In the booming activewear market, a handful of sleepy heritage brands are finding their relevance again.
Kappa, Superga and K-Way – decades-old European sports and lifestyle brands whose products have iconic status but have never achieved global leader status – have undergone a turnaround after their Italian parent company BasicNet SpA struggled to get sales back above pre-pandemic levels last year.
By laser-focusing on marketing their most recognizable products, focusing on wholesale as sportswear giants retreated, and forging partnerships with sports teams and luxury fashion brands, BasicNet’s brands appear to be enjoying a renaissance: The company, which also owns American boat shoe brand Sebago, reported first-half revenue up 26% year-on-year, reflecting an 18% increase from levels pre-coronavirus of 2019. Total sales of BasicNet products (including through licensees who distribute its brands) soared 28% to 568 million euros ($569 million) while net profits were more than doubled, the company announced in July.
“We don’t have to reinvent brands every year. We don’t really need to invent anything, really, we need to tell the story of the brands,” said Vice President Lorenzo Boglione, whose family owns a majority stake in the group.
“For our sports brand [ Kappa], we are competing against gigantic giants but there is always room for challengers,” he added. “Everyone knows their strategies – where they enter and exit the markets – which leaves room for smaller players if you’re quick and responsive.”
Nike and Adidas have limited their wholesale exposure, creating a key opportunity for smaller brands to fill the gaps in their wake. In addition to BasicNet, Puma and running brand On are among other sports companies to have seized the opportunity to stock smaller wholesale outlets where the giants have cut doors and reduced orders.
BasicNet also fueled the momentum with a comprehensive list of partnerships and collaborations: a tie-up between Sebago and Kering’s Saint Laurent was released on Monday, following recent collaborations such as Superga x Alaïa, K-Way x Fendi and K- Way x Comme des Garçons Play. The latter is an ongoing partnership, which BasicNet hopes could be similar to Play’s longstanding tie with Converse, whose heart-adorned high-tops are a mainstay of its business.
As BasicNet’s portfolio seems to have taken a turn, economic uncertainty is on the rise. Rapid inflation, accelerated by soaring energy costs following Russia’s invasion of Ukraine, is likely to trigger a downturn, particularly in BasicNet’s home European market.
If consumer spending slows, the company hopes some ambitious luxury consumers will be inclined to switch luxury prices to its more accessible offerings like the €100 K-Way windbreakers and €160 Sebago boat shoes. .
“We try as much as possible to be fair on pricing,” Boglione said. “If we do our job well, we can do well, regardless of the economic environment.”
Meanwhile, Kappa is expanding its historic soccer focus with new sports sponsors with the USA Snowboard and Ski Team set to run at the next two Winter Olympics, in 2026 and 2030. It also produces a line of jerseys as a partner of the Formula 1 team of the French car manufacturer Alpine.
BasicNet has also sought to consolidate its business by operating its business more directly, reducing its dependence on licensees by acquiring key distributors, including the operating company of K-Way France earlier this year. “It’s the company’s fastest growing brand, and a lot of that growth is now coming from our own retail stores,” Boglione said.
The Turin-based group will also open a new campus in Milan, which will include not only showrooms and offices, but also a restaurant and 10 apartments. The goal is to increase BasicNet’s attractiveness as an employer, as well as its convenience for wholesale buyers and dealers. “In Italy, the talents of our industry are in Milan, it is difficult to get them out of this ecosystem. And when you want to attract talent from [outside Italy]it’s easier to bring them to Milan,” Boglione said.
BasicNet is expected to inaugurate the new campus on Wednesday during Milan Fashion Week.