WHAT’S AHEAD FOR THE OUTDOOR INDUSTRY
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This slideshare is directed to any consumer product industry professional that wants to build a relationship with individuals and consumers, including: Adventure Parks/Ski Areas, Apps/Platforms, Associations/Conferences/Tradeshows, Clubs, Education Institutions, Event/Races, Government Entities, Outdoor Guides, Service businesses, Influencers/Brand Ambassadors/Athletes, Manufacturers, Media Publishers, News/Journalists, Non-profits, Rental Retailers, and Retailers/Resellers/Recommerce/Repair Shops.
WHAT’S AHEAD FOR THE OUTDOOR INDUSTRY
This slideshare is applicable to the U.S. market
The 10-year outlook for the U.S. outdoor industry and its public lands will be very challenging due to a confluence of factors revealed in this slideshare. I review these challenges and provide new technologies, business models and strategies that can help counteract these challenges and allow companies to succeed in this period.
Navigating The Future Takes A Village
I publish and open source much of my Future Map work for anyone to use.
I curate my forward guidance from many other futurists and subject matter experts. But this curation is colored by by own past experiences and biases, so I will be wrong, which is why I try to include probabilities of future occurrences to help measure my level of uncertainty.
But even then, I’m still just one person and can’t know everything. The task of mapping and navigating the future takes an army. Let’s crowdsource the best strategies and tactics to help position for the future. Please provide me with questions and feedback so that I can update my work so that it gets better for everyone. Use the form on the Future Map web page to submit questions and comments.
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HOW TO Copyright © Eddie Soehnel
About The Author
I am a leading-edge technologist, business model innovator and exponential growth strategist working predominantly in the DTC/B2C/B2B2C/consumer product industry.
As an ENTREPRENEUR/CXO, priors include building an online social network, which �I sold, two food companies and an education company. Current companies span pet, �telecom, SAAS, and a food startup. Along my entrepreneurship journey, I’ve crashed two �tech companies and perfected the art of face-planting as an angel investor.
This slideshare is part of my futurist work, which I’ve leveraged as a thought leader�and futurist for consumer brands, publishing predictions and action plans, speaking at industry events, conducting webinars for C-suite leaders and groups and helping DTC/B2C/B2B2C/consumer brands future-proof.
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OUTDOOR AND ACTIVE LIFESTYLE INDUSTRY 10-YEAR OUTLOOK: Slideshare Outline
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BIG PICTURE SETUP
BIG PICTURE SETUP Copyright © Eddie Soehnel
We are currently in the final gasps of the “Old Normal” that has existed since 1945 along with its antiquated systems and structures.
We face a challenging transition I call “The Reckoning,” a period of profound restructuring and economic readjustment not seen since the 1930s Great Depression and WWII.
After this lies the “Resurgence” and “New Normal” in the 2030s and beyond, a period with great potential for growth and prosperity in the U.S., the like we have never before seen in our history.
The outdoor industry will experience its own flavor of The Reckoning period through challenges presented in this slideshare, but like the U.S. as a whole, will also emerge into the Resurgence and New Normal to prosper once again.
Big Picture Setup
BIG PICTURE SETUP Copyright © Eddie Soehnel
OUTDOOR INDUSTRY CHALLENGES
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
We’ve Reached A Secular Top
We’re past the top of the 1945-to-present growth era for the U.S. outdoor industry. COVID accelerated and compressed any last remaining growth into the 2020-2022 period. Three key categories that drive the entire industry - hard/soft goods, venues (adventure parks/ski areas) and public lands - will see flat to declining revenue through the 2020’s (or if there is growth it will be negative real growth compared to inflation). A deep recession is expected and is likely to crater U.S. industry revenue significantly. It won’t be till the mid 2030’s when we may return to broad growth, once we have worked through many of the challenges covered in this slideshare.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Let’s look at macro, society-wide challenges, which is all of America and not just the outdoor industry | |
What Could Decimate The Industry� There are three significant challenges that could devastate the outdoor industry like a house of cards. | |
Section Outline (hyperlinked)
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
OUTDOOR INDUSTRY CHALLENGES
Macro-Picture
Let’s look at macro, society-wide challenges, which is all of America and not just the outdoor industry
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Demographics And A Saturated Marketplace
The post-WWII era - Old Normal - was one where we had excellent demographics and a proverbial empty room ready to be filled with products. Layer on innovation, ample global resources, peace in America and our freedom, and we built the most efficient machine possibly to deliver exceptional breadth and depth of products. We got almost anything and everything, at anytime, everywhere, at lowest costs..
That era is over with because the demographics are no longer ideal and the room (closets and garages) is now full, yet we are still operating with the same system that was built for a different set of demographics and designed to fill an empty room, both of which no longer exists.
Outcome: Until we see a new proverbial empty room that represents a new frontier to expand into, we are stuck in an era with much lower product sales.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Challenging Demographics
We had a population pyramid that gave us great demographics to power decades of prosperity. That pyramid has slowly shifted to square with a small triangle on top, which is not bad and still OK for a country, but it is not ideal.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Challenging Demographics
Millennials - In 2024 ages were 28-43
Outcome: But assets skewed to wealthy, and median have far less in assets that are being spent on healthcare, so less will be available for the millennials. Further, economic difficulties will depress wealth values and spending, negating any benefits from this group.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Challenging Demographics
Gen Z - In 2024 ages were 12-27
Outcome: This smaller generation, with different entertainment priorities and inheriting less wealth, can only support a smaller outdoor industry than we have now.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Challenging Demographics
Gen Alpha - In 2024 ages were 0 -13
Outcome: To early to tell, but gaming/interactive media is the #1 way this generation spends free time.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Challenging Demographics
Combine entertainment technologies (AI, interactive games) with dopamine addictions and younger generations spend more of their free time and social time on modern entertainment.
Outcome: outdoor may still grow but less than inflation or population growth because younger generations from a very early age have developed greater emotional connection to digital experiences (and with each other through digital).
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Saturated Marketplace: COVID Brought Demand Forward
Drilling into recreation categories in PCE data, some categories still going up, others correcting back towards trend. Play with this data here.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Saturated Marketplace
The 1945-to-present growth era saw an explosion in materialism and accumulation, where consumers closets and garages are now full of gear that can last for decades.
Couple the above two with consumer shifts associated with declining materialism, sustainable and minimalist trends and increased environmental awareness and there is too much undifferentiated product in the marketplace. Brands end up competing on price, which destroys margins and hurts everyone.
Outcome: Replacement cycles for many product categories is 10 years, and even longer for the mass market/discretionary/lifestyle/casual participant. Sales will be depressed through the 2020’.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Enormous Imbalances
In addition to good demographics and an empty room, we did many other things to maximize filling that room with product for the American consumer:
The result, however, was massive imbalances where we: (1) decimated blue collar labor - a huge part of our middle class; (2) built enormous government debt, which after 20-years or spending more than we earned, has caused us to structure our economy around excessive government spending, which when it gets take away, will be like a house of cards that crashes the economy; (3) inflated riches for the wealthy at the expense of everyone else; (4) destroyed our environment.
Outcome: we will have to correct these imbalances, which are so enormous that it will take significant pain and sacrifice across society to correct.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
What Could Decimate The Outdoor Industry
There are three significant challenges that could devastate the outdoor industry like a house of cards.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
#1: Discretionary Spending
The outdoor industry grew massively off of the mass market/discretionary/lifestyle/casual customer, which is discretionary spending that drives a significant share of industry revenue (70% is a number kicked around a lot).
Outcome: As the economy worsens and eventually when we hit a severe recession, this spending will vanish.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
#2: Pressures On Government Spending Will Lead To Decimation in Funding For Public Lands
Prioritized federal government spending starts with interest expense on debt, then defense, then entitlements, then non-defense discretionary, or everything else, which includes public lands.
Outcome: Public land locations will have to close and/or limit public access, affecting not just companies and people that are directly part of the industry, but communities that rely on public lands and the travel, lodging and dining revenue they drive from visitors.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Outcome: How much will non-defense discretionary get cut? Assume defense and veterans will not be cut (especially defense because of an increasingly chaotic and crisis-driven world), cuts to all other programs will have to be at least 33% across the board, including entitlements. BUT!...do we think that voters will allow entitlements (social security, medicare) to be cut the same as non-defense discretionary, which includes public lands? No way. Cuts could be 50% and more.
#2: Pressures On Government Spending Will Lead To Decimation in Funding For Public Lands
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Even Though public lands have high regard across the political spectrum, there seems no chance they would escape deep funding cuts when federal government finances implode.
#2: Pressures On Government Spending Will Lead To Decimation in Funding For Public Lands
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
#3: Secondary Markets To Dominate
Economic challenges will shift the consumer to the resale/used/secondary marketplace, which will thrive and potentially exceed the market for hard and soft goods, decimating brand manufacturers, where 98% of revenues are currently derived from producing and selling new product.
Brand manufacturers, next to public lands, are the backbone for the industry. If they falter, then that filters through the rest of the industry that relies on a healthy ecosystem of brand manufacturers, such as advertisers, associations/conferences/trade shows, service providers, employees/contractors/consultants, influencers/ambassadors/athletes, investors, media publishers, news/journalists and retailers/resellers.
Current resale models by brands and third party companies are not working. What is working are peer-to-peer (P2P) models via platforms like Meta Marketplace, Ebay, Craigslist and Vinted/Depop/Ebay UK, where brands get no revenue from used product sales.
Outcome: P2P used markets dominate and brands get decimated, which filters into the entire industry.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Let’s run through a plethora of additional challenges that will carve off additional revenue from the industry in the coming decade.
Additional Challenges
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Resource Constraints
Climate change and accompanying natural disasters along with deglobalization, nationalistic priorities, increasing wars and conflicts and demographic collapse across many countries is making it harder and more expensive to secure natural resources to produce products.
The 1945-to-present growth era was one where we had ample resources and we optimized their production to give us anything and everything, at anytime, everywhere, at lowest costs. This era has ended and will not come back. We will have to make choices about what to do with the resources we have, which will mean SKU rationalization in the least.
Outcome: As climate change, natural disasters, deglobalization, nationalist priorities, wars and conflicts and demographic collapse escalate, we will find ourselves without materials and products to generate sales.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
We have more costs and higher inflation because:
Outcome: higher costs and higher inflation , which reduces consumer spending.
New Era With Higher Costs
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Alternative Sources of Revenue Not Enough To Offset
Emerging business models associated with:
…are slow to emerge because the outdoor industry is a laggard in terms of adopting new technologies and business models.
Outcome: These business models and supporting technologies will mature through The Reckoning but at the industry’s present pace of adoption, won’t be significant enough to help until we get into The Resurgence and The New Normal.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Product Development Evolutionary Not Revolutionary
20+ years of almost no revolutionary innovations to capture consumers attention (exception is Dyneema?). Products are good enough, so why trade up?
Outcome: Replacement cycles for many product categories is 10 years, and even longer for the mass market/discretionary/lifestyle/casual participant. The industry will consolidate to fewer brands selling less product to work through this saturation.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
No New Innovations In Marketing And Sales
The Internet revolutionized marketing, sales and distribution via the era of Web1 (1995-2005) and era of Web2 (2005-present). But these eras are now old and every business from startup to category behemoth and in between has access to the same strategies, tactics, systems and tools. There is little if any differentiation. Consumers are bored. Without differentiation, companies compete on price, which is a race to the bottom that decimates margins and hurts everyone.
Outcome: New business models and supporting technologies to help brands differentiate will mature through The Reckoning but won’t be significant enough to help until we get into The Resurgence and The New Normal
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Environment
The outdoor industry produces an ever increasing volume of products that are harmful to the environment using material, manufacturing and logistics processes that contribute to carbon emissions, without industry-wide circularity practices to help reduce these impacts. The industry has known about these issues for decades, yet the industry is very slow to act and as a whole is having nearly no effect on reversing the continued worsening of these issues.
Outcome: the era of self-regulation is closing as government regulations begin to take effect. Regardless, climate change will continue to get worse until we reach crises/catastrophes where government/consumers force massive and rapid changes, which could lead to widespread and calamitous degrowth in favor of secondary marketplace growth and dominance.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Subscription Models Diminishing Experience
Adventure parks/ski areas/gyms revolutionized subscription models that incentivized growth, massively boosting outdoor recreation, but at cost to crowds, which is diminishing the experience.
Outcome: As consumers pull back due to crowds, this will cut revenue to the industry in all segments (activities, gear, travel, local economies that depend on outdoor, advertising, etc).
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Apps Diminishing Experience
We created many apps and tools to predict optimal outdoor activity conditions, dramatically increasing the crowds inundating locations when conditions are best, diminishing the experience.
Outcome: As consumers pull back due to crowds, this will cut revenue to the industry in all segments (activities, gear, travel, local economies that depend on outdoor, advertising, etc).
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Outdoor Losing To Activities With Stronger Dopamine Addictions
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Outdoor Losing To Activities With Stronger Dopamine Addictions
We have a dopamine-fueled culture that is incenting activities to the right of the graphic.
Consider the first category of athletics that best represents outdoor.
A study from Microsoft found that since the year 2000, the average human attention span has decreased from 12 seconds to 8 seconds—a 33% drop. This means that humans now have shorter attention spans than goldfish. This shortening is the result of having constant, unfettered access to the world’s information, content, and communications. The average American unlocks their phone 150 times per day.
Outcome: Every tactic in the right far column increases ARPU (average revenue per user) in tandem with increasing dopamine. As a result, brands that have digital products or strong digital presences are especially adjusting business practices to feed dopamine hits, at the expense of offline brands that cannot compete because either their products are offline and/or they do not have robust online presence, both of which characterize the outdoor industry.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
Consumers Trained On Discounts
Because of many of the previously mentioned challenges, the industry only knows one thing to motivate sales - discounts. Consumers are now trained to wait for the email popup giving 15% off or the next sale that is always just around the corner.
How can the industry earn reasonable margins when sales are dependent on more and more discounts to motivate sales?
Outcome: It is a race to the bottom that destroys everyone.
INDUSTRY CHALLENGES Copyright © Eddie Soehnel
PREDICTIONS & TIMING
PREDICTIONS & TIMING Copyright © Eddie Soehnel
There are two characteristics inherent with America in Reckoning periods:
As a result, the future means things will get much worse across culture, society, economics/finances, politics/geopolitics and the environment, until we reach critical states, or tipping points, where a shock or shocks forces us to act in massive and decisive ways. Shocks can come from anywhere: political/geopolitical, financial, environmental - we won’t know till they happen. But shock events to motivate America has happened many times - at least 8 since WWII. Whether it's a feature or a bug in American culture, that’s how we seem to operate. But when they do happen, nothing can stop us from doing what we need to do to win.
Predictions & Timing
PREDICTIONS & TIMING Copyright © Eddie Soehnel
What pushes the economy down are shocks from political/geopolitical, financial, environmental crises.
What pushes the economy up are efforts towards reindustrialization, electrification, AI and robotics, and political cohesion.
We hope that these UP efforts more strongly counteract the DOWN shocks, but because we are at critical states or tipping points across many areas (political/geopolitical, financial/economic and environmental), the risk to major economic dislocations is too high, so we must prepare for the worst.
Predictions, Timing & Major Actions Required
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions & Timing:
For reference points:
Recessionary effects won’t be equal across the economy. Expect the worse effects to be felt among discretionary spending-dominant categories, like outdoors.
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions, Timing & Major Actions Required
The upcoming Reckoning period, which will be characterized as a two-front war: (1) a war to fix the economy; (2) a war on climate change that continues to increase the frequency and severity of environmental catastrophes. A possibly third front will emerge from geopolitical kinetic conflicts that will only add to the economic stress. These wars will change public sentiment dramatically.
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions, Timing & Major Actions Required
The war to fix the economy
The public and government will undertake many extreme and unprecedented actions, one of which may be to force companies who want to sell in the U.S. to produce in the U.S. Consumers who are losing their jobs, can’t pay their bills and seeing assets plunge in value will want jobs, and if they buy from companies, they want to see jobs that produce those products to be in the U.S. As a result, companies must reshore.
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions, Timing & Major Actions Required
The war on climate change
When consumers are losing their houses and livelihoods to hurricanes, wildfires and other disasters, they will not care about glowing reports on environmental stewardship, what percent recycled materials a product contains, how much a company donates to environmental causes, how many carbon credits it purchases or if it is a B corporation. The will only care if a company’s absolute emissions from all-scopes is real zero or as close as possible that does not contribute to carbon emissions. As a result, companies must report all-scope emissions and prove they are real zero, or as close as possible.
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions, Timing & Major Actions Required
Companies must reshore and get to net zero before 2029, a herculean task for sure, but there is no choice. Public sentiment due to serious economic and environmental challenges will shift dramatically. Consumers will care about U.S. jobs and protecting their livelihoods from climate disasters. There are already many companies that produce solely in the U.S., track scope 1, 2 and 3 emissions and are rapidly moving towards real zero. They will win and those that cannot match them will lose.
PREDICTIONS & TIMING Copyright © Eddie Soehnel
Predictions, Timing & Major Actions Required
Navigating The Reckoning
I provide a massive trove of strategies and tactics to help outdoor industry participants navigate and survive The Reckoning period, and for some, possibly grow and thrive. They are published in the New Normal For Consumer Brands slideshare. Go there next. But you might want to first cover the Business Cycles Slideshare that zooms out and gives a more macro view of not just The Reckoning period, but also The Resurgence and how we push through our difficulties.
ADMIN SLIDES
ADMIN Copyright © Eddie Soehnel
Homework
This slideshare has only a few major suggestions for what companies out to be working on to position for the future. These suggestions and many others are in this slideshare: PATH TO NEW NORMAL FOR CONSUMER BRANDS: strategies, tactics, technologies and business models to help navigate The Reckoning and position for The Resurgence and the New Normal. This slideshare includes strategies, tactics, technologies and business models to help brands transition away from the “Old Normal” we have now that is no longer working and dying, through the difficult transition period I am calling “The Reckoning”, and into the “New Normal” for the 2030’s and beyond. What is published in this slideshare offers a picture of what successful brands will be doing in the New Normal.
For a deeper dive into The Reckoning Period, review the slideshare: BUSINESS CYCLES: Recessions in the 2020’s and Booms in the 2030’s. You can skip this slideshare and instead review a narrative that presents a possible roadmap for how the Reckoning period plays out in the U.S. It rolls up the content in the Business Cycles slideshare into a neater, more organized narrative.
Get more insight into Exponential Technologies and Consumer Shifts by reviewing those slideshares.
If not already done so, please complete the crowdsourced survey on my future map page. This is a great list of questions to help crowdsource the best for all of us.
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More About The Future
My goal is to help brands future-proof themselves against the massive changes occurring across society, culture, economics/financial markets, politics/geopolitics and the environment/sustainability by publishing predictions and action plans, speaking at events and advising companies.
If you came to this slideshare directly, then go to my Future Map landing page to access all my content. It is here: https://eddiesoehnel.com/future-map-for-consumer-brands/
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