I’ve been very critical of Foot Locker. During retail dives, even with shipping constraints and supply chain issues, it seemed both JD Sports and Hibbett Sports were outperforming Foot Locker simply based on the amount of sneakers being allotted to the chains. Nike’s continued Consumer Direct Acceleration, accelerated the demise of Footaction, and in my opinion this didn’t stop with the closing of those stores under the Foot Locker banner. Nike’s intention to dropship to Foot Locker consumers looks a lot like an acquisition, without an acquisition. Foot Locker’s own internal actions has contributed to a lot of turnover at stores and it’s becoming harder to attract teens who tend to dominate the part time makeup of the company. When you add into the mix a glitchy app for sneaker raffles, and a horrible rewards program that only allows app users to purchase gift cards with their points once every month or two, on a digital gift card which should never run out, the Foot Locker stores appear to be suffering from a host of issues. Foot Locker looks like a company trending down, even with GOAT investing in Grailed, these actions are negligible as the supply chain has hindered the product flowing into resale.
A Major Adjustment Could Pay Dividends
What just happened to make my prognosis a bit better for the Stripes? When I saw that On Running began a wholesale relationship with Foot Locker, I thought it would be problematic. Foot Locker has relied heavily on the Nike wall to the detriment of the business. While Nike still covers 90% of the shelf space in their stores, I saw a wall yesterday during a dive, and heard some information that should reignite interest in where Foot Locker could potentially go, if they make the correct moves. In the picture above, you can see a banner and a tagline. Neither has been utilized throughout social media and I don’t ever see any Foot Locker ads on my site or on other sites.Even on Instagram, their content is geared towards youth culture, streetwear and hype. The phrase THE ULTIMATE RUNNER and the Segment: PERFORMANCE RUNNING, look more like a Dick’s Sporting Good merchandised area than a Foot Locker. There are only four columns consisting of Brooks, New Balance and ASICS, but the in-app advertising of ON Running and the is the first time I’ve seen such product mix in this region at Foot Locker.
Is $ONON On-Running’s Limited Recognition Outside of Specialty Running a Plus or Minus?
When I initially heard that On was expanding distribution to Foot Locker and to other stores dominated by the Nike Wall, who also cater to what is considered urban retail, I thought it was a serious mistake. I even provided video evidence from a YouTuber who simply glossed over the shoes in a Shoe Palace. After speaking with a manager about the wall in the picture above, I have reason to think that Foot Locker is very aware they are being squeezed by Nike. Their awareness is manifesting itself in a quiet way, I see as very beneficial if handled correctly. The Performance wall is performing above expectations with a demographic I very often overlook, women. Men tend to be brand driven. Women are comfort driven and will ask questions about what feels good without regard to whether a Swoosh or Three Stripes are attached. Women as consumers, are better indicators of brand potential and they can point towards opportunities for growth. Foot Locker should do a better job of merchandising this area. Performance Running can function as a buffer for the chain. It will be interesting to see how Foot Locker handles this new segment.