Looking at spring 2020 sales figures, people pretty much stopped buying everything from bras to pants, as lockdowns turned ubiquitous video staff meetings into virtual pajama parties.
While sales of comfy athleisure wear bounced back from March lows, it is the sneaker space that has market watchers on edge, after March receipts all but evaporated for most brands.
Worried investors were thus pleasantly surprised this week when New York-based Foot Locker Inc. reported a comp-store sales increase of 18 percent in the second quarter that ended Aug. 1. This came after months of predictions that sneaker sales would be dismal for the first half of the year.
Helped in part by government stimulus, the footwear retail giant will release its full earnings on Aug. 21, and “excluding non-recurring items, the company expects to report adjusted earnings per share of 66 cents to 70 cents.” Analysts had expected a loss of 60 cents per share.
In a statement, Foot Locker Chairman and CEO Richard Johnson said, “While these undoubtedly remain challenging times, we are nonetheless pleased by the health of our category, our deep connections with our customers and the strength of our vendor relationships.”
Challenging times, indeed. And some categories are clearly less challenged than others. Cravings for comfort and aspirations to fitness during the COVID-19 summer are driving healthy sales for brands like Lululemon, which saw its stock spike on the strength of lockdown chic.
It Keeps You Running
Foot Locker’s good news also signaled better times ahead for bellwether Nike, whose sales were hammered during lockdowns.
PYMNTS spoke to Morningstar Equity Analyst David Swartz, who said the improved Foot Locker outlook means much the same for Nike. And it’s not isolated – sporting goods retailers including Hibbett Sports are also reporting that Q2 comp-store sales will rise over 70 percent.
What’s kept the sneaker market moving during lockdowns? “Running was a theme among the top-performing brands year-to-date through June. Brooks had a high teens increase, Puma grew in the high singles, Hoka ONE ONE was up more than 75 percent and On Running sales more than doubled,” wrote Matt Powell, NPD Group senior sports industry advisor, in a July 31 blog post.
Ranked on dollar sales, NPD said the top-selling styles for the first half 2020 are “Nike Air Force 1 Low, Nike Air Max 270, Nike Air Max 97, Nike Air VaporMax Plus, Nike Revolution 5, Nike Air VaporMax Flyknit 3, Adidas NMD R1, Jordan XIII Retro, Jordan I High OG and Nike Air Max 90.”
Pants Down, But Not to Worry
Between pent-up demand and ongoing work-from-home arrangements for millions of Americans, the spring sales dive now looks more like a bump in the jogging path. More reports are now forecasting a much faster recovery for footwear and apparel than previously anticipated.
As for what else people are buying, CNBC reported that “online sales of pajamas surged 143 percent in April from March, while purchases of pants fell 13 percent and bra sales declined 12 percent, according to data from Adobe Analytics, which tracks transactions from 80 of the top 100 U.S. retailers.”
“Online apparel sales overall in April increased 34 percent from March, according to Adobe,” CNBC reported.
Trendy fashion footwear and apparel continue taking a beating, as formal occasions from business meetings to weddings have yet to fully resume, and may not for some time.
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