FOOTWEAR MARKET ANALYSIS

The footwear Market size is valued at US$ 364.81 Bn in 2024 and is expected to reach US$ 475.08 Bn by 2031, growing at a compound annual growth rate (CAGR) of 3.8% from 2024 to 2031.

Market Regional Insights:

• Asia Pacific held the highest share 42.6% in 2024 and is expected to continue the trend during the forecast period. The footwear market is labor-intensive and is affected by various factors such as land resources, labor costs, material supply, environmental protection, and sales markets. Consequently, in pursuit of profit maximization, major consumer markets, footwear manufacturers, wholesalers, and retailers worldwide are shifting their focus to lower-cost countries, leading to the constant movement of global shoemaking bases. Japan, Taiwan, India, and China are lucrative markets for footwear in the Asia Pacific region.
• North America is projected to grow at a CAGR of 3.89% during the forecast period owing to the presence of major footwear manufacturers in the region. Footwear remains one of the most popular items that Americans purchase. Footwear firms invest tens of billions of dollars each year on their employees, stores, and platforms to ensure that they provide high-quality shoes on time.
• Europe is predicted to witness steady growth across the forecast period. Increased customization and personalization and increased online product delivery services across developed countries in Western Europe including Italy, the U.K., Germany, France, and Spain will positively influence the market growth in the region.

Figure 1. Global Footwear Market Share (%), By Region, 2024

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Analyst’s Views:

The market continues to grow steadily driven by rising disposable incomes and changing fashion trends across regions. Emerging economies in Asia Pacific and Latin America are expected to be the dominant as well as the fastest growing regions due to growing middle class population demanding western style footwear for work and leisure. North America and Western Europe remain major revenue contributors though their growth is expected to be moderate. Some of the key drivers fueling the demand are growing health consciousness leading to increased sales of sports and athletic shoes as well as rising opportunities in lifestyle and casual segments.

However, factors like increasing raw material costs, international trade policies, and uncertainties caused by the pandemic may act as restraints on the market growth. Volatile costs of leather and rubber are concerning manufacturers. Meanwhile, the market players need to closely watch ongoing trade tensions and formulate mitigation strategies. While the pandemic disrupted sales, a shift towards online and athleisure footwear provided opportunities for growth. Material innovation and sustainability efforts also open new opportunities for premiumization. Overall, factors like urbanization, changing retail landscape with rise of online channels, and innovating product portfolio with focus on comfort and performance are expected to support the continued but gradual expansion of the global footwear market over the coming years.

Market Drivers:

Increasing disposable income: Increasing disposable income is positively impacting the growth of the global footwear market. As people's disposable incomes are rising across various regions of the world, their spending capacity on non-essential goods has increased substantially. Footwear, being a fashion item, falls under the category of non-essential goods for many consumers. With higher disposable incomes, people are now able to spend more on premium and branded footwear compared to the past.

This rise in discretionary spending has provided financial flexibility to consumers to purchase better quality and high fashion footwear made from premium materials. Various international organizations’ data shows that the middle-class population globally has increased considerably over the past few years. For example, as per World Bank data, the middle class in Asia Pacific region surpassed more than half a billion people in 2020.

Growth in e-commerce channels: The footwear market has seen significant changes in the past few years due to the rapid rise of e-commerce platforms. As more consumers conduct product research and make purchases online, footwear brands and retailers have shifted their focus to prioritizing their digital presence and capabilities. E-commerce offers consumers a much wider variety of options compared to physical stores, as online retailers can sell styles from all around the world on a single website. They can also leverage technologies like personalized recommendations and size guides to help customers find the perfect fit. This has made researching and buying footwear much more convenient for buyers. According to statistics by the United Nations Conference on Trade and Development, the value of global e-commerce sales increased by 27% between 2019 and 2020 alone.

Rising health consciousness: Rising health consciousness is significantly impacting the growth of the market. People are increasingly focusing on their physical well-being and choosing footwear that allows comfortable movement and physical activities. Sports and fitness have become an important part of daily lives for many due to the associated health benefits. As a result, athletic and sport-specific shoes are gaining wide popularity.

Footwear brands are innovating to introduce shoes made of lightweight breathable materials that keep feet cool and comfortable during workouts or exercises. Some shoes are engineered to provide extra cushioning, absorb impact, and offer natural motion. For example, running shoes now come with thick soles and extra padding on heels and toes to protect the feet from injuries. Their flexible uppers allow natural ankle movement. Such features attract health-conscious customers and motivate them to be physically active on a regular basis.

Market Opportunities:

Innovation in product design and raw materials: Innovation in product design and raw materials presents a significant opportunity for growth in the market. With consumers demanding more sustainable and eco-friendly options, footwear brands that create unique designs using renewable and recycled materials will have a competitive advantage. Some areas ripe for innovation include utilizing plant-based fabrics like pineapple leaves or sugarcane in uppers, spinning soles from discarded fishing nets or bottles, and 3D printed shoes that reduce waste. One such innovator is Ripple Footwear, who has created a process to make soles entirely from crab and lobster shells that would otherwise be thrown out. By collaborating with fishing communities, they are able to develop sustainable biomaterials while supporting local livelihoods.

Customization and personalization: Customization and personalization could unlock tremendous potential and opportunities in the market going forward. With rising consumer demand for tailored and bespoke products that match individual tastes, styles, and needs, the ability to offer customized designs and features is fast emerging as a major driver of brand loyalty and repeat purchases among customers. Footwear brands are now focusing on ways to provide enhanced personalization at scale through both online and offline channels.

Several studies show that younger generations, in particular, appreciate unique, custom-made products that help express their individual style and identity. As millions enter the lucrative footwear categories each year, customized offerings will become mainstream across both performance and fashion segments. According to data by the United Nations DESA, nearly 26% of the world’s population is between the ages of 15 and 24. With a stronger demand for personal expression and tailored experiences, this growing demographic will drive further growth in customization in major footwear markets including North America, Western Europe, and East Asia going forward.

Emerging markets: Emerging markets present a massive opportunity for growth in the market. These economies are experiencing rapid urbanization and rising income levels, leading to increased consumer spending on discretionary items like footwear. Countries like India, Indonesia, Brazil, and others in Southeast Asia and Latin America have large, young populations that are adopting Western lifestyles at an incredible pace. As millions enter the middle class each year, the demand for footwear in these regions will surge.

As reported by the United Nations Conference on Trade and Development, footwear exports from developing countries rose by over 8% annually from 2018 to 2020, significantly outpacing global export growth. Countries like Vietnam, Indonesia, and India have become major footwear suppliers due to low production costs and a skilled labor force. This signals that emerging markets are ramping up their manufacturing competitiveness as well. By sourcing from these developing nations or establishing local production, footwear brands can reduce costs and prices - critical advantages in price-sensitive emerging markets.

Market Trends:

• Sustainable and eco-friendly footwear: The market is being significantly influenced by the rising sustainable and eco-friendly footwear trend in recent years. More consumers are becoming environmentally conscious and looking for footwear options that use eco-friendly materials and sustainable production processes. They no longer want to contribute to environmental damage through their purchase decisions. This shift in preference is pushing many major footwear brands to introduce greener collections and transition to more sustainable practices.
• For instance, brands like Nike, Adidas, and New Balance have started offering popular collections made of recycled plastic bottles, organic cotton, and other natural or recycled materials. Some shoes are even made partially from waste coffee grounds or abandoned fishnets retrieved from oceans. The brands not only aim to reduce plastic and chemical usage but also promote circular manufacturing systems. Additionally, many smaller independent labels have emerged who focus exclusively on producing zero-waste footwear using innovative material like recycled tire-rubber, plant-fiber meshes, and mushroom-leather.
• Online purchasing: The market has seen tremendous growth in online purchases over the past few years. With rising internet penetration and accessibility of smart devices, consumers are increasingly preferring the convenience of online shopping instead of visiting brick-and-mortar stores. This has provided a massive boost to the e-commerce channels of major footwear brands. According to data from the U.S. Department of Commerce, the percentage of total footwear sales conducted online in the U.S. rose from 11.6% in 2019 to over 16% by 2021.

Market Restraints:

Fluctuating raw material prices: Fluctuating raw material prices have been a major challenge restraining the growth of the market. Footwear manufacturing is a raw material intensive market that relies significantly on materials like leather, rubber, plastics and textiles. The prices of these key raw materials have exhibited high volatility in recent years due to various macroeconomic and geopolitical factors. For instance, leather prices saw a significant rise in 2021 mainly due to supply chain bottlenecks caused by the COVID-19 pandemic across major leather producing nations like Brazil and China. As per United Nations Conference on Trade and Development (UNCTAD) data, the inflation adjusted price of hides and skins increased by over 10% from 2020 to 2021.

Counter Balance: Footwear companies can diversify their sourcing of raw materials to include multiple suppliers and regions. This can help mitigate the impact of price fluctuations in any single sourcing location. Utilizing hedging strategies to lock in prices for raw materials can provide stability and predictability in the face of price volatility. This can involve using financial instruments such as futures contracts to secure prices for raw materials.

High competition among manufacturers: The footwear market has become highly competitive over the past decade as established brands look to capture market share from each other. With profit margins razor thin, companies are consistently under pressure to cut costs and outdo their rivals' offerings. This has led to an intense price war scenario where manufacturers are slashing prices to the barest minimums to stay ahead. However, this strategy is unsustainable in the long run and acts as a restraint on the overall market growth potential.

As an example, data from the World Trade Organization shows that the average unit price of textile and footwear imports into key markets like the U.S. and European Union declined by 2-4% annually between 2018 and 2020 due to heavy discounting among competitors. With costs continuing to rise due to global issues like inflation, this leaves little cushion space for footwear brands to drive profitable growth over the medium to long run. Unless companies can find ways to better manage cutthroat competition, it will remain a constraining factor capping the ceiling of potential expansion for the overall market.

Counterbalance: Manufacturers can focus on unique value propositions, such as versatility and comfort, to differentiate their products from competitors. Investing in innovative technologies, such as sustainable and convertible footwear, can help companies stand out in the market and attract consumers.

Recent Developments:

• In December 2022, Asics developed a gel-resolution 9: high-tech tennis shoe to support your dynamic footwork along the baseline. GEL-RESOLUTION™ 9 shoes are designed to provide excellent kinetic stability for lateral movements in fast-paced tennis matches.
• In September 2022, under armour launched its first running shoe made on a women's last UA Flow Synchronicity combines revolutionary UA Flow technology and consumer insights to create a shoe designed for HER - her form, her speed, her rhythm, her Journey to Compete.

Figure 2. Global Footwear Market Share (%), By Category, 2024

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Top Companies in this Market

• Nike Inc.
• Under Armor Inc.
• Skechers USA Inc.
• Under Armour, Inc.
• Puma AG
• Crocs Inc.
• Geox SpA
• Wolverine Worldwide Inc.
• Adidas AG
• Timberland

Definition: The term "footwear" refers to wearing apparel, such as shoes or boots, for the feet. It encompasses a wide range of outer coverings worn on the feet, including shoes, boots, sandals, and slippers, which serve the purpose of protecting the feet from environmental risks, providing stability, and preventing injuries. Footwear can also be used for fashion, adornment, and to indicate the status or rank of an individual within a social structure. Footwear refers to any type of outer covering worn on the feet including shoes, boots, sandals, and slippers. Footwear serves the purpose of protecting the feet from environmental risks such as temperature, rough ground, and slippery surfaces, as well as for fashion and adornment purposes.