Detailed Report: Market Dynamics of UK Sneaker/Sports Trainer Industry

This report provides a detailed analysis of the UK sneaker/sports trainer market. It begins with an overview of market characteristics, dimensions, and segments, highlighting the industry's growth and consumer spending trends. The report then identifies key players like Adidas and Nike, analyzing market share and competitive behavior. It explores the key drivers on both the demand and supply sides, including the increasing online presence of trainers, fashion trends, and technological advancements. The analysis also examines the key threats and opportunities, such as the potential impact of inflation and the rise of new competitors. The report concludes with a summary of the findings, emphasizing the dynamic nature of the UK sneaker market and the potential for future competition. The report utilizes figures and statistical data to support its findings, and includes references to relevant sources. The appendix provides additional statistical data on expenditure on clothing and footwear.

Business Decision Making

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
1. Market characteristics, dimensions and segments...................................................................1
2. Key players, market structure, market sbbhares and competitive behaviour...........................2
3 Key drivers for Sneaker/Sports trainer market in UK on both demand and supply side..........3
4. Key threats and opportunities..................................................................................................6
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8
APPENDIX......................................................................................................................................9

LIST OF FIGURES
Figure 1Expenditure in million GBP.............................................................................................1
Figure 2Top 10 companies in market in terms of customer base...................................................3
Figure 3 Number of womenswear trainers arriving in online market.............................................4
Figure 4Different type of colours in sneakers................................................................................5

INTRODUCTION
In current uncertain market environment, firms need to scan their micro and macro
environmental factors that may affect drastic impact on their business functioning. Business
decision-making process involves data collection and its critical examination for creating
important or critical business decisions. The present paper investigates UK Sneaker/Sports
Trainer market covering key aspects i.e. market dimension, characteristics, segments, key player,
market structure, key drivers and threats and opportunities.
1. Market characteristics, dimensions and segments
In UK, Sneaker market became a billionaire industry in which footwear market allows
traders to trade their business functions at a fair price and there is no possibility of slowing down
the market. Sneakers generate an extreme demand among in UK in just 10-15 years before. As
per the research study conducted by Mintel it is identified that sale of sports good rose to 7GBP
bn which is 6% high in comparison to earlier year 2015 (Fashionistas cause sales of sportswear
to Sprint, 2016). In the UK, sport trainers are committed to build and develop new skills and
capabilities among players.
Figure1: Expenditure in million GBP
(Source: Sports shoes & trainer brands in the United Kingdom, 2016)
1

Above column graph presents consumer spending in UK on the clothing & footwear
goods, which shows a continuous increase as in 2005, total spending reported to 44,642GBP
million goes up to 68,100GBP million. According to 2016 statistical reports, total weekly
expenditure on footwear at large supermarket chain, clothing chain and other outlets is found to
6GBP, 24GBP and 94GBP. It means that maximum number of people purchase sneakers and
footwear from other outlets. In UK, people often took part in sport activities as currently, on an
average 53% of the UK consumers participate in sport activities once a week. However, 16%
exercise sport 5 times or more (Fashionistas cause sales of sportswear to Sprint, 2016).
The market segments include both women and men, most importantly, people of young
age who highly prefer sports. Continuous growth in the sector changed the market to a great
extent as now, UK Sport trainers overtook heels in the footwear market. Sneakers become a new
moment for the sport trainers (Sutherland, 2016). For instance, Asos’s popular trainer destination
Looped can be recognize as the best performed or fastest growing division which clearly
indicates that how retailers are taking sneakers too seriously. Moreover, for women, trainer’s
outsold heels and as a result, 50% women aged between 35-44 years preferred trainers, however,
only 30% purchased heels. The findings clearly show that at leisure trend is showing continuous
growth and demonstrates that now-a-days, trainer become the important part of modern
wardrobe.
2. Key players, market structure, market shares and competitive behaviour
In UK, there are number of companies who lead the market and owned a strong market
share.
2

Figure 2: Top 10 companies in market in terms of customer base
(Source: Baena, 2016)
From the graph, it can be seen that Adidas and Nike are the two-strong key player who
are serving a significant proportion of the market by providing customers with unique sneakers
and sport trainers. According to the above statistical graph, it is visualized that in 2016, Adidas
and Nike has a total consumer base of 9,012,000 and 8,094,000 considered as key players and
leaders (Sports shoes & trainer brands in the United Kingdom, 2016). Besides this, Converse,
Reebok, Puma, Asics, New Balance, Slazenger, Lonsdale are the other companies. In the
industry, firms not only compete with each other on the price basis, but also, there is a non-price
competition. In this regard, establishments try to defeat rivalries by providing best quality
sneakers with unique design and innovative features. A significant increase in sportswear trend
resultant high demand among of sneakers/trainers among sport players and others (Baena, 2016).
No-doubt, market also compete on price aspect and companies with popular brand bumped their
prices of women swear trainers. In the last few year, median price for each pair rose by 53%.
3 Key drivers for Sneaker/Sports trainer market in UK on both demand and supply side
In market, regular increase in arrival of new trainers or sneakers online is a key factor
that boost market supply to a great extent.
3

Figure3: Number of womenswear trainers arriving in online market
(Source: On the front foot, 2016)
From the above line chart, it is clearly presented that over the period, in UK, there are
more and more womenswear trainers/sneakers who are coming online to satisfy rising market
demand. Evidencing it, within just two years, from January 2013 to 2015, demand grown up
from 1203 to 3003. The graph presented that first, in July 2013, arrival of sneaks in womenswear
market shows spike because of coming of Reebok Classics. In this, new trainers by designers i.e.
Lanvin, Jimmy Choo and Tommy Hilfiger came along with the famous or popular brans i.e.
Converse, Nike and Adidas. It peaked in Dec. 2014 to a great level, in which, activewear demand
serves as a key driver for high supply. Upcoming of new technologies also boosted supply such
as 3-D printing (Özdil and Anand, 2014). Powerful houses like Nike, Adidas, Armour, New
Balance produced sneaks with 3-D printing. Altra and Armous sneakers also featured with track
distance and self-lacing. Moreover, introduced innovation includes mini Led lighting and adept
fibres (Baena, 2016). Recently, Nike also launched new tech, “The Nike Makers” to produce
custom sneakers within just 2 hours as per consumer specification. It uses augmented reality,
projection, object tracking and other unique features (Pandolph, 2017).
4

Figure4: Number of trainers selling out seasonally
(Source: On the front foot, 2016)
The above chart depicts consumer interest and visualizing this, it can be said that
although market demand was erratic, still, customers shows high interest. Currently, Nike,
Converse, Vans, New Balance, Adidas are on top or highly preferred trainer brands in online
market. Nike’s Roshe in Black and Nike’s Air Max Thea in White are the highly popular or
famous trainers.
Figure5: Different type of colours in sneakers
5

(Source: On the front foot, 2016)
There are various factors which affect market demand such as fashionable design, color,
style and others. Evidencing from the above presented graph, it can be seen that neutral coloured
sport trainers dominated a great market share as more than 16,000 black sneakers are being
preferred, covering 25% market while grey accounted for 20% (McCann, 2016). In current
times, consumer spend more on fashion and lifestyle driven larger demand.
Figure6: Market share of companies
(Source: On the front foot, 2016)
Besides this, there are various styles i.e. Asos, Selfridges, Net-a-Porter and Topshop
offered by the retailers. Among all of these, Asos gains high preference and in high demand
which satisfies client requirement for widespread participation in sport related exercise and
activities (Uttam, 2013). However, looking to the current condition, Topshop gains little bit
preference in the market.
4. Key threats and opportunities
Rising market demand is a great opportunity for the marketer which will facilitate them
to expand their business across different parts of the world and gain scale-based benefits.
However, inflation rate will increase price of material and bring risk (Jensen and et.al., 2016).
Moreover, looking to the growth of the UK sneakers market, there is a possibility of new entrants
and more online arrival which may provide stiff competition level.
6

CONCLUSION
Report found that there is a vast growth in UK sneaker market over past few years
because people are demanding sneakers for sport activities in both men and womenswear. There
are various factors i.e. design, features, technology resulted into high supply whereas rising sport
participation resulted exceeded demand. As a result, in future, it is expected that competition in
the sector will be really tough.
7

REFERENCES
Books and Journals
Baena, V., 2016. The Next Revolution in Mass Customization: An insight into the sneaker
market. International Journal of Marketing, Communication and New Media. 4(6).
Jensen, J.A. and et.al., 2016. Forecasting sponsorship costs: marketing intelligence in the athletic
apparel industry. Marketing Intelligence & Planning. 34(2). pp.281-298.
McCann, J., 2016. Sportswear Design for the Active Ageing. Fashion Practice. 8(2). pp.234-
256.
Özdil, N. and Anand, S., 2014. Recent Developments in Textile Materials and Products Used for
Activewear and Sportswear. Electronic Journal of Vehicle Technologies/Tasit
Teknolojileri Elektronik Dergisi, 8(3).
Uttam, D., 2013. Active sportswear fabrics. International Journal of IT, Engineering and
Applied Sciences Research, 2(1), pp.34-40.
Online
Fashionistas cause sales of sportswear to Sprint. 2016. [Online]. Available through: <
http://www.mintel.com/press-centre/retail-press-centre/fashionistas-cause-sales-of-
sportswear-to-sprint-uk-sports-goods-sales-estimated-to-surpass-7-billion-in-2016>.
[Accessed on 29th October 2017].
On the front foot. 2016. [Online]. Available through: <
https://www.theguardian.com/news/datablog/2015/mar/03/on-the-front-foot-charting-the-
rise-of-trainers-in-fashion>. [Accessed on 29th October 2017].
Pandolph, S., 2017. Nike’s new tech creates custom sneakers in under 2 hours. [Online].
Available through: < http://www.businessinsider.com/nikes-new-tech-creates-custom-
sneakers-in-under-2-hours-2017-9?IR=T>. [Accessed on 29th October 2017].
Sports shoes & trainer brands in the United Kingdom. 2016. [Online]. Available through: <
https://www.statista.com/statistics/312998/leading-brands-of-sports-shoes-and-trainers-
in-the-uk/>. [Accessed on 29th October 2017].
Sutherland, E., 2016. Why trainers have overtaken heels in the UK footwear market. [Online].
Available through: < https://www.drapersonline.com/retail/why-trainers-have-overtaken-
heels-in-the-uk-footwear-market/7013025.article>. [Accessed on 29th October 2017].
8

APPENDIX
Expenditure on clothing and footwear by place
of purchase
UK, financial year
ending 2016
Large supermarket
chains Clothing chains Other outlets1
Average Total
Reco
rding
Averag
e Total
Reco
rding Average Total
Reco
rding
weekly
weekl
y
hous
e- weekly
weekl
y
hous
e- weekly
weekl
y
hous
e-
expendi
ture
expen
diture holds
expendi
ture
expen
diture holds
expendi
ture
expen
diture holds
all
house- in
all
house- in
all
house- in
holds
(£)
(£
millio
n)
samp
le
holds
(£)
(£
millio
n)
samp
le
holds
(£)
(£
millio
n)
samp
le
3 Clothing and footwear 2.10 58 1,22
0 7.90 215 1,56
0 13.10 358 2,24
0
3
.
1
Clot
hing 1.90 52 1,14
0 7.00
191 1,48
0
9.70 264 1,96
0
3.1.
1
Men's outer
garments 0.30 7 180 1.80 50 390 2.70 74 540
3.1.
2
Men's under
garments 0.10 3 120 0.30 8 170 0.20 5 150
3.1.
3
Women's outer
garments 0.60 18 410 3.30 90 890 4.40 119 960
3.1.
4
Women's under
garments 0.20 6 280 0.60 16 410 0.30 8 230
3.1.
5
Boys' outer
garments 0.10 4 120 0.20 6 100 0.60 16 210
3.1.
6
Girls' outer
garments 0.20 5 160 0.30 7 120 0.50 15 240
3.1.
7
Infants' outer
garments 0.20 4 140 0.20 6 120 0.20 7 130
3.1.
8
Children's under
garments 0.10 4 200 0.10 3 120 0.10 4 150
3.1.
9
Accessories 0.10 2 140 0.20 5 170 0.40 11 390
3.1.
9.1
Men's
accessories 0.00 1 50 0.10 2 60 0.10 4 130
3.1.
9.2
Women's
accessories 0.00 1 60 0.10 3 100 0.20 6 180
3.1.
9.3
Children's
accessories 0.00 0 40 0.00 0 20 0.10 2 90
3.1.
10
Haberdashery and
clothing hire 0.00 0 30 [0.00] [0] 10 0.20 5 200
3
.
2
Footwear
0.20
6
210 0.90
24
360
3.40 94
890
9