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Research: The Indian Sportswear Market – Where Fashion Meets Function

When supermodels Milind Soman and Madhu Sapre’s Tuffs shoe campaign created a buzz in 1995, the Indian sportswear market knew only a handful of brands like Power and Kamachi. The market then was almost entirely unorganized. India had recently opened up its economy after the rupee crisis. As the economy grew and the disposable income of people rose, the market witnessed the entry of brands and, at the same time, the launch of new retail formats such as exclusive, multi-brand and large malls responding to the rising needs.

Later, brands like Tuffs and Power found themselves on the same turf with global brands like Adidas and Nike (the latter entered India directly in June 2004, about six years after its main competitor, Adidas). Their brand strategies are stuff that international lore is made up of. New brands entering the market today – like Hoka, Brooks, New Balance, HRX, New Balance, Asics, Saucony – are trying to follow the standards these brands have set and build strategies for marketing and sales that are second to none.

The market, broadly divided into apparel, shoes and athleisure, continues to remain largely unorganized, and is dominated by a few major brands such as Puma, Adidas and Nike. With revenues of Rs 2,980 crore during FY22 (ended December) Puma outsold its rivals—Adidas, Nike and Reebok—all put together, according to the latest filings with the Registrar of Companies.

  • Apparel: In 2021, the apparel segment was worth $579.47 million, and by 2029, it is expected to reach $2238.13 million, growing at a CAGR of 16.2 percent. The segment’s demand has increased as a result of the government’s growing investment in sports, which has had a significant impact on the market’s expansion. In 2020, the Economic Times reported that the government had allocated $401.6 million toward its sports budget. Additionally, the flourishing growth of sports like cricket and football, augmented by the Indian Premier League and Indian Super League respectively, has immensely contributed to the growth. Customer requirements include that sportswear apparel be made of comfortable textiles, flexible enough, and durable, as they are worn when exercising.
  • Shoes: According to Statista, the Indian sports footwear segment is estimated to stand at $1.69 billion as of 2023. It is anticipated that the market will experience an annual growth rate of 5.17% by 2028. The research giant states that by 2028, the market volume will reach 19.88 million pairs. Reebok, Nike, Puma, etc. are the undisputed market leaders in terms of footwear or specifically sports shoes in India, says a study by Creedon. The mass market, however, is dominated by brands like Sparx and Red Tape.
  • Athleisure: Athleisure is a relatively new fashion trend that has taken the apparel industry by storm in the last decade. Originally designed as leisurewear but adapted for more formal situations, it sits at the crossroads where traditional sportswear meets activewear. Succinctly put, athleisure wear includes clothes that can be used to exercise in but later , and then the transition to casual wear. The global athleisure market is approximately $330 billion and is expected to grow at a rate of 8-10% annually, according to Grand Review Research.

In India, athleisure is estimated to be a $ 6.8 billion market segment, and due to a large and relatively less tapped market, it is projected to grow at a CAGR of over 10% in the next five years.

According to Abdon Lepcha, Fila’s Creative Director, “In the apparel segment, the products range from crop and tank tops for women, sweatshirts, sweat hoodies, jackets and joggers are important silhouettes that cover most of the athleisure pillar. Along with these fashion silhouettes, styles are introduced to give the x factor to the collection.” Driving factors People’s needs to buy sportswear can be divided into: to actively participate in some sporting activities; to wear sports clothing as a fashion product; and to wear them in their leisure time and feel comfortable. What is driving the market? Rising interest in a healthy lifestyle With governments and educational institutions encouraging students to participate in more sports, physical activity of any kind has gained importance. From casual joggers to professional athletes, consumers today invest in sportswear with performance-enhancing features like temperature control and moisture absorption to prevent discomfort and injury.

A Puma-Nielsen survey titled ‘How sporty is India as a nation’ reveals that in the last 12 months, 68% of adults in urban India claimed to have participated in fitness-related activities. Among adults that exercised in the last 12 months, more females (42%) participated in sports and fitness related activities on a daily basis than males (36%). Yoga (37%), jogging (29%), running (28%) and cricket (28%) are the most actively participated sports and fitness-related activities by adults, in the last 12 months.

“As a nation, we have witnessed a fundamental change in the adoption of sports culture with far more running communities, gyms and people taking up different sports. However, we have just scratched the surface and have miles to go. There is a direct correlation between sports participation among kids and improved academic performance and positive emotional wellbeing. A strong sports culture brings out the best in people and is critical for the development of a country,” said Abhishek Ganguly, the outgoing Managing Director, Puma India and Southeast.

Growing Access to Online Platforms

The Indian e-commerce market is expected to reach $ 120 billion by 2026 from $ 38 billion in 2021, according to a joint report by FICCI and Anarock. India’s fast growing e-commerce market has profited from rising affluence, a rapid rise in internet users, and the widespread usage of smartphones. There were 830 million internet connections across the globe in 2021. The percentage of people who use the internet wirelessly increased to 97 percent in metropolitan regions, which accounted for 55 percent of the total. Additionally, the number of smartphones has seen a substantial rise; it is anticipated that one billion of these devices will be in use by 2026. As a result, it’s believed several previously unattainable market segments, including D2C, have become feasible.

The e-commerce business in India is anticipated to spread into new geographic areas in non-metros. “Prior to the pandemic, around 25 percent of business used to come from online channels, which increased to 35 percent in 2022. We are expecting around 50 percent of the business to come from digital mediums in the next 3 years,” Rajat Khurana, Managing Director, ASICS India and South Asia was quoted by the Financial Express as saying. As Omnichannel gains more importance, it’s certain that online sales will continue to rise.

Sustainability

One of the important trends that has affected the growth of the market is the use of environmentally friendly materials. As consumers increasingly place emphasis on protecting the environment, manufacturers are making an effort to meet the requirements.

At least sixty percent of consumers in India are willing to pay a premium for ‘sustainability products, while 52% in urban India expect to increase spending on planet-friendly brands in the next three years, according to a survey by Bain & Company. According to the survey, sustainability is a growing concern for Indian consumers: 20% of consumers in India are environmentally and socially conscious, while 49% are health conscious. And brands are going beyond sustainable products.

In its ‘Move For The Planet’ campaign, Adidas has set aside 1.5 million euro for activities logged across 34 sports in the Adidas Running app. The German company said the contributions will support projects around the globe that educate and engage communities on sustainability through sport.

“Sustainability is not merely a buzzword, we want to make our activewear clothing impactful. Our collection is made with recycled polyester, which is lightweight and breathable, and sustainable cotton to provide the extra comfort necessary during exercise. With a focus on active lifestyles, our performance wear and essential wear complement each other perfectly,” says Rushad Wadia, Co-Founder, Good Indian.

Market Expansion Aided By Government Initiatives

One of the factors is the government initiative -Khelo India Games- launched in 2018 with a budget of Rs 1,756 crore to revive sports culture in the country and promote the development of grassroots-level sports. Today, the programme has grown into a massive sporting extravaganza that attracts thousands of young athletes from across the country. The emergence of more professional sports, including cricket, hockey, football, etc., provided the government and industry with the opportunity to produce goods in India for both India and the rest of the world. The program was primarily intended to draw foreign investment, while also generating income, recognizing, and nurturing the nation’s sporting talents, and creating jobs.

As more sports grow, the influence sports professionals plays is significant. For instance, Shiv Naresh began as a tiny tailor’s unit in Delhi, is today commonly referred to as ‘Face of Indian Sports’ with various athletes, like Vijender Singh and Mary Kom, sporting and supporting its products.

Pandemic Impact

During Covid-induced lockdowns, the Indian apparel market shrank by 27%. Post-lockdown, driven by a rise in the number of people working from home, and greater awareness about health and fitness, consumers’ buying preferences have changed. A large chunk of them shifted towards versatile and comfortable athleisure wear like yoga pants, track suits, joggers, t-shirts, and sneakers. According to regulatory filings, companies such as Decathlon, Asics, Puma, Skechers, and Reebok grew 7-24 percent in the fiscal year ended December 2020, significantly outpacing apparel retailers Zara, Benetton, Marks & Spencer, Levi’s, and Lifestyle. This jump in demand is also seen in the athleisure portfolio, says Aditya Birla Fashion and Retail Limited (ABFRL) in a statement posted on its site. The company entered the segment in 2016. Its athleisure business has continued to expand its network, with a presence in 159 exclusive stores and nearly 31,000 trade outlets as of the second quarter of FY2022-23.

Blending Fashion & Sports

Blending fashion and sports is another major factor that has induced consumers to choose sportswear products. It is easy to wear and look appropriate for a variety of occasions. This has been made possible by some of the partnerships. Adidas by Stella McCartney is another example. Nigo’s collaboration with sneaker giant Nike is another recent development. And it’s further augmented by mediums such as film. Bruce Lee is credited with bringing the classic stretchy tracksuit into mainstream fashion; in the 70s, it was cool to wear athletic tracksuits in polyester, cotton, terrycloth and velour for activities that were not even remotely athletic.

Back home, in the 90s, Karan Johar’s film Kuch Kuch Hota Hai introduced Indian audiences to brands such as DKNY and Polo Sport. Homegrown brands The healthy ecosystem has spawned Indian brands such as HRX, Wrogn, Good Indian, Tyka, Shiv Naresh, SS, Performax, Cosco, Nivia, etc. “Competition brings with it a sense of belongingness and it at least assures that we are all juxtaposed now which itself is a big win. Intensity of competition, honestly, is always dynamic and changes with regards to a lot of factors, the economic macros, education and lifestyle, access, and availability are a few to start with. For us, the key is to adhere to our positioning and keep bettering the offering to the consumer while building upon the experience,” says Afsar Zaidi, Co-Founder of HRX.

Conclusion

The Indian economy was worth roughly $3.5 trillion in 2022. It is expected to cross the $5 trillion mark in 2027. It may reach about $7.6 trillion in the next 10 years, but in an optimistic case, it would be closer to $8 trillion. Out of $3.5 trillion, about $2 trillion is consumption, thereby keeping the economy stable; because the economy is driven by private consumption.

“The economy will add trillion-dollar merchandise in the next 10 years, doubling consumption. In comparison with other countries, China’s private consumption is about 30 percent, which is three times of what we consume. But from a market perspective, India is quite close to some of the developed economies,” explains Saloni Nangia, President at Technopak, India. “The fact that we have 360 million Gen Z, which is way larger than any other country, is really going to shape the next decade. This is the kind of audience we are going to deal with. This is really the reason why we are aiming at digitally enabled commerce or retail.”

As the economy grows, people seek for a diverse greatest selection from the numerous accessible brands. As a result, the market is always expanding in response to product demand. Over the years, we have witnessed brands diversifying their products and also introducing more innovations. The market has been made more competitive with more global and Indian brands entering with new strategies, thereby making product offerings more elaborate. However, it remains to be seen what direction it will take and what will redefine it.

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