Sport Footwear saw only slim growth for the retail second quarter ending the first week of August, but the story was really as much about the year-ago quarter as anything that happened this year. Last year’s quarter saw copious amounts of liquidation sales at the mall which artificially boosted Sport Footwear to a mid-single-digits increase over the 2006 period. As a result, the 2008 second quarter saw only a low-single-digits increase over 2007 when measured in dollars, according to retail point-of-sale data compiled by SportScanINFO.


The second quarter actually looked like it was going to be a good one, tracking up in the mid-single-digits in May, then up low-single-digits through June. But as the aggressive promotions entered the year-ago comp at the mall, sales slowed in July, down mid-single-digits for the month.


Not surprisingly, sales were soft at the mall, down low-single-digits when measured in dollars for the second quarter as the year-ago events proved too tough to comp positively against. Full line was also down, however, decreasing in the mid-singles in dollars. The slump in Wheeled Footwear can once again be used as the culprit here with sales at full line just below flat for the quarter when excluding the category. Sport specialty saw high-single-digits growth for the week as it did not suffer from the Heelys burden, but saw particular strength in Running Footwear.


The mid-tier department store channel was soft for the quarter, down in the low-singles in both units and dollars, but family footwear posted the largest growth of any trade channel, up in the low-teens in dollars. The category benefited from the first time inclusion of Heelys, which added a couple of percentage points to the sales growth. However, the real driver of growth for the channel was Skate, up over 50% for the second quarter in the channel as retailers expanded assortments.


Men’s products improved in the low-single-digits, but women’s saw a low-single-digits decline.  Kid’s shoes had the largest growth for the quarter, up in the mid-single-digits. All genders posted growth at family footwear and declines at full line, while only kid’s was positive at the mall, due to strong Sport Sandals growth and only women’s saw growth at discount/mass.


Top Sellers were dominated by Nike and Jordan shoes.  On the list of top 10 selling styles were Air Force 1, the Air Jordan/Air Force 1 hybrids #3 and #5, Jordan Hydro sandal, and Nike Air Max Wright.  Asics GT 2130 and Kayano and Reebok Princess ($31) rounded out the top 15.


The skate brands all had huge increases, belying one analyst’s claim that the trend was over.  Wheeled footwear sunk by more than half for Q2, but there were some signs of recovery late in the quarter in the family footwear channel, where the category had not been sold in the year-ago quarter. DC took the top market share spot in Skate shoes for the quarter from Vans, while Etnies also saw a healthy increase. Nike’s market share was relatively flat for the quarter when measured in dollars. Surf footwear posted triple-digit growth, though off a very small base. The increase is primarily a result of Sanuk’s deconstructed looks being picked up by mall specialty retailers.


Sandals were strong in Q2 with overall sales up in the high-singles. Flip Flops continued to be a strong performer here, up over 30% for the quarter in both dollars and units, while Trail Sandals also saw double-digits growth with a strong increase in average selling prices. Sport Sandals were down in the mid-single-digits for the second quarter.


Basketball grew slightly with a sharp increase in Retro/Marquee trumping a high teens decline in Performance basketball.  The prospects for Performance Basketball are not bright for the future.


Classics grew slightly for the quarter on very strong Nike results.  All other major brands saw massive declines in Classic footwear.


Performance Training eked out a small increase due to the Under Armour Prototype launch.  This category is tracking to do about $200 million in 2008. General Cross-Training (aka Barbecue Shoes), however, was down low-teens in dollars for the quarter on flat average selling prices.
Running sales improved in the mid-singles with growth coming mainly from Fashion Running. Stability was also up, but Trail Running and Cushioning were both down mid-teens for the quarter.


Retailers remain optimistic for Back to School, even though August has started off poorly, as it has for the last several years.  It remains to be seen if the early softness is a continuation of historical trends or is due to the weak economy.  It appears whatever positive effect the stimulus checks had is now over.  The shifting “Tax-Free” dates have only added to the confusion.