Despite a challenging outdoor business market, the industry has seen more casual participants than ever, and many people are buying outdoor products for their versatility and durability.

Those are some of the takeaways from last week’s Outdoor Industry Association webinar hosted by Kelly Davis, the organization’s director of research.

Davis was joined by Matthew Tucker, director of client development for data firm Circana, James Hampton, chief revenue officer for Cotopaxi, and Eagle Creek owner Travis Campbell.

The webinar focused on OIA’s outdoor participation and sales segment data, broader consumer trends from Circana, and business insights from Cotopaxi and Eagle Creek.

Sales Down, Participation Up

“2023 was a really difficult year,” Davis said. “There’s really no way to sugarcoat it. It was a very difficult year, and it was difficult across the board in every single sales channel.”

Davis explained that more than half of outdoor independent specialty retailers saw sales declines of 10% or more in 2023.

“That’s a difficult position to be in and that’s going to affect their open-to-buy for the coming year,” she added.

The one bright spot is that the outdoor industry participant base grew significantly in 2023, up by 4%.

Since the COVID-19 pandemic, the industry has added more than 15 million participants, and those people have not left the outdoor market.

“They’re hiking, they’re birding, they’re playing pickleball, they’re paddling,” Davis added. “They’re just doing it a lot more casually than we’re used to.”

In 2023, more than 57% of Americans were participating in outdoor recreation.

However, core participants, which are defined as those participating in an outdoor activity 51 times or more a year, are dropping. In 2023, there were about 175 million Americans in the participant base, with about 90 million defined as core participants.

“That continues to drop and drop and drop over the years,” Davis said. “That’s kind of a problem for us. But it also indicates that the consumer that’s driving our market is that casual consumer.”

Looking at the Data

By category, apparel, which makes up more than half of the entire industry by sales volume – $15.7 billion of the $25.7 billion overall market – was down about 3% in 2023 compared to the previous year.

Equipment sales were $5.3 billion for 2023, down about 3.4%.

Davis said many people bought new equipment during the pandemic and that the replacement cycle is up to 10 years for many items, even longer if they’re a casual participant.

The only category in the industry that finished up for the year was accessories at $1.4 billion, a 4.2% increase for 2023.

Despite the obvious challenges, Davis emphasized that the outdoor industry has plenty of opportunity ahead of it.

“If we looked at our market and compared it just to what was going on pre-pandemic, we’d be telling a different story here today,” she said. “We’d be telling a story of a market that grew a lot and has the potential to continue to grow. And the reason it has the potential to continue to grow is because we have more participants than we’ve ever had in outdoor.”

As examples of brands that are benefiting from that growth, Davis highlighted Hoka and On Running in the footwear category. The people buying those shoes might not even be going hiking or running, she added.

“They’re probably going to walk around, and that’s about it,” Davis said.

Across the categories, most retailers reported fewer units sold for the year – apparel down 6.1%, equipment down 5%, footwear down 10%, and accessories flat – but because prices have gone up, the overall sales totals don’t look as bad.

Another data point: The subcategory of insulated mugs, cups, and tumblers was at the top of the list in terms of sales growth.

“We’re all familiar with that trend,” Davis said. “I don’t think it’s going anywhere. I’ve seen the January data. The trend continues to explode.”

The subcategory of casual pants is another top seller in the market.

Footwear Stands Out

Hoka, Vuori, On Running, Cotopaxi, and Stanley ranked at the top of the list for fastest-growing outdoor brands in 2023, according to Tucker with Circana.

Tucker added that sales of running footwear grew 12% in 2023.

He also shared a short anecdote about his wife, a nurse in Denver, who had purchased a pair of Hokas to run a half marathon. She liked the shoes so much that she wears them for work now.

“I’m not suggesting that specialty shops should host a special nurse night event,” Tucker said. “But I am saying that the jobs that consumers hire products to do during the pandemic may not be the same jobs they hire those products to do moving forward.”

Cotopaxi Comments on Customer Loyalty

Once that consumer is converted to a brand, customer service is the key to driving loyalty, Hampton with Cotopaxi said.

He said “table stakes” for an outdoor industry brand is to create durable products that last.

“The way we add to that is through putting our mission first,” Hampton said. “And using community through events, experiences, and our social media platform. Our social team does a phenomenal job engaging with our consumer that helps really foster that strong loyalty that we see within our company.”

Behind the scenes, Cotopaxi works to understand who its valuable customers are, then looks for new customers just like them.

“There’s a lot of pairing specific product to specific end consumers through our marketing efforts,” Hampton said.

Cotopaxi is watching the versatility trend that Davis and Tucker mentioned, where people might be buying trail running shoes just to walk in, for example.

“We’re definitely seeing that in the marketplace,” Hampton said.

He added that the travel category is expected to be a bright spot for the brand for the next year or two.

More Adventure Travel

Similarly, Eagle Creek’s Campbell said he took over the brand in 2021, when travel was still restricted, then saw the company’s sales take off when the travel returned in 2022.

“Both retailers and consumers were chasing inventory and trying to pursue the travel tailwind,” he said. “Timing sometimes is everything.”

Eagle Creek pays close attention to adventure travel and has seen that category outpace traditional leisure travel.

“We feel great about that as we consider ourselves an adventure travel brand,” Campbell said.

That said, product sales slowed “a hair” in the fourth quarter of 2023 and the early part of this season, he added.

Eagle Creek is still trying to determine exactly who its ideal customer is, Campbell said.

On one hand the legacy brand has customers who are in their 60s and 70s, but the customers buying its products for travel also are on the younger side.

“We see our customers prioritizing experiences over things, and that shows up in the younger consumers looking to live and work anywhere,” Campbell said.

In today’s market, customers are more willing to take a chance on a new brand, he added, and Eagle Creek is trying to build durable products that can be repaired. A customer will bring them a bag that’s 20 years old and needs new wheels.

“We build loyalty in that way,” Campbell said.

Bart Schaneman can be reached at [email protected].