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Kids shoes | online sales | Retail news
March 2016

Shopping online

for kids’ shoes

CARIN HARDISTY spoke with retailers and suppliers to find out about parents’ interest in buying footwear online for their children

Brick and mortar stores are still the preferred destination for parents buying footwear for their children — only a limited number of kids’ shoes are being bought online, despite studies showing that there is a growing interest among South African internet users to shop online.

A 2015 study by market research company Ipsos showed that almost a quarter (22%) of the study’s South African internet users have already made purchases online, with another 48% expecting to shop online in the future — therefore 70% of internet users surveyed are, or plan to become, online consumers. The potential for retail sales is thus wide open if your store offers an online channel. “We have noted a significant increase in interest in online shopping over the past few years,” says Sharnelle Peters from online retailer Zando.

“We are currently in a phase where eCommerce sales are forecasted to double every two to three years,” she adds. “Luckily Zando is in a position where we clearly surpass the fast market growth. The main reason for this, is the wide offering we cover online as well as the convenience factor. Zando offers free delivery and returns, and with our society as fast paced as it is, our customer realizes the benefit of shopping online.”

But, consumers are still very selective about what they buy online. Statistics by Effective Measure show that during August 2015 only 6.11% of South Africans bought sport shoes and clothing online, and 14% bought fashion clothing and accessories. The survey also revealed that shopping is the sixth most popular online activity. Effective Measure is the official traffic measurer of IAB, and the survey was conducted among 265 500 participants.

“Kids’ footwear was the strongest growing category in 2015 for Zando,” says Peters. “While it obviously is a smaller category compared to adults, we do see a very big interest from our customers in both affordable as well as branded (higher priced) kids product.”

Suppliers agree that online sales of kids footwear is still very small. Their kids shoe sales to online store buyers are small — only accounting for around 5-10% of online buyers’ purchases, says Dianri Luttig from Footwear Trading.

Jordan & Co’s online kids’ footwear sales are also small, says Jody Henry, the Jordan sneaker sales manager. “But it’s growing! Especially the high-top sneakers are popular.”

Despite a strong presence among online stores for Intershu Distributers’ branded adult footwear, there isn’t a demand from these buyers for their kids’ shoes, says Philip Fouché, on behalf of Intershu Distributers, which has a selection of top international footwear brands: Grendha, Ipanema, Malero, Melongos, Pierre Cardin, Rider, Rockspring, and Zaxy.

These online stores have a stronger focus on men’s and women’s footwear, he adds.

“Children need to fit their footwear before purchase, unlike men and women who know their actual size,” says Fouche. “While we cannot talk specific numbers, there is an over-all global trend that footwear has dominated sales during the induction phase,” says Peters. “I feel the reason for this, is that it is an easier purchase, sizing fluctuations are not influenced as much in footwear as compared to apparel. With Zando being in the market for only four years we see that footwear and apparel are on par.”

“Many people prefer buying kids shoes in store due to size issues,” agrees Mohammed Laher from Rand Outfitters, which has both an online and brick-and-mortar presence. They experience more sales through their brick-and-mortar stores though, he indicated. “Sizing can be a concern for our customers,” agrees Peters. “To tackle this, Zando has added more information on our website, such as the age group suggested for sizing, thus indicating whether it would fit a toddler, kid or youth. All this information is also explained in the size guide found on every kids footwear page.”

Americans buy shoes online

In America, parents mostly buy athletic footwear or sneakers when shopping for their kids’ shoes online, the research company The NPD Group found when analysing data from their Checkout Trading service for the year ending April 2015. This service tracks consumer buying behaviour online and in brick-and-mortar retail stores.

Familiarity plays a big role in what footwear American parents buy for their children. “Athletic footwear and apparel has become the wardrobe of choice for many kids as well as their parents, most of whom have grown up with athletic brands themselves and naturally seek the same for their children,” says Matt Powell, sports industry analyst for The NPD Group.

A lot of the growth in US children’s footwear sales, however, was due to increases to the average price. “The price increases are being driven by indulgent millennial parents buying shoes for their kids, the rise in Classic and Marquee basketball which carries higher price points, and the trend of teen girls buying boys-sized shoes, which are less expensive,” explains Powell.

“Just like their millennial parents, Generation Z has a tremendous affinity for and loyalty to sneakers and athletic brands,” he adds.

South African experiences

In South Africa, brand is also a big factor for parents buying their children’s shoes, especially their sneakers retail respondents indicated in our sneaker survey.

When it comes to buying footwear for their girls, light up shoes are popular among parents, says Luttig, who found that the Skechers Twinkle Toes was* a popular order among online retailers.

Parents look for comfort, price and quality in a pair of kids shoes, adds Laher.

Online buyers prefer generic kids footwear styles, says Jonathan Chaimowitz, Levi’s footwear brand manager for Footwear Trading. For Levi’s, this includes their canvas and Pitch styles.

Children’s footwear is extremely seasonal, adds Fouche.

Peters agrees and adds that in winter Zando’s customers prefer to buy sneakers and boots, and in summer they prefer sandals and slip-ons. “I would say at every change of season sales move from sandals to boots or vice versa as the weather changes. Also when we have our new arrivals, especially of high fashion and branded footwear that all the kids have to have.”

Typically sales of kids’ footwear peak around Easter, December and Eid, says Chaimowitz.

Henry has also experienced this. He has specifically designed his kids shoes so that they look good enough to be bought and worn for Eid, but comfortable enough to also be worn at other times.

Religious periods such as Christmas and Eid has an effect on sales for specific styles among their kids shoes, says Peters. In summer, the styles that peak are pretty sandals for girls and branded sneakers and shoes for boys. If Eid falls in winter, she has taken note of sales peaking for boots with detailing and embellishments for girls, and styles “that have a little extra pizazz on them or the most popular sneaker — flavour of the month sort of thing — for boys”.

Globally, times of celebration such as Christmas and Eid attract an increase in children’s footwear sales, with parents making the effort to spend a bit more on their young ones to have them both looking good and feeling special. In tough economic times, this often means saving their money during the year and making investment purchases at these times of celebrations — investing in key items that will keep their children for a longer time.

Christmas is also traditionally a time of year when working parents have a little bit more to spend.

Online sales growing

But, while online sales of kids footwear are still negligible, the rapid global growth of internet usage — including in South Africa — does not rule it out as a significant future trend. It is estimated that almost half (49%) of South Africans were connected to the internet by the end of 2015, reports Internet World Stats. That’s more than 26.8-m internet users — by comparison, South Africa only had 2.4-m internet users at the end of 2000.

Traffic on their website grew by over 80%, compared to Q4 2014, Paul van de Waal of Makro told mybroadband. Also, turnover from the website almost doubled.

Looking at the continent, Nigerians make up more than a quarter (28%) of all of Africa’s internet users (92.7-m users), according to Internet World Stats, with Egypt a far second (14% of African internet users). South Africa holds fourth place (8%), after Kenya with 9% of Africa’s internet users (almost 32-m users).

A 2013 report by McKinsey & Company, Lions go digital: The Internet’s transformative potential in Africa, predicts that ecommerce could account for 10% of retail sales in the Africa’s largest economies by 2025 — an equivalent of $75-bn in annual online sales. “Today, the formal retail sector is relatively underdeveloped across most of the continent, outside of South Africa,” the author writes. “But E‑commerce will open up a new shopping experience for Africa’s growing middle class, giving consumers access to more choice, better quality and convenience, and lower prices, while possibly unlocking incremental demand.”

E-commerce is the fastest growing retail market in Europe, Centre for Retail Research** found in their survey Online Retailing: Britain, Europe, US and Canada 2015, which predicts that European online retail spending will grow by about 40% between 2014 and 2016 (roughly 18% growth each year) from £132.05bn to £185.44-bn.

The United Kingdom, Germany, France, Sweden, The Netherlands, Italy, Poland and Spain are included in the survey, with the UK, Germany and France dominating the European online market — accounting for 81% of European online sales among these eight countries. In 2015, online retail held a 15% market share in the UK, 11% in Germany, and 8% in France.

Online retail spending in the US is also expected to grow, with Centre for Retail Research predicting a 30% growth from 2014-2016 ($306.85-bn to $398.78-bn) — roughly 14% growth each year.

More than half (57%) of Americans and 46% of Europeans buy online, the study found.

“The recession has induced many shoppers to buy online rather from traditional stores,” Centre for Retail Research found. “Retail focus on the growing use of mobile technology is an additional factor in making online retailing attractive and convenient.” Typically South Africans tend to follow international trends, so it’s only matter of time before more of our consumers become regular online buyers.

Buying online is all about convenience, says Peters. “Being a mom myself I know how little time is left out of the day and parents don’t want to spend this precious time in mall shopping with little ones. An online platform, such as Zando, allows me to shop in my own time in the comfort of my space. Our website is user friendly and with the new cellphone app it has become so much more convenient.”

“The wide offering also allows customers to purchase many items and return free of charge if it’s not suitable, or they can simply change a size,” she adds.

Online retailing, however, isn’t as easy as it might sound. “From the onset we realised that trust, mainly around payment methods, was an area of concern,” says Peters. “This factor has become less pronounced as we evolved as a company. Through offering Cash on Delivery we managed to minimize the effects of this challenge.”

Brick-and-mortar and online not exclusive

South Africa has seen several traditional brick-and-mortar retailers extending their reach to the online world. “In addition to the increased transactions across our various clients, we are seeing a transition towards a fusion of brick-and-mortar and online strategies targeting improved customer engagement,” says Mustapha Zaouini, CEO of PayU MEA, a Naspers-owned online payment portal. “In the past year we have observed an increase of transactions in the retail E-commerce sector,” he adds.

TFG (The Foschini Group) launched its online sales channel a year ago and so far results have been promising. “We are exceeding all expectations for online sales at TFG,” says Robyn Cooke, TFG’s head of E-commerce. “This is in part due to the fact that people are becoming more familiar with our sites and that the South African consumer is growing more confident about shopping online.”

TFG is also expanding its online store to cater for mobile shoppers. The mobile sites are due to launch in a few months. “Currently less than 5% of all online transactions in South Africa are completed on mobile devices so we have timed this enhancement for when we felt it most appropriate,” Cooke says.

*Footwear Trading was the Skechers distributor in South Africa for more than two decades, but Brand Folio took over the distribution in February this year.
**The Centre for Retail Research undertakes surveys to predict retail and consumer trends, and to analyse the main drivers behind retail change.

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