Atomica Sports Marketing: White Papers

The U.S. Sporting Goods Industry

2003.01.22

Industry Press Release

By SGMA international

Where It's Been - Where It's Heading

Las Vegas, Nevada – January 19, 2003 – Here are some facts: nearly three million girls play high school sports, 86% of all Americans follow sports, and sports licensed products are on the rise again! Those are just some of the findings contained in the 2003 SGMA International State of the Industry report. The highlights of this annual document were delivered by SGMA International President/CEO John Riddle during the 17th Annual Financial Day International at The Super Show®/20- 03. SGMA International's State of the Industry provides an unprecedented insight into the sporting goods industry – nearly a $50 billion market (at wholesale).

This document contains a recap of 2002, as well as a look at 2003. In 2002, manufacturers' sales are estimated at $49.1 billion – a 2.8% increase over 2001. In 2003, sales are projected to reach $50.5 billion. This represents a 2.9% increase over 2002.

The sporting goods industry's growth in 2002 was slightly greater than that of the total U.S. non-durable goods (GDP), which expanded about 2.3%. The three major segments of the sporting goods industry are sports apparel ($21.8 billion), athletic footwear ($9.5 billion) and sporting goods equipment ($17.8 billion). Sports apparel, athletic footwear and fitness products showed improved sales growth in 2002.

For 2003, the three ‘hottest' sports are projected to be soccer, fitness and basketball, according to SGMA's Survey of Manufacturers. Soccer and fitness ranked one and two, respectively, in 2002, but basketball ranked fifth. Some of the forces likely to affect the sporting goods industry in 2003 are severe price competition, boost from fashion trends, changing demographics, consolidation and tariff issues.

Some other significant observations include:

Females emerge as a key segment. They account for a majority of sports apparel purchases and a rise in participation in organized school sports.
The mature market, ages 55 and older, will grow by nearly 40% between 2000 and 2010, representing an opportunity for fitness companies and other industry segments to cater to this segment.

The youth sports playing population (ages 5-19) will grow by just 3% from 2000-2010, but is a large segment – 59 million strong.

While significant growth occurred in the youth sports-playing population in the last decade – the number of youth participants would probably have been stronger if the 8-11 year old segment was more active, as 93% say they watch TV every day, but only 24% play sports every day.

86% of all Americans over the age of 12 say they are sports fans and 29% consider themselves ‘avid' sports fans.

To encourage participation in sports, many sporting goods industry groups are cooperating on marketing programs to attract more participants.

A recent SGMA International survey found that 97% of parents believe that organized sports improve their children's physical fitness and 93% of parents believe that sports promote their children's personal growth.

This 33 page report also contains articles on athletic footwear, basketball, baseball, billiards/pool, bowling, fitness equipment, golf, outdoor, skateboarding, skating – inline and roller (2x2), soccer, softball, sports apparel, sports licensed products, and tennis.

Athletic Footwear
Running is still the largest category, but basketball shoes are rebounding. The "retro" look remained strong in 2002. Those aged 13 to 24 comprise about 5% of the total U.S. population yet account for nearly one-third of all spending for athletic footwear.

Basketball
Nearly 40 million Americans are playing basketball, of which ten million call it their favorite sport. Composite basketballs have captured the lion's share of the market for college, high school, league and home play.

Baseball
Even though baseball still retains a strong core of loyal players and has millions of fans, there is declining participation in what was once called "America's pastime." In 2003, SGMA International's Baseball/Softball Participation Committee will begin a program with the American Baseball Coaches Association to help more children play ball.

Billiards/Pool
The billiards/pool industry sales increased by 7% to $246 million (at wholesale) in 2002. More females and children are playing billiards/pool. Pool participation is benefitting from increased TV exposure. The "cocooning" effect in the wake of 9/11 has benefitted billiards/pool.

Bowling
Bowling is America's most popular sport, with more than 55 million participants. SGMA International estimates that U.S. sales of bowling equipment rose 3% in 2002 to $226 million (at wholesale) and that similar growth will occur in 2003.

Fitness Equipment
Fitness/exercise equipment is the largest category of sporting goods equipment sales – $3.8 billion in 2002. The number of individuals who worked out ‘frequently' (100+ days per year) with strength equipment has increased 56% since 1990. There are nearly 35 million members of health clubs in the U.S.

Golf
There are nearly 30 million golfers, of which nine million play on a ‘frequent' basis (25+ days per year). A junior golf development program, "The First Tee," established its 100th learning facility in 2002. Its goal is to introduce 500,000 children to golf by 2005.

Outdoor
The even distribution of hiking and camping participants across most age groups is an indication of the family appeal of these activities. Participation in camping has increased 18% since 1990. According to SGMA International, manufacturers' shipments of outdoor equipment rose just 2% in 2002 to $1.73 billion.

Skateboarding
Sales of skateboard shoes have increased 70% in the past two years. With 12.5 million participants, skateboarding is the second most popular "extreme" sport – second only to inline skating.

Skating – Inline and Roller (2x2)
There are more than 26 million inline skaters. The average participant is 17.5 years of age and inline skating is enjoyed equally by males and females. Inline marathons are a burgeoning trend. Traditional roller skating may be benefitting from a fashion trend inspired in part by Britney Spears.

Soccer
There has been an 87% increase in ‘frequent' participation ( 52+ days per year) since 1990. Females represent 45% of all players and 47% of ‘frequent' players. Total sales of soccer balls and equipment have doubled in the last decade.

Softball
Fast-pitch softball is the second-fastest growing team sport for high school girls, behind soccer. The Olympic gold medal success of the U.S. Women's Softball Team in 1996 and 2000 is credited with increasing interest in the game. Two programs designed to attract young players to slow-pitch softball will be launched in 2003 by SGMA International's Baseball/Softball Participation Committee.

Sports Apparel
Purchases of ‘overall' sports apparel are broken down as follows: women's apparel 45%; men's apparel 35%; and children's 20%. Sales of ‘active' sports apparel outperformed the ‘overall' sports apparel category in 2002. In the ‘active' sports apparel category, men's apparel accounts for more than 50% of all spending.

Sports Licensed Products
Sports licensed apparel enjoyed a turnaround year in 2002. Sports logo apparel of all kinds are back in style. Video game sales and the retro/nostalgic design captured a large part of the market. Apparel designers are working hard to blend traditional sports looks with current fashion trends.

Tennis
The Tennis Industry Association expects manufacturers' sales to improve by around 4% in 2003. The USTA has been working harder in recent years to promote team tennis, which tends to be more social, less serious and less competitive than league play.

This report can be purchased on-line at SGMA International's website – www.SGMA.com.

SGMA International, owner of The Super Show®, is the global business trade association of manufacturers, retailers and marketers in the sports products industry. SGMA International fosters industry growth and advances members' interests through market research, communications, public policy, sports promotion, and international business development programs.

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COMPANY INFORMATION:

SGMA INTERNATIONAL
200 Castlewood Drive
North Palm Beach, FL 33408 USA
T: (561)-840-1165
F: (561)-863-8984
Website: www.sgma.com

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