Cover Photo Credit: Adidas
In 2019, Nike brought in $4.03 billion worldwide from apparel & merchandise sales. For most designers and sports professionals, working with or for this brand is a dream come true. For others, they want to build their own powerful brand that can match Nike's success. This may seem like an impossible task, but new sports apparel brands can find success.
Selling sports apparel and merchandise is a lucrative business. In the NBA, merchandising accounts for $1 billion of the league's annual intake (about 11.4% of total league revenue). Other professional leagues also have good revenue streams from apparel sales. With such strong numbers and non-team apparel businesses like Nike, the market for new brands is very competitive.
Even with strong competition, creators who want to start their own brands still have many opportunities. If you are looking to start your own sports apparel brand, here are some steps to get you started and be successful.
Steps to Starting Your Sports Apparel Brand
Each of these steps are basic questions to consider before starting your brand. These elements include problems to be solved, customers to target, competitors to face, places to distribute, and partners to promote.
Step 1 - What problem do you solve that is unlike other apparel brands?
Successful entrepreneurs are innovators who first identify and then solve customer problems. Products have value because they help people have better lives. Before you start designing, look at how you are solving a problem in customers' lives. Your brand does not have to solve major issues like global violence, but it can solve other problems consumers face.
As an example, let's say that you wanted to start a sports apparel brand around the baseball phrase, "Hey Batter Batter!" This phrase is very well known among baseball fans, and is used in many different designs on apparel products. Customers may purchase your brand because it may solve their problems like:
- Finding a unique artistic take on the phrase that they actually like
- Connecting them to the game in a meaningful way
- Adding a great style to their wardrobe
- Finding the perfect gift for a friend who loves baseball
These are all basic problems that your brand could solve, but they are still too broad. Other brands have years perfecting and growing their brand loyalty by effectively solving these problems. With the "Hey Batter Batter!" phrase, the following bullet points are other niche problems (with italicized solutions) that your brand could address:
- Finding other products that sport the slogan other than t-shirts and hoodies
- Your apparel brand could offer socks, shoes, pants, jewelry, hats, beanies, etc. with the slogan.
- Finding a brand that gives to charitable/social causes
- Portion of apparel proceeds go back to local youth baseball teams, maintaining baseball fields, or to providing baseball training/equipment to under served communities. (See list below for apparel companies who successfully give to social/charitable causes)
- Finding a product that connects with ethical values
- Your apparel could have values such as being against bullying or promoting fairness in baseball.
These examples are not the extent of problems customers may be facing. Sometimes, the problem to solve is just having product available to a customer base. Staerk Performance is a fitness brand that ties in Norse mythology with its designs. The founder noticed that in Denmark, there are not a lot of fitness apparel products available, so he created the brand to reach that market and connect with its Viking heritage. He found the problem in conjunction with customers to target—the next step in forming a sports apparel brand.
Apparel companies who successfully use give back campaigns: Cotopaxi, United by Blue, Patagonia.
Step 2 - Who are your customers?
Knowing who your target customers are is very important. Many people starting out may say, "I am going to target everyone who likes sports!" While this is a good start, people who have this broad customer base in mind will find it difficult to gain traction. The broader you are, the more competition you face. From this, how do you figure out a good niche customer base that will buy your brand and make you good money?
Finding a niche customer base should start off by looking at different types of geographic, demographic, behavioral, and lifestyle characteristics. Ask yourself the following questions to get started. Will you be targeting people in certain geographic areas (city, county, state, country, etc.)? Which demographics will you be targeting: homeowners, renters, high-income earners, low-income earners, families, single-adults, ethnic groups, education levels, etc? What behaviors/lifestyle do my customers live that I can connect with (purchasing habits, hobbies, beliefs, values, etc.)?
To find the answers to these questions, you must do research. Most geographic and demographic data is free online from sources including census data, and other government sources. While this information is a good start, do not stop after looking at these characteristics. For a better look, you must also look at behavioral and lifestyle characteristics. For these, you can conduct interviews, online polls, or use other databases like Mintel where you have to purchase reports to get data. With a combination of geographic, demographic, and behavioral research, you will get a better understanding on a good target customer base.
While doing this research, make sure that you find characteristics that create customer segments big enough to sell to. Selling apparel focused on customers who live in Montana, are men, and who play/watch beach volleyball may not be the best to build a long term brand around since the number of potential customers is too small to make good money. On the other hand, make sure your customer base is not too broad, or you may lose your brand voice among competitors who also focus on broad segments.
After this research, what do you do next?
Once you have conducted preliminary research, you need to create a customer profile. A customer profile is a description of your researched characteristics from the section above. When you place all of this research in the customer profile, you create a target to keep your brand focused. Building an apparel brand is all about what your customer wants, so the profile will help you to maintain focus on their needs, not what you think will sell.
Customer Profile Example - Photo Credit: My Product Roadmap
The profile will also help you in your marketing. All of your advertising should reflect things that would connect with the profile. If the profile includes a middle-aged man who loves vintage cars, owns a dog, and travels, your marketing to this persona should not feature things that do not connect with these behaviors. You can have multiple customer profiles for your brand, but to start out, you should have one that you will first target.
Here are some more resources on how to utilize a customer profile along with persona templates: Hootsuite, Hubspot, Buffer.com
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Once you have done research on your customer and created your first profile, you are ready to move on to looking at the competition you face.
Step 3 - Who is your competition?
Countless sports brands are in the same space competing for customers' money. In this step, you will be looking at potential competitors and where you fit among the vast sports apparel landscape.
First, you must look at the competitors in the space you are pursuing. These brands may be directly or indirectly competing with you for consumer dollars. For instance, let's say that you want to create a unique fitness brand that promotes going outside and targets Americans that like to exercise. Since this is a broad target, you will be competing with major brands such as Patagonia, Mammut, and Arc'Teryx. You will also be competing with smaller designers. When searching the general terms "outdoor sports" on a design site, 24,836 search items come up for apparel and accessories. Searching the term, "fitness" pulls in 149,393 results. To find less competitors, make sure your brand is more niche and focused that reaches a target market you found in Step #2.
After seeing your competitors, use their information to determine things about your brand like pricing. Product pricing is one of the main elements that consumers rely on to determine an item's quality. If you want your product to be perceived as a high quality product, look at your competitors and what they charge. If you are going to be pricing an outdoor fitness t-shirt more than a similar shirt from Walmart, that works to show your product is higher quality. If you price it more than a Patagonia shirt however, you may be too eager and get out of the range of what consumers are willing to pay for a shirt. Do some preliminary research with your target market to figure out what would be a good price point.
Seeing the number of competitors and how they price, communicate, and operate will show what your brand will be competing on. From this research, you will start to see competitive gaps that you can exploit.
Knowing your competitors is worthless if you are not trying to actively exploit their weaknesses to build your brand's position. This is very similar to Step #1 in figuring out what customer problem your brand solves—if it solves unique problems, your brand is exploiting gaps of competitors.
Competitive gaps can include being good in one specific area or servicing a niche customer base than other brands. Habits 365, an apparel company started by a teenager, is a great example of exploiting gaps. The company's mission is encouraging customers to practice positive habits every day each year. With such a unique message from their apparel, the company has attracted influencers such as Dwayne Wade, Landon Collins, Cameron Jordan, Kam Chancellor, Andre Drummand, Giannis Antetokounmpo, Ja Morant, James Harden, and others. Habits 365 was able to find their niche by providing a unique message that connected with customers and was not being used by other competitors.
James Harden Sports Habits 365 - Photo Credit: Yahoo Finance
For your brand, what gaps can you exploit?
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With how big the market is for sports apparel, knowing and exploiting gaps from your competition will help your brand stand out and reach your target customers.
Step 4 - Where will your product be available?
After identifying your brand's position, market, and competition, the next step is figuring out how you will get your apparel to customers. Here are some great questions to ask first: Would you like to pursue a strategy selling in physical spaces or online first? Where does your target customer normally purchase apparel? Depending on your strategy choice, what are your long term goals in where to sell your product that will reach more consumers?
The biggest question in distributing your brand is if you will focus on selling in physical spaces or online first. In each category, I will be looking at the pros and cons on what to consider when making a decision.
Selling in Physical Spaces
Traditional apparel sales come at having product at physical spaces. Retail spaces are the most common place to buy apparel products. Whether at malls or shopping centers, customers associate buying clothes at these traditional areas. While these areas have high traffic, there are major elements to consider when pursuing this strategy.
- Lots of retailer locations to choose from when selling products
- Usually, retailers buy products in bulk to then resell. You would be getting good cash flow at first when major orders like this come in
- Great visibility - most retailers have good traffic that come through to look and buy product
- Less risk for consumers since they can physically hold, see, and put on the apparel to determine whether they like it or not
- Satisfy consumer wants immediately - consumers do not have to worry about waiting for the product to arrive like they would in an online order
- No shipping costs to deal with from consumers
- You must buy lots of inventory to stock at physical locations
- You must have space to hold inventory when waiting to restock
- You must have delivery processes to retailers around an area where you will sell
- High barrier of entry to get product in major retailers
- Proof of sales will need to be shown for major retailers to have your product in stores - hard to show this when you first start out
- Harder to get the in front of retail purchasing managers
- All product may not sell which means you may have to deal with unwanted inventory and sunk costs
For your brand that is starting out, major retailers will be reluctant to carry your products at first without proof. While selling apparel at major retailers may work better in the future, here are a few ideas on other physical locations you can sell to or partner with in starting out.
- Local sports bars or restaurants
- Youth sports tournaments or adult league competitions
- Different boutique/farmers markets
- Recreation centers
- Gyms/Athletic Centers
For selling apparel at physical locations, you must consider these elements before making a decision.
If physical spaces do not make sense for your brand, online stores are a great alternative when getting starting. For an online store, the main thing you have to consider is which provider to use to get your name out there. You can start your own website, put designs on an artist collective site, or use a platform like Stadium Gear & Apparel that only sells sports apparel. For each of these methods, there are pros and cons to also consider.
- You have access to reach audiences everywhere instead of just customers of a geographic region with a specific retailer
- More people are purchasing online for apparel
- Tie-in easily with brand social media
- Do not have to worry about stocking inventory at retail locations
- Can run business anytime anywhere since you do not have to wait for physical sales, but just digital ones
- With platforms like Stadium Gear & Apparel, you also have other pros:
- Hands-free management where you do not have to worry about production, fulfillment, shipping, website upkeep, or customer service
- No minimum purchase of inventory necessary
- High margins since you only have to pay for products that are sold
- No worries about inventory
- No monthly website hosting fee
- Marketing assets including SEO utilization, social media, email marketing, and others
- Sports merchandise experience and focus
- Lots of online competition in terms of getting people to organically find you
- Set up takes time if you decide to make your own personal website
- Manage shipping fees and fulfillment if you have your own site - this can also eat up your time from promoting the brand
- Figure out who your supplier is going to be to produce your clothes
- Handle all customer service, returns, or have to stock your own inventory if you don't use a service like Stadium Gear & Apparel
- Price of hosting a website if yearly/monthly fees apply
While there may be some obstacles in setting up and online store, online stores are much more affordable for a startup brand than trying to physically sell clothes at a retail location. As long as you have the right platform, actively promote, and have a great user experience, online stores are a great way to get started with your brand.
Various Apparel Collections on Stadium Gear & Apparel
Deciding where your product will be sold depends on where most of your target customers from Step #2 go to purchase gear. Whether you decide to pursue selling physical clothes at different locations or online through a website, make sure that you choose what will help make your brand succeed first.
Step 5 - Who will promote your product?
The final thing to consider for your brand is who will promote your products. As a new brand, no one will know about your products until you start advertising. With many different ways to let people know about your apparel, let's look at some platforms/people who could help promote.
When you think about social media, a wide variety of platforms can be used to promote your product. These platforms include Facebook, Twitter, Instagram, Pinterest, Reddit, Youtube, and others. Depending on where your customers are, you should have a social media account on the appropriate platform that will connect with them. While you do not need to be on every platform, choosing the ones that effectively reach your customers will be critical to your success.
One thing to know about social media is that at some point, you may need to pay for advertisements to reach more people. Many people may think that once they put up an account and start frequently posting that buying customers will come in large numbers. This is not the case. Organic growth takes time—time you may not have to keep your business afloat. Paid ads get your product in front of a large target market faster and can have good conversion rates. Test this out on your social media accounts with a small budget (sometimes this can start as low as $5) and see if the ads convert to followers and sales. If they do, then put some more budget into ads and grow your account.
Social media is a powerful tool to promote your brand. Make sure that you are on platforms where your target customers are and set aside some budget to pay for ads for greater success.
Family and friends are a great way to promote your products. As the closest people to you, they will want to see your brand succeed, and are usually your first customers. They can help share your brand with their circles, give you good feedback, and even be models for pictures. All-in-all, these people will want to help where they can when you get started.
To encourage greater participation, you can set up a payout/affiliate program for your family and friends. The program can be very simple: for every product a person who participates sells to someone else (tracked through something like a referral code) you give a percentage of those sales back to that person. This encourages family and friends to share more since they will be getting money back for people they refer that buy.
Family and close friends are powerful resources to help promote your brand at first. With a proper payout program, they can help show your brand to new potential customers.
Whether you like them or not, influencers are great route to promote your product. While some influencers give the rest a bad rap, most are very good in promoting product. In fact, a study from Social Media Today showed that marketers saw 11 times the return on their investment from influencer marketing impacts compared to traditional media. With such an impact, what are some things to consider with influencers?
Jamie Foxx is a proud supporter of Vanderhall Motorworks. While he is taking a picture with the car, Vanderhall used the opportunity to promote their apparel. Check out some of these products here.
For one, do not be surprised if you have to pay to have your product promoted. For influencers, their profiles are another source of income. While some may wear your product or give you a shout-out on their channels if you send them free pieces, most with a decent following will want to charge you. Influencers differ on what they charge depending on their following, levels of engagement, how much work they have to do for the promotion, and other factors. According to Tinuiti, a good method to create a budget with is the "one cent per follower rule" where you pay a penny per follower an influencer has. While this is not true in every case, this math can give you a starting point on what you may need to pay.
While influencers with bigger followings will have more reach and bring in a lot of customers to your product, you may find better initial success (and cheaper rates) with microinfluencers. These types of influencers have between 1,000-100,000 followers. While they may have less reach, microinfluencers can have better engagement with niche audiences. When first starting out, I recommend searching out influencers who have between 5-10,000 followers. They may be more likely to promote your product if you send them free items instead of paying them. Just make sure that your influencers reach your target audience that you determined in Step #2.
From Instagram personalities to Youtube content creators, influencers are a great way to promote your product and help you reach your target market.
Other Platforms/People To Promote
- Local Businesses
- TV Ads
- Members of Affiliate Program
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With so many ways and people to promote your product, think about who would be the best to carry your brand's message to your target customer. Once you find a good group or place to promote, start to build off their success.
Time to Start
Starting a new sports apparel brand can seem daunting. With so many things to consider, this step-by-step process will help you get started on the right note. Finding a problem your brand will solve, discovering your target customers, seeing what competition is out there, picking a place to make product available, and promoting the brand with the right people are all part of making sure your brand succeeds.
After considering these steps, you are ready to bring your brand to market. Best of luck as you begin this exciting, new journey!