The Zhitong Finance App learned that China Merchants Securities released a research report saying that outdoor sports are currently popular, but the penetration rate is low. Currently, consumption is still showing a trend of high tier cities consuming high-end outdoor products, while low tier cities are consuming quality and price compared to outdoor products. With the increase in outdoor products (outdoor brands are gradually entering China+ traditional sports and leisure brands incorporating outdoor elements), consumers are paying more attention to the functionality and price-quality ratio of outdoor products. Highly functional products can have higher product premiums, and quality-price ratio brands will continue to expand.

The views of China Merchants Securities are as follows:

Tmall platform: The pandemic has increased demand for outdoor sports. Coupled with the rise of outdoor sports trends around the world, outdoor sportswear tracks have rapidly expanded since 2020, and the price range continues to rise.

1) Industry: Outdoor sportswear tracks will expand rapidly after 2020. In 20-23, the Tmall outdoor industry's GMV compound annual growth rate was 10%. Among them, outdoor clothing CAGR = 29%, outdoor footwear CAGR = 12%, and segmented brands of jackets (CAGR = 33%), sun protection clothing (CAGR = 34%), and outdoor casual wear (CAGR = 38%) grew faster. Yoga pants are relatively mature, and the growth rate has slowed in the past three years (CAGR = 3%).

2) Brand: The industry is developing rapidly, and leading brands are still in a period of rapid expansion. In 20-23, camel outdoor clothing CAGR = 81%; Bosch and CAGR = 46%; Jeep CAGR = 19%; the rest of the brands of outdoor clothing GMV have maintained a growth trend for the past three years. Outdoor brands continue to upgrade product functionality to increase average prices. The same trend is also reflected in race segments such as jackets, sun protection clothing, and outdoor down jackets.

3) Industry pattern: a) Jacket circuit: brands with a price-quality advantage have increased their share. In 20-23, the share of camels increased from 13% to 39%, and Bushey's share increased from 4% to 7%. b) Outdoor down jackets: Strong functionality and rapid increase in brand share compared to price. In 20-23, the share of the north side increased from 13% to 18%, and the share of camels increased from 3% to 13%. c) Yoga pants: The Lululemon family is the only one, and Lululemon's share increased from 23% to 34% in 20-23.

4) Price band trend: 2023 mass price band (0-300 yuan) outdoor clothing +61%, middle and high-end price band (300-1000 yuan) +71%, high-end price band (1000 yuan +) +9%.

Douyin platform: Most popular brands, the number of competitors is gradually increasing, and it is still in a period of rapid expansion. Brands with a price-quality ratio are growing rapidly.

1) Industry: Outdoor clothing +150% YoY in 2023, yoga pants +88% YoY. Among them, jackets +353%, outdoor down jackets +168%. The average sales price increased steadily.

2) Brand: Fast release of leading outdoor clothing brands, Camel +220% YoY in 2023; Northside +65%; Bosch +261%; Columbia +620%; Aigao +278%. Average sales prices have been rising steadily.

3) Industry pattern: The brand share of outdoor clothing quality and price has increased markedly. In 2023, camels had a market share of 23% (+5pct year over year), and Bosch had a market share of 2.3% (+0.7pct year over year).

4) Price band trend: 2023 mass price band (0-300 yuan) outdoor clothing +325%; middle and high-end price band (300-1000 yuan) +212%; high-end price band (1000 yuan +) +81%.

Risk warning: Poor terminal consumer demand affects sales performance risks, new product development falls short of expectations, and increased online traffic costs affect profit performance.