The pandemic leads to a running boom in America: Morning Brief

Tuesday, June 2, 2020

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Solitary fitness has replaced group fitness

In the 2010s, group classes became the fitness world’s hottest trend.

Services like ClassPass democratized yoga and barre studios, while the likes of Barry’s Bootcamp and Orange Theory helped combined buzzy HIIT (high intensity interval training) workouts with an upscale, pay-as-you-go model that served as an alternative to the gym membership.

But with the COVID-19 pandemic shuttering most fitness classes — and research suggesting these settings are ripe for spreading the virus — Americans appear to have embraced solo fitness endeavors out of necessity.

And a big winner appears to be the performance running sneaker industry.

According to analysts at Bank of America Global Research brands like Brooks, HOKA One One, On Running, and Nike’s (NKE) performance running sneakers stand to benefit from a resurgence in interest in running outdoors.

BofA’s analysis shows that Google search trends for Brooks — which is owned by Berkshire Hathaway (BRK-A, BRK-B) —are up 83%, while searches for HOKA, owned by the Deckers Outdoor (DECK), are up 65%, and Swiss startup On Running (which counts Roger Federer as an investor) has seen searches rise 28%.

The firm also notes that searches for Nike Running are outpacing this entire group, rising 104% through May 24.

“We believe key beneficiaries from the relative momentum in performance running are [Nike] & [Deckers Outdoor],” BofA wrote in a note to clients published Monday.

“[Dicks Sporting Goods] (DKS) should also be a significant beneficiary with its broad offering of performance running brands (Nike, Brooks) and the recent announcement as the first sporting goods retailer to carry HOKA,” the firm adds.

And outside of running, outdoor solo or small group activities like biking and hiking are likely to be beneficiaries from new post-COVID fitness trends. BofA notes that downloads for apps like the Nike Training Club (up 510%), Nike Run Club (up 144%), and Strava (up 222%) suggest consumers picking up new fitness habits.

Fitness apps for solo workouts like running, swimming, and biking have surged in a post-COVID world, with Bank of America seeing this as a positive trend for companies making running sneakers. (Source: Bank of America Global Research)

Through the years, the specialty run business has seen a few mini booms and busts.

In the 1970s and 80s, brands like Adidas, Asics, and the newly-founded Nike flourished amid interest in marathons and road races as athletes like Bill Rodgers and Alberto Salazar rose in prominence.

The distance running world’s most recent boom was sparked by Christopher McDougall’s 2009 book “Born to Run,” which was followed by a rise in “minimalism” as an overarching trend in performance sneaker design.

Notably, HOKA’s line is centered around a “maximalist” idea that more protection for the foot and shock absorption — not less, as advocated in Born to Run and by companies in the years that followed — is the best way to build a performance sneaker.

So we’ll see what changes this renewed interest in running outside has in store for the industry.

By Myles Udland, reporter and co-anchor of The Final Round. Follow him at @MylesUdland

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