Footwear Insight

12 • Footwear Insight ~ July 2020 footwearinsight.com These developments have left footwear manufactur- ers and retailers in a quandary, looking to adopt strategies that will help them hold onto sales, mar- gins, customers and employees. With the nation's second-quarter GDP projected to be down sharply, Yardeni Research recently predicted real GDP in the U.S. won't recover to 2019's fourth-quarter record high until late 2022. Retailers have begun deploy- ing tactics to purge excess Spring 2020 inventories, largely directly through their own outlets and online for large athletic brands, and are looking to vendors to infuse steady "freshness" into their assortments to entice shoppers as the industry rides out 2020 on likely lower unit volumes. From a marketing perspective, cancellations (the Boston and New York City Marathons) and postponements (the Tokyo Olympics and Euro 2020 soccer tournament have both rescheduled to 2021) are giving brands opportunities to adjust their budgets, preserve capital and redeploy planned marketing funds to other initiatives. In reiterating six hypotheses on the "New Normal" post COVID-19 first suggested in April, McKinsey & Co. says brands that have managed to engage consumers during the pandemic crisis and offered outstanding customer service will see loyalty gains going forward. The research house suggests there might be increased price polarization in the months ahead that will shift consumer demand to lower pricepoints due to economic downturn, the economic inequality explosion, lower disposable incomes and higher unemployment. NPD analyst Matt Powell, however, saw a countertrend in footwear in the April- June timeframe, fueled by performance running gains from Brooks, Hoka One One and On. With more Americans looking to adopt healthier lifestyles during and post-COVID-19, running may end up being the biggest winner among footwear segments, Powell suggests, adding the activity benefits from the ongoing "social distancing" movement. The segment, which has been in decline since 2013, always rises during recessionary times, he noted. At this juncture, it's unclear how footwear makers may try and capitalize on other consumer trends that have emerged during the coronavirus pandemic. Besides running, there is more U.S. consumer WITH MORE AMERICANS LOOKING TO ADOPT HEALTHIER LIFESTYLES DURING AND POST- COVID-19, RUNNING MAY END UP BEING THE BIGGEST WINNER AMONG FOOTWEAR SEGMENTS. SUMMER LIKE NO OTHER

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