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Footwear Retailing - UK - July 2013

INTRODUCTION
Definitions
Excluded
Abbreviations
EXECUTIVE SUMMARY
The market
Figure 1: UK footwear sales, best- and worst-case forecast, 2008-18
Sales estimated to grow 5% in 2013
Weather impacts footwear sales
Market factors
Online growth
Companies, brands and innovation
Market shares
Figure 2: Ten leading retailers’ shares of consumer spending on footwear, 2012
Sector shares
Figure 3: Compound annual growth rates in revenues, selected retailers, 2008-11
Innovation
Brands
Figure 4: Attitudes towards and usage of brands in the footwear retailing sector, April 2013
The consumer
Where they buy
Figure 5: Where they buy, May 2013
Trying on for fit
Figure 6: Attitudes towards shopping for footwear, May 2013
Buying clothes and shoes at the same time
Importance of quality footwear
Figure 7: Further attitudes towards shopping for footwear, May 2013
Under-35s sacrifice fit for fashion
Brands play an important role
What we think
ISSUES IN THE MARKET
What is the growth potential for online footwear sales?
Which retailers are emerging as the winners of 2013?
To what extent has discounting impacted the footwear market?
What demographics will drive growth in the footwear sector and how can retailers capitalise on this?
TREND APPLICATIONS
Trend: Life Hacking
Trend: Guiding Choice
Mintel Futures: Old Gold
MARKET ENVIRONMENT
Key points
Economic prospects
Figure 8: UK GDP growth, Q3 2009-Q1 2013
Consumer confidence
Figure 9: UK consumer confidence, as recorded by Eurostat, June 2012-April 2013
Figure 10: GfK NOP Consumer Confidence Index, January 1988-January 2012
Figure 11: UK retail trade confidence, June 2012-April 2013
Footwear deflation continues
Figure 12: CPI annual % change for footwear, clothing and all items, May 2012- May 2013
Figure 13: Annual % change CPI and average weekly earnings, January 2011-February 2013
Growing obesity
Figure 14: Percentage of the UK population that is overweight or obese, by gender, 2006-11
An ageing population
Figure 15: Trends in the age structure of the UK population, 2012-17
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
WHO’S INNOVATING?
Key points
Innovative footwear
New launches
Concept stores
Clothing retailers focus on footwear
New campaigns
Online focus
Sustainability
Bespoke services
CONSUMER SPENDING ON FOOTWEAR
Key points
Figure 16: Consumer spending on clothing and footwear, at current prices (incl. VAT), 2008-12
Consumers spend on new shoes, but also opt to mend old ones
Quarterly footwear growth slows since 2010
Figure 17: Year-on-year growth in consumer spending on clothing and footwear, at current prices, Q1 2011-Q1 2013
Figure 18: Year-on-year real-terms growth in consumer spending on clothing and footwear, Q1 2008-Q1 2013
Footwear spending growth slows
SECTOR SIZE AND FORECAST
Key points
Figure 19: UK footwear sales, best- and worst-case forecast, 2008-18
Sales set to grow 5% in 2013
Footwear sales at current and constant prices
Figure 20: UK footwear sales at current and constant prices, 2008-18
Clothing retailers drive growth in the sector
Premium and fashion specialists outperform
Weather impacts footwear sales
Forecast
Forecast methodology
SPACE ALLOCATION SUMMARY
Summary data
Figure 21: Space allocation of footwear, May 2013
Detailed space allocation estimates
Figure 22: Footwear retailers’ space allocation estimates, May 2013
Figure 23: Footwear retailers’ space allocation estimates (continued), May 2013
Sales mix
CHANNELS OF DISTRIBUTION
Key points
Clothing specialists gaining share over footwear specialists
Figure 24: Distribution of consumer spending on footwear, 2012
MARKET SHARES
Key points
2012 snapshot: Spending remains fragmented
Figure 25: Ten leading retailers’ shares of consumer spending on footwear, 2012
In detail, 2008-12: Clarks losing share
Figure 26: Leading retailers’ shares of consumer spending on footwear, 2008-12
THE SPECIALIST RETAILERS: FINANCIALS AND OUTLETS
Key points
Growth 2008-11: premium and fashion specialists prove strong
Figure 27: Compound annual growth rates in revenues, selected retailers, 2008-11
Leading specialists’ revenues: Office surges
Figure 28: Leading footwear specialists’ net revenues, 2008-12
Outlet numbers and sales per outlet: Kurt Geiger patchy
Figure 29: Leading footwear specialists’ outlet numbers, 2008-12
Figure 30: Leading footwear specialists’ annual sales per outlet, 2008-12
Profitability: Value retailers suffer
Figure 31: Leading footwear specialists’ operating profits, 2008-12
Figure 32: Leading footwear specialists’ operating margins, 2008-12
THE NON-SPECIALIST RETAILERS
Key points
M&S leads the non-specialists
Figure 33: Leading non-specialists retailers’ estimated footwear sales, 2012
Marks & Spencer
Sports Direct
New Look
Next
ONLINE
Key points
Online sales set to reach £1 billion
Figure 34: Estimated online sales of footwear (incl. VAT), 2011-14
Next and Clarks lead online
Figure 35: Estimated net online revenues and share of all online footwear sales, 2012
The consumer: Shopping online
Figure 36: The consumer: Where they have bought footwear online in the past 12 months, most popular retailers, May 2013
Figure 37: The consumer: Attitudes towards shopping for footwear, selected statements, May 2013
Figure 38: Percentage of respondents undertaking online shopping (for any type of goods) in the last three months, January 2013
Social media metrics
Figure 39: Leading footwear retailers’ social media follower numbers, May 2013
BRAND COMMUNICATION AND PROMOTION
Key points
Advertising expenditure on footwear falls
Figure 40: Topline adspend in the UK footwear category, 2008-12
Nike spends most on footwear ads
Figure 41: Total recorded advertising expenditure in the UK footwear category, by top 20 advertisers, 2008-12
Spending relative to turnover
Figure 42: Selected footwear retailers’ ad spend relative to turnover, 2008-12
Ratio between adspend by category remains stable
Figure 43: Adspend in the UK footwear category, by product category, 2008-12
Figure 44: Share of adspend in the UK footwear category, by product category, 2008-12
Footwear adspend by media type
Figure 45: Adspend in the UK footwear category, by media type, 2008-12
BRAND RESEARCH
Brand map
Figure 46: Attitudes towards and usage of brands in the footwear retailing sector, April 2013
Correspondence analysis
Brand attitudes
Figure 47: Attitudes, by footwear retailing brand, April 2013
Brand personality
Figure 48: Footwear retailing brand personality – macro image, April 2013
Figure 49: Footwear retailing brand personality – micro image, April 2013
Brand experience
Figure 50: Footwear retailing brand usage, April 2013
Figure 51: Satisfaction with various footwear retailing brands, April 2013
Figure 52: Consideration of footwear retailing brands, April 2013
Figure 53: Consumer perceptions of current footwear retailing brand performance, April 2013
Figure 54: Footwear retailing brand recommendation – Net Promoter Score, April 2013
Brand index
Figure 55: Footwear retailing brand index, April 2013
Figure 56: Footwear retailing brand index vs. recommendation, April 2013
Target group analysis
Figure 57: Target groups, April 2013
Figure 58: Footwear retailing brand usage, by target groups, April 2013
Group One – Conformists
Group Two – Simply the Best
Group Three – Shelf Stalkers
Group Four – Habitual Shoppers
Group Five – Individualists
THE CONSUMER – WHERE THEY BUY
Key points
What we asked
Clarks and Primark stand head to head
Figure 59: Where they buy, May 2013
2012 versus 2013
Figure 60: Where they buy, April 2012 and May 2013
Who buys where
Figure 61: Where they buy, by gender, May 2013
Clarks and M&S attract younger customers
Figure 62: Consumers who bought footwear from Clarks in the last 12 months, by age, April 2012 and May 2013
Figure 63: Consumers who bought footwear from M&S in the last 12 months, by age, April 2012 and May 2013
Schuh broadens customer base
Where consumers buy – offline/online split
Figure 64: Where they buy, online and in-store, May 2013
Figure 65: Repertoire of where they bought footwear in the last 12 months, by gender and age, May 2013
THE CONSUMER – TYPES OF SHOES PURCHASED
Key points
Women buy more shoes than men
Figure 66: Numbers of pairs of shoes bought in the last 12 months, May 2013
Women favour flats
Figure 67: Percentage of women who have bought shoes from each shoe category, May 2013
Females aged 25-34 spend the most on shoes
Figure 68: Average amount spent on women’s shoes in the last 12 months, May 2013
Male under-35s opt for casual shoes
Figure 69: Percentage of men who have bought shoes from each shoe category, May 2013
Men aged 25-34 high spenders
Figure 70: Average amount spent on men’s shoes in the last 12 months, May 2013
THE CONSUMER – ATTITUDES TOWARDS SHOPPING FOR FOOTWEAR
Key points
Figure 71: Attitudes towards shopping for footwear, May 2013
Trying on for fit
Online versus in-store
Buying clothes and shoes at the same time
Young less interested in discounted shoes
Under-25s and ABs are the most loyal
Older consumers interested in shoes made in Britain
Promoting footwear m-commerce
THE CONSUMER – FURTHER ATTITUDES TOWARDS SHOPPING FOR FOOTWEAR
Key points
Figure 72: Further attitudes towards shopping for footwear, May 2013
Importance of quality footwear
Under-35s sacrifice fit for fashion
Three fifths stick to same shoe styles
Brands play an important role
Demand for well-trained staff
MACINTOSH UK (BRANTANO AND A. JONES)
What we think
Poor performance from parent company
Cross-channel delays
Online sales growing fast
UK lacks critical mass
Brantano stores need more inspiration
Capitalising on brands
Company background
Company performance
Brantano
Figure 73: Brantano (UK): Financial performance, 2007-12
Figure 74: Brantano (UK): Outlet data, 2008-12
A. Jones
Figure 75: A. Jones & Sons Plc: Financial performance, 2007/08-2012/13
Figure 76: A. Jones & Sons Plc: Outlet data, 2007/08-2012/13
Retail offering
Brantano
A. Jones
C&J CLARK (UK)
What we think
Extending its global reach
Overseas sales grow faster
Online helps to drive UK sales
Creating a more distinctive proposition
Company background
Company performance
Figure 77: C&J Clark Group: Group financial performance, 2008/09-2012/13
Figure 78: C&J Clark Group: Outlet numbers, 2007/08-2012/13
Figure 79: C&J Clark (UK): Outlet data, 2008/09-2012/13
Retail offering
DUNE GROUP
Disappointing 2011/12 figures
Profits should bounce back in 2012/13
International opportunities
Multichannel development
Company background
Company performance
Figure 80: Dune Group: Group financial performance, 2007/08-2012/13
Figure 81: Dune Group: Outlet data, 2008/09-2012/13
Figure 82: Dune Group: Outlet numbers, 2009/10-2012/13
Retail offering
FOOT LOCKER LTD
What we think
Fashion focus
UK lacklustre
Locker Room extends target
Company background
Company performance
Figure 83: Foot Locker Ltd: Group financial performance, 2007-12
Figure 84: Foot Locker Ltd: Outlet data, 2007-12
Retail offering
KURT GEIGER LTD
What we think
A coherent fashion image
Benefiting from premium demand
International potential
Online growing in importance
Company background
Company performance
Figure 85: Kurt Geiger Ltd: Group financial performance, 2007/08-2012
Figure 86: Kurt Geiger Ltd: UK Outlet data, 2007/08-2012
Retail offering
OFFICE HOLDINGS LTD
What we think
Outstanding track record
The right brand mix and concession hosts
Potential for growth
Company background
Company performance
Figure 87: Office Holdings Ltd: Group financial performance, 2007/08-2012/13
Figure 88: Office Holdings Ltd: Outlet data, 2007/08-2012/13
Retail offering
RUSSELL & BROMLEY LTD
What we think
Solid track record
Late to online
Needs to broaden horizons
Company background
Company performance
Figure 89: Russell & Bromley Ltd: Group financial performance, 2007-12
Figure 90: Russell & Bromley Ltd: Outlet data, 2007-12
Retail offering
SCHUH LTD
What we think
Genesco and Schuh a good fit…
…as Schuh reaps the benefits
Youth target requires digital strategy
International potential
Company background
Company performance
Figure 91: Schuh Ltd: Group financial performance, 2007/08-2013
Figure 92: Schuh Ltd: Outlet data, 2008/09-2011/12
Retail offering
SHOE ZONE GROUP LTD
What we think
Profits bounce back in 2011/12
Better-looking prospects
Multichannel moves
Company background
Company performance
Figure 93: Shoe Zone Group Ltd: Group financial performance, 2008/09-2011/12
Figure 94: Shoe Zone Group Ltd: Outlet data, 2008/09-2011/12
Retail offering
APPENDIX – SECTOR SIZE AND FORECAST
Figure 95: Best- and worst-case forecast of UK footwear sales, 2013-18
APPENDIX – BRAND RESEARCH
Figure 96: Brand usage, April 2013
Figure 97: Brand commitment, April 2013
Figure 98: Brand momentum, April 2013
Figure 99: Brand diversity, April 2013
Figure 100: Brand satisfaction, April 2013
Figure 101: Brand recommendation, April 2013
Figure 102: Brand attitude, April 2013
Figure 103: Brand image – macro image, April 2013
Figure 104: Brand image – micro image, April 2013
Figure 105: Profile of target groups, by demographics, April 2013
Figure 106: Psychographic segmentation by target groups, April 2013
Figure 107: Brand usage, by target groups, April 2013
Brand index
Figure 108: Brand index, April 2013
APPENDIX – THE CONSUMER – WHERE THEY BUY
Figure 109: Most popular retailers where men and women have bought footwear in-store or online, by demographics, May 2013
Figure 110: Next most popular retailers where men and women have bought footwear in-store or online, by demographics, May 2013
Figure 111: Other retailers where men and women have bought footwear in-store or online, by demographics, May 2013
Figure 112: Most popular retailers where men and women have bought footwear in-store or online, by demographics, May 2013
APPENDIX – THE CONSUMER – TYPES OF SHOES PURCHASED
Figure 113: Numbers of pairs of women's shoes bought in the last 12 months (total and by category), by demographics, May 2013
Figure 114: Most popular % of women who have bought shoes from each shoe category, by demographics, May 2013
Figure 115: Next most popular % of women who have bought shoes from each shoe category, by demographics, May 2013
Figure 116: Most popular average amount spent on women's shoes in the last 12 months (total and per category), by demographics, May 2013
Figure 117: Next most popular average amount spent on women's shoes in the last 12 months (total and per category), by demographics, May 2013
Figure 118: Numbers of pairs of men's shoes bought in the last 12 months (total and by category), by demographics, May 2013
Figure 119: % of men who have bought shoes from each category, by demographics, May 2013
Figure 120: Most popular average amount spent on men's shoes in the last 12 months (total and per category), May 2013
Figure 121: Next most popular average amount spent on men's shoes in the last 12 months (total and per category), May 2013
APPENDIX – THE CONSUMER – ATTITUDES TOWARDS SHOPPING FOR FOOWEAR
Figure 122: Most popular attitudes towards shopping for footwear, by demographics, May 2013
Figure 123: Next most popular attitudes towards shopping for footwear, by demographics, May 2013
Figure 124: Other attitudes towards shopping for footwear, by demographics, May 2013
APPENDIX – THE CONSUMER – FURTHER ATTITUDES TOWARDS SHOPPING FOR FOOTWEAR
Figure 125: Agreement with the statement ‘It is more important that shoes fit well than that they are the latest fashion’, by demographics, May 2013
Figure 126: Agreement with the statement ‘It’s worth spending more on quality footwear’, by demographics, May 2013
Figure 127: Agreement with the statement ‘Not knowing if footwear will fit puts me off shopping online’, by demographics, May 2013
Figure 128: Agreement with the statement ‘I am happy to buy shoes made from other materials that are not leather’, by demographics, May 2013
Figure 129: Agreement with the statement ‘I prefer to stick to styles that I’ve bought before and know I like’, by demographics, May 2013
Figure 130: Agreement with the statement ‘Well-known branded footwear is worth paying more for’, by demographics, May 2013
Figure 131: Agreement with the statement ‘Shopping for shoes in-store is an enjoyable activity’, by demographics, May 2013
Figure 132: Agreement with the statement ‘I prefer to shop at retailers where I know there are well-trained shop assistants’, by demographics, May 2013
Figure 133: Agreement with the statement ‘I prefer shopping online for shoes as there is a wider choice of brands and styles’, by demographics, May 2013
Figure 134: Agreement with the statement ‘Retailers should update their shoe styles more often than once a season’, by demographics, May 2013
Figure 135: Agreement with the statement ‘Price is more important to me than quality when buying footwear’, by demographics, May 2013
Figure 136: Agreement with the statement ‘Fashion is the most important consideration when buying footwear’, by demographics, May 2013

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