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NA APPAREL
MERCHANDISING
F/H’12 GEO INPUT: FLEECE, OUTERWEAR & NIKE PRO1/27/11
Ath Departm
entNSW
Young Athletes
Basketball
Ath Training
Women's
Training
OtherTotal $-
$50.0
$100.0
$150.0
$200.0
$250.0
$61.0
$12.0
$93.6
$64.2
$10.5 $13.9
$104.8
Hol 11Fall 11
% = inc./dec. from PY
30 %
30.3%
105 %11.7%
117% 10 %43 %
FLEECE - USA FA/HO11 * REVENUE IN MILLIONS VS LY
114 %
Source: NA Demand Plan
FLEECE - USA FA/HO11 *Breakdown by Category
Ath DeptNSW
Young Athletes
Basketball
Ath Training
Women's T
ROther
Total $-
$50.0
$100.0
$150.0
$200.0
$250.0
93.374 95.114
26.271 26.271
$8.3 $17.5 $9.4
$52.3
14.709
17.804
OtherKO FleeceSquadClassic
$24.1
Source: NA Demand Plan
FLEECE-NA SWOT
STRENGTHS WEAKNESSES
THREATSOPPORTUNITIES
• Total Fleece market is $1.5B; -2.7% to LY• Nike and Adidas tied for 2nd place in market share after Private Label at
7%, and lost market share (LY Nike was 8% and Adi 8.2%)• All top brands lost AUR as compared to LY• The less than $55 price point segment was the only one that gained
market share
• Columbia at 3.9% market share grew (was 2.3% LY)• UA at 3% market share also grew (was 1.4% LY)• Internal margin on core basic styles does not allow for fully profitable
realization of the “badge and borrow” strategy
Market Share info from NPD (Jul 2010-Nov 2010)
• M/W Performance Fleece (KO Franchise across categories): offer more novelty and color blocking in varied silhouettes – this segment is growing faster than cotton fleece. MAT could land another 6-8 styles for Fall 12, as example.
• UA is offering a broader assortment/color spectrum in Men’s and Women’s Performance Fleece than Nike currently is…opportunity to stop UA’s growth in this segment
• Spring opportunity in lighter weight (newness vs FA/HO) core and novelty fleece.
• Early indicators of Fall 11 AD pricing strategy (pull back margin from retailer) is strong – revenue will be flat while growing margin $
• Price/Value of Fall/Hol 11 NSW Embellished fleece was strong• Performance fleece overall drove classification growth for Fall
11 bookings (MAT / WT more than doubled their Fall 10 bookings; Sportswear is flat)
Gap $49.5089% Cotton, 11% Polyester
Champion $35 255 gram
80% Cotton, 20% PolyesterDouble Dry wicking technology
American Apparel $4970% Cotton, 30% Polyester
Metal zipper
Nike 6.0 $45300 gram
80% Cotton, 20% Polyester
The North Face Hoody $50 Cotton/Polyester
Adidas $49.9970% Cotton, 30%
Polyester
Russell $35.99255 gram
50% Polyester, 50% Cotton Dri-Power® quick-drying
NA Fleece Hoody Pricing
Nike Classic Hoody $50300 gram
80% Cotton, 20% Polyester
Champion $35 340 gram
82% cotton/18% polyester
American Apparel $3850% Cotton, 50% Polyester
The North Face $50 80% cotton/20% polyester
Russell $25255 gram
50% Polyester, 50% Cotton Dri-Power® quick-drying
NA Fleece Bottoms Pricing
Adidas$3570% Cotton, 30% Polyester
Nike Classic Pant $40300 gram
80% Cotton, 20% Polyester
Puma $45 80% cotton/20% polyester
Nike Pro – USA FA/HO11 * REVENUE IN MILLIONS VS LY
Field Sports
Soccer
Young Athletes
M Training
Basketball
W Training
Total $-
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
$31.0 $26.9
$66.8
$30.1 $26.9
$62.6
Hol 11Fall 11
+57 % -45%
75%
70%
% = inc./dec. from PY
26%
*Exclusive of NTS product that includes Pro and College Football & Baseball .
79%
72%
Nike Pro – USA FA/HO11 Breakdown by Category
Field Sports
Soccer
Young Athletes
Ath Training
Basketball
W Training
Total $-
$20.00
$40.00
$60.00
$80.00
$100.00
$120.00
$140.00
$18.25
$-
$18.98
$39.43
$38.5 $34.9
$76.0
$5.67
$4.40
Core
Compression
Hyper Cool
Hyper Warm
Hyper Strong
*Exclusive of NTS product that includes Pro and College Football & Baseball .
NIKE PRO COMBAT-NA SWOT STRENGTHS WEAKNESSES
THREATSOPPORTUNITIES
•We have become the fitted provider within the market recognizing the trend from compression early•Hypercool has proven that we can sell higher price points given adequate technology•Hyperstrong has provided the sharp point for all of NPC, driving innovation primarily through football•The switch from Nike Pro to Nike Pro Combat has created equity within this silo•Men’s Rolling 12 Month Market Share ($) - Nike: 26.3%, +8.9 points to LY (all-time high) / UA: 59.5%, -7.1 points to LY (all-time low)•W’s Rolling 12 Month Market Share ($) - Nike: 31.8%, +8.3 points to LY / UA: 36.5%, -6.7 points to LYFemale Consumer validation: Positive market share gains year round including cold weather months (took over as #1 baselayer brand Nov 10)•Creation of the Last Mile program
•UA continues to dominate cold weather with mocks and tights; they own the consumer during this time period•NPC uses the same design for both fitted and compression making it an either or and not an incremental for retailers•Capacity issues: we are having a hard time satisfying demand•Low margins, especially on fitted and when product is sourced in Asia due to over capacity in Latin America•Product benefits: we do a poor job of communicating to the consumer why they need NPC both in-store and on hang-tags•Lack of newness and style innovation in women’s •AUR: Nike continues to be a discounted brand, AUR well below UA
• Continue to lead in innovation; UA does not have the capability at this point• Tell the consumer why our product is better through in-store communication• Focus on youth: UA dominates in kids; higher price to convert them in high school
than capturing them early• All out Cold Weather attack: we need to make significant strides here to ever
knock out UA• Increase number of styles / colors on AA and demand pull to help delivery• Inclusion of women’s business into last mile program• Opportunity to grow business by layering up better/best Pro offerings
•Raw material increases and low margin styles: we cannot afford to out-price UA given our current market share•UA is retrenching based on our gains: expect better product and in-store coming soon•SP12 updates and price increases on Women’s Pro core silo
Key Styles
TARGETED PRODUCT FOCUS AT UA’S FOUNDATION
FA/HO’10 SP/SU’11
Competitive Attack
Tech Tee ($20)
Flex Short ($25)
Comp S/S Top ($25)
6” Comp Short ($25)
6” Comp Short ($25)
Tech Tee ($20)
Legend Tee ($20) Legend Tee ($20) Fitted S/S Top ($25)
Epic / Fly / Mesh ($25/$30)Epic / Fly / Mesh ($25/$30)
Fitted S/S Top ($25)
Base Layer Market Share
60.1%,-7.7 pts to LY
(Rolling 12-Mo)
Training Market Share 49.8%, -0.2
pts to LY(Rolling 12-Mo)
Legend Tee205K Units Sold
(3-Mo End Oct ’10)
Training Shorts 201K Units Sold
(3-Mo End Oct ’10)
Nike Pro Combat Sales
$12.9M, +29% to LY(3-Mo End Oct ’10)
Shorts$38.1M Booked
SP/SU11 +53% to LY
Base Layer Market Share
25.7%, +9.3 pts to LY
(Rolling 12-Mo)
Training Market Share 21.1%, +3.8 pts to LY
(Rolling 12-Mo)
Tech Tee192K Units Sold
(3-Mo End Oct ’10)
Training Shorts 162K Units Sold
(3-Mo End Oct ’10)
UA Base Layer Sales
$26.6M, -27% to LY(3-Mo End Oct ’10)
Nike Pro Combat$39M Booked
SP/SU11+48% to LY
Updated Tech TeeComing SP’11
Legend Tee $14.2M Booked
SP/SU11 +58% to LY
ColdGear Mock ($50)
ColdGear Tight ($50)
Comp S/S Top ($25)
Flex Short ($25)
HyperWarm Mock ($50)
HyperWarm Mock 18K Units Sold
(3-Mo End Oct ’10)
HyperWarm Tight ($50)
HyperWarm Tight 6K Units Sold, -13%
to LY(3-Mo End Oct ’10)
6” Comp Short ($25)
Updated Compression
BaselayerComing SP’11
6” Comp Short ($25)
#1
#1
Cold Gear Mock89K Units Sold, -50%
to LY(3-Mo End Oct ’10)
Cold Gear Tight30K Units Sold, -27%
to LY(3-Mo End Oct ’10)
MEN’S
Action O
utdoor
Basketball
Soccer
Young Athletes NSW
Running
W Training
Total $-
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
$3.4
$0.6 $0.7
$5.2
$0.4
$0.4
$0.5
$2.1
Hol 11Fall 11
% = inc./dec. from PY
Outerwear – USA FA/HO11 * REVENUE IN MILLIONS VS LY
Note: Canada Outerwear business is estimated at $3.5 mil down from $6 mil PY.
97 %
25 %
48%67 %119% -35 %-38 % new