In recent years many outdoor brands have deliberately set out to be more fashionable, with their clothes now used regularly and not just for sporting activities. For many consumers outdoor is simply a lifestyle product, instead of a technical product for outdoor pursuits.
There has also been huge growth in people wanting to improve their health and fitness, which has driven a convergence between the outdoor equipment and sports markets. People who participate in a sport are typically strong buyers of outdoor equipment and clothing.
After a period of unprecedented growth over the last decade or so, the outdoor equipment and clothing market now faces a much more challenging environment.
Latest figures from the European Outdoor Group1 show the market only growing by 2.1% in value and 1.7% in volume during 2015. Apparel was impacted most, while other categories proved to be more resilient.
Two of the largest European markets, Germany and France, grew by 2.2% and 2.5% respectively, while the UK lagged slightly with growth of 1.8%. In terms of regions, Southern Europe and Eastern Europe performed best, growing by 2.3% and 2.2% respectively. EOG says the market has experienced two consecutive difficult winter seasons and all eyes will be on data showing how the market performed during winter 2016.
With the market saturated – estimates suggest there are now more than 500 outdoor brands – leading players are looking for new ways to position themselves and make their brands stand out among the crowd.
The big challenge for such groups is how to address this broader target market and increase sales without putting at risk their core brand values and unique selling points.
One solution has been for big brands to open their own retail stores in prominent retail locations, thereby attracting new customers to their brands. Indeed, due to the specialised and technical nature of many products in the outdoor market, there is still great value in the store model as consumers want advice and to review products before they purchase.
1: European Outdoor Group – State of Trade report
Against this backdrop we continue to see significant M&A activity. In recent years the market has seen substantial consolidation of the retail base, reducing the number of independent retailers, while at the same time brands have been consolidating giving bigger players more sales opportunities across several markets.