The German brand that rivals Adidas is toasting its success and reaping the rewards from a bet on the developing African economy, most recently championed by a partnership with the Confederation of African Football (CAF).

The continent’s overwhelming share of Gen Zers is a huge driver for this rise. But there may be another reason for Puma’s focus on the African market: an apparent decline in physical activity that could start to affect demand for sportswear. 

Puma looks to Africa

The EMEA region, short for Europe, the Middle East, and Africa, is Puma’s biggest and fastest-growing market, making up about 44% of the group’s sales last year—and the sportswear brand can point to Africa for a lot of that growth. 

Puma more than tripled its revenue in Africa between 2020 and 2023, increasing sales by 228%.

Soccer has been at the forefront of this growth, with the replica shirts of African teams like Morocco, Egypt, and Ghana among the group’s sponsored teams.

Johan Kuhlo, general manager of EEMEA Distribution at Puma, also credits brand partnerships and pop-up stores as reasons for its popularity on the 1.2 billion-strong continent.

But Puma’s secret weapon in Africa might really be the continent’s extremely young median age.

The median age across the continent of Africa is 19, according to a Wilson Center analysis of the CIA’s factbook on countries. 

While Kuhlo says Puma doesn’t focus on Gen Zers explicitly, he indicated a clear link between Africa’s outsized Gen Z contingent and its popularity in the region.

“It’s the generation out of all age groups that is most into sports, and most into sportswear outside of sports activities,” Kuhlo told Fortune.

That “megatrend” of “casualization,” where shoppers buy athleisure for casual rather than active purposes, is Puma’s biggest business driver.

It’s something reflected in the company’s evolving brand partnerships, which have traditionally leaned on deals with sports stars like Brazil star Neymar.

In Africa, Puma launched a partnership with Grammy-nominated Nigerian artist Davido to find the intersection between its sportswear and the tastes of young, fashion-savvy music fans.

Puma blames RTO, not less exercise, for lower apparel sales

However, there might be another reason for Puma’s focus on African Gen Zers and the rise of casualization—people don’t seem to be exercising as much as they used to. 

Industry analysts are concerned about a decline in physical activity among all age groups, with a 2022 WHO report finding that 80% of adolescents and 27% of adults didn’t meet the body’s recommended levels of physical activity. 

In Puma’s native country of Germany, for example, 80% of boys and 82% of girls are physically inactive, according to the WHO. 

Emma Zwiebler, interim CEO at the World Federation of the Sporting Goods Industry (WFSGI), says this is a long-run worsening trend, and she isn’t convinced that a focus on “casualization” alone will support companies like Puma, Adidas, and Nike in the long run. 

“The industry’s future growth is inextricably linked to physical inactivity levels. Because unless we are going to build the industry based on athleisure sales alone, these changes will have an impact on our industry,” Zwiebler told Fortune.

However, a report by the consultancy McKinsey looking at the sportswear industry indicated demand remained strong, with 7% global growth forecast between 2023 and 2027. 

Puma has faced headwinds recently, with its share price down by a third since the start of the year after Argentina’s currency crisis hit its currency-converted sales.

Speaking to Fortune, Puma’s Kuhlo rejected the idea that falling physical activity was playing a part in the group’s slower apparel sales, which grew at just 2.9% in the first half of 2023 and declined in the third quarter, even as shoe sales, which make up more than half of revenues, enjoyed double-digit growth.

Kuhlo instead suggested there has been a pullback in the purchasing of sporting apparel as people returned to the office and were forced to dress less casually.

“Probably we’ve seen a little bit of an unnatural peak in terms of casual wear and sports leisure wear during stay-at-home orders and COVID, when everybody was rushing to get another three pairs of black sweatpants or tights,” Kuhlo said. 

“And of course, that’s no longer the case, and maybe people take a little bit of extra pleasure in dressing up a little bit more after they didn’t have much of a reason to.”

Still, in the long run, Kuhlo says both casualization and also says another “megatrend” for Puma customers is sports uptake, suggesting that at least among customers of the German giant, activity levels are still healthy.