How can the sporting goods industry turn inactivity into opportunity?

About 1.8 billion people worldwide are physically inactive.

Rising physical inactivity presents both a risk and an opportunity for the global sporting goods industry, whose growth is expected to slow to 6% from 2024 to 2029 as consumers reevaluate discretionary spending amidst rising prices.

The share of physically inactive adults jumped to 31% in 2022 from 26% in 2010, and the trend could endure in the coming years, with the World Health Organization projecting inactivity levels to reach 35% by 2030, according to a McKinsey & Co. and World Federation of the Sporting Goods Industry (WFSGI) report published in March.

About 1.8 billion people worldwide—more than double the adult population of India—are physically inactive, it added.

“This is not just a health crisis,” Emma Zwiebler, CEO at WFSGI, said in a May podcast discussing the report. “This will be a business crisis for the industry if we do not start to take action now.”

If levels continue to rise or even remain constant for younger generations, the market related to physical activity will decline, according to the report. “However, converting physically inactive segments is the biggest potential opportunity for the sporting goods industry.”

Growth in the global sporting goods market is expected to slow to 6% annually from 2024 to 2029 due to a slowdown in the Asia–Pacific region, Western Europe, and Latin America after growing 7% yearly from 2021 to 2024.

“We need products that don’t just get to ‘higher, faster, stronger,’ but actually help remove barriers to physical activity,” Zwiebler said.

Brands should also launch campaigns that not only promote products but also raise awareness about the benefits of physical activity. “We’re not talking about marketing campaigns focused on products, but marketing campaigns that promote the benefits of being physically active for all,” she added.

Meanwhile, with potential tariff increases this year, companies can prepare by accelerating efforts to derisk and diversify their supply chains, according to the report. “For example, they could review their supply chain footprints and inventory management practices, as well as boost efficiency through increased automation and digitalization,” it added.

Another trend identified in the report is the growing role of fitness as part of a person’s identity.

“It opens up opportunities for challenger brands... as the audience becomes more discerning about what is made for ‘people like me,’” McKinsey Partner Eric Falardeau said in the podcast.

Competition in the sporting goods industry is shifting, with once dominant large players losing market share to smaller, more agile rivals, according to the report.

“These challengers and smaller brands are really speaking to the consumer …[and] really understanding more nuanced demands,” McKinsey Partner Pamela Brown said. “Brands that have the most visible innovation are the ones that are winning.”

Meanwhile, the boom in blended live sports and entertainment offers an opportunity. McKinsey estimates the global live events ticketing market surpassed $100b in 2023 and could reach $150b by 2030.

“The demand for live experiences is blurring the traditional lines between sports, entertainment, and retail,” McKinsey Partner Alexander Thiel said in the podcast.

Retailers should transform retail spaces into experiential hubs that host events, and blend sports, entertainment, and retail to attract and engage consumers, driving foot traffic and sales, McKinsey said.

Questions to ponder:

1. What are some examples of successful or unsuccessful campaigns and interventions led by sporting brands to promote exercise?

2. How can we ensure that campaigns are sustainable and have a lasting impact?