La Gear

The athletic footwear industry has grown rapidly over the past two decades. Retail

growth averaged roughly 20 percent per year between 1985 and 1993 to about $6 billion

in sales. The forces responsible for that growth include the popularity of running

in the late 1970s, with that sport eventually reaching non-runners, and the purchase

of running shoes for casual use piggybacking the trend toward more casual lifestyles.

The emergence of aerobics in the early 1980s created a new fashion and fitness

trend for women who wanted fashionable apparel and footwear. They preferred

stylish items that were comfortable and colorful, with more variety than traditional

exercise outfits. The early 1980s also produced shoes designed for individual sports

and technological innovations in material and design. From those 1980s trends

emerged two seemingly distinct athletic shoe market segments, that is, consumers

who wanted performance versus those who were primarily interested in fashion.

In the 1990s, athletic footwear is worn to make a statement, The shoes are not

only for serious athletes but also for casual athletes and fashion wearers looking for

comfortable, attractive shoes that represent the wearer's personality and life style.

Athletic footwear has evolved from being an accessory to an essential clothing item.

From high-tops to high-tech, the sneaker has made it to the high style of fashion's

runways. In the recent designer collections, sneakers took front stage as

footwear's must-have accessory. The sneaker also received another honor, a special

award from the Council of Fashion Designers of America for its uniquely American

influence on world fashion. The sneaker is the most universal item in everyone's

wardrobe. It is now also becoming integrated into different aspects of every

consumer's life, from the office to the home. The sneaker represents everyone's

sense of fitness and health; everyone feels young and healthy wearing sneakers.

When it comes to serious footwear, Nike is the market leader. Its modern track

shoes energized an industry and produced a $3.5 billion footwear superpower with

superstar advertising. Celebrity athletes such as Michael Jordan and Bo Jackson

have convinced lots of fans on and off the playing field to "Just Do It." Nike is best

at enhancing an athlete's ability with a shoe that has the latest technology.

Other major contenders in the athletic footwear business are Reebok and L.A.

Gear. They, along with Nike, are in a marketing war with stakes that include

dominance of the U.S. and international athletic shoe markets and image leadership

in a product category where performance and fashion become blurred in an

avalanche of new technologies and styles.

ATHLETIC SHOE BUYERS

Although the shoes sold by Nike, Reebok, and L.A. Gear appeal to consumers of

all ages, incomes, and both genders, there are significant differences between the

customer profiles for the brands.

Tables 5Ð'-1 and 5Ð'-2 separately profile women and men on key demographics

for purchase behavior in the last 12 months and by leading competitor (L.A. Gear

versus Nike versus Reebok). According to Table 5Ð'-1, some 59 percent of women

purchased a pair of shoes in the last 12 months, with Reebok the most likely brand

of choice. Similarly, some 52 percent of men purchased at least one pair of

sneaker/athletic shoes in the last 12 months and, among men, the most likely brand

is also Reebok. The tables also show that L.A. Gear's shoes are most popular with

young women, while Nike's shoes do well with young men. What these numbers

do not show is the fact that women purchase significantly more shoes than men,

as much as 20 to 30 percent more.

The pie charts in Figures 5Ð'-1 and 5Ð'-2 reinforce the information on gender differences

in the tables by showing that major brand market shares differ by gender.

Reebok and L.A. Gear are more popular with women than with men, probably due

to their historical emphasis on fashion over performance. Nike does slightly better

with men than with women, presumably due to its reputation for innovation

and technology in support of its performance positioning.

However, in reality, the market for performance shoes overlaps with the fashion

shoe market. The two positioning dimensions, fashion and performance, are

frequently difficult to separate because performance (or appearing as though you

could perform) is a form of fashion. Realistically, those who purchase performance

shoes are more likely to be found wearing them on a walk in the mall than playing

at competitive sports. Only one pair of athletic shoes out of seven ever sees

any real sweat. However, to be the market leader,