Athleisure is a large and growing market. As of 2016, the industry generated around $46 billion in U.S. sales, and by next year that figure is widely forecast to hit $83 billion in the U.S. and $360 billion worldwide. That is slightly more than the market cap of Walmart, the largest retailer on Earth by sales.
On the surface, it seems that a large and growing market should be good news for up-and-comers, particularly given the demographic groups associated with the purchase of athleisure wear. Women, particularly those under the age of 50, have been driving the market in the U.S. and around the world, pushing it to its current massive size. But a deeper dive into the athleisure market discovers the trouble for players new and old – it is a crowded place, arguably bordering on over-saturated.
A decade and a half ago, a customer looking for what is now termed athleisure wear had a handful of options. Today, they can go to the Gap’s Athleta, Tory Burch’s Tory Sport, Kate Hudson’s Fabletics, Target’s C9 Champion apparel, Lululemon, Nike, Under Armour, J. Crew – the list goes on and on and on and on, which is the trouble the marketplace is having. Though most recent data indicates that consumer demand is not quite at the white-hot levels of 2016, the market is still large and growing – it’s just not growing enough to warrant the oceans of apparel now on sale.
“The problem with the athleisure market isn’t so much that demand is dropping off a cliff, it’s more that supply is excessive and demand is not quite what it once was,” GlobalData Retail Managing Director Neil Saunders said in an interview with CNBC. “There will likely be more consolidation and pain in the athleisure market over the next few years as the weaker players drop out and the stronger players compete more heavily.”
For players that don’t have multi-billion-dollar backing in the form of an established retail chain or brand, the question is how to stay on the strong side of the line and avoid being absorbed in a market consolidation that is seeming increasingly like an inevitability.
In seeking an answer, the independent DTC athleisure brand Acabada Activewear recently looked to another retail trend: CBD-based wellness.
CBD, short for cannabidiol, is a non-psychoactive ingredient that can be (illegally) derived from cannabis plants or (sort of legally) derived from hemp plants. The mostly legal version is available for sale over the counter in the majority of states – which means that, in the last 18 to 24 months, there has been something of a boom in CBD-infused products. On any given day, a shopper can find CBD pet products, skincare items and more on the shelves of grocery stores and high-end department stores alike. Most of the products are centered on health and wellness, as CBD is reported to have medicinal effects of lowering anxiety and inflammation.
Acabada, in a market increasingly crowded with CBD-containing serums, creams, salves and edible products, saw an opportunity for a wearable version. So last month, they decided to test it out by releasing the world’s first brand of workout wear infused with CBD. The theory behind the product? According to material the brand sent to PYMNTS, it “fights soreness and promotes healing before activity even begins.”
To pull that off, the brand uses what it describes as a proprietary system to wrap CBD droplets in a polymer layer that will prevent evaporation. That polymer is then embedded into the fabric of the athleisure gear. When the customer works out, the action of the material moving across their skin causes the CBD to be rubbed in, thus activating its healing effects. The infusion reportedly lasts through 40 wash cycles. After that point, the apparel still functions as athleisure gear, though without the wellness properties.
Does it work? Medical opinions vary.
“My first feeling is, this is crazy,” pediatric neurologist Robert Carson told The Cut. “But, in actually thinking about it, and it kind of pains me to say it, this could be plausible.”
Plausible, he noted, but not necessarily a lock. It would depend on how efficiently the CBD moved from the workout gear and through the human body. And, as Acabada is a DTC retailer and not a drug company, there aren’t a lot of detailed studies on their new product line.
“There’s no evidence to show that over-the-counter doses and availability of CBD actually treat many of the symptoms people are complaining about,” board-certified emergency department physician Darria Gillespie told Allure. “There’s no way to know if you’re getting too much or too little, or what else is in the product.”
But the bigger limitation Acabada may face is cost: $100 for a pair of leggings that offer only limited-time healing may not be quite the value consumers are seeking in a world where Walmart is selling similar-looking leggings for less than $20. Particularly since early product reviews have not indicated that consumers are noticing any major change to their workout experience.
But in an athleisure market overcrowded with similar products, Acabada has managed to do something that might be even more difficult than creating leggings that heal: It’s found a way to stand apart from the crowd.
At least for the time being.