Sportswear in Brazil

PROSPECTS

Sportswear still posts a disappointing performance due to the weak economic recovery

The slow recovery of the Brazilian economy is still impacting the performance of sportswear, which remained practically flat in 2019. With a strong penetration of sports footwear, the most mature category, the industry revenues depend on the repositioning of performance products and the purchasing of sports-inspired items for new occasions, such as the more flexible workplace environments.

Discussions about import taxes divide national and international brands

Local manufacturers, especially in the area of sports footwear, are concerned about the possibility of a reduction in taxes for imports from other countries to the Mercosur nations due to new trade agreements. Asian production costs are lower and, combined with the internal costs of Brazilian taxes, processes and logistics, may result in unfair competition that makes local companies vulnerable.

Despite the gym culture in Brazil, major specialist retailers see weak performances

Even though Brazilian consumers are strongly inclined to partake in sports and, according to Euromonitor International data on institutional channels, Brazil is the country with the third highest number of sport clubs and gyms in the world, at almost 28,000 outlets (behind only Russia and the US), Brazilian sportswear continues to record sales performances below its full potential. The relatively high prices of the most popular sportswear brands makes consumers more likely to postpone purchases for such goods and prioritise more basic items needed for a household’s general wellbeing in periods of crisis.

COMPETITIVE LANDSCAPE

Nike remains the leading brand, helped by continued innovations in its portfolio

Nike’s performance was boosted by the launch of new versions of the Zoom collection and some of the activities to promote the brand. These included efforts to become closer to women, investing in the Zoom Squad, a team of five Brazilian women to represent the brand in the Chicago Marathon.

Specialist retailers launch innovations to enhance the consumer experience

Decathlon has been investing more in the experience within its stores, such as salespeople specialising in the store section of the sports they personally partake in, acting as consultants for shoppers in the process of choosing the best products. Centauro, one of the most important specialist retailers, launched a training programme for beginners in street running.

Professional team sponsorships and sports events strengthen consumer bond with brands

As soccer carries such great importance in Brazil, with broad coverage in mass media, a strong driver of visibility is the sponsorship of soccer teams. Nike is the main sponsor of major Brazilian clubs, such as Corinthians, while adidas has benefited from Flamengo’s winning season in 2019, and also sponsors São Paulo and Internacional.

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