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Floors 4 Gyms / TVS Sports Surfaces
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Floors 4 Gyms / TVS Sports Surfaces
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Changes in consumer spending on online fitness 'here to stay', says McKinsey report

By

A new report shows how the pandemic is shifting consumer behaviours in fitness, sport and physical activity – and how those changes are likely to be permanent when it comes to the consumption of goods and digital services.

The Sporting Goods 2021 – The Next Normal for an Industry in Flux report, from McKinsey & Company and The World Federation Sporting Goods Industry (WFSGI), outlines how the impact of the pandemic will require strategic planning from retail companies hoping to survive in the sector.

Offering insight into how physical activity products and services are consumed, the report shows how 2020 resulted in "winners and losers", as companies strived to react quickly to the changes.

According to the report, the shift to digital and online was perhaps even bigger than at first thought – and is likely to become a permanent feature for the sector.

Online share of sporting goods sales, for example, jumped in 2020 to a level previously forecast for 2024.

Among the biggest winners of this shift was athletics wear specialist Lululemon, which was quick to expand its services during the pandemic. It acquired at-home fitness tech firm Mirror in a deal worth around US$500m (€446m, £407m) and saw its Q3 sales jump to US$1.1bn – up 22 per cent from 2019.

Meanwhile, the well-documented "pivot to digital" in fitness is perhaps best seen in the way Peloton saw its quarterly workouts more than quadruple during 2020 – from 19 million in Q1 2020 to 77 million in Q4.

The successes of Peloton and Lululemon are, according to the report, a sign of the "new normal" that will influence the retail sector for years to come.

"The impact of the pandemic goes beyond temporary performance," the report states.

"It has also accelerated changes that will have long-lasting impacts on companies throughout the sporting goods value chain.

"Indeed, COVID-19 has ushered in the next normal for the industry, defined by factors including digital commerce, rising demand for sustainable products and increasing participation in individual forms of sport and exercise.

"To win in the new environment, the industry needs to adapt both its customer proposition and its operational capabilities."

As well as presenting a review of 2020 and a preview of 2021, the report also analyses eight key themes likely to define the evolution of these markets.

The eight trends are divided into three main categories:

Consumer Shifts

Athleisure — the new default and a competitive battleground

Physical activity gap — an opportunity to put healthy lifestyles within reach of all Sustainability — the COVID-19-accelerated next normal

Digital Leap

Digital-enabled fitness and exercise communities take centre stage

Leap forward in online — an accelerating business model shift to DTC Marketing shift from assets to influencers — an opportunity to make digital pay

Industry disruption

Retail under pressure — but a critical part of the future channel mix

Supply chains —the flexibility imperative and a raised bar on agility

• To download and read the full report, click here.

Sign up here to get Fit Tech's weekly ezine and every issue of Fit Tech magazine free on digital.
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Changes in consumer spending on online fitness 'here to stay', says McKinsey report

By

A new report shows how the pandemic is shifting consumer behaviours in fitness, sport and physical activity – and how those changes are likely to be permanent when it comes to the consumption of goods and digital services.

The Sporting Goods 2021 – The Next Normal for an Industry in Flux report, from McKinsey & Company and The World Federation Sporting Goods Industry (WFSGI), outlines how the impact of the pandemic will require strategic planning from retail companies hoping to survive in the sector.

Offering insight into how physical activity products and services are consumed, the report shows how 2020 resulted in "winners and losers", as companies strived to react quickly to the changes.

According to the report, the shift to digital and online was perhaps even bigger than at first thought – and is likely to become a permanent feature for the sector.

Online share of sporting goods sales, for example, jumped in 2020 to a level previously forecast for 2024.

Among the biggest winners of this shift was athletics wear specialist Lululemon, which was quick to expand its services during the pandemic. It acquired at-home fitness tech firm Mirror in a deal worth around US$500m (€446m, £407m) and saw its Q3 sales jump to US$1.1bn – up 22 per cent from 2019.

Meanwhile, the well-documented "pivot to digital" in fitness is perhaps best seen in the way Peloton saw its quarterly workouts more than quadruple during 2020 – from 19 million in Q1 2020 to 77 million in Q4.

The successes of Peloton and Lululemon are, according to the report, a sign of the "new normal" that will influence the retail sector for years to come.

"The impact of the pandemic goes beyond temporary performance," the report states.

"It has also accelerated changes that will have long-lasting impacts on companies throughout the sporting goods value chain.

"Indeed, COVID-19 has ushered in the next normal for the industry, defined by factors including digital commerce, rising demand for sustainable products and increasing participation in individual forms of sport and exercise.

"To win in the new environment, the industry needs to adapt both its customer proposition and its operational capabilities."

As well as presenting a review of 2020 and a preview of 2021, the report also analyses eight key themes likely to define the evolution of these markets.

The eight trends are divided into three main categories:

Consumer Shifts

Athleisure — the new default and a competitive battleground

Physical activity gap — an opportunity to put healthy lifestyles within reach of all Sustainability — the COVID-19-accelerated next normal

Digital Leap

Digital-enabled fitness and exercise communities take centre stage

Leap forward in online — an accelerating business model shift to DTC Marketing shift from assets to influencers — an opportunity to make digital pay

Industry disruption

Retail under pressure — but a critical part of the future channel mix

Supply chains —the flexibility imperative and a raised bar on agility

• To download and read the full report, click here.

Sign up here to get Fit Tech's weekly ezine and every issue of Fit Tech magazine free on digital.
More news
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Floors 4 Gyms / TVS Sports Surfaces
Floors 4 Gyms / TVS Sports Surfaces