Industry news

Team boot sales down — but not as bad as expected

Unit sales tracked by GfK Marketing Services in the first half of 2008 were slightly (-3%) down on 2007… but then, as everybody knows, 2007 was an exceptionally good year. This was offset by higher unit prices (about 5% increase), which resulted in a 2% growth in revenues.

While the year-on-year unit sales of rugby, soccer and hockey boots were down from last year, the general trend was that prices were up. Therefore, despite the negative growth (-3%), revenue growth was 9%.

Boots sold at the highest price point (more than R1 000 — even as high as R1 500) were 15% up on 2007 and there were also measurable sales at the R800-R1 000 price point. This would indicate that some consumers were accepting the higher price points, although not yet in significant numbers.

But, the main buyers of team boots are families of school-going children who were hit hard by the interest rate hikes as they have to pay off bonds, higher purchase on cars and higher school fees, says Bowen. That accounts for the current drop in units sold and the concentration of sales in mid-price points, especially in rugby.

“Although sales are down on last year — which was a very good year — there is still a lot of interest in football boots. The downward trend is therefore not as bad as it might seem. The 2010 Fifa World Cup is generating a lot of interest from inside and outside the country, with many international brands now entering the market” says Craig Bowen of GfK Marketing, who track sportshoe sales in SA at point of sale.

“Brands are also putting a lot into above and below line marketing. This has resulted in a robust sales environment during what could have been a difficult period for retail. Most of the big brands now also present much wider ranges, from entry level moulded cleats to expert level blades, offering more for a much bigger spread of the market.

Hockey is a much smaller market in terms of participation numbers than soccer and rugby and sales are spread across all levels, from the top-end brands to entry level.

While the units sold do not show a dramatic change from pre-season to mid-season, there is a sharp peak in prices before the winter season (when most team boots are sold), which then drops as the season progresses — which could indicate that consumers are buying at end of season sales at lower price points.

But, as some distributors point out, one can hardly talk about a “team boot season” nowadays as sales continue throughout the year.

SA retail sales of hockey, soccer and rugby boots : January 2007-June 2008

» Year to date growth shows a market slow down in units sales by -3% across these team sports
» On average price levels have increased by +5% over last year’s prices, maintaining revenue levels at +2% over last year’s revenues
» The market slowdown was felt strongest late in the 2nd Quarter after April 08 where double digit decline in units and value was experienced.

Team boot price point and seasonality

» In 2008, more team boots were sold at higher price points (more than R1 000 as well as R800-1 000) during the peak season, indicating that consumers were accepting the higher price points;
» There was a drop in units sold during the pre-season as well as season in the R500-600 price point category;
» Sales of team boots in the R400-500 price point remained fairly constant;
» In the R300-400 price point sales were slightly lower in 2008 than in 2007;
» Sales of the entry level price point team boots (below R200) peaked at the end of 2007 and January 2008 (about double the number of units sold in January 2007), but then levelled out as the season progressed.