Climb Beyond. Market Research for the Introduction of a New Product into the Indoor Climbing Sport

Contents

1 Introduction
1.1 Indoor climbing
1.2 Hypothesis & research questions
1.3 Product description
1.3.1 Body and movement tracking
1.3.2 Body projection
1.4 Market assessment
1.4.1 Private expenditures for leisure and fun
1.4.2 Sports
1.4.3 Indoor climbing facilities
1.5 Discussion of uncertainty
1.5.1 Capital concerns
1.5.2 User acceptance and other innovations
1.5.3 Goals and limits of this thesis

2 Literature Review
2.1 Market research in practice
2.1.1 The market research process
2.2 Climbing as a niche market
2.2.1 Rock-Climbing and Indoor-Climbing
2.3 Motives
2.4 Progression
2.5 Conflicts & Regression
2.6 Linking the hypotheses

3 Methodology
3.1 Qualitative research
3.1.1 Interviews
3.1.2 Topic selection & outline
3.1.3 Method of data collection
3.2 Quantitative research
3.2.1 Questionaire design
3.2.2 Site information and sampling technique
3.2.3 Method of data collection
3.2.4 Variables

4 Results
4.1 Results of Interviews
4.1.1 Selection and discussion of valid results
4.2 Results of the questionaire
4.2.1 Response and completion rate
4.2.2 Adjustments and data correction
4.2.3 Publishing the results
4.2.4 Geographical distribution and general demographics
4.2.5 Gender demographics
4.2.6 Demographics on training intensity and performance
4.2.7 Findings
4.2.8 Research question 1
4.2.9 Research question 2
4.2.10 Research question 3
4.2.11 Research question 4

5 Discussion and Conclusion
5.1 Summary of the results
5.2 Factors influencing the product
5.3 Limitations and boundaries
5.4 Suggestions for future research

A Interview guideline (German)

B Transcripts of interviews (German)
B.1 Petra
B.2 Richard
B.3 Gerhard
B.4 Christian
B.5 Silke

C Interview codices

D Questionaire
D.1 German version
D.2 English version

List of Figures

List of Tables

Bibliography

Chapter 1 Introduction

Indoor climbing is a well recognized sport since the 1980’s but anyone who never tried climbing himself might have problems in understanding the topic of this Master’s thesis. Therefore this introduction chapter gives not only an overview about the research questions but also about climbing as a sport and as a niche market.

This chapter consists of a short introduction to the sport of indoor climbing followed byfour hypotheses which have been the basic idea for this thesis. Afterwards the product idea isdescribed. This idea is the direct result of the observed hypotheses. The product descriptionis followed by a market assessment showing that there is a valid market need and an accuratemarket size for introducing the product to the market. The closing section of this chapteris a discussion of uncertain points that potential investors might argue when it comes to thedevelopment of the actual product. The research done in this thesis will reduce these concernsand uncertainty to a minimum level.

1.1 Indoor climbing

Indoor climbing is a fun sport for urbanized people with a highly increasing market. Mostclimbing facilities - also called gyms - are located in short distance of people’s home andreachable without long traveling. Neither special background knowledge nor special physicalcondition is needed to just start climbing. It perfectly fits the trend of adrenalin sports wherepeople who are stressed by daily life just want to cross the physical borders of what they arecapable of. Climbing forces you to face your fear of height, your fear of falling and your fearof being secured by a thin rope that is hold by second person that you have to trust. But itgives you the joy of succeeding, of reaching the top, of learning new moves, of trying moredifficult routes and being better than others. The combination of these extremes makes thissport so attractive to many people.

The climbing market itself is divided into indoor and outdoor climbing while indoor is themore attractive part for urbanized people. Indoor climbing is frequently called sport climbing or gym climbing while outdoor climbing is rather used for recreational or rock climbing.Furthermore the indoor market is divided into bouldering and rope climbing. Bouldering means climbing on walls of smaller height without being secured and without any furthertechnical equipment. It allows a person to learn technical skills and moves without the fear offalling. When you fall, you simply fall onto a soft mattress. Most routes used for boulderingare aligned horizontally instead of vertically. In contrast rope climbing allows people to climbup to a typical vertical height of 8 to 24 meters being secured by a rope that is controlled by asecond person standing at the bottom. This requires specific knowledge about securing, usingropes and knots and the usage of further technical equipment. Even though rope climbing ismore complicated and more dangerous than bouldering, it is also the more attractive part ofclimbing because it contains all the fears and joys listed above.

1.2 Hypothesis & research questions

As shown by Hörst (2008)¹, climbing requires technical, physical and mental strength equally. That is one of the keys why this sport is so attractive to many people. Nevertheless most climbers fail to advance in at least one of these fields. This is as an opportunity for the introduction of a new product. This thesis tries to identify why climbers fail to advance and it will show that this new product can help them to continue to climb and learn technical issues faster and feel mentally more secure.

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Figure 1.1: Relative demands of various sports

Improving in climbing skills means working on each of the three strengthes for yourself:technical, mental and physical. One usually does so by training with others or attendinginstruction courses. But most courses focus on rope climbing and the security issues thatcome along with it. Only advanced courses try to focus on technical skills like dynamicmoves, jumps or on mental disciplines like challenging your fears. Courses and prices varydepending on the level of difficulty and how advanced the participants are. For instructors itis rather difficult to teach every single participant separately or to even tell them what theirown capabilities are if the group has more than five students. There is an opportunity toteach starters in a different way that gives them more personal feedback and a faster successrate.

As described by the British Mountaineering Council (2003) the indoor climbing marketexploded from the late 1980’s to the beginning of the new millennium. Western countries likethe US, UK and Germany have already entered a saturation phase or at least will enter it inthe near future. For the companies that operate indoor climbing gyms it gets more and moredifficult to offer something new exciting for the active climbers and during summer period itis even more difficult to even fill the facilities with visitors especially if natural rock climbingareas are in a close distance.

The new way of teaching that is proposed in this thesis addresses all these issues. It helpsinstructors to disgs experienced climbers to feel more secure on the wall where they are usually lost and afraid whenever they do not know how to continue. And it enables operators of indoor climbing facilities to make their service more attractive. For users it also allows tracking their own training progress at home or even compare themselves to others.

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Figure 1.2: Training response on climbing

The new product combines state-of-the art technology to give users the real climbingexperience directly from the start. It helps people to enjoy climbing and facing their fear. Ithelps them to advance faster while saving money on instruction courses because they mightnot need an advanced course anymore. Without the product and its surrounding services,anyone who just starts climbing will experience a learning curve as discussed by Hörst (2008)² and shown in figure 1.2. But for urbanized people a faster increase is of high interest. Peopleare laking time and patience to wait for success. The new product and services aims toincrease the learning curve much faster.

The following hypotheses are based on the needs of indoor climbers that will be served by the product and its services.

1. Climbers want to get better and they know that they have problems doing so.
2. They want to learn faster and they know that they have to train more often but do not have the time to do so.
3. Many climbers realize that they need help only when they are in a problematic situation and not before.
4. A significant number of startes stops to climb because they do not advance.

Each hypothesis will be discussed throughout the thesis. Not only to evaluate if the hypothesis is valid but also to show that they are important factors for identifying the available market size and level of acceptance of the new product. Therefore the weight of each single factor is of high interest.

1.3 Product description

The idea for the new product was born while attending an instruction course and observingother climbers in the gym. There was a feeling that most of the people really want to getbetter but that professional climbers do not really care about them and that there is a hugegap between what most people want and what is offered to them. The product and its servicesaddress the needs of these climbers directly. Not only for learning and advancing but alsoin how to access and use the service. Climbing is a sport and sometimes it is risky. Peoplesweat, people fall and they have to take care not to injure themselves or others. Any newproduct has to make sure that climbers want to include it in their athletic activity and thatthey can access it easily without any danger.

The following pages will introduce a product idea that directly resulted from the observation mentioned above. It is explained why the product is designed in this specific way. The empirical research within this thesis then tries to identify that the product addresses real valid issues that are perceived by a large group of climbers. It reduces the uncertainty that comes along with the introduction of a completely new product into a market that is highly averse to technological applications. Matching the perception of climbers with the product and services will reduce the uncertainty to an acceptable level.

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Table 1.1: Video tracking and body shape extraction

The central product is a device that can observe and track any user while climbing upa route. This is achieved by a video camera system that is able to record the user into avideo file. From that video information the shape of the user’s body can be extracted andreprojected as helpful visual information onto the climbing wall as shown by the two figuresin table 1.1. The projection is done by the second component of the device which is mostlikely a monochrome laser beam. That visual information assists in finding the next stepwhile climbing up the same router again or when previewing and analyzing the steps beforestarting to climb. Extended services will be available online allowing users to see their own performance at home or comparing themselves to others.

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Figure 1.3: A series of climbing moves

The product is designed to be easily used and accessible all the time for little money. Surrounding services for accessing data remotely might cost a premium. Because all the technology is put into a single small device, any existing climbing gym can be enhanced by just installing the device and calibrating it to their specific environmental conditions (point of view, light and shadow). There is no need to change anything else in the gym itself. Only the device and an Internet connection are required.

1.3.1 Body and movement tracking

Using your complete body is an important factor when it comes to improving your climbingskills. Despite the human nature of using your hands and arms to climb, the real step forwardin training comes when a climber learns how to climb with the help of legs and the correctpositioning of the body. This is important for saving energy when climbing up a wall. Whenit comes to help in climbing sport everyone says that just pointing visually to the next gripwill be enough to let the climber know where to put the hands for the next move. But becauseit is so important to learn how to position your feet and body, a well designed help systemshould include that in the learning process. Therefore recognizing, tracking and comparingbody positions and movements is the most important feature of the product that is introducedin this document. The extracted shape of a body can also be used for analysing the style of climbing or where the climber lacks technical skills. This can be used for giving training advices within an online community.

For a long time body recognition was a topic only in security surveillance industry. Butnow it is a huge topic in the gaming industry and therefore for the broader public. Devices likeNintendo®WiiTMand Sony®EyeToy®allow players to use their body to interact freely withthe game. But the real break-through was done by Microsoft®with KinectTMfor XBox®360because it tracks up to four bodies (including skeleton data) at the same time and no additionaltechnical equipment has to be held by the player. KinectTMis the first device that has acomputing power that is high enough and a latency low enough to give the player a smoothfeeling of real interaction. Ten years ago this would have been impossible but nowadaysevery teenager knows about that topic and feels comfortable using this technology. The samedevelopments are of interest for indoor climbing because they allow detailed tracking of ahuman body. Within indoor climbing any device that does not need to be worn on the bodyhas a clear advantage. Therefore only Microsoft®KinectTMis of interest. But the device onlyworks up to a distance of 3.5 meters. Typically distances in indoor climbing gyms are 3 to 10 meters if a camera should have a good viewport onto the climbing wall. This is why adifferent method of using two cameras in a stereoscopic mode will be used. Tracking dataincludes:

- Video recording for later playback, comparison, assisting and teaching
- Distance information for terrain/wall recognition to determine the distance of the climber between the camera device and the climbing wall
- Shape recognition of any human body for compressed data storage and laser reprojection
The -dvantages of these tracking method are:
- re-usage of existing technology: Stereoscopic or cameras with depth/distance recognition are on the market
- re-usage of existing algorithms from the scientific field of computer graphics
- full body recognition: a complete human body is tracked and not only hands or feet
Othe- advantages are obvious because no additional equipment is needed:
- people do not need to buy any new equipment
- people do not need to wear anything on their body
- no markers are needed to put on hands and feet (as used in motion capturing in filmindustry)

1.3.2 Body projection

Tracking a climber on the wall is the first step to record the data that is needed to learn for yourself or to teach others. Therefore the tracked data can be used in digital services like websites and communities or it can be used for re-projection onto the climbing wall. One option is to learn when the shape of the body of a professional climber is projected onto the climbing wall while a less experienced climber tries to climb up the same route. Projection is done while climbing so that the next best move from the current position can be seen. The user will feel much more secure and assisted. The projection can also be used for a step-by-step view to learn about the route while still standing on the ground or being online at home and preparing for the next training session.

The projection must be easy to see, bright enough and easy to understand. Indoor climbing walls are usually colored in white or beige with smaller parts of the wall being colored in red, yellow or light grey. Furthermore the environment is fully lightened by powerful lamps from opposite walls or the ceiling and the grips and handles are colored as well. Therefore a monochrome laser beam projection, that everybody is familiar with from laser shows or laser pointer devices, will be used. The purposes are:

- mature and inexpensive technology
- security issues of laser beams are well known and easy to handle
- perfect contrast and brightness even under very bright environmental conditions
- low maintenance costs, low energy consumption and long life time
- compact design

1.4 Market assessment

1.4.1 Private expenditures for leisure and fun

Indoor climbing is an activity that is done in people’s free time. Therefore it belongs tothe financial indicator of expenditures that are done for leisure and sports. Assessing themarket data for climbing starts on the overall expenditures of private households and publicgovernment in this sector. The publicly available data for this sector is given by the NACE³ codes for retail and wholesale as well as rental agencies for sports equipment. Unfortunatelythere are no NACE codes that go into climbing sport in more detail. Table 1.2 is based on thedata report as annually published by the German Federal Statistics Office (2005) to (2009).Due to a change in methodology the data after 2009 is not comparable to the data before.There is also a negative peak between the years 2008 and 2009 which is due to the economiccrisis that started in fall 2008. The data for 2010 and 2011 was not yet available.

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Table 1.2: Retail and Wholesale with bicycles, sports equipment and related material

There is an obvious trend that the business for sports equipment is increasing. Mostnumbers nearly doubled within just five years. This fits another trend that people do have anincreasing sensitivity for a healthy life style and that they are willing to spend more moneyfor it. This theory is also supported by the German Federal Statistics Office (2006 b)⁴. Basedon the same report⁵ figure 1.4 on time usage for leisure and culture is constructed.

According to the German Federal Statistics Office (2006 b, p. 149) each single householdspends on average 11% of the income on leisure and sports. This is e 218 a month whichsums up to e 2616 annually. The German Federal Statistics Office (2010 a) records about 40million households. Therefore the money spent on leisure activities sums up to e 104 billion⁶ annually. The same data reveals that 52% of the people in east Germany and 44% in thewest are doing any kind of sport at least once a week. The trend observed in the retail andwholesale industry for sports follows the same trend because the number of people doingsports on a regularly basis increased by more than 30% from 1998 to 2004. At the same time the German Federal Statistics Office (2010 b) shows that the number of people working in positions that require higher qualifications increased from 33% in 1992 to 42% in 2010. It can be assumed that these people do have a higher income that allows them to spend more money on leisure, sports and culture.

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Figure 1.4: Money spend on leisure and percentage for sports once a week

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Table 1.3: Percentage of people doing sports once a week

1.4.2 Sports

Now the expenditures for leisure, sports and culture are known, the data has to be splitup to expenditures done on sports only and - if possible - on indoor climbing. There isnot much recent data on climbing publicly available. Therefore the most current data forthe United Kingdom and Germany is used for the evaluation and as a basic assumption forwesternized countries. The 61% of the people in Germany that do sports at least once aweek are summarized in a group that includes walking, jogging, hiking and climbing (GermanFederal Statistics Office 2006 b).⁷ According to 81.2 million German citizens as recorded bythe German Federal Statistics Office (2010 a) there are around 36 million people⁸ doing sports regularly and 22 million of them (61%) are doing one of the activities listed before.

There is no official data that further divides this group of activities. However, an unvalidated assumption records 350.000 active climbers in Germany in 2011.⁹ For the UK a numberof 700.000 people in 1993 has been recorded by the British Mountaineering Council (2003)which is an increase of 40% compared to 1989 and the subset of the participants who engagein indoor climbing amounts roughly to 74%. This number has been seen as still valid in 2003.

Based on these numbers 259.000 indoor climbers are assumed to be active in Germany.This defines a subset of 3 to 4% of the overall group of people that are active in walking,jogging, hiking or climbing. And as published by the German Federal Statistics Office (2006 b)about 60% of them are in an age between 18 to 39 which makes them an interesting targetgroup.

Another important fact is revealed by the German Federal Statistics Office (2006 c) whichreports that the public expenditures on recreation and sports increased from 1.1 billion Euroin 1970 to 5.7 billion Euro in 2003. From these 5.7 billion Euro, 1.7 billion have been spenton the construction of sports facilities and another 1.1 billion on the promotion of sports.

1.4.3 Indoor climbing facilities

Now that the detailed expenditures on leisure and sports are known, another point of interest are the facilities where indoor climbing takes place. These indoor climbing halls vary in geographic location, size, number of climbing routes and height. Valid data is available for the UK from 1998 to 2003 as published by the British Mountaineering Council (2003) and by the German Alpine Association (2003).

According to that data there are about 370 climbing halls in Germany and 254 in the UKin 2003. Other unverified sources list another 60 halls in Austria, 30 in Switzerland, 600 hallsin the US and 90 in Canada. The data also reveals an increasing trend of indoor climbingbecause the number of halls in the UK increased by 477% from 44 in 1988 to 254 in 1998 andin Germany by 48% from 250 in the middle of the 21st century to 370 in 2011. Figure 1.5illustrates the number of climbing gyms for the German speaking part of Europe as well asfor the United Kingdom.

The size, equipment and environment of climbing facilities varies a lot. Therefore theyare of different attractiveness to climbers. In Germany the most attractive and biggest hallsare located in the south-west including Munich, Stuttgart and Cologne. But they are widelyspread all over the country. Based on the date which is published by the German AlpineAssociation (2003) the average calculated numbers per facility in Germany are:

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Figure 1.5: Number of climbing halls per country

- 1.500 square meters in size
- 10 to 16 meter in height
- 100 to 400 different climbing routes

The German Alpine Association lists one facility in Munich as the largest climbing hall with a size of 8.000 square meters and second a one in Duisburg with a size of 7.000 square meters. The third biggest is located in Munich and has a size of 3.750 square meters. In height they are listed with 34 meters in Munich, 31 meters in Leipzig and 18 meters in Dortmund. Of course, these samples are exceptions but they underline the increasing interest in indoor climbing because most of the facilities have been extended during the past 5 years due to increasing number of visitors. For example the largest hall in the area of Munich has been extended from a size of 4.450 in 2009 to 8.000 square meters in 2011.¹⁰

Contacting the two largest climbing equipment manufacturers Black Diamond¹¹ and Mammut¹² did not lead to any new valid data. They redirected to the same sources of information that have been used already. This indicates that these sources are valid. Further data on market size is disucussed in chapter 2.2.

1.5 Discussion of uncertainty

1.5.1 Capital concerns

The device, used for visual recording, tracking and re-projection, should be affordable forclimbing gyms and the surrounding premium services for users as well as for the gym mustbe priced at an acceptable level. The target price for the device should be less than e 5.000.Developing a prototype and installing it on a test site will not consume much money. Theconcerns about capital are more likely within the business model and the cash flow.

Because of the quite low target price, the generated cash flow highly depends on the pricingmodel, which is used once the device is installed, and on the cooperation with the operatingcompany that runs climbing facilities. By selling the device itself no sustainable cash flow canbe generated because the gross margin is low and the indoor climbing market has a limitedsize. Once installed, no further cash flow is generated. Therefore a one-time payment is notan option. For the end user - the climber - there should be no or at least minimum additionalcosts to use the services on-site. Online services might be accessible at additional costs thathave to be paid by the user.

The device will be designedto observe about 5 to 10 different routes depending on thefield of view onto the wall.Therefore an installation of 1to 5 devices depending on thenumber of routes inside a gymis assumed. Because the device is limited to a good viewing angle onto routes, a total coverage of 10 to 40% per facility is assumed. Based on 259.000 active climbers the calculation for the revenue of a facility can be done as listed in figure 1.6.¹³ These numbers reflect the revenue generated by all facilities in Germany. Any business model has to be based on a desired share of these revenues. But the design of the business model is not part of this thesis.

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Figure 1.6: Market share and coverage of visitors

1.5.2 User acceptance and other innovations

The idea for the product and the perception of the market is skewed by personal assumptionsof the author who is a climber himself. Even though the market size is assessed by realnumbers there is no data giving an estimation how many climbers would actually use theproduct. People climb because of various reasons that will discussed in section 2.3. There isan assumption that most of them want to advance but there is no valid data if they agree thatthey might need help or that they would accept or even use help. And the level of acceptancemight differ depending on people’s motivation for climbing and their level of performance.

Even non-climbers know that this is a rough sport. Climbing started as outdoorrock climbing and developed into an urban sport with the rise of indoor climbinggyms in the 1980’s. The first category ofclimbing was free climbing which did notinclude any further equipment. Later ontechnical equipment was developed for securing each other. This is mostly about carabiners, ropes, knots and climbing harnesseswhich is also the biggest market in climbing equipment when it comes to consumer goods Figure 1.7: PowerNPlay USA Belay glasses (B2C). Indoor climbing became popular be- cause people wanted to train even in winter periods. Users developed first artifical walls with colored handles. That user innovation developed into the mass market of todays indoor climbing sport. The business to business (B2B) market of building climbing gyms focuses on artifical walls and on the design of a nice environment.

Until today the only high-tech products are the ones for security issues. But there are nobreak through innovations in information technologies, learning or leisure applied in indoorclimbing. The only innovations that are partly used are belay or prism glasses with a prismain front of your eyes as shown in figure 1.7 so that the securing (belaying) person can observesthe climber.¹⁴ This is to prevent neck problems because of looking with your head up all thetime. The second innovation, which is mostly known in the US, are auto belayers as shownin figure 1.8.¹⁵¹⁶ Usually rope climbing includes two people. One standing at the bottomsecuring the second person that climbs up the wall. An auto belay system allows people toclimb even though they lack a climbing partner. It is installed on top of a route or on theceiling and controls the ascent and descent of the climber with its rope. The problem about auto belayers is that people do not trust them, especially because there have been recordedaccidents. This is because climbing as a team includes a partner check. This means onechecks the other to make sure all security issues are satisfied before climbing up. Using anauto belayer without any further security check by an instructor increases the risk of failureson securing your belt or carabiner to a level that makes people feel uncomfortable. But still,the auto belayer serves a market need. And it has to be found highly successul because itincreased the number of customers in 44% of the surveyed gyms that installed these kind ofauto-belayers.¹⁷

Designing the service proposed by this thesis needsto think about the same issues. There has to be a market where people are willing to use it. People have tofeel secure and owners of climbing gyms need a business reason to install the product in their gym. Therefore, the product should not affect the traditional waypeople climb. The way of using a rope and harnesswith two people, one belayer and one climber, will notbe changed. There is no additional equipment thatneeds to be worn on the body. So the risk of injuriesremains unaffected. The product is more or less anadd-on that can be used if climbers feel the need of assistance. And the surrounding online services donot affect the actual process of climbing at all. This is why the product does fit into the field of learning, help and support. It has nothing in common with security equipment and harnesses.

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Figure 1.8: True Blue auto belayer

But there is no data showing how many climbers might need or even use the product.What percentage of all climbers will be interested in it? What percentage of them will feelcomfortable using it and what percentage of that group will feel a positive effect? Thatis why it is highly important to know how the community of climbers is segmented. Thisincludes people that prefer outdoor, indoor climbing or bouldering and it includes sub-groupsof different levels of experience. Each level might have different motivations, different problemsand a different acceptance level for the new product. Gathering data about these facts willreduce uncertainty. It allows an estimation of a real market size, number of potential usersand the development of a product and marketing strategy and it is a strong argument forpotential investors.

1.5.3 Goals and limits of this thesis

This thesis will test the hypotheses listed in section 1.2 using empirical research. This linksthe research questions to the market and consumer needs that can be satisfied by the product(Morgan & Hague 2004, p. 8). Therefore this thesis does not focus on empirical research only.The focus is on a product, the available market and user acceptance. Empirical researchis used to gain a deeper insight how big the share of potential buyers is. This enables theforecast of business revenues (Morgan & Hague 2004, p.6). This is why the research will beskewed and therefore invalid for other research that focuses on different topics on climbing.Before getting into empirical research any available literature that links the product to indoorclimbing, while taking care of the hypothesis, will be analyzed. Remaining questions that areunanswered by the literature will be included into the research. The overall goal of the thesisis to reduce the uncertainty as much as possible before introducing the product. For moredetails about limits or suggestions for future research please refer to chapter 5.4.

Chapter 2 Literature Review

The product targets the learning curve or so called response rate of people who climb. It also targets the owners of indoor climbing gyms who might be interested in the product because it makes the gym more exciting and more customers might be attracted. Designing the product and surrounding services especially to these needs is essential. Therefore it has to be understood how the market for indoor climbing is structured.

This chapter starts on literature about market research and how it is used in best practice ifa new product is developed. Afterwards related literature which allows a better understandingof indoor climbing from a market point of view as well as from a training point of view isreviewed.

The most intense discussion within this chapter is on market segmentation and different motives of climbers because not all of them will be interested in using the product. Each of the segments has different motives why people climb which might contradict the goals and targets of the product. The discussion then shifts from motives to progression, conflicts and regression. This includes learning and training which comes along with success and a good response rate if people continue to climb. But there are obviously people who fail and stop climbing. It is important to know which factors are perceived by participants, either positive or negative ones, to ensure that the product targets the right issues.

The chapter ends with a summary of the findings from the literature and how they relate to the hypothesis (see chapter 1.2). The combination of both is the starting point for the empirical research done in chapter 3 and 4.

2.1 Market research in practice

It is essential to know what market research is and how it works to understand why this thesis is no pure empirical research but rather skewed to research done on the available market and the acceptance of the product. The use of market research becomes obvious when comparing it with traditional social research. The later one focuses on information about society and social issues which are then used by governmental organizations to make decisions. Market research in contrast is used as a commercial activity to gather information that helps solving a business problem (Adams & Brace 2006, p. 6).

A business is a dynamic entity which is embedded in an environment with outside andinside stakeholders. It will therefore influence the environment and vice versa. To survive inthat environment or even grow the organization needs to make decisions. Especially strategicdecisions might be costly and they therefore need careful research and insight to make adecision. Market research therefore reduces the human factor which makes decisions on guttfeeling and intensions. Conducting market research increases the focus of logical decisionmaking based on valid mesurable data (Morgan & Hague 2004, Adams & Brace 2006).

Market research as a scientific or commercial activity evolved in the 1930’s. Competition between large organizations forced them to have a closer look at consumer needs and their buying habits (Morgan & Hague 2004, p. 2). In the early years research was done using observation and audits. This was due to a distrust in getting honest answers from consumers. Only by the 1960’s a change to qualitative research was made because competition intensified and the experience from academic social researchers was taken into account when gathering data (Morgan & Hague 2004).¹ This reduced the costs of conducting market research while increasing the business revenues by using the outcome of that research.

For what kind of business problems market research is helpful is explained using Igor Ansoff ’s product and markets matrix which describes four categories for business situationsaddressing different problems depending on the situation (Morgan & Hague 2004, p. 4).

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Figure 2.1: Ansoff and market research

Within the context of this thesis the upper quads of the matrix (see figure 2.1) are addressed. Before introducing the product to the market, it needs to be varified if there is a realneed so that the product might be accepted by users. This is the upper left quad. The secondone is the upper right one because even if the product addresses real needs there might beother needs that are more urgent or which will generate higher revenue and more return oninvestment. Doing the research will reveal other needs that have not been discussed so far.

Market research is used in all stages of the maturity curve or product life cycle whilethe meaning of research differs in each stage (Morgan & Hague 2004, p. 5). Within thisthesis market research is done in the very first stage which is the youth or developmentof the product. Market research focuses on unmet needs but it also helps estimating thelikely demand for the product which then allows making pricing decisions. Therefore marketresearch is often used in the context of marketing which leads to the four P’s which are product, price, place and promotion (Morgan & Hague 2004, p. 6). In each of these P’s research is usedfor different purposes. Within this thesis only the first P standing for product is important.But it can also be used for a further research on the second P which is the Price.

While research on the product is usually done by placing the product in front of the useror telling him about product details, research in this document is done without naming theproduct itself. Therefore the focus is on finding out if there is a market for the product andif the market is ready so that the product can be introduced. This is why only people’sperception on climbing sport and their problems are of interest. That knowledge can then belinked to the product design.

Addressing two quads of the matrix as shown in figure 2.1 and focusing on of the P’s ofthe product marketing mix also defines the clear scope of the research. It is restricted towhat is crucial to the decisions that need to be made before, while and after introducing theproduct to the market (Morgan & Hague 2004, p. 8). It therefore sets the product idea andsurrounding services into a relation to real consumer and customer needs with the goal thatthe resulting information reduces uncertainty and business risk. For further details pleaserefer to chapter 1.2, 1.5 and 1.5.3 which discuss the hypotheses, uncertainties of the productidea and goals and limits of this thesis.

2.1.1 The market research process

Conducting market research follows a well definedframework which is called the Market Research Process as shown in figure 2.2 (Morgan & Hague 2004,Adams & Brace 2006, Callingham 2004). This process defines the interaction between an organizationthat is in the need of getting data by doing market research and another entity that actually performs theresearch. It defines which information is needed fromwhich party so that the research can be carried out.

The Brief is a compilation of information that isprepared by the contracting entity and given to theorganization that carries out the research. It containsa list of points of interest for which information shouldbe gathered. It therefore defines the scope of the research. The scope of the research is then refined bythe Proposal and the Commission which are handledbetween both involved entities. The real market research is then done using Qualitative and Quantita- tive research (Morgan & Hague 2004, p. 60) which issupported by Desk research. The findings are thenanalyzed and reported back to the contracting entity.

Because this thesis is not split into a contractingbody and an outside entity that conducts the research,some points of the process are joined. The first threepoints which are the preparation of the research are completely handled in chapter 1. They define the 2.2:Figure Market research process problem, why and what kind of information is needed and they frame the scope. The desk search is done in chapter 2 which reviews the available literature that is related to the research topic. The outcome of the literature review is then used in chapter 3 which describes how the market research is conducted. The last two chapters 4 and 5 are the final part of Analysis and Reporting as proposed by the market research process.

2.2 Climbing as a niche market

In section 1.4 the market of indoor climbing has been assessed on publicly available statistical data for Germany only. It shows that the market is of a satisfying size and that there is an opportunity because of the good growth rate. However, it does not include how the society and active participants perceive climbing and how it is treated in science.

Most of the available literature is about the English speaking market or the worldwide trend of climbing. Early literature handles climbing as an outdoor recreation activity (Bryan 1977, Hobson 2000). By the beginning of the last decade of the 19th century amore detailed discussion on climbing as a serious sport started (Dubin 1992, Olmsted 1993,Stebbings 1999, Iso-Ahola 1999). The evolution from an outdoor recreational activity to anindoor sport is based on the need for more extreme accomplishments and the availability ofsophisticated safety equipment (Rapelje 2004, p. 15). This was made possible by improvements of equipment like carabiners and harnesses but mostly because of the development ofnew climbing shoes with a soft rubber sole which allowed new moves which have not beenpossible before. With each improvement in safety equipment the populartiy of climbing grew(Rapelje 2004, Anonymous 1995, Mittelstaedt 1996, Mittelstaedt 1997, Schrader 1997). Inthe 1960’s the first indoor climbing gyms opened in Europe and in the end of the 1980’s thistrend swept over to North America. Real competition which was mainly based on comparingones accomplishments was made possible by the introduction of rating systems. For eachcontinent or geographical region there is an own rating system but all of them range fromnovice to expert level (Hobson 2000)².

There has been an increase in indoor climbing by 250% from 1989 to 1994 (Anonymous 1995, p. 1) with a continuing growth (Rapelje 2004)³. It is said that the US sees an increase in active climbers by 100.000 a year. In 1994 170 climbing gyms have been recorded for the US and more than 500 single climbing walls for UK while the British Mountaineering Council (2003) lists 254 gyms for UK in 2003.

2.2.1 Rock-Climbing and Indoor-Climbing

Most of the literature defines three types of climbers which are natural rock (outdoor), artificalwall (indoor) and ice climbers (Rapelje 2004, p. 3). From the group of rock climbers about 55.5% also participate in climbing on manufactured artifical walls. Even though there is anotable strong crossover between rock climbing and indoor climbing participants (Rapelje2004, p. 20), it can be argued that there must be a high number of climbers that are onlyparticipating in indoor climbing and never or seldom do in outdoor climbing. This is because more than 49% of all gyms are located in urban areas where natural rocks are out of reach (Rapelje 2004, p. 19).

This becomes obvious if any interactive map of climbing gyms for example in North America is studied. These maps are widely acccessible online and they show a concentration ofgyms around urban hotspots. Figure 2.3 shows a simple search result for the phrase ”Indoor Climbing” done on Google®MapsTMfor the north-east of the United States of America. Another reason for that urbanization is that it gets more and more complicated and difficult toaccess areas for natural rockclimbing because of the increasing popularity of climbing itself(CRYSDALE 2000, p. 3). There is a huge discussion about security issues because rocksmight fall off and injure people. But also because of the way people have to access the rock.The path way often leads through private property. Another discussion is about the chalkthat remains on the rocks which then becomes an environmental issue. There are also areaswhere it is prohibited to use fixed bolts that are screwed into the rock. These are reasons whymore and more people shift into sport climbing which is mostly done indoor (Rapelje 2004, p. 20 and figure 2).

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Figure 2.3: Example of urban density of indoor climbing gyms

2.3 Motives

A lot of research is done on motivational issues on people participating in recreational sports,especially in high risk sports like climbing. They are commonly grouped into categoriesthat describe the climbers desire for risk or challenge, locus of control, recognition, catharsisand creativity (Ewert 1985, Slanger & Rudestam 1997). Gathering motives listed in otherliterature comes to more detailled categories which will be explained later on. Therefore thedifferent well known types of motivation will be grouped into new main categories as listedin table 2.1. This makes them easier to be reflected against the product that is discussed inthis thesis.

Figure 1.1 in chapter 1.2 defines three demands for indoor climbing which are technical,mental and physical (Hörst 2008).⁴ Most motivations can be grouped into one of thesethree categories. All of them are intrinsic motives. Other extrinsic motives like level ofexperience, self efficiency or the level of sensation seeking (Csikszentmihalyi 1990, Slanger &Rudestam 1997) seem to be less important than intrinsic ones because they vanish or loseimportance the more experienced a climber gets (Ewert 1985). But the difference betweenintrinsic and extrinsic motives is critical and needs to be included in the empirical researchof chapter 3 within this thesis. Table 2.1 puts each motive into a corresponding demandcategory.

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Table 2.1: Motivational factors of climbers

Races and competition and recognition are seen as extrinsic motives when it comes tocomparing ones skills to others. But it can also be seen as a friendly competition. CRYSDALE(2000, p. 2) describes this as a scenario where people compare their skills to get better overallinstead of just being better than another climber (Anonymous 1995, p. 1). The extrinsic part of this motivation becomes more obvious when the climbers gets more and more involvedin the community (Kuentzel & Heberlein 2006, Scott, Shafer, Hobson & McFarlane 2001,Schrader 1997). Within the reviewed literature this is the only extrinsic motivation at all.

Competition is strongly related to the motivational factor of community and commitment.Depending on the level of involvement participants are grouped into novice to experts asdefined by Hobson (2000) or into strangers, tourists, regulars or insiders introduced in Unruh(1979). Each climber on a certain level of performance has different motivations, a differentrelationship to the group and therefore a different commitment (see chapter 3.2.4) to climbing.For some people who reached the very top level the activity becomes a central point in theirlife (Dubin 1992, Scott et al. 2001). For these individuals the community is not only agroup where they can be active in the desired sport. They also build friendships and strongrelationships to other community members (CRYSDALE 2000, Kuentzel & Heberlein 2006).

Outdoor climbing is usually known as a high risk sport. But due to the improvements madein equipment climbing is now seen as less dangerous than most other sports as for examplesoccer (CRYSDALE 2000, Kuentzel & Heberlein 2006, Anonymous 1995). This might soundirrational but for some people this seems to be a motivational factor to prefer climbing insteadof other sports. On the other hand some climbers are seeking for the thrill and borderlineexperience (Rapelje 2004, p. 28). They are testing their physical and mental limits of whatthey are capable of for the sake of continually improving their skills (Hobson 2000, p. 19). Thisis also related to a certain degree of death anxiety (Schrader 1997). Heywood (1994) arguesthat ”the unpredictability, the risk, the irrationality of climbing are substantially matters ofchoice”. Any climber can chose the level of risk and difficulty accordingly to his or her skilllevel. This makes climbing superior to other sports because there is a level of difficulty foreach level of experience.

While testing personal limits is already a challenge some people define that specific motivation in a different way. For them climbing is more like playing chess or solving a puzzle. Each new route, each problem is a challenge they want to solve. Once done, they feel some kind of pride, satisfaction and accomplishment because they have reached the top or managed to get through the problem (CRYSDALE 2000).

From a mental point of view climbing helps people to forget about their daily problems, their worries and sorrows. It therefore helps to relief stress (CRYSDALE 2000). This is because climbing forces one to focus on the wall, on security issues and on the moves that are needed to reach the top. Compared to other sports this relief does start immediately and not just after a warming up phase. The moment a climber touches the wall with his or her hands and starts to think about the right moves, this relief will be there.

Fitness and body as a motivational factor is about living healthy and getting to know yourown body (CRYSDALE 2000). But it also means mental fitness because climbing increases self-discipline and self-confidence (Mittelstaedt 1997). This is also because people have to face their fears that are natural within humanity and the climbing sport.

Most of the listed motives shift with the level of experience and commitment of a climber. Some are getting stronger and some weaken the more active and experienced a climber gets. The only motive that is strong from the beginning and remains strong through all stages is about accomplishment, satisfaction and pride (Rapelje 2004, p. 61). This is a very intrinsic motive because people want to succeed and want to be good at climbing.

2.4 Progression

Progression and conflicts come along with the different motives of a climber. It is a virtuous circle where progression will change motives and vice versa. Therefore it is hard to divide between the theoretical models of progression and the ones for conflicts. Each factor can be both depending on the amplitude and perception. This section will focus on factors that are usually seen to have a positive influence on climbing performance while section 2.5 explains factors with a more negative impact.

The commonly used theoretical construct for describing progression is the recreation specialization framework (Hobson 2000, Scott et al. 2001). Within that framework the term specialization is defined as a developmental process in terms of behaviour, skill level, knowledge and the level of commitment so that the activity might become a central life interest (Dubin 1992, Kuentzel & Heberlein 2006).

In this thesis the discussion on progression is about people who already joined climbingor at least tried it once. It is not necessarily about getting people to even start climbing.The important question is what makes people to continue climbing and not to stop. Kuentzel& Heberlein (2006) call it the degree of involvement. The key factor for involvement in anyactivity has been identified as the degree of intrinsinc rewards that the activity offers to theparticipant (Csikszentmihalyi 1990, CRYSDALE 2000). Compared to other sports, climbingoffers a lot of rewards because it allows people to match their skill level to challenge level(Rapelje 2004, p. 30). Csikszentmihalyi (1990) states that this is because a climber can simplymove on to the next level once a level of difficulty has been reached. According to Heywood(1994) this setting is provided by different routes and type of walls within a climbing gym.This is even more important because the recreation specialization framework, discussed byHobson (2000, p. 2), describes progression also as constantly seeking for new challenges.

Kuentzel & Heberlein (2006) argue that a climber feels very strong satisfaction only whenhaving positive rewards. Therefore participants need to feel a positive progress. This caneither be by just reaching the top of a new difficult route, needing less energy to do so,developing an overall feeling for your body or any other change in the field of measurablefactors (CRYSDALE 2000).⁵ A progress in each of them will give the participant a feedbackof progression while the amplitute depends on his or her motives and the type of progressbecause it might be some kind of regress. When having a strong positive amplitude, theclimber will develop confidence and pride which is important to continue to climb (Hoffmann& VDBS 2011).⁶ Once participants reached a state of flow because of positive rewards,satisfaction and progress it is more likely that they will be gradually more involved in theactivity (Csikszentmihalyi 1990).

Involvement is very important because it motivates people to invest into regular trainingwhich is a key driver for acquiring skills in climbing (Hörst 2008, Kleinhappl 2011 a). Investingtime, money and other resouces into more intensive training requires also a higher commitmentto the activity itself (Scott et al. 2001, Hörst 2008). Therefore the focus of any innovation andof management decisions within the climbing sport must be on increasing the participantslevel of involvement and commitment followed by the other factors (Rapelje 2004, p. 7).

Some people that are active in climbing might argue that they do not have the abilityto get better at all. That they simply can not advance because of their limited geneticpotential which includes bone structure, strength of muscles and other biological reasons.But according to Hörst (2008, p. 10/19) there is ”a poor correlation between fitness and theability to climb” and each influencing factor can be trained after the variables that are ”mostholding you back” have been identified using questionaires or regular self-assessments.

Hörst (2008, p. 14) says that these trainable variables are increasing footwork and climbing skills, focusing on saving energy while climbing as well as taking care of rest positions(Hoffmann & VDBS 2011, CRYSDALE 2000). But Hörst (2008)⁷ also argues that any climbermust be able to visualize the route or specific problematic position in his or her mind to betterunderstand how to solve the problem. Otherwise the climber will never be able to advance inthese technical points. Without this understanding a participant might not advance to anyhigher level than a moderate one.

To be able to visualize and solve problems in your mind, one has to be metally stable. This is why Hörst (2008, p. 13/23) grants a quite large part to mental training. Once people are good at controlling their mental state they use that as an indicator for there overall well being (CRYSDALE 2000, p. 4). The mental state does include fears which are discussed in secion 2.5 but it also contains distracting thoughts like work and family.

2.5 Conflicts & Regression

Regression is the opposite of progression. It also exists because of some kind of conflicts, achange in motivation or that the participant does not feel any reward to the investment thathe or she has done into the activity. All variables with a positive impact on progression arediscussed in section 2.4 while this section focuses on factors that influence progression in anegative way.

From a training point of view some variables that lead to fast progress in the beginning can turn into barriers that limit the progress later on or even turn into regression. According to Hörst (2008, p. 27) this is usually poor technique which includes missing footwork, overgripping of holds, bad body positioning, climbing too slowly while spending too much energy, dismal focus and many others. Especially beginners put too much of their own muscle strength into climbing. Hörst (2008)⁸ says that they do not climb using the correct technique. Instead, they climb just by using power and strength which enables them to climb up routes from easy to medium difficulty (Kleinhappl 2011 a).

Progression based on your own muscle strength works fine up to a moderate level. Butusually people are then stuck on a level and they need to train smarter. If they do not changetheir style of training, the missing positive response to their motivational factors might turninto dissatisfaction (Scott et al. 2001).⁹ At the same time participants who have successfullyrealized the variables they need to train and improve might run into a fight with themselves.They are putting themselves under such a pressure, that no progress is possible anymore(Hörst 2008, p. 28).

For various sports Hobson (2000, p. 182) identified that the total number of participantsis skewed to the low end of the continuum. This is based on the theory that people advancein skills and experience the longer and the more they are involved in the activity. But thereis a significant number of people who start an activity using simple and easy techniques tomaximize their chances of getting fast positive rewards. When they realize that they have tochange their attitute towards the activity or they need to be more involved they do not longerengage in that specific sport (Scott et al. 2001, p. 3). Usually they then switch to anotheractivity or they stop doing any sport at all because they realize that the activity had simply”run its course” (Kuentzel & Heberlein 2006).

Another factor that fits into the same category are occasional participants. They are happyto engage in that activity only on a casual or occasional manner (Kuentzel & Heberlein 2006).And therefore they do not have the drive to develop to any higher level of experience (Scottet al. 2001). People might also run into different conflicts with a social background. Thestrongest and most often listed one is work or family obligations so that the participant is lacking the time and resources to engage more often in the activity (Rapelje 2004).¹⁰ If this conflicts gets too strong or because of any other private reason people start to reorder their priorities and climbing might become less important to them (Rapelje 2004, p. 28).

Hörst (2008, p. 15) discusses another important conflict with a mental background whichare unreasonable fears. They usually occur when climbers reach a moderate medium level(Kleinhappl 2011 a). Then they try routes of more complexity and difficulty which requiresmore advanced techniques. Not having the corresponding knowledge will increase for examplethe risk to fail and fall. Hörst (2008)¹¹ lists the fear of falling, the fear of pain, fear of failureand the fear of embarrassment. Only by fighting these fears by facing them or overcomingthem by mental training and relaxion will enable the climber to advance to the next level.

[...]

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¹ Figure 1.1; page 5

² Figure 1.5; page 10

³ French: Nomenclature statistique des activités économiques dans la Communauté européenne

⁴ chapter 10.2, page 530/531

⁵ table 4, page 530

⁶ e 1 bill. = e 1.000.000.000

⁷ chapter 10.2, figure 4, page 529

⁸ assumption of 45% overall; because of 44% in West Germany and 52% in East Germany

⁹ Mr Thomas Bucher; Public relations; German Alpine Association; Email dated Oct. 27th 2011

¹⁰ Mr Thomas Bucher; Public relations; German Alpine Association; Email dated Oct. 27th 2011

¹¹ http://www.blackdiamondequipment.com

¹² http://www.mammut.ch/

¹³ larger facilities do have entrance fees of e 18 and more

¹⁴ http://www.powernplayusa.com/

¹⁵ http://www.autobelay.com/

¹⁶ http://www.extremeengineering.com/climbing-wall-auto-belays.aspx

¹⁷ http://www.autobelay.com/news/survey-says-trublue-auto-belay-increases-participation/

¹ page 3, 4 and 74

² see chapter 3.2.4

³ page 1 and 18

⁴ page 5, figure 1.1

⁵ page 1 and 4

⁶ pages 136 to 140

⁷ page 9 and 36 to 39

⁸ page 10 and 122

⁹ page 1 and 3

¹⁰ page 7 and 35

¹¹ page 30 to 34