Despite widespread concerns over obesity, diabetes and other health issues, most Americans believe they are in better-than-average health for their age. According to the SGMA’s “2008 State of the Industry Consumer Survey,” the industry faces an uphill battle in convincing Americans to exercise and get active.

According to the survey, 53 percent of men and 47 percent of women believe they’re in either “excellent” or “good” shape, and 34 percent of both men and women believe they’re in “average” shape. Only 16 percent of men and 19 percent of women consider themselves “below average” or in “poor” shape.

“People think they’re healthy and they’re not,” says Tom Cove, president and CEO of SGMA. “But that represents a tremendous opportunity for the industry. If [consumers are] hearing from their doctor that they’re not healthy, they might realize they need go to the sporting goods store to get in shape.”

As part of his “State of the Industry” presentation at the recent SGMA Team Sports Show and SGMA Sports Licensing Show, Cove broke down the numerous opportunities and challenges facing the industry. His overall presentation focused on the consumer more so than in past years, because vendors responding to SGMA’s “State of the Industry Survey” in early 2008 indicated that slower consumer spending was their top concern going into the year. In recent years, the greatest concern had been gaining market share-a perennial goal for vendors in a mature market.

“The concern today in sporting goods is more focused on the economy than we’ve seen in several years,” notes Cove, who also points to rising prices emanating from China as another, newer, worry.

Although core sports participation continues to grow in many activities-such as baseball, ice hockey, lacrosse, paintball, tennis, triathlon, running/jogging, and cheerleading-Cove observes that the industry continues to get hurt by a significant drop-off of people engaged in team sports beyond age 18. Casual play also continues to decline, especially in basketball and softball.

From a consumer standpoint, the survey clearly shows that the messages around the importance of physical activity aren’t getting through to many Americans. Of those surveyed, 45 percent (38 percent of males and 50 percent of females) didn’t participate in any sports activities during 2007.

The three biggest reasons Americans gave for not participating in sports were that they didn’t enjoy sports or fitness (25 percent of males, 34 percent of females); they had an injury or health problem (29 percent of males, 31 percent of females); or they did not have enough time (22 percent of males, 27 percent of females). Other reasons cited were that participation was too expensive (14 percent of males, 20 percent of females), and that there was a lack of opportunities to play (13 percent of males, 11 percent of females).

Asked what would motivate them to participate, respondents answered less-expensive equipment/fees (17 percent of males, 36 percent of females); doctor’s recommendation (18 percent of males, 22 percent of females); a less intimidating atmosphere (10 percent of males, 26 percent of females); a tax deduction for cost (12 percent of males; 14 percent of females); and a possibility of meeting new people (10 percent of males; 11 percent of females). A whopping 40 percent of male and 24 percent of female non-participants agreed that, “Nothing would motivate me.”

Of the 55 percent of respondents who did participate in sports, the most popular activities were fitness (selected by 35 percent in total); outdoor sports (23 percent); individual sports (21 percent); team sports and water sports (both 11 percent); racquet sports (8 percent); and winter sports (6 percent).

Asked what would drive them to participate more, the most common response for both genders was more available time (45 percent of males, 54 percent of females). More disposable income (36 percent of males, 44 percent of females); spouse/family member participation (26 percent of males, 34 percent of females); more/better access to facilities (28 percent of males, 34 percent of females); and more organized activities (19 percent of males, 24 percent of females); rounded out the participation drivers.

When participants were asked what would drive them to spend more money on sports equipment, 55 percent cited more disposable income. Other reasons cited were a tax deduction for cost (26 percent); opportunities to test equipment prior to purchase (18 percent); and innovative new equipment (17 percent). Twenty-nine percent responded that, “Nothing would motivate me.”

Cove finds it surprising that only 17 percent mentioned “innovative new equipment” as a driver of purchases of sports equipment-especially since much of the industry’s marketing addresses such aspects. Not having enough time or money are the primary reasons that people aren’t participating in sports, and Cove also feels that a major part of the problem is that Americans’ lives are absorbed by so many other activities besides sports.

“We used to take for granted that our industry was part of America’s lifestyle, but it’s not as central as it once was,” laments Cove.

Nonetheless, Cove believes that more innovation and smarter marketing would help. For instance, Baby Boomers have been turning to exercise to remain vital, yet Cove can’t think of one major sporting goods vendor that is running a marketing campaign around fitness walking shoes, the key category for aging Americans. “[Baby Boomers] have more money and more time than most consumers, and they’re clearly focused on getting healthy,” he says.

Trumpeting the message about the positive impact of physical activity would also help. As part of that, SGMA is currently sponsoring a bill in Congress, called PHIT, which would allow tax deductions for purchases of certain types of equipment as well as for certain use fees. Cove also notes that $75.7 million in PEP grants are being awarded in 2008 to schools and community-based organizations to support physical education and physical activity programs.

“Our whole intention [in Washington] is that we’ve got to provide backing to encourage healthy lifestyles, and not just programs for after you get sick,” explains Cove.

SGMA is also supporting legislation that would provide duty-free treatment of certain footwear and sports items, including ski and golf equipment, that are imported into the U.S. Congress is also expected to pass tough laws governing product safety, testing, and import regulations, which may particularly affect children’s products. Trade policy could also change significantly, depending on the presidential election and political divisions in the House and Senate.

But Cove admits that the main concerns for industry participants are the state of the economy and rising costs largely coming out of China. Although the industry appears to be hunkering down to ride out this difficult period, it will not pay to be too cautious.

“If we wind up putting less product on the shelf and do less refills, the consumers will be coming in and not finding anything,” warns Cove. “We’ll wind up missing out on the buzz and vibe that has to be there to drive the industry.”