Today on THE ROCK FIGHT (an outdoor podcast that aims for the head) we take a look inside the Outdoor Industry Association's latest participation trends report.
Since 2007 the OIA has published the trends of who is going outside. And this year participation hit an all time high while core participants dropped.
And it begs the question: how will these numbers impact the industry?
In order to make sense of this trend Kelly Davis, Director of Research of the OIA and Wes Allen from Sunlight Sports in Cody, WY join Colin to dig a little deeper into what retailers and brands should take away from this new data.
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Episode Transcript
Colin (00:00):
Welcome to the Rock Fight where we speak out truth, slay sacred cows, and sometimes agree to disagree. This is an outdoor podcast that aims for the head. I'm Colin Truman. Today we're talking about the impact that will be felt at the register by the outdoor participation report recently released by the Outdoor Industry Association. But first, please be sure to follow and rate the rock fight wherever you're listening. If Apple Podcasts is your preferred podcast app, leave us a written review and send a screenshot of that review to my rock fight@gmail.com and we'll send you a gear and beer and rock fight sticker. But whatever you do, leave a five star review on any of those podcast platforms and head right now to rock fight.co to sign up for our weekly newsletter news from the front and comes out every Sunday with advanced copies of the articles we post throughout the week. Okay, let's start the show
Chris DeMakes (00:51):
Fight. Fight.
Colin (00:55):
Last week on the rock fight we put up an episode titled The Secret of Going Outside that referenced the recently released annual participation report that the Outdoor Industry Association puts out each year. The info in this report is generated through 18,000 surveys conducted throughout the course of the previous year and determines the activity level of the US population from ages six on up when it comes to human powered outdoor sports. I think it's like 50 plus categories. This report has been generated since 2007, giving us 17 years of data and trends, and 2024 gave us three notable metrics. The first that the total number of participants in the US hit an all time high of 175 million in 2023. Second, the percentage of women participating in outdoor activities crossed over 50% for the first time, and three core participants are on the decline. Now the paradox of participation being at an all time high, but the core being on the decline is what has caused the most buzz when it comes to this report because of what it could mean for the outdoor industry.
(01:56):
Outdoor retailers often rely on the consistency of core participants to support their business. So if new folks are finding the outdoors at a record pace, but the people who recreate the most who are on the decline, what does that mean for the soul of our industry? To dig into this, we have two guests with producer Dave and myself today. Kelly Davis is the director of research at the Outdoor Industry Association and has been the face behind this report since it started. Chances are you've seen her breaking down trends at trade shows at some point. And we also have old friend Wes Allen from Sunlight Sports and Cody Wyoming, and he's here today to offer the perspective of a retailer and talk about what challenges or potential upsides retailers can expect as our industry evolves. Welcome back to the Rock flight, where today it's the retail impact of the OIA a's participation report. Kelly Davis and Wes Allen. Alright, well we're joined today by Kelly Davis from the Outdoor Industry Association and Wes Allen backed by Popular Demand from Sunlight Sports third time. Now Wes, you're coming for a Patty's record. I feel like Patty O'Connell's in Colorado right now starting to sweat a little bit.
Wes (03:02):
I hear there's a jacket at five times, so I'm really excited about that.
Colin (03:05):
It's starting to get some buzz. I really feel like we're going to have to make it.
Producer Dave (03:08):
It's a waterproof, puffy. That's right.
Wes (03:12):
I don't have any of those. I'm very excited now
Colin (03:15):
I feel like we should make one and expect everybody fight over it. That's probably what we should
Wes (03:19):
Do.
Colin (03:20):
But seemingly everything else in life these days, the outdoor industry is finding itself as an added sort of interesting spot in its history. And I was perusing the latest participation report put out by the Outdoor Industry Association, which is basically a passion project by Kelly Davis now, and it drove home the point that we are in a time of change and I wanted to see what we could learn from the trends in this report with the retail presence as well. So Kelly, let's start with you. I mean, can you just give the audience a broad overview, the key takeaways from the report or if someone listening says doesn't really know about it, what is the report exactly? Maybe that's probably the best place to start.
Kelly (03:55):
Yeah, I mean it's pretty simple. It's counting participants and outdoor and looking at it by activity and looking at things like frequency of outings, demographics, who's doing what groups of people are doing specific groups of activities and what does that look like and what can we learn from it? How can we look at this data and learn a more about who our consumer is and B, how can we grow this participant base? How do we keep it growing and not just from the standpoint of let's just have more people participating, but let's have the people that are participating participate more. So it's sort of a learning experience. It's really kind of nice to be able to look back and we've been doing this study since 2007, so we've got comparable data on all of these metrics. Going back to 2007. I can see through that period what happened up to the pandemic and then the explosion during the pandemic.
(04:55):
I can see things that are happening over time and that's kind of an amazing thing with data. I mean it's a big data set. It's huge. I love getting it. I get it on April 15th and this year I got on April 19th and it's a big day. I mean I wake, it's like Christmas for me. I open that thing and it's like I'm ripping the paper off going, okay, how many And this year, so when I looked at it, I was expecting, okay, don't be surprised if you've got zero 1.5% growth. Just take a breath. Well,
Colin (05:26):
Before you get to that, what is usually what do you expect from a growth perspective? Or is there usually just a little bit of a margin of error, kind of grows or shrinks a little bit every year?
Kelly (05:36):
Well, we have so many responses. Well, we have a quota of responses. We get 18,000 responses a year to the survey. So the margin of error at the top line, it's nearly zero at the top line. We get down to sports like adventure racing, the margin of error is a little bit bigger, but in this case we've got just an enormous amount of data from 18,000 and we do 1600 interviews a month. So it's spread out and that helps for example, because they're not calendar year, they go season to season to season as an example. But yeah, it's a pretty amazing study and I think that at some point survey methodology is not going to work anymore, but we're not there yet and we've got a panel of people that are willing to take long surveys. So if anything, we're undercounting when you think about what the bias might be of people that sit around and take surveys for points that target. But yeah, you get the idea.
Colin (06:37):
Well, outdoorsy people are notorious for wanting to tell you all about what they do. So I think this is probably a good survey for an outdoorsy crowd. It
Kelly (06:45):
Kind of is. Listen, I'll tell you, this is my equals one moment I joined their panel so I could take their surveys and survey. They never did send me this survey, which kind of sucked, but I had to take a whole bunch of 30 to 45 minute surveys about bullshit, where are you shopping these days? At that point I was like, man, I've got better things to do with my time than do this. I think I can earn five bucks and 10 cents on somebody else's lawn or something if I'm not
Colin (07:15):
Desperate. I dunno if the retailer on our call note thinks that's bullshit, but I hear what you're saying. Okay, so get back April 19th, you open up this year's survey, what do you find?
Kelly (07:24):
I find that we grew 4.1% and after a year where we had already grown about 4%, so we went to 175.8 million participants and that's 57.3% of the American population over the age of five. So six to death. That's pretty amazing. I saw that the women in outdoor finally pushed past 50% participation rates. So more than 50% of women finally are participating in outdoor. It's 51.5. We gained 1.5%, which is kind of huge actually. So
Colin (08:06):
Put that in context. Historically, going back to 2007, maybe not exactly, but where were we around then from that 1 75 and even the female participation number? How much have we grown in the past
Kelly (08:18):
20 years? So just to give you perspective, I'll go back 10 years, how about that? We had 141.6 million participants in 2014, and that was about 47% of the population. We're at 57. We've gained 10% of the population in 10 years. I mean, we're up since the pandemic, we're up 22.2 million participants.
Colin (08:47):
So the pandemic bump is sort of holding strong and continuing to grow.
Kelly (08:52):
It is. It is. And I kind of expect it to plateau and it's just not. And it's looking like a lot of people are just, Hey man, hiking's fun, let's go for a hike today. And I call my buddy, let's go for a hike today. That sounds good. That's kind what I'm seeing going on.
Colin (09:08):
And we're going to get into the hardcore participation that's kind of the other side of this number. That's almost the downside. But Wes, just to throw it to you for a second, when you see these bigger numbers, I mean you've been in the retail game a long time and I want to get to what you're seeing at the register, but what's your reaction when you see that top line number? Is that surprising to you that the growth has been so strong?
Wes (09:27):
It's not surprising. I think that one of the, well, it's not surprising, the pandemic bump was real. You couldn't go to restaurant, you had to go outside for a hike or whatever. And one of the things that we do know about outdoor recreation participation is it's generally pretty sticky in that you get into it even if you're not doing it once a week, once you get yourself a pair of hiking shoes, you occasionally go, it'd be nice to go out and take a walk around outside, or I should get back on my bike or let's get down to the boat ramp and I've got a few hours. Those kinds of things are sticky. So an increasing participation is not that surprising thing. Surprising to me, and I also, I have no data to support this, but I do believe that people just don't like to be alone. And I think we're still coming out of a period of isolation around the pandemic. I think it's just natural to text your friends or DM 'em or something and say, I'm going to go out and do X, Y and Z. Do you want to go with me? And that increases participation, social connections, increase participation. So it's not surprising to me.
Colin (10:44):
Yeah, my household is that we're going to get into the hardcore in a second here. That's me obviously I've defined my life and career around that. My wife is she mountain bikes, she likes to trail run, she loves these things, but it's relatively infrequent, but she still is motivated to do it. She still says, oh, I'm going to go do this. That might be weeks in between, but she still goes, you're right, it does. It gets to that sticky point for just about everybody, but let's get into that part of it now. So Kelly that we have the hardcore participation, right? Is it hardcore using that? Is that how you guys, the phrase, what's the word you guys use? Core participation?
Kelly (11:15):
Yeah, we use core and everybody wonders. Well, what's core? Everybody's got an idea in their head of what a core participant is. Even I do mean when I do my little bias worksheet and I go, well, I have archetypes in my head too. In the core I've got core climbers and paddlers and they're all in my head and they all live in there, but it's really just a frequency metric. That's all it is. And at the beginning of the study in 2007, outdoors sat down with the pack and said, okay, based on previous studies, the frequency of participation that is required to be considered a core participant, each activity is this, and it's different for each one. For example, to be a core participant in running road running specifically, you have to participate 50 times or more in a year, which seems reasonable. I mean if you're not running once a week or maybe you take a couple,
Colin (12:09):
Yeah, are you even a runner?
Kelly (12:11):
I mean it'd be considered a core runner. That's a pretty low bar. And for trail running, it's only 26 times or more,
Colin (12:17):
Right? Oh, come on now trail runners are running way more than roadrunners.
Kelly (12:20):
Well, as a trail runner myself, I'm like, what that? But I have a theory about that and I can only theorize a little bit, but I think a lot of road runners are sampling trail running and we're counting them as trail runners. And so the core looks a little smaller in trail running or trail runners are running road. And then I think maybe trail running is a treat for a lot of runners and maybe it's just to cut the boredom. You can't eat chicken every day, you know what I mean? But
Colin (12:49):
The point is that this is the basis of which these things are kind of built off of for metrics point, it's
Kelly (12:54):
Kind of an idea. And I would say a lot of people have said, well, maybe it's time to change and I kind of don't want to because that affects comparability of data going back and I have the actual frequency so I can see who the super duper hardcore people are, the people that are participating in something 365 and I've got those people, but these numbers are just a cutoff in frequency. So we can say, okay, this percentage of this activities participants are relatively frequent, they're doing it enough that they're probably buying, they're probably acting like that core consumer in terms of their buying habits. We want to look at this in terms of what information can we deliver from this to guys, Wes, to help him understand just in the overall base that might help retailers understand their consumers better.
Colin (13:49):
So where are the core participants in this year's study?
Kelly (13:54):
So this is when the data gets a little bit painful right now, 28 on average, each outdoor activity, when we look at what percentage are those frequent participants in 20 23, 28 0.8% was the average percentage of core participants in each activity. And that translated, and this is a sum count, so I'm just looking at counting the number that fit into that core category in each of the 51 activities that we measure. And that number this year was 88.4 million. So it doesn't math, don't try and math it because a lot of those people are poor in a lot of different things. So that includes crossover. That's just the sum of all the people that count as core participants in each activity. So it's 28.8% on average for activity. And just going back, just to give you some perspective, I want to know too, back in 2014, it looked like 33.8% of the participant base was core, but remember that's when the participant base was only 141.6 million, so yeah, it was a much higher percentage. That was 98.6 million were counted. Do we
Colin (15:09):
Know why? Because I think when we first spoke about this on the rock fight a couple of weeks ago and Justin Hausman was here and he was kind of thinking, well, if more people participating, even if generationally we'll get into that bit in a second, it's changing, you'd still think more people would be, there'd be more core athletes or core participants. So do we have any idea why that number might be going down?
Kelly (15:32):
I mean, this is the best cocktail conversation in the world for outdoor. This is way better than how many
Colin (15:39):
Days? What do you think it is, Kelly? I what's the best? No, the best cocktail. What's the best cocktail?
Kelly (15:47):
I had this whiskey sour something the other day with. Yeah, it was amazing, but I think it's a lot of things. This is like a multivariate equation where you just keep chucking things in and to see what has an impact. It could be, we've got a lot of screens to look at these days. I look at the frequency of participation of kids. It's going down too. Same thing. They've got a lot to do indoors and I think I'm seeing a trend, especially in team sports where you get kids really, really young that they make super core, that they go just travel league and that they're just super core. That is true. I'm wondering, and I haven't seen a ton of evidence for it yet, but I'm wondering if the same thing isn't happening in some of the outdoor activities where it's just if you're going to be core, you're going to be just super, super core. You're going to be on the mountain bike racing
Colin (16:44):
Team. The generalist has gone away and now it's my family and I go mountain biking and that's it. I have a
Wes (16:50):
Question for you, Kelly. Yeah, and that is, so I'm listening to you discuss the core participants and that in this last one we had 28.8% percent of participants being core participants.
Kelly (17:03):
Well wait, that's 28.8% of the activity of each activity is core participants.
Wes (17:11):
I just want to clarify when we're talking about these participation rates, when we talk about core participants, let's say that we have somebody, we have one person that goes out and goes mountain biking 52 times a year. It seems like that would probably qualify as a core participant, correct?
Kelly (17:36):
Yeah, absolutely.
Wes (17:37):
Okay. If they have a friend that they get to go mountain biking occasionally and that person mountain bikes 12 times a year, but they 12 times a year and they go road running 12 times a year and they go fly fishing 12 times a year,
Colin (17:56):
Are they core?
Wes (17:57):
Is that person meet the definition of core outdoor participant? This person B? They
Kelly (18:03):
Do in a weird way. So I've got a little category which is 51 times or more and they just have to participate 51 times or more in
Colin (18:11):
Anything in outdoors
Kelly (18:12):
And it's like 7%. Yeah, it's like 7% and the person you're talking about, I've thought about that person a lot. I might be that person a little bit.
Colin (18:24):
I'm kind of that person now. I've sort of given up on hardcore or anything and I just do a little bit of all of it. But Wes, when you hear some of this, because we can get into, obviously we can peel this on you and of why all day long, but I posited last week that the impact of the lack of the hardcore core participant is what's going to really impact the retail front, which is one reason we wanted to bring you on because that's the person you see almost weekly in your shop. It's not the person who just came in and they're in town and they're coming in, oh, we can pick something up and you never see them again. It's like, oh, hey, it's Joe's here. He needs socks again. Right? So does this terrify you hearing this does this or is what do you see through your eyes when you're hearing these numbers?
Wes (19:09):
I think that anybody who makes their living selling stuff in the outdoors looks at a participation study like this. It's got significant changes and there's always that little twin of, oh no, we've done these things for so long. Now they're changing. What are we going to do? There are a couple of things though. I do think that for every change there's an opportunity just in general. I think a lot of retailers who are at their heart optimists who about that, that way it made me really interested though because I had gone through the participation study when it came out and then I had listened to your episode of the rock fight that was the one previous or two previous to this particular one where you're talking about the knock on effects on the outdoor retailers. And so I called a person, I know a guy named Dirk Sorenson who's got a company called Curiosity Cartel.
Colin (20:06):
Great name by the way.
Wes (20:07):
It is really a great name. He's super sharp. What they do is they get cell phone data from individual consumers and they track their shopping behavior into active sports doors. So he is watching where consumers are moving around and I wanted to hear what he said about this, what's happened in the last 12 months, how might we be able to correlate those things with what we're seeing in the participation study that Kelly did and he had some very interesting tidbits and I think anybody who would really want to dive into the data and understand and maybe get some strategy around it, we're going to talk, I'm going to tell you the high level things I learned from him, but the data both in the participation study and that curiosity cartel is kind of so deep that it probably takes a lot more really engagement with it.
(21:11):
But top line, here we go. There is a shift in where people are going when they're engaging with retailers and it's really interesting. One of the shifts is this, the winner in changing visits of outdoor participants. There are two winners right now. One is Dick's Sporting Goods. They're seeing a lot more traffic into there. And the other winner in this, ironically, and I know it's coming from me and I am definitely a homer for specialty outdoor retail, but Dick's Sporting Goods and Specialty are both seeing a benefit from this shift in participation. They tend to be younger customers and the Dicks thing that checks, if you've got family just like Kelly was talking about, and you've got kids and you're going to go get some cleats or you're going to go get a BAT or a MIT or whatever, you're probably going into, that's the most common store for you to go in and because they have exposure to outdoor, you might have the ability to buy stuff there too. The thing that was also very interesting is that the door swings at REI that he reported have declined significantly and their average customer is older than it was even 12 months ago. They're aging. That does tie into some interesting points that Kelly had in the participation study where there was an increase in participation with the older consumer. I think Kelly, the thing that I read was that there was increase in 60 plus participation,
Kelly (23:08):
Right? Yes. Five and over had a 12.5% increase in 23. It was amazing,
Wes (23:15):
And that's where you're seeing the strength for REI, but the younger consumers, you're seeing strength, like I said in DSG and in specialty, and I think that married with the conversation about participation has some really profound implications on strategy going forward.
Colin (23:35):
Just connecting dots and think, trying to think this through logically that tracks and even anecdotally speaking, because at this point in my life as a consumer, Dixon, REI are pretty much interchangeable. There's a Dicks that's closer to my house, so if I need something that I would go to Dick's for the same reason I go to an REI, because I'm not going for the experience I'm going for, I need something for a trip this weekend or whatever it is, and I could pretty much get almost anything I would get at an REI at a Dick's. Now if I wanted to go shop something very specifically and I knew that REI had a deal or something like that, then there's a reason to go there versus my specialty retailer, which is always going to be my default to number one. I like shopping at specialty stores, but it's a really interesting thing if other people are seeing that as there is an interchangeability there between Dick's and REI, it's creates an opportunity for the specialty account to further differentiate themselves from those folks. And the REI experience has been tough lately. I mean either whether it's politically or union, whatever it is, we've talked about it Wes in the past, so it's a really interesting point about how this actually could shake out and where the opportunities lie and where the pitfalls lie.
Wes (24:45):
I just want to give one more piece of information there that kind of correlates exactly what you just said, Colin, because one of the things I learned from my conversation with the folks at Curiosity Cartel was about trade radius, meaning what's the area that any particular door pulls customers from for both an REI and a Dick's Sporting Goods? Their trade radius is pretty small. It makes sense. A lot of them are suburb, they're placed in suburb in neighborhoods, so just generally shorter, the trade radius for specialist retailers is quite a bit larger, so people will travel further to go to those stores, but the saturation and the distribution of things like REI and Deck Sporting Goods leads to them being more of a shop that people go into for convenience perhaps. Again, there's data and then there's what you take from it and you have to be careful about the assumptions you make based on some of it and if it reinforces your biases, but I think there's really some meaty intersections between that participant data and the cell phone tracking data that we see in the outdoor space.
Colin (26:01):
Before we move off to this, what are you seeing in your store? Do you see any correlations between the folks coming in your stores, the buying habits, even just too deep in the weeds, but even the revenue cycles? What are you noticing? Are there any correlations to what Kelly has in her report?
Wes (26:18):
Well, I think there are a few correlations that I would say or things that I see as knock on effects because one, a lot of the buying power is with an older customer, the boomer generation or whatever you want to call it, they are the most financially secure cohort by age in the us, and so you still see them spending quite a bit of money. When you look at people who are in the younger cohorts, they're being pressed by just a heightened cost of living, and so I know that what we see is more price sensitivity. They're anecdotally the people who are coming into our shop. We have a relatively young demographic. They are price sensitive. They want to support the people in their community. They also really need to make sure that they are getting the most they can for their money. The other thing that I would say that I think ties into all this participation stuff, and I think I would be remiss to talk about is what they're buying. We've talked about this before. You can have somebody who's come into any retail location that sells outdoor gear in the last 12 months or 24 months, and maybe they came in 10 times, maybe the second time they came in, they bought a road bike and they spent a lot of money and it was seven or $8,000. Well, they might've come in six more times since they bought their road bike. They did not buy another road bike. They bought gels, they bought a repair kit. They may be buying
Colin (28:01):
Chagrin like, Hey, you want to buy another road bike? That'd be pretty great
Wes (28:05):
If we sold road bikes, I'd be all in on that. Yeah,
Colin (28:07):
That's a good point.
Wes (28:09):
But we do see that in the conversation in the retailer community is very much that in that, as everyone has heard ad nauseum, those big ticket purchases happened right after stimulus and when everybody was trying to figure out what to do, there is still traffic. We're still seeing those customers come in, they're buying different things and it has an effect on people's revenue.
Colin (28:35):
Kelly, when you look at your report, what activities are you most bullish on? I mean, obviously I'm assuming hiking is just right at the top. Hiking's always right at the top, right? Yeah. But is there anything that kind of surprises you on the actual activity side?
Kelly (28:46):
Birding and wildlife doing never ceases to stop Amazingly. I mean, the frequency of participation and birding is one of the highest. It's like 57 times a year people just go out and look at and you've got to go a quarter mile from your house. It doesn't count. Look out your window
Colin (29:04):
Constantly. Is that the progression? Everyone says they hate running, and then you get older and you have kids and jobs and you start running. You have to then eventually your knees give out. So you start birding. Is this just a
Kelly (29:14):
Progression? It's like a hardcore triathlon and now I'm hiking. I am now a pedal kayak angler. I dropped a couple thousand on that this year because I am, I just needed something new and I think that it could be a progression. It could be, Hey, I'm not going to tear it up on the trail anymore, but look at that owl where I'm, so, yeah. Yeah, I think that might be happening. So I'm most bullish on hiking, camping, fishing especially. Freshwater fishing is nuts right now, especially with women who knew bicycling, all of it, especially mountain and gravel and I want to start measuring gravel. I think gravel's huge and I'm always going to be bullish on running and trail running always.
Colin (30:05):
So for both of you though, what can brands do? What should brands take away from this report? Sort of the one maybe slot that isn't kind of filled on this call. I mean, we all sort have to get data, digest data and how do we go forward using that data to inform our decisions? What can brands do better to support consumers and retailers as the landscape changes?
Kelly (30:25):
For me, when I think about it, I'm thinking about it at a super high level. I'm thinking about really understanding consumers. So I would recommend as a researcher, you've got to do segmentation and build personas and really think about how things have changed over the past 10, maybe 15 years, because we've seen some trends that are long-term that way and really think about that in terms of the deep, deep questions. What motivates people to go outside? Has that changed? Who am I seeing outdoors and how has that changed? Because it is, I mean the new participant and young participant is a much more diverse group and there are more of them. So the motivations for going outside of changed and you really need to understand why your consumer is going to do the things that are going to lead them to buy your product and really think from that level.
(31:18):
You've got to really think from the consumer up rather than build it. And they will come because we know the core. We are the core. We're going to build things for the core and here they are. That doesn't, you'll still be able to survive that way, but growth will be a problem if you're only looking at the industry from that perspective. So that's what I think about when I'm thinking about this report and what the implications of it are, and there's a lot of inference in what I just said. So that's what I hope is to just start more conversations like this about what we can do.
Colin (31:53):
For a long time, it bothered me the way brands would a few years ago especially, probably the pandemic shook it out of them, but there was still such an adherence to marketing to the core when the landscape had so obviously changed and so many more people were participating. And it does feel like that's softened quite a bit now, and people, brands seem to understand that their audience is larger than that, but now it's here, it's in black and white data is like, Hey, actually you're marketing to the one part of this report that's declining. So if you're still trying to be a super hardcore brand, maybe you should try something else. So Wes, what do you think?
Wes (32:24):
I think it's really, all these conversations are super interesting. I think there's a tendency for all of us to maybe paint everything with a really broad brush, but what I would,
Colin (32:39):
Yeah, it's a podcast. That's what we do here.
Wes (32:45):
Okay, point taken. What I'd hope brands would do with this is I think that they would want to dive a little bit deeper. I think that one of the things that we're going to see over the next eight to 12 to 18 months as profit is going to be really thin on the ground. People are not going to be making as many dollars selling things, or at least they're not going to be keeping as much as margins go down. There's a lot of product in the, there's a lot of product in the system right now. So as you look at it from a brand perspective, I think that you would really want to spend time understanding what parts of your line resonate with what consumer. So you talk about a casual versus a corp participant, and every brand of any size has some product that's aimed at somebody who's just getting into it and somebody who's enfranchised what you would hope, or at least what I would hope to see from brands is a little bit more thoughtfulness than they've had to use in recent years about what they make, how much they make of it and where they put it.
(33:58):
So we go back to both participation and visitation. Data. Brands that are going to succeed are going to pull back. They're going to say, okay, we have X, Y, and Z business partners, business partner X over here. They get this demographic that matches up with this particular thing that we make in our line. Y gets a different demographic and this matches up here and Z, they get a demographic that really doesn't match up with our line at all. Recently, they would just sell everything to everybody, and if Z wanted to buy a bunch of stuff, they would sell it to Z, even though that it wouldn't move and then it would pollute the rest of the ecosystem. I think that anytime that you get access to data like the participation survey and the other data about not only who's participating but how they're interacting with a business side of the industry, you would hope that successful brands would step back and they would have that high level strategic overview. The thing that got us out of that was honestly four or five years ago when the pandemic happened, you could just pour product wherever it wanted to, wherever you could put it, and it would just go away. We are not in that spot right now. I think that there's a lot of information. I think there needs to be a lot of self-reflection both on the brand side and on the retailer side about what product is going to get placed, where and how that can be most efficient, most effective.
Colin (35:30):
I think I got everything we need to on the topic though. Anything we missed, Dave, that we want to make sure I should
Wes (35:34):
Ask? Well, I did want to just point out though,
Producer Dave (35:36):
Colin, this whole discussion between core and hardcore core is for the participation study hardcore is for the school of rock. You're not hardcore.
Colin (35:47):
You're not hardcore. You're not hardcore. I think that is true actually. That was proven. Thank you, Richard Link later. Yeah,
Wes (35:53):
You have to ask,
Producer Dave (35:54):
Actually one more question for West there. You did get kind of into it and I wanted to ask it at the front end when you were talking about, so we've got this influx of participation. So on the top end, it is rising. It has been rising. What is the most effect on your, have you changed what you bought? Have you seen this new customer come in? You are in a special case in the sense that you're a core specialty retailer in a very core specialty location. So I would imagine your store in a larger market might have a different perspective on this, but I'm just looking at you. Where you are is what I call in my kind of world an aggregator town. You're in a place that aggregates outdoor enthusiasts of all kinds. They come for the nature, they come for the small. That's a great place where you bring people together. What does this top line participation increase mean to you from just how you've run your business over the last couple of years?
Wes (37:00):
I think we viewed it as a great opportunity. I think just from a business perspective, one of the things that any retailer and an outdoor activity will tell you is that the more profit or the earlier someone is in their journey and getting involved in an activity, the better business it is to be involved with them when people
Colin (37:24):
Are, so you're taking advantage of the uninitiated is that basically you're saying
Wes (37:26):
No, you are making a living by inspiring people to want to get outside. I like that.
Colin (37:34):
Who does
Producer Dave (37:34):
Your pr I taking a page out of package. It is good, right? Toothpaste preference, razor blades. Let's get, I'm
Colin (37:40):
Teasing, but right. It's true. I mean, that's when you don't have to be you in, if you're a new sport or a new activity and it's at early days, you're like, oh, I'm going to try this now. Oh, you know what? That shoe didn't quite work for me. Let's go try this one now. Absolutely. That's the benefit to the retailer without a doubt. Yeah,
Wes (37:55):
It's a huge opportunity Related to this, I will share a SAT that I've seen replicated through studies time and time again that is that less than 20% of people ski a second time.
Kelly (38:07):
I might have done that study
Wes (38:12):
Your first time going skiing, like bad boots, standing in the rental line forever. Hold on, the lift cotton socks. All of it is so bad that the vast majority of people never do it a second time. Speaking about my particular retailer, our focus more and more is people are getting into this, and it's not as much the enfranchised people that are visiting our store, but it is a younger person who's getting into it is, I know this sounds very trite, but it's to be welcoming and not intimidating and to have stuff that you would want to give to somebody for their first time to go out. You don't need a pair of $300 full steel shank boots to get started into hiking. The people who got started in the eighties and nineties, that's how they got started. Well, you
Colin (39:08):
Used to think that though, right? That was the deal. I mean, I kind of mentioned in the episode last week or even in our outline about there was this rebellious nature to it and the hardcore thing was more real. It's like, oh, you're doing that. You're such a badass if you're out doing that and don't you want to be like this? But the barrier to entry was much higher. You had to get over that to kind of be seen as one of those people. And now it's much more welcoming. I mean, go on TikTok and see what the thing kids are watching. It's much more about mental health and physical health and all of these things that are much more empowering sneakers. What?
Wes (39:38):
Sneakers and sneakers
Colin (39:39):
And sneakers. Yes. Or flip flops even.
Wes (39:43):
And you really want to work with partners that get that right. You want to work with, you want to work with brands and you want to work with the other partners that understand that that is the case you take. We've seen the trend in decline in hardcore users. We do sit right outside of one of the premier outdoor spaces in the us. We're in the middle of it really. And back way back the before times when I started working at the retailer, we sold a ton of big packs because everybody was going out for 12 and 14 days and it's pretty well documented. That is a thing that has fallen off quite a ways. We now focus on things that you can pick up and if you're going to go out for a morning and then you're going to go have lunch and everything, that's fine. We still have the big packs and we still want to be there for that customer. But if you really want to welcome people into the sports, you have to make it so that you need to present an environment that's both inspirational and approachable. And that really, that's been our mantra, especially over the last four or five years.
Colin (41:02):
So Kelly, let's give you the last word. As we look ahead here, based on everything you've seen, what kind of predictions are you willing to make? Or do you expect these trends just to continue? Or are we in a place where it's kind of chaos and who knows what's going to happen in 2025?
Kelly (41:15):
I mean the patterns are starting to play themselves out. I mean, one of the things that I'm watching really closely, and this is going to sound weird, but I'm watching inflation, I'm watching general consumer spending because I think that's more indicative of what we can expect in our market, especially in our younger demographic. I mean, the one thing I love about the 55 plus crowd is they've got time and money, and it sounds like Wes has experienced that with that crowd too. But right now, younger people are getting squeezed like crazy, man. It's like a stake is 30% more expensive than it was three years ago. Your housing's 30% more expensive than it was. It's insane. And if you're young and you're struggling, maybe you're saving up for a ski pass, you pay your $1,200 for a ski pass and what do you have left over so that you don't have to eat ramen and beans and rice for the rest of the year? So I'm watching those metrics most closely to try and see what we can expect in terms of spending in the market. In terms of participation, look, I've spent two years of me going, well, I'm going to be conservative, so I'm expecting 3% growth, which is less conservative than I used to be, but I mean we're getting close to the same participation rate that coffee has in the us. So at some point things are going to, things are probably going to even out a little
Colin (42:47):
Bit. I don't think that's an accident. I just want to say I think there's probably real reasons for that.
Kelly (42:52):
Yeah, we're
Colin (42:52):
Definitely, I love both things. Those things. We've
Kelly (42:54):
Expanded alcohol, so we got that going for us. So yeah, I'm expecting continued growth, and I just want to make this clear. There's huge, huge opportunity in the new people that have joined and are not considered core by frequency yet. If we got those people just going out and it's about 90 million, they're casual. Just one more time. I mean, that's a lot on things and there's an economic impact there. So I think that if inflation cools and the economy stays stable in terms of the labor market and we're starting to see prices actually go down in certain places like food, if we can continue to see that, then I think we're going to see a healthier retail market. And I think participation in terms of at least the casual participant will continue to grow at about 3%, or I'm hoping that this is where the conversation really is at. Can we get these new participants participating more if they started hiking, are they going to start camping? Are they going to start fishing? And how can we help them along and what points in that journey can we push on to be most effective in helping them explore more opportunities in outdoor? That's what I think.
Colin (44:13):
Yeah, maybe it just could be a bit of a transition. I mean, it'd be interesting to see the reports like 10 years past the pandemic, right? A lot of people come into it and then all of a sudden just we have an avalanche of new core users because they've just sort of now really gotten into it started kind of casually. We'll see. It'll be interesting to monitor over the next a few years here for sure. But thank you both very much for coming on the show. Really interesting stuff. I think it's great to dig into it and really appreciate it.
Speaker 6 (44:38):
Thanks. Thanks for having us, Colin. Hey, thanks Wes. Bye, Kelly.
Colin (44:42):
Alright, that's the show for today. What do you think? Will core participation go back up? Are retailers screwed? Do you like Dick's as much as REI? Send your feedback to my rock fight@gmail.com. The rock fight is a production of rock Fight LLC. Our producer today was David Carta. Art direction provided by Sarah Genser. I'm Colin true. Thanks for listening. And here to take us right towards those westbound signs and just to leave town tonight. It's Krista Makes with the rock Fight fight song. We'll see you next time. Rock fighters. Rock
Chris DeMakes (45:12):
Fight, rock fight. Rock fight, rock fight, rock fight. Rock fight. Here we go into the rock fight where we speak our truth, play sacred cows and sometimes agree to disagree. We talk about human power, outdoor activities and pick bites about topics that we find interesting like culture, music, the latest movie reviews, ideas that aim for the, this is where we speak our truth. This is where we speak our truth. Rat to the welcome to.