Outdoor recreation boomed during the pandemic, but could be plateauing

If you headed into the mountains (or the woods, or the lake, or the desert) to escape a tiny city apartment during the pandemic, you probably noticed you weren’t alone.

If it seemed like the entire country was flooding into campsites, RVs, and national parks, it’s probably because, by many accounts, they were. According to a report commissioned by the Outdoor Foundation, 2020 saw the highest participation rate on record in outdoor recreation. Visits to parks like Acadia in Maine saw record highs in 2021, and sales of products like sport racks, tents, and sleeping-bag liners saw massive growth.

“It was a really good two years for outdoor,”  Kelly Davis, director of research at Outdoor Industry Association, told Retail Brew. “One of the dark gifts of Covid is that everybody got outside.”

While the outdoor retail industry wasn’t immune to the impact of the Covid-19 pandemic, nor is it immune to the challenges of high inflation and supply-chain disruptions, experts say the industry’s outlook is a hopeful one.

“The outdoor market does tend to be pretty resilient,” Davis said. “We fared the 2008 downturn pretty well, and I think we’re going to fare this one fairly well, too.”

Lay of the land

Participation in outdoor recreation doesn’t necessarily follow the same path as outdoor sales, Davis explained.

“When the economy is bad, that’s good for some outdoor categories, because these are options for entertainment that are super low cost,” she said.

• The outdoor recreation participant base has grown nearly 7% since March 2020, according to Outdoor Industry Association data. The biggest jump occurred between 2019 and 2020, but 2021 saw the industry continue to expand.
• Some categories, like team sports, saw declining participation during the pandemic, Davis said, while others, like walking for fitness, gained participants.

2020 may have seen the biggest growth in participation, but outdoor industry sales during that year were down by 3% from 2019, Matt Powell, senior industry advisor for sports at market research firm NPD Group, said. 2021 was a different story, with sales increasing by 29%.

“We’ve seen this happen in many of the categories that NPD tracks,” Powell told Retail Brew. “There was so much stimulus money in the market last year that it really artificially boosted the business. And in most cases, categories had a record year last year. This year, there is no stimulus money, so we’re giving back some of those gains.”

• In 2022, outdoor industry sales are flat compared to the 12 months prior, Powell said.
• Despite that plateau, outdoor industry sales are still above pre-pandemic levels, he added.

Davis said that outdoor retailers suffered from supply-chain challenges, just like any other industry during the pandemic, and that the fallout from those disruptions are top of mind.

“We’re thinking about the economy, and we’re thinking about what happens when you’ve got demand distortion caused by supply-chain disruption,” she said. “We’re all sort of trying to suss out how to avoid the worst of the bullwhip effect.”

• The bullwhip effect refers to waves of exaggerated consumer demand that ripple up the supply chain, sometimes leading to excess inventory.
• But despite changing consumer demand and high inflation, prices for outdoor goods haven’t seen any significant increases this year, Powell said.

Looking ahead: The price of outdoor gear might not be rising, but outdoor enthusiasts are still feeling the cost of high inflation, and are going to reduce their spending, Davis said.

Participation in higher-cost activities, such as snorkeling and snow sports, is likely to remain high, because they’re primarily pursued by households with incomes of over $100,000, which makes them fairly recession-proof, she added.

Davis expects overall outdoor participation to plateau, but not decrease compared to last year. “The market has risen and stayed sticky, so people are sticking around and continuing to hike or walk or go birdwatching, or whatever it is that they picked up during the pandemic,” she said.

• Sales might be plateauing, but Powell says consumers are still spending a lot of time outdoors; they’re just doing it closer to home, he explained.
• Products like pop-up shelters, grills, and coolers “aren’t really meant for heavy-duty outdoor activity, but simply [extend] the home into the backyard,” he said.

That trend is in line with pandemic-era data showing that many outdoor participants were newcomers, rather than rugged outdoorsmen, Powell said. “What we saw were more novices and beginners, people who had never done any serious camping…and so, the more accessible products…really outperformed.”—MA