Other BriefingsChina’s Outdoor Sports Industry: Growth Potential, Trends, and Opportunities
Several factors are behind the upward demand for products and services in China’s outdoor sports industry, including preferences for an active lifestyle, functional requirements of athleisure wear, and demographic-linked consumer trends. Foreign brands face growing competition from China firms but can tap into a customer base at the premium and entry-level segments. We discuss why that is in this article.
China is ramping up efforts to promote the high-quality development of the outdoor sports industry and boost associated consumption, having released detailed action plans.
New lifestyle and consumption trends also contribute to the sector’s growth potential. Businesses operating in this sector will see increasing opportunities in the years to come.
In this article, we discuss the growth potential of China’s outdoor sports industry and examine the opportunities for foreign investors.
China’s outdoor sports market at a glance
Market size
Consumer spending in the outdoor sports industry revolves around two key categories: outdoor sports services and outdoor sports products. Outdoor sports services encompass specialized clubs, travel offerings, and community activities catering to varying entry levels. Meanwhile, outdoor products include clothing, bags, professional equipment, accessories, and personal care items.
As of 2022, China hosted over 204,000 outdoor sports-related enterprises, increasing by over 20 percent in a year, according to official data. Between January and October 2022, over 30,000 new outdoor sports enterprises were registered. In the same period, outdoor sports consumption reached nearly RMB 1 trillion (US$137 billion). Further, the number of outdoor sports sites, such as ski resorts, mountain camps, aviation flight camps, auto-camping grounds, and rock-climbing spots, increased significantly.
The surge in popularity is creating significant business opportunities. Sales of products like frisbees and gloves are on the rise, leading to substantial revenue growth for companies. For example, Yikun Discs, a sports gear company, reported RMB 60 million (US$8.22 million) in sales in 2022, with an impressive average annual growth rate of 150 percent over the last three years. Bicycle parts and accessories on the JD.com saw a remarkable 100 percent y-o-y increase in transaction volume during the 2022 “618 Shopping Festival”. And the pre-sale data of JD.com’s 2023 618 Shopping Festival reveals strong growth in specific sports gear, with the sale of fashion shoes, trail-running shoes, summer jackets, and outdoor backpacks all increasing by over 100 percent.
According to Zhiyan Consulting, in 2022 and 2023, the market size of outdoor sports product reached RMB 181.7 billion and RMB 209.1 billion, respectively, with an average annual growth rate of 7.3 percent.
By 2025, China’s outdoor sports product market is expected to reach RMB 241 billion, and the camping market in China is set to reach RMB 1.44 trillion (US$202.04 billion), while the total outdoor sports industry is expected to surpass RMB 3 trillion (US$410.6 billion), according to official estimates.
Growth factors
Several factors contribute to the significant development of China’s outdoor sports industry, including the social needs of young people, favorable government policies, increasing health consciousness among different groups, and the marketing campaigns of social media and variety entertainment shows.
As per the National Sports Health Trend Report, rising living standards have led to a substantial increase in public health awareness in China. People are starting to prioritize physical health over wealth and job satisfaction.
Meanwhile, exercise is no longer just seen as a form of relaxation and entertainment; it is also regarded as a means to enhance one’s self-worth and image. Outdoor sports provide both social interaction and fitness opportunities, creating a popular trend, especially among the younger generations.
Government initiatives on promoting a healthier lifestyle and environmental consciousness have also played a pivotal role in boosting these sports. Clean water programs and enhanced beach infrastructure have made outdoor activities even more appealing, contributing to the overall growth of the outdoor sports industry.
Moreover, outdoor sports gained momentum during the pandemic period and worked as an alternative to constrained long-distance travel domestic or abroad. Though travel restrictions and COVID-19 are no longer concerns for travelers now, people continue integrating outdoor sports into their lifestyle.
China’s outdoor sports participants
The growing interest in outdoor activities in China is predominantly fueled by younger demographics. According to data from the Chinese travel website Mafengwo, millennials and Gen Z are leading the outdoor sports trend, comprising 85.6 percent of outdoor sports enthusiasts in 2022.
Meanwhile, different age groups have specific preferences for outdoor sports. For example, post-80s and post-85s are more inclined toward fishing and Frisbee sports, while post-90s lean toward surfing and snorkeling. Post-95s are drawn to wild camping, and post-00s favor skateboarding.
Outdoor sports events are particularly popular in first-tier cities and emerging first-tier cities. However, there is noticeable growth in second-tier, third-tier, and fourth-tier cities, accounting for 35 percent of the total outdoor sports enthusiasts.
Women’s participation in outdoor sports has been increasing in recent years. Ctrip data reveals that female involvement in activities like camping and hiking reached 51 percent in 2021. Women are not only concerned about the functionality of outdoor products but also prioritize stylish appearance and comfort. Outdoor brands can actively tap into the female market and cater to their consumption needs, striving for a more balanced gender ratio among their target consumers.
China’s plans for the development of the outdoor sports sector
China has been intensifying efforts to foster the high-quality growth of the outdoor sports sector.
In October, 2023, the National Development and Reform Commission (NDRC) along with four other government bodies — the General Administration of Sport of China, the Ministry of Natural Resources, the Ministry of Water Resources, and the National Forestry and Grassland Administration — released the Action Plan to Promote the Construction and Service Improvement of Outdoor Sports Facilities (2023-2025) (the Action Plan) to develop the industry. The Action Plan aims to develop outdoor sports into a RMB 3 trillion (US$410.6 billion) industry by 2025.
To be more specific, the Action Plan lays out a series of objectives, which include the following tasks among others:
- Promote the construction of sports parks.
- Build a national trail system that includes historical and cultural trails, natural landscape trails, and leisure and health trails.
- Optimize the layout of ice and snow sports facilities.
- Improve mountain outdoor sports facilities.
- Increase the supply of water sports facilities.
- Support the construction of camping sites.
- Foster car driving sports camps.
- Strengthen the construction of aviation flight camps.
- Enrich the supply of outdoor sports events.
- Guide and support social organizations at all levels to hold various outdoor competitions.
- Improve the application of outdoor sports technology.
- Improve the safety and rescue mechanism for outdoor sports.
The objective also involves integrating natural resources with outdoor sports, fostering specialized small and medium-sized outdoor sports businesses, and sustainability. Moreover, the Action Plan proposes to build relevant standards for outdoor sports sectors and foster the outdoor sports culture among students and general public, which will further contribute to the development of the outdoor sports sectors.
Under the Action Plan, the government will support and facilitate the development of the outdoor sports industry in the following ways:
- Industry clusters: Local governments are encouraged to build on their unique strengthens and promote the integrated development of the outdoor sports industry with tourism, culture, health care, research, equipment manufacturing, and other industries.
- Land supply: The application and approval process for land usage will be further optimized and innovative land supply methods will be explored.
- Logistic supports: Local governments are encouraged to cooperate other logistic departments to facilitate the transportation of skiing, camping, and cycling equipment. Outdoor sports industry clusters are encouraged to professional outdoor sports equipment transportation or rental services. Logistics companies are encouraged to develop new services for accurate delivery of outdoor sports equipment.
- Participation of private sector: The private sector is encouraged to participate in the development of the outdoor sports industry, to improve the efficiency of infrastructure construction and service operation.
- Financial support: In addition to government budgets, financial institutions are encouraged to actively support the development of outdoor sports enterprises. Qualified outdoor sports enterprises are encouraged to go public for financing. Local governments are encouraged to include the outdoor sports industry in local list of encouraged industries.
The NDRC highlights that the enthusiasm for outdoor sports among Chinese consumers will greatly drive the development of various related industries and thus stimulate domestic demand and consumption.
How foreign businesses can strengthen their presence in the China outdoor sports market
Foreign businesses and investors should conduct a thorough examination of the challenges and risks inherent in the Chinese outdoor sports market. Developing targeted product strategies alongside factoring in local aesthetes, brand awareness channels, and cultural and functional preferences will be essential to succeed in this market.
Foreign brands can actively compete in China’s outdoor sports market. Some international sports brands are recognized for their quality and impact on lifestyle, expanding their market beyond traditional sports products. These brands prioritize functionality, with a strong emphasis on features such as waterproofing, lightweight designs, and quick-drying capabilities, to ensure customer comfort during rigorous activities. Additionally, their designs are captivating, adding an extra layer of appeal and setting them apart in terms of both quality and intricate detailing. This combination of style and functionality has led to increased investment in high-performance gear due to its quality and broad appeal.
As the outdoor sports industry feature younger consumers, utilizing social media and mobile marketing is essential in China, and requiring a strong presence on platforms like WeChat, Weibo, and Douyin, as well as e-commerce platforms like Tmall, JD.com, and Taobao.
Partnering with sports influencers, sponsoring events, and collaborating with local athletes or teams can further enhance brand visibility and credibility within the sports community. Celebrity endorsements can be influential in shaping consumer preferences, provided the celebrities have a genuine interest in outdoor sports to maintain credibility. International brands are well-suited to the premium end of the market, but they must invest in maintaining product-market fit, authenticity, and relevance in China’s evolving consumer landscape.
Potential challenges and risks
China’s outdoor sports industry is currently in its nascent stage, characterized by a low overall participation rate and a prevalence of entry-level products. Challenges that impede its development, include limited access to natural areas for outdoor activities, a scarcity of professional athletes, inadequate facilities, a dearth of diverse products, and insufficient brand awareness. Moreover, the specialized skills required for many outdoor sports and their relatively high costs can limit accessibility to a wider market. Furthermore, in the post-COVID era, the industry faces the dual challenge of retaining existing outdoor sports enthusiasts while contending with the potential abandonment of such activities by others. The key to sustained industry growth lies in maintaining customer loyalty and expanding the base of long-term consumers.
Additionally, international brands need to be mindful of competition from their Chinese counterparts, leveraging the guochao (China chic) trend. In recent years, the resurgence of national pride among younger consumers has prompted domestic companies to offer more cost-effective alternatives to foreign products. Esteemed Chinese brands such as Anta and Li-Ning have successfully capitalized on the guochao trend, further solidifying their market positions.
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China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
Dezan Shira & Associates has offices in Vietnam, Indonesia, Singapore, United States, Germany, Italy, India, Dubai (UAE), and Russia, in addition to our trade research facilities along the Belt & Road Initiative. We also have partner firms assisting foreign investors in The Philippines, Malaysia, Thailand, Bangladesh.
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