MOSS ADAMS CAPITAL: Apparel and foowear market monitor highlights notable deals, stock prices and results.
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Skate shoes and price points were a hot topic during the Genesco conference call yesterday. Genesco owns Journeys, an important mall-based shoe retailer for the industry.
CEO Robert Dennis praised the innovation of skate shoe vendors and said Journeys picked up business from PacSun, which decided not to sell footwear last year. He also had some interested things to say about teens willing to pay top price for brands they really want and reported sales in February improved greatly at Journeys stores.
"Well, skate was very strong for Journeys and we expect it to continue to be strong," Genesco CEO Robert Dennis said.
"There was some tailwind presumably from Pac Sun's exit. As you know we've never been able to quantify that. But we just think that skate is a very strong category for our teen customer and expect to continue to do that. Our vendors are all continuing to be innovative and so there is new product out there that is compelling and gives the teen a reason to buy. So it will still be a big part of our business."
Pricing: Dennis said the average selling price increased at Journeys for the year and a big part of that was the popularity of Uggs, one of the most expensive items in the store. He said it proves that "pricing is not the key driver for the teen customer in making a decision to purchase footwear."
He also said price points have increased for some skate shoes, "(There is) great value added occurring within the skate category both in terms of treatments and in technology that is justifying higher price points.
Overall, Journeys buyers sense "a general trend of the teenager shifting their mix preference away from some of the lowest priced categories."
Other notes from the call
Comp sales at Journeys stores in the fourth quarter declined 3 percent.
In February, the first month of the fiscal first quarter of 2009, comps increased 9 percent at Journeys stores.