The Development Trend of the Sports Industry in the United States
In 2019, the overall North American sports market revenue was approximately US$73 billion, making it one of the largest sports markets in the world. It is expected to grow to US$83.1 billion by 2023. The sports market is growing rapidly, but over the past few decades, it has become a mature industry.
Published: Dec 23, 2021
The COVID-19 epidemic in the United States is severe, and people are required or willing to stay at home, causing changes in sports and leisure trends. U.S. Centers for Disease Control and Prevention (CDC) recommends that exercise alone or with family members at home, and reducing participation in outdoor sports, can prevent the spread of disease. In addition, Google found through big data analysis that search keywords for exercise during the epidemic were concentrated in Home Gym, Home Fitness, Home workout, etc.
Overview of the changes in the lives of Americans in the post-epidemic era:
- The stay-at-home order issued by the U.S. government has increased people's stay home time and has also affected the way consumers choose clothes. A set of clothing that can be used for both home sports and daily wear has become the standard of choice for American consumers. For example, tank tops, rhythmic pants, bright-colored shorts that can make you feel happy, and T-Shit are all recent hot products, with a sales growth rate of 12%. Preferred footwear is mainly jogging shoes to facilitate short-distance movement around the home.
- The American people have developed unique sports trends, including home meditation, yoga, the use of fitness equipment that can be placed at home, (such as indoor treadmills, indoor bicycles,) and sports goods that can be placed in the courtyard, (such as small basketball stands, inflatable swimming pools, trampolines, billiards, badminton, etc.) People are also watching more online customized courses and instructional videos.
- State governments still do not recommend people travel across states, and national parks still strictly control the number of tourists. Therefore, going to parks, beaches, outdoor trails, and riversides near residences is the current first choice for picnics and camping by RV. All kinds of bicycles, electric scooters, picnic mats, sunshade tents, and even RVs are products that Americans are considering buying.
- Fitness equipment, home or garden sports equipment, and picnic and camping equipment are all leisure sports products that people are using more since the start of the epidemic.
- Service strategy and model adjustments have strengthened product network services. NIKE has begun to cooperate with many well-known social platforms and audio-visual platforms, providing sports teaching videos and the Nike Training Club that can be done in the home office. Lululemon assists consumer interaction by providing a platform for consumers to share exercise processes and results. This helps to maintain good social interaction with safe distancing. Under Armour is focused on family-based services, providing a combination of products suitable for all age groups of the whole family.
An overview of the impact of the post-epidemic era on the U.S. sporting goods market:
- In June 2020, the total retail sales of sports goods in stores in the United States reached 5.5 billion U.S. dollars, higher than the 4 billion U.S. dollars for the same period in 2019. Overall sports market sales showed an increase. During the epidemic, the sporting goods market was more resilient than expected, thanks to strong online growth, a surge in interest in healthy lifestyles, and a faster-than-expected recovery in Western countries.
- Store closures and the COVID-19 epidemic have restricted store operations, causing consumers to switch to online shopping. Online operations, have been able to increase profits as well as control data and brand performance. Although online shopping has been introduced in the past, consumers were still accustomed to physical offline purchases, and the development of online shopping has accelerated due to changes in the epidemic.
- Consumers pay more attention to health. This change in consumer behavior will help sports product companies bring products to market, and it will also help the positioning of health-related brands. During the epidemic, Americans increased the frequency of cooking at home. They were more health-conscious about their diets than usual. People's interest in sports has surged, to a level higher than before the lockdown. Although COVID-19 has prevented American consumers from going to the gym, many people still seek ways to exercise away from the crowd, by engaging in in-home sports or outdoor sports.
COVID-19 has caused global factory closures and large-scale blockades. At the same time, the demand for sporting goods has surged. As a result, many sporting goods suppliers in the United States are in short supply, and the industry is facing an unprecedented shortage of inventory. Products that face this challenge include dumbbells, kettlebells, bicycles, and kayaks.
In terms of sales, commercial fitness equipment used in military institutions, cruise ships, universities, sports centers, and chain gyms has been hit hard by the epidemic. As a result, the fitness equipment market and the gym market have also set off a wave of mergers and acquisitions, and sales. The gym is also actively carrying out digital transformation and strengthening its influence on social media.
- Home sports:
In 2020, the global sales of home fitness equipment reached 9.5 billion U.S. dollars, an annual growth rate of 40%. Gyms are also undergoing digital transformation, and online courses are being promoted.
- Outdoor sports:
U.S. consumers' interest in outdoor activities has surged. June is usually the month of summer outdoor activities and is an important month for the U.S. outdoor products market. The sales of bicycles at many retailers in the United States increased by 63% compared to 2019, the sales of paddle sports equipment such as kayaks and paddleboards increased by 56%, and the sales of golf equipment increased by 51%.
Many consumers seek family activities to maintain their health. Bicycle sales continued to accelerate in June 2020, and sales increased by 63% over the same period in 2019. Although in the first few months of the COVID-19 crisis, the growth of bicycles mainly came from the sales of household bicycles, the growth in June came from the high-end bicycles that enthusiasts usually buy, including road bicycles and full-suspension mountain bikes. The shift to high-end bicycles can be attributed to the shortage of household bicycles, and cyclists who are now more willing to invest in this activity for the long term.
- Paddle sports:
The rowing sports category (kayaking, paddleboard, raft, and canoe) faced a decline before the outbreak. Traditional paddle sports goods are bulky and expensive, which is a challenge for retailers from the perspective of inventory management. However, as consumers seek activities that keep them active and distance themselves from society, existing inventory quickly turns into sales. Sales of paddle sports equipment in June 2020 increased by 56% compared to the same period in 2019. Inflatable kayaks and paddles are more popular because consumers find them easier to store and cheaper. In June 2017, inflatable products accounted for 19% of paddleboard unit sales and 9% of leisure kayak unit sales. In June 2020, they rose by 66% and 26%.
In June 2020, the sales of golf equipment increased by 51%. It was observed that many new players tried playing golf for the first time, and with the reopening of golf courses, pent-up demand led to an increase in interest in golf. If manufacturers can grasp this opportunity, it will be an excellent time to interact with new customers.
With consumers wanting to set up tents in the yard, or visit local tourist attractions, the sales of leisure tents in June 2020 increased by 31%; almost twice the growth rate of backpack tents. If camping continues to be popular, customers will turn from home entertainment to more outdoor activities and create a boon for the sports goods market. More and more consumers are eager to participate in affordable sports activities.
- Field sports:
Because many resorts restricted operations during the winter of 2020, sales of ski and snowboard passes decreased. Instead, people purchased their own equipment for these sports. The sales of snowboards, boots, and fasteners for outdoor sports grew by 137%, and the sales of accessories (beacons, shovels, and ski poles) grew by 69%. From August 2019 to March 2020, sales of mountain tourism equipment (boots, snowboards, and fixtures) increased by 15%, mainly due to the increase of 34% in mountain tourism boots, of which 6% of sales came from online.
Running is a sport that continued to see an increase in participation in during 2020. Running is considered a safe activity because it allows social distancing. As consumers are increasingly interested in seeking a healthy lifestyle, running has attracted more people to participate.
- Bird watching and natural attractions:
You can find unique birds even in big cities. Bird watching has become a way for people to connect with nature and bird watching has led to the increased sales of related products. Sales of binoculars increased by 22% in June 2020.
Sports goods popular in the United States in the post-epidemic era:
Due to the COVID-19 outbreak in the United States in early 2020, state governments announced home restrictions. As gyms, sports halls, and large outdoor parks were closed, the government also called for the use of public transportation to be reduced as much as possible to reduce the infection and spread of the virus. To find safe and suitable outdoor activities for children and a safe way of commuting, cycling has become a priority for many people, which has prompted a surge in bicycle sales in the United States. Sales of bicycles in the United States began to grow in March 2020, and sales continued to climb in April. The overall sales of traditional bicycles, indoor bicycles, parts, helmets, and other accessories increased by 75% over the same period in (2019), reaching US$1 billion. In April 2020, sales of adult recreational bicycles under $200 increased by 203%, front suspension cross-country bicycles increased by 150%, and children's bicycles also increased by 107%.
Due to the closure of gyms, athletes and many fitness enthusiasts were seeking new ways to maintain their health and exercise habits, which has caused the sales of fitness equipment to skyrocket. The sales volume of home fitness equipment for the seven weeks from March to May, 2020 increased by 175% compared with the same period 2019. Dumbbells, kettlebells, and other weightlifting equipment that can be used at home, whether in Walmart, Target or Amazon, were sold out during the epidemic.
- Stationary Bikes or Exercise Bikes:
The exercise bike is low-impact aerobic exercise equipment which provides exercise similar to cycling. Because it does not require much balance and coordination, it is easier to use than ordinary bicycles or treadmills, and can reduce the risk of injury during exercise. Many people are still not at ease about going back to the gym to exercise, so exercise bikes are loved by consumers to perform aerobic exercise at home. The sales volume of exercise bikes in April 2020 increased by 270% compared with the same period in 2019, and sales volume in July also increased by 197% compared with the same period in 2019.
Opportunities and transformation suggestions for Taiwan's sports goods industry in the post-epidemic era:
- Grasp the consumption trend of sports goods:
- 2021 sporting goods events (including FIFA and the Olympics) and a wider range of team sporting events were held, which helped drive growth in the sporting goods market.
- Virtual and physical fitness services will expand, and home fitness equipment and bicycles are expected to continue to sell well.
- As the demand for outdoor activities increases, manufacturers should pay more attention to attracting and serving the needs of beginners. Special attention can be paid to attracting beginners and young enthusiasts who love outdoor sports.
- Convenient storage of home fitness equipment for outdoor activities has also become a need in the post-epidemic era.
- The trend of online sales will grow steadily, prompting many companies to invest more in e-commerce.
- Suggestions for expanding sales of products:
According to an analysis of consumers' purchase of sportswear and shoes, to alleviate the depression caused by home restrictions, the products most chosen had bright colors and natural patterns. They were comfortable and could be worn as both sports and home casual clothing. People were willing to pay as high as 12% more for these products. When they would eventually return to the company, they could still wear this type of casual wear as it would not go out of fashion. Taiwanese manufacturers have several patented technologies for the breathability and comfort of clothing, but the attraction of their designs and colors are relatively weak. Customers are buying clothes that they can still wear when they return to the office. They want clothes that retain the feeling of "home office" yet can still be mixed and matched similar to a suit jacket.
In terms of footwear, the main purchase options are sports and leisure shoes that can also be worn for jogging and office at the same time. Outdoor activities were still a major factor in deciding the customers’ first choice of products. Although the options for outdoor sports shoes are greatly reduced compared to before the epidemic, consumers pay more attention to the elasticity and breathability of the fabric to ensure that the shoes can supply multiple purpose use in the future. However, it is difficult to display fabric materials in online shopping. Taiwanese manufacturers will need to include this information as an important message to consumers when they expand sales of such products.
The sports market is already a mature industry in the United States. Dominated by sports goods and apparel, it is creating hundreds of billions of dollars in business opportunities and continues to grow. The market for women's wearables also has shown new opportunities for development in the sports industry.
- Home fitness equipment:
Taiwan’s yoga and fitness equipment has been booming in recent years, and the United States has done the same. The difference is that Taiwan’s space is limited, and some products have emphasized features like convenient storage and home use. These kinds of product features can provide relief for American consumers, who are afraid to go to the gym, but have a small living area. Small, storable sports goods have become a market focus. According to one questionnaire, 72% of people want to maintain personal exercise plans at home, such as yoga, or exercise plans that using personal fitness equipment that can be placed at home. Seeing this trend, distributors are actively promoting yoga products (yoga mats, pedals, elastic bands), fitness products (horizontal bars, trampolines, dumbbells, skipping fitness ropes, small treadmills, boxing, bicycles), and fun and sports personal products (snooker, basketballs and basketball hoops, badminton, frisbee, etc.). Such distributors have been willing to cooperate with small businesses to ensure that the products they put on the Internet are more diversified. Taiwan’s yoga products have diverse designs and are attracting consumers' attention. Taiwanese manufacturers have also developed compact, multi-functional fitness equipment, such as folding treadmills or treadmills that are easy to store and can share exercise information online. Such products not only encourage users to exercise at home but also help users maintain social relations, and are gradually being valued by Americans in metropolitan areas.
- Outdoor sports equipment:
According to one survey, 66% of the respondents hoped to increase their outdoor activities after the epidemic. Hiking, climbing, fishing, hunting, etc., could be enjoyed without having to stay indoors, and would maintain social distancing. Bicycles and their components manufactured in Taiwan, as well as camping and mountaineering products, would meet these needs. Instead of long trips to national parks, people now prefer walks and bike rides in tree-lined trails near their home. Lightweight electric bicycles, foldable bicycles that can be stored at home or in the car, children's bicycles, bicycle racks, and other composite functional bicycles have been in high demand during the epidemic. Besides their use for leisure, bicycles can be used to avoid public transportation and reduce the cost of driving by cars.
- Camping products:
Outdoor activities and camping are recommended activities as they expose people to nature. Hiking, golf, tennis, cycling, surfing, snorkeling, and scuba diving are all sports that people can try for the first time once the epidemic has slowed down. Online sales of these products have become a trend with US distributors and will continue to develop in the post-epidemic era.
- Online courses:
To create the experience of exercising in the gym, online exercise teaching apps have also increased significantly. The number of members and sales volume of well-known online sports APPs has increased, showing consumers' outstanding demand for smart fitness equipment. Digital fitness courses, equipment, and related product accessories will be the trend of future development.
Published by Dec 23, 2021