The cooperation will be resumed with the Fall/Winter 2006/07 collections and, for the moment, it will be focused on special make-ups and on “frame deal” items. Nike, which holds the highest market share in Italy as compared to any other sports brand, stopped working with Intersport, the largest network of sporting goods stores in that country, in February 2004 for a variety of reasons, and this affected the Italian buying group from the Fall/Winter 2004/05 season onwards. The previous contract with Nike was producing annual revenues of nearly €60 million per year.
Intersport Italia reacted to the loss of this important partnership with several new initiatives and actions that have placed the group on a firmer footing. Its revenues for the financial year ending next Feb. 28 are expected to grow to €150 million, up from €145 million the year before, thanks to an increase in the memberships and in orders made by the retail members for private label products and products from Intersport’s cash-and-carry warehouse.
After a relative stability in the number of members, 25 new retailers joined the group last year with 42 stores, more than offsetting the departure of nine older members, mostly due to financial reasons. Intesport Italia now has a total of 194 members with nearly 400 doors, and for its financial year ending Feb. 28 it is set to reach a total retail turnover of €780 million (including VAT), which represents an estimated 17 percent of the total Italian sporting goods market, up from a previous level of 15 percent Intersport Italia had previously set a goal of reaching a 20 percent market share, but the objective has now become a more ambitious 25 percent.
Nowadays, practically all the stores affiliated to the Italian network are carrying the Intersport sign on their storefronts, like their colleagues in France, Germany and many other European countries. In Italy, where retailers are traditionally very individualistic, Intersport’s corporate identity program allows the retailers to post banners of identical sizes for their original names and for the Intersport logo, and this goes also for the group’s biggest member, Cisalfa Sport. After coming on board, the new management of Intersport Italia had managed to convince the 85 percent of the retailers to adopt the Intersport banner, up from 40 percent at the beginning of 2004. The remaining 15 percent agreed to follow suit before the end of February 2006.
In 2005 Intersport Italia supported the new corporate identity program with a 27 percent increase in its advertising budget, as compared to 2004, and by a number of new initiatives, such as a very successful fund-raising campaign for UNICEF launched in connection with Christmas sales at the affiliated stores. Last year Intersport Italia launched also a program of monthly promotions of selected branded products or private labels, focusing on a different product category each month. The communication budget for these monthly campaigns will be doubled in 2006, involving the suppliers in several new co-marketing projects. Intersport Italia is now reinforcing its staff and working on the development of a new information technology platform, in cooperation with Intersport International, in order to better predict changes in consumer demand and to help building up the best product ranges for its members.
