With less than 24 hours before Nike and Lululemon report their most recent quarterly results to the market, a recent report from Placer.ai appears to be rather timely as brands, retailers, investors and consumers look for the bigger picture around the results after the market closes on Thursday afternoon.

Placer.ai knows that Athleisure & Sportswear are a go-to for consumers looking to move seamlessly between activities – from a workout to work-from-home.

“That functionality has kept the category running hot in recent years even while more consumers are getting back to the office and socializing,” the company said in their latest report. “And since Athleisure & Sportswear are now bonafide wardrobe staples, more consumers are investing in high-end items.”

The research firm said they dove into the data for two of the category’s biggest upscale players – Nike and Lululemon – in order to take a closer look at the consumer behavior driving visit growth.

Without Breaking A Sweat
During all four quarters of 2023, Nike and Lululemon saw year-over-year (YoY) foot traffic growth that surpassed the visit increases in wider Athleisure & Sportswear space, Placer.ai observed. The report said part of Nike’s sizable 2023 YoY visit gains were likely due to the addition of a large number of stores relative to its somewhat modest footprint.

Nike is continuing to invest in own-brand stores to boost DTC business including the first U.S. Michael Jordan “World of Flight” store coming to Philadelphia, PA. Lululemon also expanded its store count – albeit more modestly – which likely also helped the company stay ahead of the competition.

Editor’s Note: Mouse over the chart and graph content for more data.

How is 2024 Shaping Up?
Fueled by significant store growth, Placer.ai said that Nike managed to keep YoY foot traffic positive in the first two months of 2024 despite the arctic blast that plagued overall retail visits in January.

“Lululemon and the wider Athleisure & Sportswear space were less insulated from the effects of the storm, and the comparison to a strong 2023 made for mild YoY visit gaps in January 2024. But by the end of February 2024, both lululemon and the Athleisure & Sportswear space had narrowed their visit gaps and appeared to be on an upward trajectory,” the firm wrote in its report.

An Affluent Incline
The firm said in the report that by diving deeper into the demographic data for Nike’s trade area they found some indication that the aggressive expansion is not the only factor driving the brand’s recent foot traffic gains.

“Analysis using the AGS: Demographic Dimensions dataset revealed that since the 2021 retail reopening – and specifically Q3 2021 – the median household income (HHI) of Nike’s captured market has been higher than that of its potential market*. And the gap between the median HHI in the brand’s captured and potential markets seems to have widened even further in 2022-2023,” Placer.ai revealed.

Placer.ai said that driving traffic from affluent consumers appears to be an intentional strategy by the brand. It reference recent comments from Nike CEO John Donahoe that the brand is expanding in products across price points and now offers more expensive womenswear than ever before – and location intelligence indicates that this strategy is working.

“By Q4 2023, the median HHI of Nike’s captured market had climbed to $95.6K – the highest in nearly five years. This suggests that despite the adverse impact of inflation on some aspirational shoppers, Nike is succeeding in driving high-value foot traffic,” the report said.

*A chain’s potential market refers to the population residing in a given trade area, where the Census Block Groups (CBGs) making up the trade area are weighted to reflect the number of households in each CBG. A chain’s captured market weighs each CBG according to the actual number of visits originating to the chain from that CBG.

Editor’s Note: Mouse over the chart/graph content for more data.

Will the success of upscale athleisure and sportswear continue in 2024? Visit Placer.ai here to find out.

Image courtesy Lululemon (global brand ambassadors),  Data/Graphs courtesy Placer.ai