SKU’d Thoughts 48: Will outdoor activities slow down post-pandemic?
At the height of the pandemic last year, gyms were mandated to shut down and most Americans had to find alternative ways to keep moving and work up a sweat. Some built makeshift gyms at home and others turned to outdoor activities such as cycling and hiking, or a combination of home workouts. But as most people get vaccinated and gyms re-open, will the interest in outdoor activities decrease? I don’t foresee a slowdown. A few reasons why:
Focus on healthier lifestyles: Driven in part by the rising cost of healthcare, Americans are being more preemptive about their health and engaging in behaviors that reduce doctor visits.
Work from home: For some, remote work will become the norm post-pandemic which removes the daily commutes that once guaranteed people would leave their homes. So outdoor activities, even if just once a week, will break up the monotony of staring at a computer screen or trying to simulate nature on a smart exercise bike.
The urban out-migration: Pandemic, coupled with remote work, has driven Americans out of major cities (New York City, San Francisco, etc.) to more southern and western locations. These resettlers are closer to nature and have easier access to the outdoors and will likely take full advantage of it.
Millennials spend money on outdoor: Millennials have more than $1.4 trillion in annual spending power and according to an outdoor industry report make up ~38% of U.S. outdoor consumers and spend on average more time on money on outdoor activities.
Gen Zers care about nature: This generation is leading the charge on climate change and wants to preserve nature. They are also an active group so experiencing nature while burning calories appeals to them. According to Statista, they have the highest participation rate (59.1%) of any age group when it comes to outdoor activities.
The decision to participate in outdoor activities requires some investment in the right apparel and equipment. Zeroing in on hiking, which about 50 million Americans participate in annually, the market for gear and equipment is projected to reach $13.1 billion by 2027 in the U.S. and $28.7 billion globally during that same time period. Brands that are able to appeal to multi-cultural, young, and diverse audiences will be well-positioned to maximize on this pending growth in outdoor spending.
Legacy outerwear apparel brands The North Face and Columbia have had weak appeal among younger Millennials and Gen Z-ers. These age groups have a higher penetration of multi-cultural and diverse consumers than previous generations that legacy brands have catered to. They are also more likely to live in city centers and looking for versatile apparel that could come in use even off the hiking trail. This opens the door for emerging brands focused on targeting a diverse and young audience. It’s just one of the reasons I was excited to invest in Season Three, an outdoor apparel lifestyle brand catering to the next generation. The company’s flagship product is The Ansel, a rugged-yet-stylish genderless hiking boot that is hand-made in Italy with the young city-dweller in mind.