek to athletic footwear that is robust and comfortable in order to lace up.
Therefore the rise in sports participation and related activities has seen the demand for
sports gear rise leading to huge the growth, witnessed in the industry. This has propelled the
growth of the industry to where there are approximately 15 athletic footwear brand that jostle for
US market and dominate it (Technavio, 2018). An examination of the size of the market in
terms of dollars shows a steady growth since 2015 when the industry was worth 17.2 billion U.S.
dollars, in 2016 it was worth $ 17.5 billion while in 2017 it was worth $ 19.6 billion (Statista,
2017). In terms of revenue, the industry in the US in 2018 brought in US$16,143m with
estimated US$49.24 revenue generated from each individual in the population. The market is
projected to keep growing to where by 2020 it will be growing at a 3% CAGR 2016-2020
(Technavio, 2018). However according to the projections of Statista the compound annual
growth rate 2018-2021 of the industry is projected to be 7.8%.
Although the athletic footwear as a whole has shown considerable growth, there are some
categories which have experienced more growth as others decline. The industry is made of the
ATHLETIC FOOTWEAR INDUSTRY IN THE US
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following categories; Sport Leisure, Performance, Work/Occupational/Safety and Outdoor. Sport
leisure category has experienced the largest growth to the point where it is the largest athletic
footwear category with a 17% growth in sales to clinch $9.6 billion in 2017. This was brought
about by a growth of 39% in running and 24% growth in casual athletic footwear. However the
category which has experienced a decline in the last two years is performance where there was a
10% decline in their sales to $7.4 billion in 2017. This has been brought about by a 7% decline
in running shoe sales and 15% in training shoe sales (The NPD Group, Inc., 2018).
Although there are 15 competitors who have a hold of the US athletic footwear industry,
there are some competitors who are stronger than others and who have and control a bigger
market share. The company with the lion’s share in terms of market size is Nike which has 48%,
VF Corporation with 9.2%, Adidas with 8.7%, Under Armour with 2% while the rest of the
brands share 32% (Statista, 2018a). However according to the
sales in 2017 the leading
companies in terms of dollars were Nike/Brand Jordan, followed by Adidas and then Skechers,
Under Armour and c...
