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Bryan Eshelman
Partner & Managing Director
New York
It’s not just about price. That was the takeaway from a Retail Dive article on inflation and consumer behavior that featured the Fall 2024 U.S. Consumer Footwear Survey from AlixPartners in partnership with Footwear Distributors and Retailers of America. Our research found that price ranked below quality and value for 1,000 parents preparing to shop for back-to-school shoes.
We also zoomed in on consumer price comparisons and shopping behaviors. Our survey showed that one-third of consumers start their footwear search on Amazon.com, but nearly two-thirds (63%) intend to purchase shoes in-store—armed with deep knowledge of differing price points for the same shoe, product qualities, and ranges between brands. “The survey found that consumers treat Amazon as a search engine, filtering out the types of shoes they want based on images, reviews, colors and product availability,” reported Footwear News in its coverage of our research.
That said, for footwear, unlike other categories, consumers have a strong preference for an ability to touch and try on product as part of the purchase decision. Both of these behaviors—starting on Amazon but ending in-store—have important implications for how footwear brands and retailers coordinate their online and offline business.
In fall 2024, customers are fatigued by inflation so are increasingly focused on the overall value proposition put forth by retailers and brands, we find. This will translate into great scrutiny over purchase decisions and potentially flat growth for the sector. Nearly 1 in 5 respondents from households earning less than $100,000 a year expect to spend $50 or less on shoes per child, even as we see a small net increase in projected spending; with price hikes, it could be a wash when it comes to pairs.
Even more crucial, then, that retailers get their assortment, inventory, and pricing right … or customers will walk.
In August, we co-hosted footwear’s top brass and retail leaders during FFANY Market Week to discuss the results of the survey and hear from the FDRA membership. Here is what’s on the mind of executives:
- Companies are worried about upcoming elections and potential tariff ramifications, along with additional cost pressures, given pricing is more difficult lever in the current environment.
- Loyalty programs are challenging to successfully execute in footwear. Companies need to evaluate new ways to proactively manage engagement and churn, including potentially leveraging advanced analytics, as well as invest in fresher assortments to compete and appeal to younger consumers.
- Companies are unraveling inventory issues from excessive historical buys; new countries of production must continue to be explored, as capacity in Vietnam and Cambodia becomes too expensive.
- Consumers are no longer forgiving of the post-COVID supply chain disruption. If you don’t have it in stock, you’ll miss the sale.
We will be watching consumer spending as retailers prepare for the holiday season, so stay tuned.
