“We’re definitely positive on the run footwear space,” said Janine Stichter, an analyst at BTIG who covers Deckers Brands, the parent of Hoka, and On.

Stichter, who was among a handful of analysts attending The Running Event in Austin this past November, said the growth is being helped by solid participation in running that’s marked by surveys showing heightened interest in run clubs and race participation in part for social reasons. Increased emphasis in fitness coming out of the pandemic is also believed to still be leading more people to run regularly.

Stichter said, “When people get involved in running, there’s a sticky customer base and they tend to repurchase over and over.”

She further sees the overall run footwear category benefiting from the “premiumization of price points” tied to the emergence of “super shoes,” or carbon- plated running shoes. Not only are these models incentivizing runners to purchase more pairs but to also pay up for innovation.

“Their price points are typically over $200,” noted Stichter. “You wouldn’t typically see an everyday runner buying a shoe at that price point, but we’re seeing more and more consumers willing to trade up for a shoe you would get if you were a real elite marathoner but built more for the everyday runner.”

The max cushioning trend, now embraced by most brands after being pioneered by Hoka, also fits squarely within the broader comfort footwear trend, increasing the appeal and overall growth opportunity of running styles for everyday wear.

“People are just wearing these max cushioning shoes,” remarked Chris Nardone, who covers Deckers, On, Nike and Skechers for Bank of America (BOFA). “It goes from high school and college kids all the way up to grandparents. I think the category is definitely here to stay.”

Sam Poser, who covers Deckers, Nike, On and several other footwear stocks for Williams Trading, argues the overall run footwear category is foremost being boosted from the “huge comfort phase.” He said, “The most comfortable sneakers are running shoes, no matter who makes it.”

He believes the wide majority of individuals are using running styles not for running but for walking, including increasingly wearing them to work or out socially to feed an outsized broader opportunity in run. Poser said, “When they’re crossing over into multi-use, that’s when things get really good. I think we’re seeing a lot of that.”

Run Specialty Seen As Critical To Brand Credibility

Poser suspects run specialty, with its run-centric focus, is seeing less of a benefit than other retail channels from people looking to purchase running shoes generally for walking. However, he believes specialty run remains critical in helping people learn about and try on product, even with the major shift to online selling.  

“The best brands recognize they have to sit next to their other competitors to win,” said Poser. “That was one of the mistakes that Nike made.”

Indeed, Nike, as well as Adidas, have recently recommitted to the run specialty channel to better establish themselves in the run category, and several other brands, including Skechers, Craft, Diadora and Salomon, have been making major investments in performance run in recent years.

Stichter believes run specialty remains the industry’s primary “customer acquisition vehicle.” She believes that although its maximal construction was clearly unique, a large part of Hoka’s success is because they prioritized run specialty early on and likely also benefited as Nike reduced focus on the channel.

“Where it becomes really important is getting that new customer in the door and getting them in your shoes, particularly for that new kid on the block,” said Stichter. “They can eventually repurchase online, but I do think [run specialty’s] still important just in terms of customer acquisition.”

BOFA’s Nardone believes the run specialty channel “is still just as important, if not more important” than in the recent past because the runner is overwhelmed by the wide range of choices available. He said, “More competition among brands gives the consumer more of a need to go there than to just shop at one of the more generic sporting goods stores, where maybe the education process is not nearly as intense.”

He further expects run specialty to benefit as hyper-competition among brands brings a constant stream of fresh innovation to shoe walls. However, he also believes that taking a page from the channel’s dominant players, Hoka and Brooks, more brands are investing in properly servicing specialty run accounts to better support sales at specialty run. This includes sending out reps to train staff on the latest shoes and updates as well as spending marketing dollars on community events.

Nardone said, “If you go to a specialty run store and you sit down in the chair to get fit, the person that’s helping you can only bring back out three boxes. So even if there’s 10 great brands, they’re only going to come out with three boxes to start. So that’s why it’s so important for the staff at specialty run retailers to be very well educated on the differences in all these shoes.”

Run Footwear’s Potential Disruptors

Analysts remain generally bullish on both Hoka and On’s growth prospects although how their distribution and segmentation strategies evolve will be closely followed. Nardone said, “It’s very important for these brands not to be near-term sighted and just chase growth and flood the market with product.”

For Hoka, one concern is whether the brand can develop more of a lifestyle look to expand beyond the run specialty channel, where it shares about half of the market share with Brooks. Williams’ Poser noted that both Ugg and Crocs were roundly considered “ugly” shoes but have since earned wide acceptance.

Stichter is confident Hoka is taking steps to support key specialty run partners, such as providing exclusive product or colors, as it expands via DTC (direct-to-consumer) and other more lifestyle channels. She observed, “Specialty run was what put them on the map. It gives them credibility with real runners.”

On is generally seen as having more room for growth with still minimal share in run specialty and the model’s look seen having more of a lifestyle opportunity.

Stichter said she will be closely watching innovation in the space. She said, “There was a lot of sameness in the innovations at The Running Event in Austin, where everyone was doing really good things but a lot of the same things. I think it’s becoming harder to find that next innovation to differentiate yourself.”

Poser said max cushioning is “very comfortable” and aligns with the resilient comfort footwear trend but the technology has to continually evolve to remain relevant. He said, “Things that don’t change get stale.”

Analysts will also be closely following the competitive landscape. The return of juggernauts such as Nike and Adidas in particular can possibly increase the size of the running shoe market by taking more share away from categories such as dress shoes but may also take share away from existing players.

Nardone called out Nike as particularly appearing to be making “a much bigger commitment to the channel” with signs of investments back in its EKIN rep force and promising innovations in the Pegasus Premium and Vomero 18 that features the tallest stack height (46mm) in the franchise’s history.

“All these brands are kind of fighting at each other’s necks so it’s going to be very, very competitive,” said Nardone. “The category is growing and that’s helpful, but in a couple years there’s probably going to be only a couple winners that emerge as share gainers.”