Under Armour recently realised to experience its ambitious goal of becoming a $US10 million, it will have to add footwear to its mix.
Based on the brand, that initiative is doing great. Footwear sales over the last quarter of 2016 were up 36%, in accordance with the company’s own metrics.
But that number doesn’t tell the whole story. According to another number by industry analysts at NPD Group, the sales of Under Armour’s footwear actually fell 20% in that same period.
These numbers are accurate. How is possible? Under Armour’s number includes sales directly to customers along with sales to wholesalers, as being the FEC requires, while the NPD number measures actual sales to consumers.
The discrepancy is explained by the fact that Under Armour Australia sold a great deal of shoes to retailers, but those retailers couldn’t move them. It means inventory piled up, causing trouble for retailers and necessitating discounting, industry analyst Robin Lewis writes on his website The Robin Report.
That’s not great news for less than Armour’s star-powered footwear business, which contains seen sluggish growth in its models endorsed by all-star basketball player Steph Curry. Basketball footwear sales industry-wide were down about 20% in 2016.
The athletic shoe industry overall has shifted to lifestyle and retro styles, that Under Armour has limited offerings. NPD analyst Matt Powell called retro styles “the dexjpky43 player from the athletic footwear market” growing at 29% through October of 2016. Unlike Adidas and Nike, Under Armour lacks decades of footwear styles to draw in inspiration from and it has virtually nothing to offer within this category.
Under Armour by and large is shifting strategy after having a disappointing quarter, admitting it missed the athleisure trend.