The sports industry is one of the biggest industries in the world. Valued at about $470 billion in 2018, many wonder how they can get into the market and have a piece of the billion-dollar pie. Some decide to be an athlete, while some choose to become a coach. There are many ways to enter the sports industry using different professions. But one of the most profitable businesses in the sports industry is the sportswear market.
The value of the sportswear industry in 2018 was $167.7 billion, about 35% of the overall sports industry. That’s huge compared to the other markets that compile the industry. Additionally, the sportswear industry has a CAGR of 5.1%, meaning that it’s one of the market forces that help the entire industry grow. However, the market is dominated by many known brands like Nike, Addidas, and UnderArmour, each of them taking a sizable chunk of the market. Despite this, your sports retail store can still succeed and have a decent revenue stream for years to come.
Here are some ways you can do that:
Choosing the Right Target Audience
When starting any business, you’ll have to think about your target audience. This will determine how you’re going to market your products and how you are going to distribute them. After that, it’s all about developing relationships and eventually having a loyal consumer base.
Smaller sports retail shop would make people in their city their target audience. This works if your shop is in a small state and there aren’t many sport retail stores around. Stores like these can quickly develop regulars who are always looking for sports apparel and accessories. However, sales can be few and far between. People in your city isn’t a good target audience if you want to grow your sports retail store. You’re going to have to choose an entire demographic.
Take the millennial generation, for example. They are currently the spending generation right now. It’s estimated that this generation alone can spend $1.4 trillion in 2020. They are also currently the most dominant generation, and that they enjoy exercising. With this in mind, you can start thinking about how to appeal to this current generation. If you do your research, you’ll know that most of them spend their time online and make their purchases digitally.
Now that you have access to this information, you’ll start marketing online to appeal to this generation, maybe even have an online retail store as well. All of this is possible because you’ve chosen your target audience. Moreover, the target audience that you’ve selected is big enough that it’s worth investing money in because you’ll know you’ll get it back anyway.
This is just a simple example of how choosing the right audience can help you determine your sports retail store’s future. You can select another target audience aside from millennials, perhaps even choose a niche target audience that’s been growing throughout the years. Just make sure that the target audience you’ve selected is big enough to invest money on.
Work with Trusted Brands
Unlike other industries out there, where you’ll have the most success building your brand, the sports industry requires you to work with other dominating brands. Working with big brands can help your retail store to be noticed by others, specifically the fan of the brands.
Accumulatively, both Nike and Addidas own about 30% of the footwear market in the US. That’s huge, and having those brands in your store can help push sales. Additionally, certain brands are associated with specific apparel in the market. For example, when it comes to sports footwear, people always look for Nike. When it comes to men’s workout wear, people think of UnderArmour. When it comes to women’s winter headwear or ski helmet, people buy Giro, and so forth. By working with other brands, you can leverage various niches in the market, which will eventually develop your brand.
Choose the Right Location
Ultimately, choosing the right location for your first retail store is going to make or break your business. You’ll have to start considering a place with the right balance between sales and business growth.
You can always start your business in a big metropolitan area, where there is a lot of foot traffic. It’s possible to begin in an intersection where your store can technically market itself. However, different audiences from different generations live there, making it hard for you to grow your business. What you can do is setting up near a gym or partnering with one.
You know that the people who enter the gym will look for sportswear no matter what, so you’ll get easy an easy revenue stream from that. This is just an example of how you can choose the right location for your retail store, so ponder about this for a while before you go start your store anywhere.
Starting your own sports retail store isn’t going to be easy. However, if you’re equipped with the right knowledge and mindset, you can grow your store slowly but surely. Before you even know about it, you’re already taking a decent chunk of the multi-billion dollar market.