Tier II and III towns in India are driving demand for sportswear. The main factor behind this is the growth in e-commerce sales. A host of smaller cities, those like Surat and Indore, now are ordering more branded sportswear because of the ease of purchase. The sporting culture in these towns has also matured with cities like Surat, Ahmedabad and Chandigarh organising marathons.
Of Asics’ total sales through its own website last year, about 35 per cent was from smaller towns. This has given the Japanese sportswear company the confidence to open its mono stores in such cities. For Under Armour, the American sportswear brand and one of the world’s largest, such sales from Tier II and III cities contributed more than 60 per cent to its overall e-commerce sales last year. Such sales for Puma now contribute 40 per cent to the topline compared to 20 per cent five years ago. In 2019, the German sportswear brand opened 30 stores in these markets and has witnessed 15 per cent like-to-like growth in these stores.
Both Amazon and Flipkart have been focusing on the next set of internet users from beyond the top ten cities to drive sales growth. In the last festive season sale, both e-tailers saw a surge in the number of such customers, not only driven by aspirations but also aided by Hindi interfaces on the apps.