So much for the new running boom.
In the first quarter ended March 31, Asics North America reported that overall sales dropped by the double digits, but the company did see a glimmer of hope in online sales, driven by a heightened interest in running footwear and apparel.
Overall, however, Asics U.S. reported sales dropped 18.4 percent year-over-year, with Mexico declining 10 percent and Canada falling 5.5 percent. In the U.S. market, the brand also saw a 14.2 percent decrease in performance running product.
“There is no question that these unprecedented times have created challenges for our brand and the industry as a whole,” said Koichiro Kodama, chief executive officer of Asics North America. “We have also found that our brand philosophy of ‘Sound Mind, Sound Body’ is more important than ever, especially as people have needed to adjust to these new circumstances and fitness regime. With these adjustments and during this time, we have also seen an increased demand for Asics performance footwear products online through our key partners as well as our own e-commerce.”
For the corporation as a whole, the operating loss in the first quarter was 882 million yen, or $8.2 million, compared with operating income of 6.2 billion yen in last year’s first quarter. Net sales fell 13.5 percent to 85.3 billion yen, or $793.4 million, from 98.7 billion yen in the first quarter of 2019.
However, the brand’s e-commerce sales jumped 60 percent in the period, the company said.
By category, performance running sales fell 11.5 percent to 38 billion yen from 43 billion yen in the first quarter of last year, with operating income falling 87 percent to 239 million from 1.8 billion yen last year. Onitsuka Tiger also had a rough quarter, with sales falling 29.5 percent to 7.6 billion yen from 10.8 billion yen and operating income falling 88.9 percent to 228 million yen from 2 billion yen in the prior-year period. Apparel and equipment sales also decreased 22.8 percent to 8.3 billion yen from 10.7 billion yen last year.
Asics acknowledged that the first quarter was difficult “due to the cooling down of personal consumption as a result of factors such as marathon events being suspended or a reduction in their scale, temporary closing of own retail stores and regulations…because of the global spread of the novel coronavirus.”
To respond, the company increased its focus on digital sales and also sped up its planned development of products in China to capitalize on an expected rebound as stores around the world reopen. The brand also reduced its spending on marketing.
In North America, the company increased the discount for health-care workers and first responders to 60 percent and also provided free access to its Asics Studio app, allowing all consumers to utilize its library of at-home workouts. The brand is also partnering with its retail partners to provide shoe donations to front-line workers as well as T-shirts for screen-printing and fund-raising efforts.