Industry Analysis : Reebok

As far as Reebok’s industry is concerned it lies mainly in 2 industries, 1 is sports apparel and the
2nd is sports footwear. Below we will analyse each industry one by one.

Sports Apparel Industry :

1) Overview :

Sports Apparel is defined as sports specific clothes people wear while doing physical activities.
There are several sportswear available in the market depending on the type of sports or activity
you’re doing. Wearing sports apparel has some great advantages such as they are durable, it
improves the motion, and provides superior comfort. These sports specific clothing also helps
athletes to avoid injury and helps them to enhance their on field performance.
Rise in the spending capacity of people, more people are nowadays focussed towards a healthy
lifestyle. Increasing health awareness in a large chunk of people is driving them towards using
sports apparel which helps in driving this market.
Endorsements from celebrities is also a major factor which boosts the growth of this market.
Additionally in today’s times of increasing social media influence, people started taking physical
activity as a fashion and started following it, this helps in driving the growth of this market
furthermore.

2) Market Outlook :

In 2018, the sports apparel market was valued at $167.7 billion and it is estimated that it will
reach upto $248.1 billion by the year 2026, by registering a CAGR of 5.1%. More than 50% of
the total share in 2018 was from the men end user segment and it is expected to grow at a CAGR
of 4.6%.
Sports apparel market is growing at a fast pace, below graph shows us the total revenue it has
generated over the years and the expected revenue till the year 2025. In the year 2012, the
revenue was merely $135 billion, but in 2020, the revenue has grown up to $188 billion. As per
the forecast, the revenue will reach upto $207 billion by the year 2025.
The below graph completely justifies the fact that the market benefited from the changing
consumer trend over the years and increasing interest in health and fitness has increased the
participation of people in sports activities. In the United States, more than 64% of adults wore
sports clothes and shoes in everyday life. This shows how big the industry is and how much
potential it has to grow in the upcoming years as the trend will go up the market will go up as
well.
 a) Sports Apparel Market (By End User)
As far as the end user segment is concerned, the market is divided into 3 major segments,
children, men and women.

As per the above graph, the men user segment generated the maximum revenue in the year 2018
and it will continue to grow at the same CAGR till 2026, women segment is also witnessing a
good amount of growth and is growing at a rate of 5.6% CAGR.

b) Sports Apparel Market ( By Distribution Channel)

As per the above graph, discount stores have the highest share in the market and due to increase
in the use of internet and smartphones to shop online, the E-commerce segment might witness
the fastest growth in coming years as it is expected to register 5.9% CAGR.

c) Sports Apparel Market (By Region)

As per the above graph, Asia pacific region is growing at the fastest rate, mainly because of 2
prominent areas, India and China where the major percentage of population is young and the
increase in appetite to use foreign brands. In these two countries at present, People are more
concerned towards improving their lifestyles which has impacted the demand for sports apparel.
The participation of Chinese people is well known, and therefore due to active participation in
sports activity, China is the leader in the Asia Pacific region and can surpass the United States in
the years to come.

Sports Footwear Industry :

1) Overview

Sports shoes are designed mainly for active participation in physical activity or sports. Sports
shoes are the most important asset for any athlete as they provide flexibility, stability and motion
control. As per the active participation of teenagers and kids in sports activities over the years the
market has grown worldwide at a rapid pace. The increasing awareness among the youth and
middle aged people has increased a lot in the last couple of years and therefore it is the reason for
driving growth in this industry. The athletic footwear industry is segmented by product type into
running shoes, sports shoes, trekking/hiking shoes. Etc.
In terms of growth, North America generates the highest revenue in the world followed by
Europe. The sports footwear market is also growing due to the innovations done by the
companies in terms of product development.

2) Market Outlook

The global sports footwear market was valued at $99.61 billion in the year 2020, it is projected
that the market will register a CAGR of 4.56% in the period of 2021-2026.
The Covid 19 has affected the sports footwear market adversely across the globe. The closures of
outlets, factories has made this the most severely hit business due to the pandemic. It is expected
to grow by $97.42 billion in 2021 to $134.99 billion in 2028 at a CAGR of 4.8%.
Below is the revenue graph of the industry in which we can clearly see the it is growing
continuously since 2012 to 2019, but due to the pandemic it has been affected but we can again
see the growth from 2022.
The increase in sports activities in the world again after the covid 19, will improve the numbers
industry is receiving at the moment. As most people use sports footwear while playing or doing
some physical activity, therefore after life comes back to normalcy we can definitely see the
rising numbers again.

a) Sports Apparel Market (By End User)

Sports footwear market is divided into 3 major segments, women, men and kids. Men segment
hold more than 50% of the market share in the industry as men are more inclined towards
physical activities and sports. In 2018, according to US Bureau of labour statistics on an average
men spent 5.7 hours in a day in physical activity whereas women spent only 4.9 hours.
As per the above graph we can see the increasing participation of women in major sports events,
the increasing participation can be a driving factor for the industry as more women will start
participating in sports actively.

b) Sports Footwear Market ( By Distribution Channel)

The sports footwear market considers sales from supermarkets, sports stores, online retail stores
and others. Currently sports stores are leading the market with the highest market share but in the
years to come, it is expected that the online retail stores will have the largest market share in
terms of sales. Due to the pandemic, people’s buying behaviour has changed significantly and
they’ve moved from offline stores to online stores.

c) Sports Footwear Market (By Region)

North America has the major market share in the sports footwear market account $38.99 billion
in 2020. The major reason for the growth is increasing participation of people in sports or
physical activity in the region. According to the outdoor industry association in 2020, mentioned
that in 2018 more than 50% of the people in the United States participated in various sports
activities.
After North America, the Asia Pacific region is the fastest growing region in the forecast period
2021 to 2028. China and India are the two countries which hold the majority of the market share
in the sports footwear industry. The 2 countries comprise almost 40% of the global sports
footwear market share.