Why Are Sporting Goods Stores Failing?
Over the past year, it seems like sporting goods department stores are dropping like flies. Smaller specialty shops are doing pretty well, but places like Sports Authority — not so much. Ditto Quicksilver and PacSun, mall-level shops selling a variety of sport-related apparel and equipment.
Some are blaming the Usual Suspects — read Amazon and other online retailers — while others are just saying the whole business model is shot. Well, tell that to Dick’s Sporting Goods. In fact, tell it to the industry as a whole. Athletic wear is selling well, so are running and basketball shoes. Golf is hurting, but you can’t throw a giant tire without hitting someone doing CrossFit or marathon running.
Sure, people will buy certain items online, but most folks still want to try it on before they take it home. Especially where shoes and sporting equipment are concerned.
Crowded Market
The problem, some say, is over saturation. There are simply too many options for shoppers. Spoiled for choice, they tend to opt for convenience. Because some of the biggest brands have been resting on their figurative laurels, they failed to stand out from the crowd and develop brand loyalty among their customers.
Failure to Evolve
Further, some companies have failed to adapt to an evolving marketplace. While they complain about online sales and specialty shops peeling away their customers, their competitors are working hard to keep customers coming into the store — and rewarding them for their loyalty.
They are also evolving to meet the needs of the Millennial market. Leisure, even among retirees is changing. Fewer people are playing golf, and more are choosing other active lifestyle options. Companies that recognize this and change their stock and store focus accordingly will do well. Those who refuse will experience the slow struggle of long asphyxiation.
Changing Times
These are not Magic 8-Ball predictions, these are the next closest things to established fact. We’ve seen it time and again in this and other markets. Interests change, hobbies shift. Remember when Jane Fonda workouts were all the rage, and everyone was buying leotards? What about biker shorts in the 90s? Fashion changes, appetites evolve, and the stores that understand that will better understand their customers. They will be the brand left standing while the others spend their time trying to figure out what went wrong.
Roman Temkin is a New York based Real Estate Developer and sports enthusiast.
