The concept of “outdoor” is the product of urbanization, based on the maturation of nature awareness, social structure, and environmental infrastructure. We summarize it as “Three Elements of Outdoor Development.”

(1) Changes in industrial structure accompany shifts in vacation demands and evolving environmental awareness, turning the outdoors into a “utopian” destination.

The rise of vacation demands coincides with the emergence of the tertiary industry, leading to heightened expectations for quality leisure time. The outdoors offers mental laborers a space for relaxation and rejuvenation. The term “outdoor recreation” in English more directly conveys the significance of outdoor activities. The tertiary industry, with its core focus on the service sector, involves work that not only takes physical energy but also mental and intellectual energy. This characteristic amplifies the societal need for adjusting mental states. The stress-reducing effects of natural environments have made the outdoors a preferred destination for more individuals during their vacations.

People’s nature awareness has also evolved with the rise of the tertiary industry. As industrialization peaked, the interpretation and perception of “nature” shifted from “conquering nature” to the stance of “utilizing nature” or “respecting nature.”

A turning point in ideological transformation arose from people’s reflections on environmental pollution. In 1962, the book “Silent Spring” criticized pesticide pollution in the United States, which was a social sensation at that time and became a pivotal moment in the shift of environmental awareness.

A similar turn took place in Japan in 1960. After experiencing rapid economic growth post-World War II, Japan faced environmental pollution diseases such as Minamata disease and Itai-itai disease, making people realize the importance of the natural environment.

During that time, a survey asked, “For the happiness of humanity, how do you think we should approach nature?” The majority of respondents believed that nature should be utilized and conquered. However, as environmental pollution issues surfaced in Japan, the number of people advocating conquering nature sharply decreased. In a 2018 survey, 46% of respondents believed in obeying nature, while 42% believed in utilizing nature.

With environmental issues in recent years and a slowdown in economic growth, there has been a fundamental shift in natural awareness in Chinese society. People have been increasingly longing for a pastoral-style life. From the ambitious motorcycle leap across the Yellow River in the 1990s, to large-scale dance productions integrating natural scenery by Director Zhang Yimou in the 2000s, to recent creators like Li Ziqi and Chuangxi Xiaoge immersing themselves in creating pastoral lifestyles.

The relationship between people and nature has transformed from opposition to integration. CNKI (China National Knowledge Infrastructure) also sees surges in the number of articles on nature conservation and outdoor themes. Society’s view of nature has evolved from being a resource for full utilization to becoming an interactive, consumable, and experiential entity.

(2) Changes in industrial structure have compressed working hours, and the prevalence of convenient transportation modes has led more people to choose outdoor activities.

For outdoor consumption, people need to have leisure time. The development of the outdoor market is closely linked to people having more vacation time. On one hand, labor laws protect the workforces’ rights and set an upper limit on working hours. On the other hand, the transformation of the social-industrial structure has resulted in a reduction in working hours. According to OECD statistics, the average annual working hours per employed person in major developed countries worldwide have significantly decreased. From 1970 to 2020, European and American countries reduced from around 2000 hours per person per year to about 1600 hours, and Japan and South Korea reduced from 2200 hours and 3000 hours to around 1700 hours and 2000 hours, respectively.

Having sufficient time is not enough; there is also a need for efficient means of transportation to reach outdoor destinations. The ongoing development of transportation methods has brought new opportunities and transformations to the outdoor industry. The popularization of automobiles, the expansion of railways, and the reduction in airfare have provided consumers with more convenient means to reach outdoor destinations.

Taking the example of Yuzawa in Niigata, a skiing destination in Japan, after the Shinkansen (bullet train) opened direct access from Tokyo to Yuzawa in 1982, the number of skiers skyrocketed, rising from 3.7 million in 1982 to 8.18 million in 1993. Many young people living in cities chose to go skiing on weekends, even making same-day round trips, turning skiing from a vacation into a daily “convenient travel.”

We find through comparison that the most significant factors affecting the outdoor market in China are the excessive concentration of vacation time and insufficient public transportation. Firstly, China’s vacation time is concentrated during National Day, resulting in a surge in demand nationwide for specific areas. This leads to short-term, low-frequency and concentrated outdoor consumption, detached from the novelty-seeking attribute. Secondly, most outdoor facilities in China require self-driving, lacking sufficient public transportation, and the popularization of automobiles is also limited by external constraints such as urban restrictions on vehicle purchases and parking locations.

(3) Environmental infrastructure determines if people adopt the outdoors as a lifestyle.

What people seek is not true wilderness, but a relatively comfortable outdoor experience. Another prerequisite for outdoor demand is the appropriate exploitation and utilization of nature, turning it into a consumable space and continually attracting urban residents by providing a comfortable environment.

The maturity of outdoor infrastructure directly influences user experiences, impacting the lifecycle of outdoor activities. Comparing skiing resorts in China, Japan, and Austria, Kitzbühel in Austria not only boasts a superior ski environment but also features a richer array of supporting facilities such as retail infrastructure, residential options, and catering services. Excellent infrastructure results in an average stay of up to 6 nights for skiers, ensuring stable repeat business and making it a choice for family vacations.

This outcome sharply contrasts with Japan’s “convenience-oriented travel” in skiing. In the late 1980s, during the skiing boom, Japanese ski resorts, to cope with the concentrated demand during the Golden Week and weekends, built large-scale resort hotels. Ski resorts were overcrowded during holidays, while were relatively deserted on weekdays. This convenient travel model compromised consumer experiences and deep interactions with the local community, making skiing easily substituted by other recreational activities. The skiing market in China may face similar challenges in the future. Japan’s camping market faced similar issues, which we will analyze further through the development of the camping markets in the United States and Japan.

In the dynamic landscape of the outdoor market, many enterprises have successfully weathered industry cycles. GenBridge Capital, recognizing the pivotal role of extensibility in outdoor businesses, outlines a path through what is termed the “Golden Trio of the Outdoor Industry.” At the apex of this triangle lie three core elements: functionality, fashionability, and cultural significance.

Functionality means product innovation based on functional needs, like ease of movement, waterproofing, sun protection, breathability, and safety. Given the potential threats posed by nature’s elements such as cold, humidity, and heavy rain, functionality holds paramount importance. Additionally, in different natural environments, users may need to wear outdoor clothing for extended periods during sleep and movement. Therefore, outdoor apparel must place significant emphasis on comfort and usability. Brands often initiate their foray into the market with a focus on functionality. Examples include Montbell’s sleeping bags using Dupont’s latest materials, North Face’s waterproof zippers invented by YKK, and Patagonia’s camming devices.

Fashionability revolves around differentiation, using imitation and the acquisition of specific labels to stand out and adjust social relationships. Outdoor lifestyle serves as a material for urban individuals to attach symbols of differentiation to themselves. This remains particularly pronounced in Asian countries where outdoor activities still represent a fashionable and luxurious lifestyle. Outdoor pursuits can effectively alter relationships among individuals. Examples include LL Bean capitalizing on the Preppy Trend, North Face’s Urban Outdoor style Nanamica Purple Label series in Japan, and Descente’s fashion-oriented differentiated designs in South Korea.

Cultural significance refers to a brand becoming a shared understanding among a group of people, possessing and sharing the same values and belief systems. Cultural attributes often encompass fashionability, but the primary goal is not differentiation. Cultural attributes are likely developed through iconic events, brand community activities, and brand ethos. Notable cases include Burton’s snowboarding culture, Snow Peak’s “Wilderness Adventure is Life”, and Patagonia’s environmentalism.

Case Study of Snow Peak: How It Transitioned from Functionality to Cultural Significance and Weathered Industry Cycles Through Brand Service Innovation

Snow Peak, a renowned Japanese camping equipment enterprise, gained strong brand momentum by providing high-end tents, camping facilities, furniture and apparel. Its revenue soared from 3.6 billion Japanese yen in 2014 to 16.7 billion in 2021, with its market value surpassing hundreds of millions of Japanese yen.

Entering the camping scene in the late 1980s, Snow Peak introduced its first high-end tent, priced significantly above the market average. To everyone’s surprise, this tent not only succeeded but garnered exceptional feedback. By 1993, leveraging the success of high-end tents, Snow Peak achieved its peak with revenues reaching 25 billion yen and an operating profit of around 4 billion yen.

However, the Japanese camping trend experienced a decline in 1995-1996, leading to an operational crisis for Snow Peak. Revenues plummeted rapidly to 1.4 billion yen in 1997, as dwindling camping enthusiasm resulted in fewer channels willing to procure Snow Peak’s products. Facing rejection from channels, the founder and employees found themselves at a crossroads. In 1998, the second-generation leader, Tohru Yamai, officially assumed the role of president, seeking a transformation opportunity. The breakthrough came from an employee’s simple observation:

“After being rejected several times, I began to question whether Snow Peak still held meaning for society. It’s not just me, my team felt the same way. Then we noticed that with the decline of camping, camping activities across Japan were fading away. At that moment, a team member said, ‘We may not know our purpose in society, but we know that seeing smiles on our users’ faces gives us more motivation.’ This made me realize that we should enjoy camping with our users and began planning Snow Peak camping events. The guiding light on our path forward was our users.”

With this newfound perspective, Snow Peak published a small-page ad in a magazine and organized its first camping event in January 1998, with only 30 participants. This event became an opportunity to listen to consumer needs and gradually evolved into the IP camping event series known as Snow Peak Way, which continues to thrive to this day.

In the first event, Yamai Tohru obtained two crucial pieces of feedback through direct communication with consumers:

1. Consumers acknowledged the excellent quality of Snow Peak’s products but expressed concerns about the high prices.
2. The predominant sales channel was wholesale to distributors, resulting in no single store displaying the brand’s entire product range. Consumers were unable to see the true face of the brand.

Subsequently, in 1999, Yamai Tohru made two bold reforms. Firstly, he terminated all collaborations with intermediaries and shifted to direct-to-consumer (2C) retail or collaborated directly with retail channels to open in-store boutiques. The number of terminal sales points decreased from 1000 to 250, bringing price down by roughly 25%. Product originally priced at 80,000 yen dropping to 59,800 yen. A dedicated full-time employee was stationed at each in-store boutique in major channels to enhance consumer understanding of the brand and products. Simultaneously, Snow Peak established large-scale flagship stores to showcase the brand’s lifestyle and worldview, featuring not only tents but also a variety of categories, including cookware, accessories, outdoor furniture, and more.

Following these changes, Snow Peak implemented policies such as permanent guarantee, further strengthening its relationship with consumers. If a weekend camping product broke, consumers could bring it to the store on Monday, the store would send it to headquarters on Tuesday, repair it by Wednesday, and ensure it was back in the hands of consumers by Friday for weekend use. This permanent guarantee nurtured customer trust. High product quality and service provided ample support for selling products at high added value.

Despite a decline in revenue, Snow Peak’s net profit has consistently increased year by year since 2000, resulting in more stable and healthy growth. The brand has also gained a group of high-net-worth users, establishing unique brand assets and recognition.

Snow Peak’s path through the industry cycle aligns with the “Golden Trio of the Outdoor Industry.” Initially, Snow Peak achieved substantial growth during the dividend boom by introducing differentiated high-end and high-performance tent products based on functionality. However, during the industry downturn, the company strengthened its interaction with consumers through initiatives like Snow Peak Way, offline flagship stores, and a lifetime warranty system, deepening the brand’s cultural tone. Choosing cultural significance over fashionability in the camping industry is a strategic decision based on the unique attributes of the camping industry.

The camping industry, like a beach, faces continuous waves from surrounding industries. Camping is a consumption scenario that combines various product categories, making it easy for product demand to be diverted by adjacent fields due to a lack of sufficiently differentiated major categories. For example, tent categories are prone to competition from comprehensive retailers like Montbell and Decathlon, clothing categories are susceptible to infiltration by outdoor or functional clothing brands like The North Face, Patagonia, and Uniqlo, while cookware, furniture, and some hardware products can be easily replaced by affordable alternatives in the Home Center format. Establishing barriers in a specific category is challenging for brands in the camping industry.

Snow Peak’s first generation of L Field Tent (Source: Official Website)

Faced with the dual pressure of the industry’s inherent characteristics and the downturn cycle, Snow Peak, through service innovation akin to community operation, has garnered a group of high-net-worth users. In the downturn of the camping trend, what often remains is a group of consumers who are most passionate about camping. These users have become the brand’s most effective ambassadors, providing stronger potential energy for the brand when the next cycle arrives. They acknowledge the value of the products and are willing to accept premium pricing. Snow Peak’s brand culture, “Wilderness Adventure is Life”, is considered a part of their life values.

The strategy of targeting high-net-worth users with strong product performance and a robust cultural approach has been reinforced under the Diderot Effect in the consumer goods industry. The Diderot Effect is a “the more you get, the more you want,” a common law in the consumer industry. Starting from small products like cups, Snow Peak’s products deepen the relationship with the brand every time consumers use, repair, or participate in Snow Peak activities, permeating beyond the campsite scenes. This turns consumers into regular customers for the brand. For Snow Peak, the product itself not only needs sufficient differentiated performance but also requires maintaining the consumer experience, allowing the Diderot Effect to grow larger.

Extending from functionality to culture, as seen in the case of Snow Peak, is a relatively rare occurrence in the outdoor industry. The majority of enterprises achieve brand culture by starting with fashionable product innovation, capturing a larger audience through continuous interaction with consumers and eventually crystallizing the brand’s cultural identity. The path from functionality to fashionability includes various cases such as The North Face’s Nanamica, Descente’s fashion extension in South Korea, and L.L.Bean capturing the Preppy trend. This path has enabled these enterprises to successfully traverse the cycles of the outdoor industry.

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