Without Payless, Here’s Where Back-to-School Shoppers Will Go for Shoes

Five months have passed since Payless ShoeSource filed for bankruptcy, for the second and final time, and began liquidating all 2,500 of its stores. It marked the end of the run for the 63-year-old family-footwear retailer, leaving similarly low-priced mass merchants in the running to nab its leftover market share.

Now, the upcoming back-to-school season will mark a critical time for retailers to compete and lay claim to that white space. According to The NPD Group, Payless accounted for nearly 4% of children’s shoes sold last year, making it the No. 6 player in the country based on unit sales. However, almost half of consumers who bought kids’ footwear at the chain also made purchases at Walmart, while close to a quarter shopped at Target and another 10% went to Kohl’s — leaving all three companies primed to grab customers searching for a new shopping destination in the wake of Payless’s demise.

“Athletic footwear specialty, sporting goods stores and mass merchants will grab the bulk of [back-to-school] sales,” added Beth Goldstein, NPD’s executive director and fashion footwear and accessories analyst, “but based on year-to-date momentum, branded shoe stores, shoe chains and off-price retailers will likely grab a bigger piece of the pie this year.”

In 2018, NPD noted that retail sales for children’s shoes peaked during the first week of August in the central, southern and western parts of the country, where school often opens earlier in the year. The northeast region, on the other hand, saw a majority of back-to-school sales during the final two weeks of the month in anticipation of the early September start date.

“Spending on kids’ footwear during the back-to-school shopping season is very much in line with what we’re seeing in the footwear industry as a whole,” Goldstein added. “Consumers are following a ‘buy now, wear now’ pattern, indicating they are making their shoe purchases very close to the need, not before.”

The firm expects the same pattern to continue this year, with athleisure brands — driven largely by the sport leisure category, which makes up 60% of the market — holding onto their top spot among kids’ footwear of choices. And although online shoe shopping is increasingly gaining ground, NPD suggests that brick-and-mortar locations still hold clout when it comes to back-to-school buys — with 80% of last year’s sales during the season done in physical stores where growing youngsters with rapidly changing sizes can try on shoes.

“While in-store shopping increases in importance during the back-to-school season, retailers of all types will boost their omnichannel efforts to capture both store and website sales during this critical selling period,” Goldstein added.

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