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Online sporting apparel kicking goals

 

Lorna janeThe online sporting apparel industry has been kicking goals over the past five years, growing rapidly on the back of the increasing consumer acceptance of online shopping, says Ibisworld.

Industry revenue is forecast to rise by a compound annual 22.6 per cent to be worth $70.8 million over the five years through 2014-15, up 16.3 per cent on the previous year as demand growth begins to slow.

Bricks and mortar retailers have begun to realise the benefits of having an online presence, as many consumers move away from purchasing sporting apparel at physical locations and are shopping online instead.

The online sporting apparel industry is characterised by a moderate level of market share concentration.

The major companies, Lorna Jane and Super Retail Group have expanded their online presence over the past five years in the face of competition from local and overseas online sporting apparel retailers, and exert significant dominance over the industry due to their size, economies of scale and large customer base outside of the online space.

Lorna Jane in particular has been highly proactive in developing its multichannel strategy, launching its online store in 2007 and successfully building its social media presence to drive customer engagement.

Demand for upmarket sporting apparel, such as women’s workout gear sold by Lorna Jane and Lululemon, is nearing its peak.

Many consumers have already opted to purchase expensive sporting apparel that does not need to be replaced frequently, partially limiting the potential for growth.

Ibisworld industry analyst, David Whytcross, says the lower growth potential is expected to continue over the next five years, as fashion trends move away from wearing sporting apparel for non exercise purposes and as the take up of online shopping begins to slow.

“Industry operators are expected to try increasing consumers’ average spend on each transaction, as the majority of consumers are already shopping online and the market is expected to become saturated with more online sporting apparel retailers.”

More bricks and mortar stores are expected to enter the industry, which will add to revenue but will likely lead to prices being lowered.

 

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