JD Sports Scores 20% Sales Growth Due to Younger Buyers

British sportswear retailer JD Sports had a merry Christmas, thanks to its younger customers.

A trading update Wednesday (Jan. 11) showed the company’s businesses saw a more than 20% growth in revenue in the last six weeks of 2022. Speaking to reporters, CEO Régis Schultz credited the growth to the retailer’s younger customer base.

“I think that the buying power of our customer is much higher than it used to be,” he said, per a Wednesday Reuters report. “They don’t have the utility and the rent or the mortgage to pay.”

The trading update, provided to PYMNTS by the company, said JD Sports’ business in North America has “recovered strongly,” seeing a growth of more than 20% during the second half of the year. The company has 134 stores in the United States and Canada.

“Management firmly believes that the most significant opportunities lie in the continued international multichannel development of the group’s sports fashion businesses and, consequently, the group will be accelerating its global investment in these businesses through 2023,” the update said.

As PYMNTS noted last month, a lack of financial worry, such as what Schultz described, has allowed many young adults to purchase luxury goods.

“When young adults free up their budget for daily necessities (e.g. rent and grocery), they simply have more disposable income to be allocated to discretionary spending,” a report by Morgan Stanley said.

Fewer than half of Americans between the ages of 18 and 29 still live at home, while in the U.K., 42% of those between the ages of 15 and 34 are living with their parents, the report found.

That figure for the U.S. is the highest since 1940, while that for the U.K. is the highest in the 25 years of data published by Morgan Stanley — and up from 36% in 1996, per the report.

The report attributed this trend to young people in the two nations pursuing higher education, holding off on getting married, wishing to save money, and finding rents unaffordable.

At the same time, the report found “very significant” growth in sales of luxury goods in the West in the past three to five years.

This is due in part to a growing total addressable market (TAM) for these goods in western countries, which includes a growing number of younger consumers, such as the ones still living at home.

“This is of course not the only reason luxury goods consumers are getting younger in the West (social media playing also an important part), but we see it as fundamentally positive for the industry,” the report said.

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