Asics Secures Foothold in the U.S. : Retail: Japanese shoe and apparel maker teams with U.S. sales experts to challenge the dominant players for a share in the $6-billion market for athletic footwear.
In an age when lavish advertising for athletic shoes has every child dreaming of pumping up inflatable footwear or thinking more about Bo Jackson’s Nikes than his athletic prowess, it hardly seems like there would be room for another sneaker.
But one Japanese-owned shoe maker says it is thriving as it jockeys for position among 39 name brands in the $6-billion U.S. market for athletic footwear.
Asics Tiger Corp. in Fountain Valley, the U.S. division of a Japanese athletic shoe and apparel maker, says it has combined Eastern technology and Western marketing skills in a push to make inroads against industry leaders Nike Inc. and Reebok International Ltd., which collectively control about half of the market.
Asics’ running shoes are some of the industry’s most highly regarded products. The gel cushioning in the soles of most of its shoes has won plaudits from athletes and industry analysts alike. And the company’s success is reflected in a rapidly escalating sales curve.
In footwear alone, Asics’ sales have increased to $110 million in 1990, up 156% over $43 million in 1986, according to Sporting Goods Intelligence, a marketing survey company in Glen Mills, Pa. The company presently has a 2% share of U.S. athletic footwear sales.
Overall, Asics expects $175 million in U.S. sales this year on its full line of shoes and apparel, a 45% increase over last year, according to H. Peter Goehrig, an Asics vice president. What makes that accomplishment even more impressive is that it comes in an otherwise stagnant market for athletic footwear, Goehrig says. As a result, Asics has to count on increasing market share by stealing it from competitors.
“What we have tried to do is take away from competitors we most respect,” he said.
That means Nike and Reebok. Practicing the fine art of guerrilla warfare as it applies to marketing--trying to make a big splash on a limited budget--Asics has produced a series of television advertisements that poke fun at its larger rivals.
In one, for instance, the basketball player wearing the Asics gel-cushioned shoes makes drive after drive to the basket. Another player wearing shoes that have to be inflated, just like the latest high-priced offering from Reebok and Nike, stands helplessly on the sidelines trying to pump up his shoes. After trying to use a bicycle pump and a compressor, he never makes it to the court before the spot ends.
Asics offers technological innovation of its own. Asics shoes are lighter and have gel cushioning--silicone-compound-filled pads placed in the arch and heel of many of its most popular shoes. The cushioning dissipates the impact of running on hard surfaces and works well in hot or cold weather, the company says.
While marketing a full range of shoes, the company has gained a reputation as maker of some of the best shoes available for specialized sports such as wrestling and volleyball. But it is better known for having one of the more popular lines of running shoes.
“They are doing a very creditable job,” said John Horan of Sporting Goods Intelligence. “Asics has done the best job of any in finding a niche--the performance running business.”
Mark Anderson, a footwear buyer for Covina-based Chick’s Sporting Goods, said Asics competes with Nike as the best-selling running shoe in Chick’s chain of six stores, including three in Orange County.
“Asics is a good company to work with,” Anderson said. “The customers’ response currently is strong. They are a major player in the running category. . . . When you go to races, you see a lot of people in them.”
Anderson said that Asics’ popularity results from a good-quality product and smart marketing. The style of the shoes, much of it designed in Fountain Valley, and the color selections have been a hit, he said, and Asics’ gel cushioning is considered more practical and less “touchy feely” than pump-up shoes, Horan said.
Asics was founded in Kobe, Japan, in the late 1940s by a Japanese veteran of World War II under the brand name of Tiger. In 1977, it merged with a Japanese knitwear maker and sporting goods manufacturer. The new company was named Asics after the Latin phrase anima sana in corpore sano-- a sound mind in a sound body.
Today, Asics Tiger is a $1.1-billion worldwide sporting goods conglomerate. Besides the shoes sporting its familiar intertwined stripe design that looks like a stylized tick-tack-toe board, the company produces apparel and accessories ranging from ski wear and running suits to its own line of sunglasses and kneepads.
While its products are considered of high quality--some thought to be technologically superior--Asics once had trouble spreading the word. Conservative Japanese business practices were not translating to higher sales.
Realizing the deficiency, the company brought in an American marketing team several years ago. Colors and fashion details were left to the U.S. team; technological development remained with Asics’ Japanese design center in Kobe. U.S. advertising and promotion for shoes and apparel was greatly increased and now runs at more than $10 million a year. That is enough to air television spots during sporting events and place full-color spreads in sports magazines but is far shy of the saturation coverage that a company like Nike can afford.
Best Foot Forward In the super-competitive world of athletic footwear, Nike and Reebok combined account for nearly half of all U.S. sales. LA Gear is a distant third. A host of other competitors, including Asics Tiger Corp., are battling it out for the rest of the market. Asics Sales in the U.S. In millions of dollars 1986: $43 1987: $56 1988: $73 1989: $95 1990: $110 Source: Sporting Goods Intelligence, 1991 The Athletic Shoe Market In percent of all athletic shoes sold in the U.S. in 1990: Reebok: 20.8% LA Gear: 12.0% Keds: 5.0%. Converse: 4.0% Adidas: 3.2% Avia: 2.6% British Knights: 2.6% Etonic: 2.2% Asics: 2.0% Nike: 28.4%
