After multiple quarters of sluggish sales, retailers have shifted their focus and efforts to the second-biggest spending event of the year: back-to-school. But much like the backpacks students will haul around in September, the outlook points to a mixed bag for retailers.
Issues such as unpredictable weather and an uncertain economy continue to plague footwear and apparel firms, while a lack of trends is also making some industry watchers anxious.
“With a limited scope of categories that are resonating strongly, both apparel and footwear remain challenged,” explained B. Riley & Co. LLC Inc. analyst Jeff Van Sinderen. “We also are in the middle of a not-so-great fashion cycle for apparel outside of active and athleisure, [although] footwear is relatively healthier with more favorable micro-trends to drive it.”
Van Sinderen said the retail space would benefit from new trend drivers, but “I’m not totally convinced that is in the cards for back-to-school 2016.”
Nevertheless, footwear sellers continue to forge ahead — relying on strength in athletic as well as canvas styles and ramping up their digital efforts to address consumer shifts.
Many of last year’s top athletic brands — including Nike Inc., Skechers USA Inc. and Converse — are expected to produce robust sales. Meanwhile, Adidas, boosted by its high-profile collaborations and several key product launches, and Puma, jolted by partnerships with buzz queens Rihanna and Kylie Jenner, are predicted to make a major splash this time around.
Jason Short, VP and DMM for men’s and women’s athletic shoes at Famous Footwear, said he expects the usual top-notch performance from Nike and Converse but is also adding Adidas to his list due to accelerating momentum.
“Adidas is the new [standout] brand this back-to-school season,” Short said. “They’re trending strongly in the market place compared to a year ago this time.”
Van Sinderen has also made a similar observation regarding heightened interest in the Germany-based athletic brand. “Adidas has made a substantial comeback, and I think that will translate into solid year-over-year gains for them during back-to-school this year,” he said.
Fashion athletic styles — once again led by Steve Madden — are also expected to outperform. CL King & Associates analyst Steve Marotta dubbed Steve Madden his top back-to-school brand, while Van Sinderen noted that Madden’s e-commerce partnership with Amazon will be a further boon to business.
Jill Oralevich, DMM at Lester’s in New York, said she’s also stocking up on fashion athletic picks from Madden as well as Puma and Adidas this season.
“Puma is new to the list in terms of the fashion and athletic sneaker trend,” Oralevich said. “Fashion sneakers continue to drive the footwear business — that whole [Adidas] Stan Smith, tennis-inspired lace-up sneaker trend is big.”
Rack Room Shoes senior marketing director Jan Mauldin said the Charlotte, N.C.-based chain of stores is also relying heavily on athletic trends this time around, focusing much of its back-to-school efforts on a newly launched athletic shop concept.
Mauldin said the retailer would pump up its digital advertising and rely on customer data to drive sales: “Social media will include promotion of the athletic brands plus contests and games to increase and enhance engagement.”
This back-to-school season will see many retailers accelerate their e-commerce social media efforts.
“We’re going to have strong Instagram campaigns,” noted Lester’s exec Oralevich, “[including] weekly posts with the most prevalent trend as well as posts about what we feel are our stronger, most compelling products.”
Similarly, Shawn Manning, owner of Fontana’s Shoes in Ithaca, N.Y., said he’ll use Facebook to get consumers’ attention.
“We’ll have sponsored posts for specific brands with photos of new styles,” he said. “We will also use [an email marketing service] to send out e-blasts [for products and promotions].”
To augment its e-commerce and social media strategy, Rack Room will also roll out a new member-focused rewards app supported by several “app-only” deals to drive interest.
While athletic remains a red-hot category for Rack Room and its retail counterparts, insiders said they will also keep their eyes on canvas styles by Vans and boat shoes by Sperry, which have both generated solid interest lately.
“I’ve seen more younger guys getting into boat shoes — initially it was just the girls,” said Marina Richey, store manager at Family Footwear in Bennington, Vt. “As for girl’s shoes: boat shoes, Sperry canvas sneakers, Converse canvas sneakers, higher-heeled clogs and flats like Birkenstock’s line will be [among our top styles].”
Manning also noted that Birkenstock would probably rank among the top sellers at Fontana’s Shoes. “We expect Birkenstock to sell strongly right through September — it has been one of our strongest sellers this summer.”
Still, ongoing sales of the popular sandal will be dependent on weather.
Both Marotta and Van Sinderen say they expect Mother Nature — largely uncooperative throughout the latter part of 2015 and early 2016 — to impact retail revenues as well as store traffic this back-to-school season.
“Weather, unfortunately, always plays a big role,” Marotta said. “Going into the back-to-school season, cooler weather is preferred because it spurs fall demand and heightens the pace of sales early in the season and reduces the risk of heightened promotions late in the season.”
Last year’s unseasonably warm winter and fall gave rise to heightened interest in short boots over tall boots, and many retailers plan to double down on the trend in this year’s inventory while ditching some of the heavy-duty winter styles.
“Booties were an emerging trend last year, and they took off throughout third and fourth quarter,” noted Michelle Mackin, VP and DMM of women’s nonathletic and accessories at Famous Footwear. “This year, it will definitely become the nonathletic shoe of choice, because [consumers are] replacing a flat, or even a tall or midshaft boot, with a bootie.”
Conversely, Manning said he’s hoping a lack of interest in boots last year has created pent-up demand for the upcoming fall and winter seasons.
“Since a lot of our customers didn’t buy boots last year, we’re hoping people will need to replace those [old] boots that they squeezed the life out of this year,” he said.
Regarding popular color trends, Famous Footwear VP and DMM for kids’ shoes Dan Tea said he’s seen a switch toward more clean and sophisticated colorways.
“There’s definitely a shift in colors toward more black, whites and grays — that’s the key story for kids shoes today,” Tea said. “For girls, it’s more about blues and teals — pink is a thing of the past. Trends last year were all about crazy colors — prints, patterns, tie-dye and color blocking — now it’s a more monochromatic palette.”
Despite the shifts in color — and retailers’ modernized promotional strategies — for some buyers, the season’s success hinges on the shoes themselves.
“We have seen great trends in the footwear market, and ultimately those trends can drive good sales — where there is good trend, there is good product, and where there’s good product, there’s good business,” Oralevich said. “I don’t know whether or not that [will actually] create the volume we all need it to and want it to create — but good product is the first line of defense.”
— With contributions by Zameena Mejia
(Editor’s note: This story originally appeared in the July 25, 2016, issue of Footwear News.)