New Delhi: Foot Locker Inc., a New York-based specialty athletic retailer, sees India as a priority market as it prepares to launch its first store in the world’s fifth-largest economy this week.
“We see the opportunity, India is the fifth-largest consumer market in the world. I would add that the brand partners that we work with are also very excited about growing their presence in this important market. So, it’s a high priority; we see definite growth ahead,” Mary N. Dillon, president and chief executive officer, Foot Locker, told Mint in an interview.
Foot Locker is a multi-brand retailer that sells footwear from brands such as Adidas, Nike, Jordan, Puma, Birkenstock, Crocs, Skechers, Saucony, New Era, along with athleisure clothing.
“Anytime we think about entering a new market, it’s really just – can we get the size and scale, is there a consumer market that’s big enough? Obviously India is the fifth-largest (consumer market) in the world, it’s a young market and we know the sneaker culture particularly appeals to younger people,” Dillon, who was earlier the CEO of US beauty retailer Ulta Beauty, said.
‘Long-term view on the market’
Foot Locker holds a “long-term” view on the market, Dillon said in a virtual call.
Last year, Foot Locker signed a long-term licensing agreement with Metro Brands Ltd (MBL), a Mumbai-based multi-brand footwear and fashion retailer, and Nykaa Fashion to expand its offline and online presence in India.
Under the terms of the agreements, MBL was granted exclusive rights to own and operate Foot Locker stores within India. Nykaa Fashion serves as the exclusive e-commerce partner and will operate Foot Locker’s India website and retail authorized merchandise on Foot Locker’s branded shops on Nykaa’s existing e-commerce platforms.
The retailer is set to open its first store in Delhi this week.
Post-pandemic, consumers have taken to sneakers with more shoppers swapping formal footwear for several pairs of white sneakers. It isn’t uncommon to see executives wear sneakers to work or youngsters sport a pair at music clubs.
Globally, the category of sneakers is definitely projected to continue to grow and that’s largely due to the casualization, Dillon added. “Once you discover this category and go beyond the more functional attributes that a lot of people use it for, like sport, then you start to realize that sneakers can become a part of your everyday life,” she said.
As of 3 February 2024, the company operated 2,523 stores in 26 countries across North America, Europe, Australia, New Zealand, and Asia, and a licensed store presence in the Middle East and Asia.
Foot Locker’s decision to enter India is prompted by an increase in sneaker culture that has seen the arrival and expansion of several brands in the country.
In April, Italian sports brand Lotto entered the India market via Agilitas Sports. In 2021, Aditya Birla Fashion and Retail Ltd was awarded exclusive rights to distribute and sell Reebok in India and other ASEAN countries. Last year, Bata India announced the expansion of its product portfolio in activewear and athleisure clothing.
For Metro Brands, an estimated 15% to 18% of all footwear sold is athletic wear, its chief executive officer Nissan Joseph said. However, the market is still in early stages of development.
“What’s more critical is that we’ve seen the growth coming in that category,” he said.
While established brands like Nike, Adidas, and Puma have a strong presence in the market with their standalone stores, Joseph explained that their retail concept would offer a different assortment of products and avoid direct cannibalization of existing businesses. “I do want to say that it’s not a cannibalistic sale in any way, shape, or form to have a Foot Locker or a Metro. There are two different consumers and even the type of products that we would carry in the sneaker range are different,” he said.
Meanwhile, for Nykaa that also runs a fashion and lifestyle platform Nykaa Fashion, footwear, sneakers and athleisure are growing faster than the platform.
“They’re amongst our highest growing categories. The second trend we’re seeing very clearly, especially online, is premiumization; we do find that Indians are spending more with average order values going up. There’s a huge demand for international brands in the country, anything we launch that’s sort of fresh and new and international gets lapped up really quickly,” Dillon said.
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