By  on August 7, 2014

Activewear is taking a big bite out of the denim business, but jeans brands are fighting back.

After several years of strong increases, men’s jeans sales have struggled with weakening sales and margin-sapping promotions. But knowing that comfort is king with today’s customers, manufacturers are embracing the jogger trend in an attempt to replace some of the business that has migrated to other categories.

For the 12 months ended June 30, total sales of men’s jeans were $5.5 billion, down 2.5 percent from the previous year, according to The NPD Group. Unit sales dropped as well, falling to 206.9 million compared with 213.9 million in 2013. The hardest hit were the 18-to-24 and 35-to-44 age brackets, with sales dips of 5 and 8 percent, respectively.

Enter the “jogger” pant, better known as the sweatpant. If women are purchasing more yoga pants to fit their active lifestyles, men are following suit, looking to these sweats as a versatile apparel item that can take them from the gym to the office.

“It’s a trend, but it’s something that all denim companies are focusing on or should be focusing on,” said Rebecca Duval, vice president equity analyst at BlueFin Research Partners. “There are two versions we’re seeing in the market now: the uberstretchy jogger, which is like denim but very soft, then this denim that looks like it’s woven terry cloth and everyone is going to that.

“It’s a hot trend, but it’s not going to take over all of the other fits. It will be an important trend for the season that will keep consumers interested,” she said. “A lot of retailers want it or are chasing it, so much so that the mills can’t even keep up with the sheer amount of volume they’re requesting.”

Silver Jeans Co., founded in Winnipeg, Manitoba, Canada, by Michael Silver, is jumping on the bandwagon with the introduction of the Joga. The new pant, which retails for $88, is made of a poly-cotton blend with Lycra and is indigo-dyed. It was introduced for fall and aims to look like denim but feel like a sweatpant.

“Our whole concept was not to try to hit the customer over the head, but to subtly allow them to feel like they’re cheating,” Silver said. “It’s not OK for guys to know that they have stretch in the fabric. It’s not masculine. You almost have to fool them and can’t tell them it’s not real denim.”

Silver said the company will focus on softer, stretchier fabrics but create innovations so the Joga has “a real denim construction that isn’t too limp and too soft and stretchy.”

“Today, the term ‘casual’ has become synonymous with activewear and comfort,” said Marshal Cohen, chief industry analyst.

“As a country, we’ve gotten so casual that we can wear one step above pajamas out in public now. Denim is now considered dressy, which is one reason that the industry has lost its momentum — the consumer is gravitating toward more loose and comfortable fits.”

Seven For All Mankind, owned by VF Corp., is also seeing the importance of the jogger and introduced a version this summer as it continues to grow its men’s division. “I think it’s important for us as a fashion brand to reflect trends that are right for our customer,” said Barry Miguel, president of Seven For All Mankind.

For fall, the company will move into a cargo jogger.

“We have now in our collection knit-based denim that [has] a lot of attributes of the jogger, but still has the appearance of a jean,” he said.

But the bread and butter for the company remains its mainstay premium denim. Realizing that for the men’s market a constant flow of innovation is absolutely necessary to maintain excitement and sales, Miguel said the company is researching new technology to keep customers coming back.

For instance, along with cargo denim for fall, Miguel said the brand would introduce a color program for the new season, which will include shades of khaki, olive and navy. The brand also introduced a No Fade denim line this past spring, which retails for $198 and guarantees the indigo and black colors will stay the same shade for up to 40 washes.

“I’m optimistic about the denim industry and we need to continue to innovate and offer something new to continue the conversation,” he said. “Our men’s denim is still going strong and we project an optimistic future ahead.”

To stay competitive, brands like Baldwin Denim are no longer focusing solely on jeans. For instance, the company is constantly introducing products to its lineup. Three seasons ago, it introduced its version of the jogger pant, retailing for $298. For fall, the firm will expand into knitwear, printed shirts and more, while actively using its signature triple-stitch logo for branding purposes.

Matt Baldwin, founder, said that other than jeans, it’s his trouser categories in khakis and peppered canvas that keep customers coming back. He also introduced technical fabrics with wicking properties to his five-pocket jeans, while creating utility trousers with cell phone pockets, a place for tech equipment, ear buds and pens.

“That’s how we get our customers, by offering more sku’s [stockkeeping units] and more innovation,” he said. Thanks to the new products, the company said Baldwin Denim has grown by 80 percent each year since launching men’s in 2009.

Hudson Jeans, now owned by Joe’s Jeans Inc., saw 16 percent sales growth in the second quarter, with men’s denim now comprising about 20 percent of overall sales.

The biggest and most profitable denim style is the Byron fit, retailing from $165 to $220, which comprises 80 percent of the business. The price points of the entire line range from $175 to $300, with prices of the most expensive jeans rising $40 since 2010.

The rise in price is due to treatments and details, said Dina McCaffrey, senior vice president of sales at Hudson. “Price has never been an issue with our customers, even with the slight rise,” she said. “With the rest of the brands going up in price, we don’t feel pressured to keep it low.”

Still, affordable denim reigns supreme. Men are becoming a little more wary about buying jeans, and when they do, Cohen said, they are turning to commodity denim with price points of $17 to $25. According to NPD, the under-$25 jeans market has been the only sector of the industry that’s growing, as more upscale jeans, from $75, are taking the biggest hit.

“Men are saying, ‘How many more pairs do I need?’” said Cohen. “If there’s not innovation or technological advancements, the denim market will continue trending downwards.”

Uniqlo, owned by Fast Retailing Co. Ltd., said it is on the upswing with men’s denim, thanks to technology such as Heat Tech fabrics, the antiodor line and windproof jeans. In the past year, the company has reported sales growth of 120 percent in its denim category alone, according to a spokeswoman.

“From our perspective, we see strong growth in this category in the next few years and sales have grown over the past six to 12 months,” said Justin Kerr, Uniqlo’s global senior vice president of merchandising. “We’re seeing that our customers aren’t going to these $300 jeans now and that it’s difficult to justify that price. Instead, they’re spending money on technology as an indulgence.”

The retailer said it is seeing the most interest in its Japanese selvage denim, which retails for $39.90.

“We’re very confident in this selvage space,” Kerr said. “There’s so much innovation and it’s real Japanese denim. We don’t make a big deal about it, either. For another brand that would be their entire marketing campaign.”

As for joggers, Uniqlo isn’t paying too much attention to the trend: “We’re not focusing on [them] because we don’t need to.”

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