How Will Your Favorite Sneaker Brand Perform in 2018? | Puma SE ($PMMAF)

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Originally posted on ARCH-USA

Puma SE stock price, stock quotes and financial overviews from MarketWatch.

Source: Puma SE

Puma SE $PMMAF

Current Share $433.67

2017 Recap:  Puma is a brand that I very rarely discuss on the site. When I do it’s about a person, not the brand (Rihanna). This affiliation and alignment with one person in my opinion has always made Puma in North America a shaky platform. The thing is Puma is an international company and while the North American market isn’t a focus for Puma, cracking the market is vital and this past year and the year before Rihanna made Puma hot to the tune of a 200 dollar increase in share value. At this time in 2016 Puma sat at around $216/share. The brand had remained relatively flat. The only thing that gave Puma a bump in the American market in 2015-2016 was Foot Locker’s inclusion of the Puma Lab inside of their stores. Puma Lab gave the brand a portion of the wall set aside specifically for Puma to shine. The problem is the brand hadn’t yet aligned so completely with Rihanna and their footwear was basically Clydes and Suedes. Puma Lab has all but disappeared which is unfortunate because at this moment with their success with Fenty, Puma would stand out in Foot Locker.

It’s interesting though… internationally Puma is as strong as it’s ever been. While the US won’t be watching the men’s World Cup, Puma will be represented very well at the FIFA and this of course translates to potential branding and sales opportunities apart from Rihanna, but I’m getting ahead of myself. 2017 saw the drop of the Tsugi line from Puma. The Tsugi Kori landed in my top 40 shoes of 2017 but didn’t exactly translate into sales on the men’s side. Fenty remained incredibly strong and kept Puma’s guidance high on the fashion side, but the Big Sean drop and the Weeknd designed Parallel was so limited it really accomplished very little for the brand. Still 2017 was Puma’s year.

2018 Analysis: Now, on to where I was headed above… Internationally, FIFA World Cup has already begun for Puma. Last year, “PUMA Football launched 23 globally licensed club Third and Away kits under the same story of “Step Out” across 7 time zones.” They have also integrated recent tech like Netfit into shoes for soccer stars like Antoine Griezmann. They’ve even created cross promotional campaigns with French rapper MHD:

Roger Milla, Cameroon and MHD | Puma Drops A Fire Jersey Spot

I establish this to say that while 2017 was amazing and futbol will keep Puma rising on the international front, I do think in North America Puma is already cooling off. While Rihanna has been able to keep Puma high on the list for women it is still vital to the brand to capture sales beyond Fenty and when you walk into stores Puma is on a deep discount with every line they’ve dropped. Adding Selena Gomez won’t drive the same passion for the shoes as Rihanna and as dope as the Tsugi Kori is, local shops like City Gear have the Tsugi on sale for 50% off and they haven’t added the Kori to their stock. 2018 is a breaking point for Puma in North America and I’m not quite sure that the World Cup will offset the slow down that could take place in the US.

2018 Prediction: Puma has a few tricks up its sleeve and the 50th Anniversary of the Suede has produced some dope sneakers. Retro still rules and the 90s retro will allow for Puma to capture the streets with the packs being dropped throughout the year. The colorful, City edition of the 50th Anniversary Suedes with the matching tees could get the brand some traction with guys. I think it would be an incredible chance to also shine light on the Tsugi via City Inspired B-Boy drops. As the spring comes, the possibility of delivering the tees and apparel for both the Suede and more modern shoes creates an exciting opportunity. How will Puma perform?

I think the promo is going to hurt margins of course and I see the slow down in Fenty not affecting the brand at all. Fenty and Rihanna is so high that a drop down a level in altitude won’t be noticeable until the fact that in North America Puma still hasn’t figured out the men’s market. Even when the market notices that North America is low, I think the FIFA will help to spike sales for Puma before and after the event. That spike will keep Puma steady throughout 2018.

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Chris
Chris
Founder, Writer and Webmaster at ARCH & CBP
Chris B. is the founder of ARCH.

The ARCH network is unlike other sneakerhead sites. ARCH is a more informative look into sneaker culture. By presenting information about the business of sportswear through marketing analysis, updates on stock prices and introductions to new brands and styles, the site is easily distinguished from the everyday site only giving you release dates.

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