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More people are seeking outdoor recreation, but outdoor retailers are struggling

The pandemic introduced millions of Americans to outdoor recreation and it's a trend still seen today, but the outdoor retail industry is still taking financial hits.
An REI retail store
Posted at 5:51 PM, May 08, 2024

Life is stressful, expensive and busy — so it makes sense that most Americans are heading to parks and trails to get a much needed break from it all in nature.

"I mean, I never thought we'd get to 57% of America," said Kelly Davis, the director of research for the Outdoor Industry Association.Davis was looking at some new data about outdoor recreation participation numbers before our conversation.

According to last year's data, 2022 saw a record 168 million Americans recreating in the outdoors, and she says that number increased by almost 8 million in 2023. "There's 7.7 million new participants entering the market, like starting to participate in outdoor recreation for the first time last year," she said.

Davis said that the new participants are more diverse in race, and she's also seeing more women participate in outdoor recreation.

But looking at the businesses that sell the outdoor gear, it's not so rosy of a picture.

REI, the Seattle-based outdoor retail giant, recently announced that it lost $311 million last year. Last fall and winter, the retailer announced rounds of layoffs.

An REI storefront

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"That's a bloodbath," Davis said.

So where is the disconnect?

While participation numbers are up, the frequency that people go out is down. Davis says this new group are casual participants — they're hiking in local parks, birding and getting into pickleball, and they're doing it for their mental health. They're not doing the big, expensive mountaineering adventures.

"When we're living in a world where we're all just basically trying to survive, maybe the extra hunting trip doesn't happen," she said.

So how can the industry best serve the increasing amount of new customers? Davis hopes that this new, diverse group is engaged with by brands and retailers, encouraged to participate and to bring their friends along, and is not left out for being a different kind of customer than the industry is used to. She says helping these new participants find an identity in the outdoors is key.

"It's really interesting when I think about the new motivations for this participant to get outside and it's not to carve a perfect turn and it's not to huck off a 50 foot cliff. It's just to cope with everything that's going on," she said.