The collapse of JJB Sports left a gap in the premium sportswear market that Matalan and brands are fighting for, as well as industry giant Sports Direct.

Matalan is poised to open Sporting Pro, while other retailers and brands are jostling to take a share of the market once held by JJB Sport

Matalan has become the latest retailer to make a play to capture a slice of the sportswear market. It unveiled launch plans for a Sporting Pro fascia last week.

Matalan will follow JD Sports, which launched JD Pro late last year, in turning its hand to performance sportswear.

Both retailers have identified a gap in the market created by JJB Sports’ collapse in October last year.

For a long time JJB was the market leader in sportswear. In fact, just five years ago it was racking up more than £800m annual turnover.

Goliath of the sector Sports Direct will have undoubtedly benefited from JJB’s demise, but there is a portion of pie left uneaten according to Cantor Fitzgerald analyst Freddie George.

“Although Sports Direct has its [football boot specialist area] Boot Room and [dedicated running area] She Runs He Runs, it’s still largely fashion in store. There’s a big gap in the market for a true specialist,” he says.

Growing market

Sporting Pro boss, and ex-JJB chief executive Tom Knight, is determined to fill that JJB-shaped hole.

He says: “There’s a gap in the market. JD is not really a sports store, it’s more about fashion and Sports Direct is very much about an own-brand proposition.

“We want to present sports in a way that will excite the consumer. JJB’s demise is part of it, obviously. There are geographic gaps but more importantly [gaps in] products.”

Sporting Pro isn’t Knight’s first attempt to capitalise on his former employer’s demise. He helped JD strike when the iron was hot, launching JD Pro just a month after JJB plunged into administration.

JD Pro targets sporty city types with a shop in Bow Lane, London. JD chairman Peter Cowgill is confident the format has legs and plans to add another four to five larger stores to the trial.

Knight, who decamped to Matalan not long after JD Pro opened, is confident about the opportunity in sports retail.

He tells Retail Week he plans to open 100 Sporting Pro stores in the next four to five years, 14 of which will debut before Christmas this year.

Like JD Pro, Sporting Pro has linked with buying group Intersport, which has more than 5,400 stores in its network, and it will sell brands such as Nike, Adidas, New Balance, Asics, and Reebok, as well as an array of sporting equipment.

Matalan and JD are chasing a market in growth, according to George. “I’m very positive on the sportswear market.

There’s a big trend in keeping fit and this year is the only year for a while where there hasn’t been any major tournament to boost trade. The Brazil World Cup next year will heighten interest and create a fillip.”

Team GB’s roaring success at the London 2012 Olympics has also piqued consumer interest in taking up sports in a more serious way. Budding Jessica Ennises and Andy Murrays are now eager to have the most up-to-date, expert gear.

Brands fight back

It is not just sporty consumers who are missing out because of JJB’s demise. Performance sportswear brands have also been left without a retailer to reach their customers.

Although Sports Direct does sell a growing array of sportswear product, its emphasis on price means it is not a natural home for those serious about sport.

The congested store environment in some of its shops may also be worrying for some sports brands, for whom image is vital.

One retail analyst says: “They [brands] secretly don’t like Sports Direct and its reputation as a discounter. Sports Direct doesn’t automatically get the latest products because the brands want somewhere to showcase the products.”

Verdict Retail senior analyst Honor Westnedge agrees. “Brands are careful to protect their brand so they might only wholesale ranges they don’t stock in their own store or end of season stock,” she says.

The fact that Nike and Adidas backed JJB through its woes - just months before its collapse Adidas agreed to provide security for a loan to fund a much-needed store revamp programme - shows how important a performance specialist is to even the biggest of brands.

However, top sportswear brands are not sitting and waiting for a nationwide sportswear retailer to appear overnight - names such as Nike, Adidas and Reebok are taking matters into their own hands.

Nike has revealed plans to double its UK store estate to 60 over the next few years and Adidas, which opened its gleaming Trinity Leeds flagship last week, is also on the expansion trail. Adidas, which has just seven mainline stores in the UK, says it will increase “focus on own-brand retail stores” and plans to open in cities across the country.

Adidas-owned Reebok, which had a big presence in JJB Stores, is also returning to retail. The shopfit for its first store in Covent Garden is under way ready for a grand opening next month, and it has signed for a flagship in Bluewater.

Rupert Campbell, group retail director at Adidas, says the brand’s new strategy has been driven by JJB’s disappearance from the high street.

He says: “We want to grow our share of the premium brand market and doing it in our own stores is the best way to do it. We can deliver a premium product experience with well-trained, knowledgeable staff in store. We can present our brand in the right way.”

Getting in on the game

Westnedge believes brands have decided to expand in an effort to protect price points. “Sportswear retail has changed so much in the past five years and has become increasingly discount driven. The brands are trying to change that,” she explains.

Despite the raft of openings, George is dubious about brand-operated sportswear stores. He says: “I think it’s a bit of an ego-trip. People aren’t brand loyal, they like to shop around.”

However, brands such as Nike and Adidas spend millions on celebrity and sports personality endorsements to drive loyalty, and a greater presence in cities will only drive customer awareness, according to Westnedge.

Matalan and JD will not be alone in vying to win the JJB customer, Westnedge expects more retailers to push into sports specialism. “We’ve already seen John Lewis do more than it used to. Like JD Pro, we might see existing players moving into a sports specialism,” she speculates.

But powerhouse Sports Direct will not lie down and allow new players to grab a slice of the sportswear market.

George points out that Sports Direct’s range of performance sportswear is getting better and more specialist departments are being installed in store. “Its [model] Shirebrook store shows howmuch more serious they’ve become about sport but it definitely is a work in progress,” he says.

He thinks the fact that expert gear is mixed with apparel could put off serious sportswear shoppers and wonders whether Sports Direct should sell its fashion offer under a different fascia.

With brands’ increasing interest in becoming retailers, the sportswear market could look very different and be more competitive in five years’ time.

In fact, in spite of Sports Direct boss Mike Ashley’s eagerness to “finish off” JJB, its collapse may well bring increased risk as well as reward for Sports Direct.

Westnedge expects the market to polarise, with brands at one end and discounters, such as Sports Direct, at the other.

However, George believes there will only be one victor. “I wouldn’t bet against Mike Ashley and his team. In the end, they always win,” he says.

Comfort and Classes winning the female customer

It is no coincidence that Adidas, Reebok and Sporting Pro are making sure their stores are appealing to women, as well as men.

Creating a female-friendly atmosphere was a key part of JJB’s brand position and differentiated it from its bigger rival Sports Direct.

Sports Direct’s store environment, with piles of sporting gear, can be off-putting to female shoppers, according to Verdict senior analyst Honor Westnedge. “The in-store experience doesn’t match with what women expect in terms of service or environment,” she says.

Sporting Pro boss Tom Knight aims to use this to his advantage. He says: “If we present a brand that is clear, concise and crisp it will make it easier for women to shop. We want the stores to be places where people feel comfortable and they want to come back again.”

Sporting Pro will also have the benefit of Matalan’s 12 million-strong customer database, which Knight says he intends to market to - the majority of them will be women.

Adidas also plans to attract female customers and intends to launch activities such as running clubs and yoga classes at Trinity Leeds, where it has a flagship.

This approach is expected to be replicated across its new stores.