Analysts Bullish on Basketball Despite NBA Lockout

Analysts Bullish on Basketball Despite NBA
Lebron James debuted his new signature shoe at the South Florida Classic exhibition game this past weekend.

As the NBA lockout drags into its third month, analysts say that the basketball category is still strong should more NBA games be cancelled.

Susquehanna Financial Group reported that it doesn’t see a significant risk to basketball footwear overall at this time, with the category showing strong second quarter results for retailers Foot Locker and Finish Line.

According to the firm’s recent NBA Lockout report, Nike, Foot Locker and Finish Line all highlighted basketball as a growth driver this year. 

Sportsonesource analyst Matt Powell also said footwear will see little impact, but licensed apparel could take a big hit, similar to what happened in the 1999 NBA lockout. “Last week, basketball apparel sales dropped about 20 percent,” he said. “I think that’s the first sign we’ve seen that the lockout is going to negatively impact licensed apparel sales.”

Powell added that brands are capitalizing on non-professional basketball events to gain exposure for products. For example, the players of the Miami Heat organized an exhibition basketball game this past Saturday, which pitted Jordan Brand endorsees against Nike Brand endorsees.

“Brands have figured out other ways to promote their products to get exposure, whether it’s on the web or these manufactured events that are going on,” Powell said. “Kids are still going to play basketball, and they’ll still need shoes.”

The NBA and its players continued negotiations on Monday in an effort to resolve the labor dispute.

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