Celebrity fans, limited editions and compelling brand stories – trainers are big business. We take a look at whether sneakers could put a spring in the step of the footwear category in travel retail.
Research by Pi Insights* has pinpointed an increased interest in shoes among European travellers in 2021 compared to before the pandemic – 19% of people bought luxury shoes in the channel versus 13% in 2019. Looking at trainers as a subcategory, there is excitement around its potential as a growth driver for the wider category.
It’s something that Duty Free Dynamics (DFD) saw an opportunity for and acted upon.
“We decided to approach Skechers and propose to them a partnership for that purpose, based on our experience and DFD’s extensive network of retail partners,” says Maria Villarreal, VP Commercial Americas, DFD. “The response by the retailers has been very positive, showing great interest in offering the brand to their customers.”
Now, sneakers is emerging as one of the leading categories in DFD’s portfolio.
“Skechers is enjoying a very successful sales performance that doesn’t seem to stop,” says Villarreal. “Financial results for Q1 2022 reflect record quarterly sales of $1.82 billion, a year-over-year increase of 26.8%.”
A sharp rise in demand is also being experienced by LØCI, which is attracting attention around the world for its sustainable credentials and A-list following. The eco-friendly, vegan sneaker company was founded founded by Emmanuel Eribo, Frank Eribo, Philippe Homsy and Quaradeghini (co-founders of Butterfly Twists) during the pandemic and is already available in 26 countries around the world – 11 of which came on board within a few weeks of its launch.
Harper Dennis Hobbs is representing the brand in global travel retail and, since exhibiting at the TFWA World Exhibition in Cannes in 2021, has secured two listings: with Tallink from July and, following that, onboard Virgin Voyages.
‘LØCI is ideal for the cruise market as there is the link to the ocean with the brand story’ – Jessica McGratty-Singer, International Wholesale Director, Harper Dennis Hobbs.
“LØCI is just getting started in travel retail and it’s great to see this interest in a relatively short space of time,” says Jessica McGratty-Singer, International Wholesale Director, Harper Dennis Hobbs.
It’s easy to understand the appeal. The trainers, which retail for $US150-200, are made from recycled plastic (each pair saves 20 plastic bottles from entering the oceans), are handmade by artisans in Portugal and 10% of the profits of every pair sold goes to wildlife charities. There’s also the celebrity factor.
LØCI started by working with actress, designer and environmentalist Nikki Reed as a brand ambassador. She created an exclusive collection of premium unisex vegan sneakers, which sold out around the world and has since released another collection.
“Now we have Ben Affleck, Mila Kunis, Jessica Alba wearing them which is brilliant,” says McGratty-Singer.
On the new listings, she says: “LØCI is ideal for the cruise market as there is the link to the ocean with the brand story, which we will be telling visually at the point of sale. Plus, people have that extra time to shop and are looking for something new and different.
“I think pop-ups in airports are also exciting and great way for customers to have a 360-degree view of the brand,” she adds. “It can be a good test of the brand’s success and whether to go in-store.
“The only issue is that there’s not much storage space, so if someone needs a different size the airport retailing for shoes can be a bit difficult unless you have your own store. But as people are actively looking for trainers I think that, together with the brand, we will work to find the right partners.”
More limited editions, such as the collaborations with Soho House and various charities, are also on the cards.
DFD agrees that ‘limited editions are highly valued’ in addition to brands and designs that travellers can’t get in their home countries, attractive displays and personalised spaces that offer a great customer experience. As such, the space that sneakers occupy at the POS needs careful consideration.
“You have to store several units of each item, which is very challenging for the operator; that’s why the POS only has a small buffer of inventory for a few weeks,” explains Villarreal. “Our centralised distribution centres, utilising a proprietary platform called OES, have the capacity to re-supply the POS within 72 hours, thus minimising stocks for the retailers.”
‘The potential to develop the sneakers category in travel retail is ‘more than significant, given its increasing popularity and worldwide demand’ – Maria Villarreal, VP Commercial Americas, Duty Free Dynamics
DFD is working closely with its brand and retail partners to elevate the offer.
“Our new focus is on the mono-brand and shop-in-shop formats, providing that the space allocation would allow for it, or the critical mass would justify it,” says Villarreal. “In cases where neither of those settings are feasible, we would opt for a personalised visual merchandising format.”
Expansion is on the cards for both brands in the future.
“We will work strategically and with partners where we can really share the brand story,” says McGratty-Singer. “I do think the brand will become quite big in the channel.”
DFD believes the potential to develop the sneakers category in travel retail is ‘more than significant, given its increasing popularity and worldwide demand’.
As Villarreal reveals: “We are having such great success with sneakers and the apparel and footwear category in general, that we will be sharing very good news in the next few months about important additions to our brand portfolio.”
*Source: The Pi Insights The European Duty Free Luxury Shopper study of European respondents who have travelled internationally between May-October 2021.
This is an extended version of the report that featured in our June/July e-zine.