Sports Fashion: Inc Impact of COVID-19 - UK - December 2020
Overview
 
What you need to know 
With almost a third (32%) of people buying sports fashion to wear at home rather than for sports use, we can clearly see that demand for sports fashion rose due to the need for comfortable and casual clothing during the pandemic. 

COVID-19, therefore, did not affect the sports fashion market in the same way as the rest of the fashion industry. Store closures at the start of the year did lead to a drop in sales but once retailers had adjusted, sports fashion brands again saw an uptick in revenue as people bought items not just for comfort but also to wear for outdoor exercise. Although the January 2021 lockdown will slow the recovery of the market, the long-term prospects for sports fashion are still positive. 

One of the biggest threats to the market has been the decline in consumer confidence as many have been worried about their financial stability. The market is heavily reliant on branded products and if people start to trade down and move away from these the category will suffer. However, as many shoppers are reluctant to move away from branded sportswear we do not imagine this will have a lasting effect. 

There also remain big opportunities within the sector. Brands and retailers are starting to embrace online and digital innovation and introducing interactive at-home workouts, easy click-and-collect options and providing shoppers with engaging online content, such as activities and classes offered via social media, which has stood some of the major brands and retailers in good stead. 

Key issues covered in this Report
●	How consumers’ behaviours and attitudes have changed since COVID-19. 
●	The impact Brexit will have on the sports fashion market. 
●	Consumer habits towards sports fashion. 
●	Interest in innovations within the sports fashion sector. 

COVID-19: Market context
This update on the impact that COVID-19 is having on the market was prepared on 8 January 2021. 

The first COVID-19 cases were confirmed in the UK at the end of January 2020, with a small number of cases in February. As the case level rose, the government ordered the closure of non-essential stores on 20 March. 

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. It wasn't until 15 June that non-essential stores were allowed to reopen, followed by pubs, restaurants, hotels and hairdressers on 4 July, and many beauty businesses on 13 July.

By September, it had become clear that the UK was at the start of a second wave, and social distancing measures were intensified. Continued increases in infection numbers led to Wales implementing a two-week national lockdown from 19 October, England announcing a full month-long lockdown from 5 November and Scotland introduced a new five-level system of coronavirus restrictions. 

Despite these restrictions, however, case numbers continued to increase. All four UK nations tightened restrictions in January 2021, effectively leading to a full UK-wide lockdown. There is no defined end date for the lockdown, although the legislation regarding to the English lockdown that was presented to Parliament extends to 31 March.

The UK’s vaccination programme started on 8 December 2020, and with both the Pfizer-BioNTech and the Oxford-AstraZeneca vaccines licenced for use in the UK, the government aims to offer a vaccine to 15 million people by mid-February.

Impact of the January lockdown and the vaccination rollout
Much of this Report was prepared in December 2020, before the announcement of the January lockdown.

However, the content was reassessed and, where necessary, adjusted on 8 January, in order to ensure that our analysis and our forecast expectations still hold true. We have also reassessed the content in the light of the progress of the vaccine rollout, and the resolution of the Brexit negotiations.

Our core assumptions on the path of the pandemic had always included an expectation of severe disruption to markets and consumers’ lifestyles well into 2021, with a strong likelihood that the virus would still be with us even into 2022. Although the second wave of infections and subsequent lockdown puts us towards the negative end of our initial expectations, these developments are still broadly consistent with our previous assumptions.

Similarly, Mintel had factored in the likelihood that an effective vaccine would be available from early- to-mid 2021. The licensing of the Pfizer-BioNTech and Oxford-AstraZeneca vaccines puts us slightly ahead of that assumption, but the challenge associated with rolling out a new vaccination programme to millions of people means that our previous assumptions are still broadly consistent with the new reality.

Economic and other assumptions
Mintel’s economic assumptions are based on the Office for Budget Responsibility’s central scenario included in its November 2020 Fiscal Sustainability Report. The scenario suggests that UK GDP will have fallen by 11.3% in 2020, recovering by 5.5% in 2021, and 6.6% in 2022. GDP isn’t expected to return to pre-COVID levels until the fourth quarter of 2022. The central scenario has unemployment peaking at 7.5% in Q2 2021.

The current uncertainty means that there is wide variation on the range of forecasts, however, and this is reflected in the OBR’s own scenarios. In its upside scenario, economic activity returns to pre-COVID-19 levels by Q4 2021. Its more negative scenario, by contrast, would mean that GDP doesn’t recover until Q3 2024.

The second wave of infections and subsequent lockdown means that the short-term prospects for the country are consistent with the OBR’s negative scenario, but this needs to be balanced against the fact that the vaccine rollout is ahead of even the OBR’s central scenario. Medium- to long-term, then, we are still basing our forecasts and market analysis on the OBR’s central economic scenario.

Products covered in this Report
For the purposes of this Report, Mintel has used the following definitions: 

●	Sports clothing (eg tracksuits, leggings, sports kits, etc)
●	Sports footwear (eg trainers, running shoes, etc).

All items of clothing and footwear that are designed for sport are included, regardless of whether these items were worn when participating in a sporting activity or worn as casualwear. This includes items from well-known brands as well as high street sportswear.