NetworkNewsWire Editorial Coverage: Fashion trends are constantly changing. What’s popular one day may not be the next. Athletic wear styles rarely change, but athleisure wear is changing the entire market and creating lucrative new revenue streams for businesses that take part in this exciting new segment.
- Athletic wear sales have grown by a whopping 61 percent since 2007.
- Morgan Stanley forecasts sales of $355 billion by 2021, up from $290 billion now.
- Celebrity marketing partnerships boost companies’ social media profiles.
Athleisure wear revolves around a company like RYU’s ability to combine workout-ready clothing with comfort and global appeal. The modern athleisure market is all about creating apparel that is suitable for both high performance and daily use. RYU Apparel, Inc. (TSX.V: RYU) (OTC: RYPPF) (RYU Profile) is the newest threat to challenge the fashion monopoly controlled by conventional clothing conglomerates Nike, Inc. (NYSE: NKE); Gap, Inc. (NYSE: GPS); Adidas AG ADR (OTC: ADDYY)and Lululemon Athletica, Inc. (NASDAQ: LULU).
A Hot Trend in Fashion: Athleisure
The current state of the fashion industry is not looking good for established companies like that choose to remain dedicated to the declining performance apparel segment of the fashion industry. Some companies, however, are changing scope and broadening their athletic wear to include athleisure wear.
RYU (TSX.V: RYU) (OTC: RYPPF) interviewed athletes and trainers, asking them what they want most from their performance apparel. The resulting products were designed to achieve professional performance without giving up a moment of comfort. This approach has allowed companies such as RYU to cater to both the fashion and athletic wear markets through its athleisure line without alienating its customers.
Adidas has partnered with Kanye West on Yeezy, a luxury athleisure line with a high price point. The highly coveted Yeezy sneaker models flew off the shelves and immediately sold out the day they were sold in stores, prompting Adidas to promise the shoes could be purchased online as well. The Adidas Yeezy Boost 350 V2 was the second-most Instagrammed sneaker ever.
The athleisure market has captured the attention of other apparel conglomerates as well, and for good reason. The athleisure industry grew by 17 percent in 2017 and is now the largest apparel category in the United States. Even Nike has taken notice of this market shift and has responded by creating a new line in collaboration with Serena Williams and Off White.
RYU’s head start in athleisure has given the company a considerable advantage as major brands battle to secure their share of the athleisure market. The company’s revenue has grown each year since 2016 ($1.36 million in 2016, $3 million in 2017, and $8 million projected in 2018) and even outsold Lululemon and Under Armour combined over their first two years ($4.5 million versus $2.4 million) of business. RYU expects to see margins increase once economies of scale are realized.
RYU’s first mover advantage gives it the edge in the athleisure industry, with companies such as Wrangler, Nike, Lululemon and others fighting to catch up. The demand is there. The question is, how will companies survive in such a competitive market?
Companies such as H&M have already found it difficult to avoid inventory crunch because their entire business model revolves around selling low-margin items at high volumes. In athleisure, the successful companies are more likely to sell high-margin, premium items that guarantee quality. While major brands such as Nike and Adidas may be willing to offload unsold product via outlets, others such as RYU don’t discount their merchandise.
RYU’s quality products come from the top. Each item is designed by fashion tycoon and CEO Marcello Leone to achieve a professional level of performance. Leone is personally involved in the design and testing of each product on RYU’s line, ensuring each item will perform after every use. This dedication to quality allows RYU to maintain a limited number of SKUs, limiting inventory and maintaining stable margins.
Another important thing to look for in this industry is a company’s ability to secure patents on its innovative athleisure wear. RYU owns several patents on its products, including the “Trilayr” waistband that addresses several problems with existing yoga pants, allowing a full range of flexibility for yogis, weightlifters, walkers and joggers.
RYU’s innovative approach to its technical gear also led to the creation of the company’s patented OutLayr technology, which provides a number of RYU products with waterproofing necessary to survive outdoors in any type of environment, rain or shine. These patents are a critical aspect of RYU’s product design. With each innovation, RYU has created legally protected designs that establish its products as the industry standard for performance apparel.
The athleisure trend is about more than just clothing; however, it’s about demanding quality and performance in every setting. RYU is more than a clothing company, its an innovative tech company dedicated to improving the quality of urban athletic wear with every product they design. The company’s extensive list of patents is an extension of this approach, providing legal protection against competitors lagging behind.
The Athleisure Trend Isn’t Slowing Down
The biggest growth is yet to come in athleisure. Lululemon’s shares hit a record high of $160.68 this month with total sales in the quarter ending July 29 rising 25 percent to $723.5 million. Morgan Stanley expects the industry to be worth over $350 billion by 2020, leaving plenty of room for growth for RYU and others that continue to innovate in the space. RYU’s experienced management team’s innovative approach to product design is expected to maintain its advantage over the competition.
Nike, Inc. (NYSE: NKE) is an international fashion and performance apparel company that has established footholds in most major sports categories. The organization produces performance apparel and casual clothing and dominates the international shoe market. The company is working to catch up on the athleisure trend, adapting its popular line of Air Jordan sneakers to include technical improvements, such as self-tightening laces.
Lululemon, Athletica, Inc. (NASDAQ: LULU) is one of the largest names in the athleisure wear market. Projections suggest the company could reach $3.2 billion in sales this year, driven by solid numbers in women’s pants, Lululemon’s most profitable category. The company’s current focus is on fashion over function when it comes to its approach to athleisure.
Adidas (OTC: ADDYY) is an international performance apparel, casual apparel and shoe manufacturer. The company joined the athleisure movement in order to take on its rival Nike, which helped drive Adidas’ stock price up to an all-time high of $218 per share in August. Adidas continues to appeal to the urban athletic wear market through its partnership with West’s Yeezy line, which released a new edition of the Yeezy Boost 350 V2 in September.
Gap Inc. (NYSE: GPS) is a retail clothing company beginning its expansion into athleisure apparel. The company announced it will soon be launching a new brand called Hill City that will cater to male urban athletes and professionals, mimicking the success the company experienced with its Athleta line for women. The company’s Athleta line is expected to cross the $1 billion milestone in sales over the next couple of years.
For more information on RYU Apparel, please visit RYU Apparel, Inc. (TSX.V: RYU) (OTC: RYPPF)
Please also read and review and the following article: Meet The Innovative Sports Apparel Company That Crushed Lululemon and Under Armour’s Numbers
NetworkNewsWire (NNW) is a financial news and content distribution company that provides (1) access to a network of wire services via NetworkWire to reach all target markets, industries and demographics in the most effective manner possible, (2) article and editorial syndication to 5,000+ news outlets (3), enhanced press release services to ensure maximum impact, (4) social media distribution via the Investor Brand Network (IBN) to nearly 2 million followers, (5) a full array of corporate communications solutions, and (6) a total news coverage solution with NNW Prime. As a multifaceted organization with an extensive team of contributing journalists and writers, NNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. By cutting through the overload of information in today’s market, NNW brings its clients unparalleled visibility, recognition and brand awareness. NNW is where news, content and information converge.
To receive SMS text alerts from NetworkNewsWire, text “STOCKS” to 77948 (U.S. Mobile Phones Only)
For more information, please visit https://www.networknewswire.com
DISCLAIMER: NetworkNewsWire (NNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by NNW are solely those of NNW. Readers of this Article and content agree that they cannot and will not seek to hold liable NNW for any investment decisions by their readers or subscribers. NNW is a news dissemination and financial marketing solutions provider and are NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.
The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, NNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.
NNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and NNW undertakes no obligation to update such statements.