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People
Bryan Eshelman
Partner & Managing Director
New York
The appetite for athletic footwear goes all the way to the top, with U.K. Prime Minister Rishi Sunak recently making headlines in his Adidas Sambas. According to our Spring U.S. Consumer Footwear Survey, conducted in partnership with Footwear Distributors & Retailers of America (FDRA), the athletic sector is the only shoe segment projected to see an increase in spending for the spring and summer period this year—albeit a modest 2% growth. Overall, footwear spending projects to be flat in months to come, and certain segments such as work shoes and fashion / dress shoes expect heavy declines of 21% and 19%, respectively.
While the economy has improved from this time last year, inflation remains elevated, and consumers are still feeling the budgetary pressure. They report buying shoes more frequently, but 42% of survey respondents are more likely this year to search for coupons or wait for a sale compared to 2023.
This price-conscious method allows consumers to still prioritize their favorite brands. Only 7% of respondents said they would purchase a similar model—or “dupe”—of a shoe they like instead of the original, a clear indicator that brand preference plays a leading role in the footwear industry. This is especially true of the athletic segment, where 61% of respondents plan to shop for athletic shoes in branded online stores and 57% in branded brick-and-mortar stores, compared to 49% and 40% of consumers respectively for non-athletic shoes.
Our survey unlocked several key insights the footwear industry can implement to meet consumer needs across categories, which will prove critical to take more share given the muted spend projections. Companies should prioritize the following tactics to boost traffic and increase sales this spring, summer, and beyond:
Leverage technology to improve planning and allocation accuracy
Customers cannot buy what you do not have. When consumers can’t get their preferred brand or size in-store or through fast shipping, the sale is often lost—60% abandon purchases due to stock issues, the highest reason outside of price concerns.
Upgrading planning and allocation activities is crucial to ensure customers can get the product they want when they want it, and new AI capabilities can help. Utilizing AI allows companies to optimize inventory at individual stores, as well as across brick-and-mortar operations and e-commerce offerings, by constantly monitoring stock levels to reduce out-of-stock moments and limit excess inventory. Investments in AI won’t only improve forecasting, planning, and allocation, but will pay off more than ever given the opportunity to directly improve conversion.
Companies that have seamless omni-channel integration will benefit the most from these enhancements, as they’ll be able to streamline inventory optimization across channels and expedite time to results.
Make the most of purchase events through add-ons
Our findings show that when retailers do get shoppers in the door (online or B&M), they need to make the most of purchase events—and add-on purchases provide a strong opportunity to do so.
More than 70% of consumers indicated that they intend on buying additional items when purchasing footwear. While socks and fashion shoelaces make for easy add-ons—47% and 25% of respondents respectively plan to purchase each alongside shoes—companies can offer more to appeal to consumers open to larger baskets. Accessories, tights, and arch support also appeal to shoppers, as at least 18% of respondents plan to augment footwear purchases with each option.
It’s critical to have a structured plan and set of integrated activities in place that boost basket-building behavior. This can include introducing improved product recommendation engines rooted in machine learning and customer segmentation, developing promotional strategies for add-on products, and performance incentives for associates that can build add-on sales.
Reassess packaging to reduce and reallocate costs
Less than half of consumers believe a box and extra laces are important items; these have little-to-no impact on purchase decisions. As such, companies should reduce both the complexity of their packaging design and the quantity—and even quality—of materials used. Coupling these changes with sustainability initiatives—for instance, switching to 100% recycled materials or removing box paper and shoe stuffing—can both lower costs and create goodwill with consumers that increasingly factor environmental impact into purchase decisions.
By limiting these extras or eliminating them altogether, companies free up extra resources they can invest into marketing plans, technology enhancements, or shipping improvements. This last point provides an especially strong opportunity for the industry, as footwear consumers have higher expectations around ship time for free shipping compared to the rest of the retail market. On average, they are two points more likely to expect a package within two days and four points more likely to expect their shoes to arrive within three days. 15% expect next-day delivery for footwear, while only 3% of companies in the market currently target this level of service. With increased budget, more companies can revamp service offerings to meet consumer expectations.
Fiscally conscious consumers may wait for the best deal to snag their next pair of sneakers, but that doesn’t mean they’ll eschew their favorite brand. More than ever, retailers must optimize inventory to ensure brands and sizes are in-stock both in store and online; otherwise, they risk consumers walking. Brands trying to leverage this brand preference to increase their DTC penetration must truly develop retail expertise on par with—or better than—their best wholesale customers in order to scale this channel profitably.
Those that nail the above, while maximizing purchase events and spreading budget to best meet consumer needs, will leap ahead of the competition in the seasons to come. Start today—tailor your strategy one foot at a time.
