Opinion: The Outdoor Industry’s Affordability Problem and Why Used Product May Be the Answer

Published: October 30, 2024

With increasing prices and growing income inequality, the outdoor industry faces an affordability problem. Unchecked, this problem will lead to declining sales as older core consumers age out of outdoor participation. 

But the industry has a relatively underutilized asset to combat this issue – used gear. Let’s dig into why we have an affordability problem, how used gear could be the solution, and the changes we need to make as an industry to make it happen.

The Outdoor Affordability Problem

At the recent Outdoor Media Summit, Julia Day of Circana presented data showing that over the 12 months through February 2024, outdoor retail accounted for $28 billion compared to $22 billion in 2019, before the pandemic. That’s a 28% increase in sales by dollars. 

The interesting thing is that Circana only shows a 6% increase in units over those same periods, meaning a 20% increase in average unit retail (AUR) prices. While some of the increase may be driven by shifts in mix, the majority is pure inflation. Many brands increased retail price points 10% to 15% in 2022 to address huge jumps in supply chain costs in 2021 along with the ongoing impact of higher tariffs.

The 28% increase in overall sales was driven by a large increase in the number of outdoor participants during COVID, with many using their stimulus money at outdoor retailers and brands. Still more of the new outdoor participants started with entry level gear found at mass retailers or big box stores, gear such as $100 tents, $300 bikes and $400 kayaks.

The challenge facing the outdoor industry is that the price step-up from mass market outdoor gear to enthusiast outdoor gear is a big one, with prices frequently three to four times higher – so $300 tents, $1,000 bikes and $1,500 kayaks.

To be clear, I’m not saying that outdoor gear is overpriced; the level of engineering, materials and performance of outdoor gear drives the price rather than brands trying to take too much margin. The challenge is that with the loss of stimulus payments and rising income inequality between younger and older consumers, fewer and fewer younger consumers can afford true outdoor product, leading to an aging customer base. 

That aging impact can already be seen in the decreasing participation from core outdoor enthusiasts in the most recent Outdoor Industry Association (OIA) Participation Study.

An Answer to the Outdoor Affordability Problem

So what’s the answer? One obvious response would be to make less expensive products, but this would mean settling for lower performance, less durability or higher weight. Few outdoor brands want to go there.

An alternative solution came to me at the recent Outdoor Media Summit. Todd Frank, the owner of the Trail Head stores in Missoula, Montana, reported how the used gear and apparel section of his store was drawing in customers they did not have before – younger people and families with children. Used gear sales have quickly grown to become a double-digit percent of his business, and 70% of the people selling the gear took store credit. The addition of the used gear store had totally changed Trail Head’s consumer and its relationship with those consumers.

At the same event, Gabe Maier, president of the Grassroots Outdoor Alliance (GOA), reported that 30-40% of GOA stores sell used gear, with 70% of them saying it accounts for over 10% of sales – far more than those stores see from ecommerce.

The Problem with Outdoor Industry Used Gear Programs

Used gear is certainly not a new idea for the outdoor industry. In fact, it’s become de rigueur for outdoor brands to add a used gear store to support their sustainability goals by creating a “circular economy” for their products.

While these brand initiatives are laudable, they really don’t move the needle. Part of the issue is that they are typically standalone initiatives, hidden away in some corner of the brand’s website and not integrated into the overall customer flow. For example, how many brands display their used items alongside new on their site’s product pages?

Even if brands add used gear to their product pages, their online marketing dollars are focused on attracting NEW product customers. By the time customers land on a brand’s website, they’ve likely already decided that they’re going to buy a new product.

The other issue is cost. After accounting for shipping, inspecting, photographing, cleaning, repairing, storing, marketing, selling, and shipping (again), these brand-specific used gear stores are typically money losers. For this reason, few brands push them very hard after the initial press release, resulting in limited inventory and a poor customer experience.

The Changes Needed to Boost Used Gear Programs

It’s a far better experience for the customer to shop a wide range of products across multiple brands to find something that works for them. In this way, consumers will be exposed to the performance of outdoor gear at a more affordable entry price. Many used customers will just continue buying used, but some will fall in love with outdoor brands and make the step up to new product. Todd Frank of Trail Head tells the story of a customer who always complained that Merino wool was ridiculously expensive, then bought some Icebreaker on the used rack. That customer returned and spent $400 to be covered in new Icebreaker from head to toe.

So what does this mean for brands? Get used products into the hands of the people that can actually move it efficiently, i.e., partner with your retailers and multi-brand marketplaces to create a true market for used product and returns, rather than letting it pile up in warehouses or end up in landfills. This product would be sold in bulk and priced at a large discount to new.

While this may seem like an obvious step, most brands aren’t doing it today out of concern that selling their used products to retailers will cut into their new business. That’s myopic thinking, since used products draw a totally different customer, one who may then transition to new over time.

What’s Next?

California’s new SB-707 Responsible Textile Recovery Act may force the hand of typically slow-moving outdoor brands. SB-707 will require apparel producers to join a Producer Responsibility Organization (PRO) that will set up statewide infrastructure to collect, transport, repair, sort and recycle textile products.  PROs must emphasize reuse, likely diverting product to secondary resellers.

The outdoor industry has two choices: continue to view used product as a liability to be dealt with and get dragged along by legislation. Or, take the lead and view used product as an asset to grow our industry.

Eoin Comerford is the former CEO of Moosejaw, where he led successive years of profitable growth that positioned Moosejaw as one of the top U.S. outdoor retail brands. He now is the principal at Outsize Consulting.

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