As is now traditional, the WFSGI and McKinsey used ISPO Munich as an opportunity to present an exclusive preview of their annual Sporting Goods Report, now in its fourth year. Available in January 2024, we bring you an advanced summary of the four key industry trends McKinsey is predicting for the sporting goods industry in 2024.
The discussion began on a positive note: 2023 was a good year, and unexpectedly so. All regional markets saw an improvement compared to 2022.
Back in January, the 2023 report called for a “need for resilience in a world in disarray.” WFSGI and McKinsey predicted four key themes would shape the industry in 2023: Brand relevance, sustainability, nearshoring and investments in the industry. Judging by the trends predicted for 2024, it seems like many in the industry took note of McKinsey’s recommendations.
As it looks towards 2024, McKinsey describes its outlook as “quite positive, but with a question mark over China.”
Once again, the report is divided into four key trends for the sporting goods industry for the year.
2024 will see a shift in consumer preferences
As was mentioned throughout ISPO Munich 2023, we are seeing a shift in consumer preferences in both the sports they wish to engage in and their motivations for doing so. This shift is towards sports which are more “accessible.”
“Accessible” in this sense, explained Alexander Thiel, McKinsey Partner and Leader Sporting Goods Practice EMEA, means sports that require limited skills (something that you don’t need to start as a child to do in adulthood), are social in nature and can be done without membership of a club and club fee for example. These would include paddle tennis, golf (off-course), tennis, trail running and snowshoeing.
“People are putting the activity and the fun angle in focus,” said Thiel.
This shift needs to be reflected in brand messaging, with the most successful brands encouraging consumers and communicating the message that you don’t have to be the most successful, but instead pushing the inclusivity of their brand.
Planning is an increasing priority
Partly as a response to its own call to action at the start of the year, McKinsey sees planning as back at the top of the agenda for sporting goods brands.
Over the last few years, with a pandemic and geopolitical situations, there has been the realization that things can change quickly, and there is always the potential for volatility. Brands are, therefore, already building in failsafes.
71 percent of respondents in a McKinsey survey are considering standardization and formalization of planning processes. 58 percent are considering the implementation of advanced analytics, and 58 percent are considering the implementation of a new supply chain planning IT system.
However, this is having an effect on prices, because incorporating these failsafes naturally has an effect on built-in prices.
Sabine Becker, Associate Partner McKinsey, also added that many are embracing cooler and more user-friendly planning tools: “Why use an Excel spreadsheet when there is so much other software available?”
Ecosystem strategies will be reviewed
“Consumers want a haptic experience,” said Becker when discussing omnichannel, meaning that consumers want to touch and feel products as well as see them. This is affecting the buyer’s journey.
Consumers now increasingly start online and end offline. They are looking for a multibrand experience which includes objective advice.
As such, companies might want to start thinking holistically, creating an ecosystem that incorporates the back-and-forth omnichannel journey rather than anticipating a one-directional journey.
Furthermore, says Thiel, brands need to “move beyond being a pure product supplier [and] take seriously what the consumer wants from sports.” For example, a healthy, active life.
A move from “targets” to “action”
Finally, as with last year, sustainability makes the list of trends. This time, however, it’s about moving forward from targets into action, with communicating a sustainability message to the consumers as an important step.
The full report will be available in January 2024. You can pre-register to receive the Sporting Goods Report 2024, and any updates, at McKinsey now.
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