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Footwear sellers pushing new mobile initiatives (NKE, SKX)
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BIIFootwear retailers Nike and Skechers are pursuing mobile initiatives, which could help them capitalize on the overall upward digital sales trend in their product category.
Nike is leveraging its group of mobile apps, including Nike+, to drive overall sales. The retailer's online sales jumped 49% YoY during the three months ended August 31, 2016. This helped lift its overall direct-to-consumer sales 22% during the same period. The company attributes much of its digital success to its Nike+ mobile app, which delivers personalized content and offers to its users. This strategy likely helps bolster conversion rates, along with customer retention.
Skechers is pushing a multifunctional app that both supplements in-store shopping and creates a mobile commerce channel. Skechers app users can get proximity-based notifications about deals within local stores that sell Skechers products. They can also scan items with the app to gain more product information. In addition, the retailer integrated an Instagram feed of tagged Skechers products that users can visit to make purchases through their phones. The latter initiative could help Skechers display its products in new ways, though social commerce is still an unproven sales channel. Roughly 1% of e-commerce orders in Q1 2016 occurred from a direct social media referral, according to Custora. This is down from just 2% during Q1 2015, indicating that shoppers prefer to make their purchases elsewhere.
Both footwear companies could see an uptick in digital sales. Over half of all media, sporting, and hobby good sales will be made online this year, BI Intelligence estimates. Moreover, the athleisure fashion trend, in which people wear athletic clothes in nongym settings, like at the office or while shopping, has consumers spending more online for these types of goods. Both Nike and Skechers could capitalize on this broader trend to drive up their digital sales, which may help ensure they remain relevant to increasingly digital-savvy consumers.
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