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Content provided by : Hong Kong Trade Development Council
3 July 2009
Brand betrayal

Move to lower priced goods.

Move to lower priced goods.

Italian sportswear consumers demand quality and great prices and are less loyal to specific brands when compared to the past, according to a number of market reviewers.

While the sportswear on offer in Italy continues to be dominated by international brand names, the current economic crisis has persuaded many consumers to seek special offers and better prices.

As in many other sectors, volume sales for sportswear have decreased in the past few months, due to diminishing demand.

Total turnover for the Italian sportswear sector is estimated at some Euros4.5 billion, but sales are expected to fall by nearly 2% this year.

There are, however, some players that are maintaining or even increasing revenues, and one is the leading distributor, Cisalfa.

The family-focused chain based in Osio Sopra, Italy, has 125 retails stores and will open three new megastores by the end of the year.

The only other big player operating in Italy is France's Decathlon. In fact, in the past few years it's established itself as the main player in the sportswear business, with 52 megastores located throughout the country.

As it happens, both chains sell the most popular international brand names such as Nike, Puma and Adidas but sales margins for their own brand names have been increasing over the years.

Where it comes to their "own brand" labels, the two retail firms adopt very different strategies.

Decathlon has created a number of own brand names that are now widely distributed through its stores, including such names as Quechua, Kalenji and Tribord.

By contrast, Cisalfa has decided to invest in the re-branding of once-popular brands that have lost their appeal over the years. These include brands such as Best Company and Ellesse. These two brands are now worth a quarter of Cisalfa's sales.

The strategies of these chain stores seem to be aimed at acquiring greater control over their pricing chain, in view of parallel but increasing sales of cheaper, but quite high quality goods sought by wary consumers.

As a means of lowering prices and keeping a hand on quality goods these firms are purchasing a large part of the products they need from Hong Kong and Chinese mainland suppliers.

from Alessio Pulsinelli, Milan Office

Contact:
Company
Tel/Fax/Web
Cisalfa Tel: (39) 35-4556111
Fax: (39) 35-500900
Web: http://www.cisalfasport.it
Decathlon Web: http://www.decathlon.fr