The 72 largest integrated sporting goods retail chains saw their combined sales grow by 7.5 percent on a currency-weighted basis in 2015, according to our annual study of the global retail market. Translated into U.S. dollars, their sales inched up by 1.2 percent to a net total of almost $93 billion (before sales taxes) because of the strong appreciation of the American currency, which pushed down the dollar revenues of almost every chain outside the U.S.
The 7.5 percent increase was slightly lower than the growth of 8.3 percent that we had calculated for the chains in 2014, probably due to sluggish economic conditions and unfavorable weather across the planet, plus the absence of an international mega-event like the Olympic Games or the Fifa World Cup. It was better than the 6.3 percent rate that we had estimated for 2013, however.
Anyhow, the chains scored relatively well in a global market that continued to grow at a steady rate of 5 percent in constant currencies, judging from the NPD Group's figures. Its annual estimate for the global consumption of sporting goods puts the world market at a level of nearly $400 billion, but the figure includes sales taxes (see the next article in this issue). It also includes all kinds of bicycles, even e-bikes, which are not sold by many of the chains on our chart.
Another research institute, Lucintel, estimates the global sporting goods market at $255 billion. Curiously, this figure is very close to the size of the personal luxury goods market, which grew by only about 2 percent last year, according to various market researchers. It will be probably flat in 2016.
Our annual rankings of the world's largest sporting goods retailers exclude the voluntary groups in this sector, which play a very important role, especially in Europe. Retail sales after VAT grew by 5.1 percent to €11.03 billion for the retailers affiliated with Intersport International Corp. (IIC), some of which are featured on our chart. The Athlete's Foot, which has belonged to IIC since 2013, grew by 6 percent to €307 million. The other major European voluntary group, Sport 2000 International, reported more recently an increase at retail of 8 percent to €6.6 billion.
Our global retail chart, published on page 3 of this issue, also excludes generalist retailers for which sports products are not their primary business like Walmart or Alibaba, which are actually a big factor in the two biggest markets of the world, the U.S. and China. Our rankings continue to exclude the Russian-based Sportmaster group, which has been very secretive about its precise figures, although it has said that it is one of the top ten sporting goods retailers in the world.
While they continue to grow faster than the overall market, the major sporting goods retailers are facing increasing competition from their vendors, whose direct-to-consumer (DTC) efforts have been growing faster. Just those of the top six public suppliers of softgoods – Nike, Adidas, VF Corp., Under Armour, Puma and Skechers – rose by 9.1 percent in dollars and by 14.2 percent in local currencies last year.
With total combined DTC sales of $18.7 billion, these six major players controlled 7.3 percent of the global sporting goods market based on Lucintel's conservative estimate of total market size, up from 7.0 percent in 2014. We would like to note that, comparatively, the DTC operations of brands like Louis Vuitton, Gucci or Prada take up a much larger share of the market in the luxury goods sector.
To put together the chart, in cooperation with our colleagues in the U.S., we rely on public figures, input from management and estimates based on variations in the number of stores. All data are collected in the local currencies for the financial year nearest to Dec. 31, then translated into U.S. dollars based on the average exchange rates calculated by the OECD for each year. However, percentage changes for the individual companies are based on the currencies they use.
On this basis, the 38 chains based in North America on our list had slowed growth last year, with a 6.8 percent increase to a total of $58.5 billion. The 22 European chains based in Europe grew a little faster, rising by 8.3 percent to $23.3 billion. It should be noted that these regional figures include the sales of global players like Foot Locker and Decathlon. We should also point out the figures given for them in this chart (before VAT) are not necessarily the same that we have given in our European retail charts on Sept. 21, which referred to their sales in each individual market. Like the international voluntary groups, these chains grew faster than the market in 15 major European countries, which rose by 3.8 percent to €49.3 billion before VAT, according to our estimates.
The fastest-growing region for the major chains was Asia-Pacific, aided by the strong development of the specialized retail sector in China and Southeast Asia, in cooperation or in competition with the sports brands' mono-brand stores. Here, the 12 major retail chains registered a 9.2 percent increase to $12.3 billion.
Developing countries, not surprisingly, are where the biggest growth is taking place, thanks to the modernization of their regional retail structures. The chains based in these countries grew by 17.2 percent and came to represent 8.6 percent of the global market. In contrast, the growth in the developed world was limited to 6.7 percent last year.
With sales of $10.1 billion, Decathlon remained comfortably at the top of the list, and its strong expansion in emerging markets helped it to raise its global market share. The French giant was followed at a distance by another global player, Foot Locker, which came slightly ahead of Dick's Sporting Goods. Both of these American retailers will fall behind Bass Pro in our future 2016 rankings following its recent acquisition of another big American outdoor retailer, Cabela's. Two of the U.S. companies in our chart, Sports Authority and Sport Chalet, will disappear due to their recent bankruptcies in an over-saturated market.
The only pure e-commerce player in the sporting goods market, Brazil-based Netshoes, enjoyed the biggest growth last year, although we are not quite sure about the figure that were given to us for the company this time. XXL Sport, which is based in Norway, was the runner-up in terms of growth. Remarkable increases were scored by other retailers, such as Belle International and Pou Sheng of China, Lululemon, JD Sports Fashion and smaller companies like Optics Planet and Monkey Sports in the U.S. and CRC Sports in Thailand. Sports Direct International, the embattled and acquisitive U.K.-based retailer, remained in sixth position globally, but lost market share, with an increase of only 3.9 percent in the sports segment.
