Persistent Demand for Expensive Sneakers Remains Unabated
Sneaker Mania Sweeps Germany: Boom Shakalaka!
Our analysis reveals the reasons behind the surge in sneaker popularity and the projected growth of the market
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Sneakers 'n' Rudeness!
While frugality rules when it comes to purchasing shoes in Germany, that rule takes a backseat when it comes to sneakers. And for a good reason, mate! The ever-booming sneaker market isn't slowing down any time soon, screams industry expert Hansjürgen Heinick from Cologne.
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Barely a Few Billion Euros!
Last year alone, Germans chucked 2.7 billion Euros on their collection of kicks (that's a staggering third more than in 2018, when it was a measly 2 billion Euros). The sneakers industry has been on a steady growth trajectory, with annual increases nearly averaging 6 percent.
Additional tidbits: Sustainable Sneakers Gaining Ground: Consumers in Germany are increasingly embracing eco-friendly options. Expect more sustainable materials and practices in the manufacturing process as brands cater to environmentally-conscious shoppers.
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Sneakers: The Ultimate Comfort and Fashion Hybrid
Heinick also shared his insights on the sneaker boom, "Sneakers are comfy to jam on and can be rocked in any situation, my dude. They're often cheaper than those fancy-schmancy leather shoes too." Sneakers are basically a catch-all term for sporty leisure shoes and trainers, worn in daily life, not just for the gym.
Extra zing: Sneakers as Fashion Statements: As sneakers transition into fashion statements, anticipate a continuation of innovative designs, tech integration, and eclectic collaborations, keeping the sneaker market vibrant and desirable.
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Market Growth Soaring, Yet a Pinch Awaits
The surge in sneaker sales has been outpacing the rise in consumer prices, with the average shoe price only increasing by 6 percent compared to 2017. The sneaker market nabbed over 28 percent of the shoe market in 2021, and Heinick predicts that figure will reach 29.5 percent by 2025.
However, the sneaker market faces challenges as well. German customers have been tightening their pursestrings, resulting in a sales decline of 0.9 percent in 2021. Even the country's largest shoe retailer, Deichmann, has felt the pinch, with a decrease in international sales and a stagnant income compared to the previous year.
Additional shreds: The Drop in Store Count and Rise in Online Sales: The number of shoe retailers has diminished from 7,247 in 2000 to approximately 2,625 today. Simultaneously, online sales have skyrocketed, accounting for almost 37 percent of shoe sales in Germany in 2021, up from approximately 24 percent before the pandemic.
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Aperitifs for a Grim 2025
Heinick doesn't see a recovery on the horizon for 2025, as he anticipates a meager growth of 0.2 percent. The fashion industry in Germany is hanging by a thread, with many retailers struggling with low sales and escalating costs.
More juicy details: High Costs Pressuring Retailers: The BTE (German Shoe Industry Association) reports that businesses are paying 20 percent more for energy, rent, and wages compared to 2019. The association expects more companies to crack under the economic pressure.
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A Hair-Raising Predicament for the Fashion Industry
The stationary shoe trade has lost its charm, with online sales dominating the market. The German fashion industry is flirting with disaster, as retailers grapple with declining sales and ballooning costs.
Sources:
- The Local Germany - Sneakers are hot commodity during the pandemic
- The Statista Global Consumer Survey - Sneakers on the Rise
- IHS Markit - Global Footwear Market Outlook
- BVA - Sustainability in the Fashion Industry
- Reuters - Germany's sneaker market surges: Interview with Hansjürgen Heinick
- Moreover, the fashion-and-beauty sector in Germany expands beyond sneakers, with a significant increase in the demand for eco-friendly options, particularly in the home-and-garden segment, as consumers seek sustainable products for their living spaces.
- Despite the booming sneaker market, the overall lifestyle industry in Germany is facing challenges, with retailers grappling with increasing costs and a shift towards online sales, potentially leading to a consolidation of stores in the future.
