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ISSUE 1238september 17, 2012
The Weekly Digital Magazine for the Sporting Goods Industry
2 SGBWeekly.com | SEPTEMBER 17, 2012
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NEWS 4 BY THE NUMBERS LULULEMON LIFTS FISCAL YEAR GUIDANCE ON ROBUST SECOND QUARTER LululemonAthleticareportedrevenuesforthesecondquarterjumped. 6 AMAZON TO LAUNCH KIDS SPORTS AND OUTDOOR GEAR WEBSITE Amazonislaunchinganewe-commercesitecalledAfterSchool.com. EMS LAUNCHES FIRST LOYALTY PROGRAMCustomersenrolledinEMSRewardswillearnpointsoneverypurchasetheymake. 7 COLLECTIVE BRANDS SWINGS TO PROFIT IN FISCAL SECOND QUARTERCollectiveBrands,Inc.,in likelyitslastreportasapubliccompany,returnedtoprofitabilityinthefiscalsecondquarter endedJuly28. MOVERS & SHAKERS
SEPTEMBER 17, 2012 | SGBWeekly.com 3
Copyright2012SportsOneSource,LLC.Allrightsreserved.TheopinionsexpressedbywritersandcontributorstoSGBWEEKLYarenotnecessarilythoseoftheeditorsorpublishers.SGBWEEKLYisnotresponsibleforunsolicitedmanuscripts,photographsorartwork.ArticlesappearinginSGBWEEKLYmaynotbereproducedinwholeorinpartwithouttheexpresspermissionofthepublisher.SGBWEEKLYispublishedweeklybySportsOneSource,LLC,2151HawkinsStreet,Suite200,Charlotte,NC28203;704.987.3450.SendaddresschangestoSGBWEEKLY,2151HawkinsStreet,Suite200,Charlotte,NC28203;704.987.3450
10 VIBRAM USA promotes Michael MartintoGeneralManagerofVibramFiveFingersandFinishedGoods. GIVING BACK
12 THE RACE TO END CHILD OBESITY IS ON Sauconylaunchesobesity-fightingrunapp. FEATURES
16 RUN SPECIALTY SHRUGS OFF MINIMALIST BLUESTherunspecialtychannel appearstohaverackedupanother stretchofsolidgrowth. DEPARTMENTS
22 CALENDAR
16
Senior Business EditorThomas J. Ryan
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The Weekly Digital Magazine for the Sporting Goods Industry
SEPTEMBER 17, 2012ISSUE 1233
BY THE NUMBERS
Delta Apparel, Inc., the parent of MJ Soffe, said that increased retail prices resulting from the residual effects of higher cotton prices from earlier in the year led to sluggish sell-through and lower than anticipated replenishment orders during the fourth quarter. As a result, the company reported that net sales in Q4 dipped slightly to $135.4 million, down from $137.6 million in the fourth quarter of 2011. Net income for the 2012 fourth quarter was $4.8 million, or 55 cents per diluted share, compared to $8.5 million, or 97 cents per diluted share, in the fourth quarter of 2011.
Quiksilver, Inc.’s revenues grew 1.8 percent to $512.4 million in the fiscal third quarter ended July 31, as a successful back-to-school launch of DC footwear and apparel into mid-tier department stores in the U.S. and growing sales in new Asian markets barely offset declines in Europe. Quik’s revenues grew 8 percent in currency-neutral terms. Net income was $12.6 million, or 7 cents per diluted share, compared with $10.4 million, or 6 cents per diluted share.
Smith & Wesson reported net income in the fiscal first quarter ended July 31 reached a record $18.9 million or 28 cents per share, compared to $2.3 million, or 4 cents per share in fiscal Q1 last year. Revenue for the quarter was $136.0 million, an increase 48.3 percent over the prior-year period. SWHC said it exceeded revenue expectations by bringing forward the capacity increases in working with its suppliers.
G-III Apparel Group reported that net sales increased by 9.4 percent to $251.5 million for the second fiscal quarter ended July 31, up from $230.0 million in the year-ago period. Net income for Q2 was $1.4 million, or 7 cents per diluted share, compared to net income of $1.6 million, or 8 cents per diluted share, in the prior year’s comparable period. The earnings results come on the heels of the company’s acquisition of Vilebrequin, a provider of luxury swimwear, accessories and resort-wear, last month.
Riding strapping demand for its yoga and running apparel, Lululemon Athletica reported rev-enues for the second quarter jumped 33.1 percent to $282.6 million while earnings shot up 49.0 percent to $57.2 million, or 39 cents a share – both eclipsing internal forecasts.
In early June, the company projected revenues in the quarter to come in the range of $273 million to $278 million on a comp store gain in the low double-digits. EPS was expected to range between 28 cents to 30 cents.
Comp sales in the latest period rose 15 percent. The growth was also boosted by the addition since Q2 of 2011 of 26 net new corporate-owned stores in the U.S. plus four re-acquired franchise stores, 6 stores in Australia, 2 in New Zealand and 4 Ivivva stores. Direct-to-consumer revenue vaulted 90.7 percent to $35.4 million, or 12.5 percent of total revenues. Including e-commerce, comps were up 23 percent on a currency-neutral basis.
Slightly weaker Canadian and Australian currency against the U.S. dollar had the effect of decreasing reported revenues by $5.9 million, or 3 percent.
Gross margins in the quarter eroded 240 basis points to 55.1 percent of sales. The decline reflected higher costs associated with inflation in input costs as well as increased innovation and function in its product line and a more normalized rate of markdowns versus last year's low level due to a better, more balanced inventory position. These factors were partially offset by lower use of airfreight due to reduced inventory chase efforts.
Christine Day, Lululemon’s CEO stated “We continue to strive for the right balance be-tween strong growth and maintaining our market leader focus on execution, innovation and investments in infrastructure and while doing so delivered another strong quarter.”
LULULEMON LIFTS FISCAL YEAR GUIDANCE ON ROBUST SECOND QUARTER
N E W S
4 SGBWeekly.com | SEPTEMBER 17, 2012
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6 SGBWeekly.com | SEPTEMBER 17, 2012
Beginning September 1, customers enrolled in EMS Rewards will earn points on every purchase they make at Eastern Mountain Sports' 69 retail locations, 17 adventure school locations, and online at ems.com. Eligible purchases include full-price merchandise as well as sale and clearance items, gear rentals, gear repair, and maintenance ser-vices as well as climbing, kayaking and skiing lessons.
"Our intention is to reward our customers for how they really shop, so we wanted to be as inclusive as possible," Eastern Mountain Sports CEO Will Manzer explained. "Our customers will be rewarded every time they connect with our brand. From trying new sports to investing in our top-quality gear and ongoing maintenance and outdoor education, EMS Rewards is where our customers' love for the outdoors pays off."
Utilizing the Smart Button loyalty platform, the paperless EMS Re-wards program has no key fobs or cards to carry. Customers can create accounts at any retail store and online at rewards.EMS.com. Mem-bers will then earn points on every purchase they make at any Eastern Mountain Sports store or adventure school and online at ems.com.
EMS Rewards members earn points on every purchase they make at Eastern Mountain Sports' 69 retail loca-tions, 17 adventure school locations, and online at ems.com. (PRNewsFoto / Eastern Mountain Sports, Inc.)
N E W S
Amazon.com's Quidsi unit reportedly is launching a new sports and activities e-commerce site called AfterSchool.com. The website is designed to out-fit kids with sports, dance and art supplies.
"AfterSchool.com is a completely new way to shop for kids' favorite sports & activities," according to a message Amazon.com sent to manufactur-ing partners that was attained by geekwire.com. "Whether they are into sports, outdoor recreation, dance, or art, AfterSchool.com has the gear kids need. With over 35,000 products in one place, plus helpful tools like Age Filters, Gear Checklists and Gear Guides, you'll spend less time shopping, and more time cheering your kids on."
Amazon.com acquired Quidsi, operator of
Diapers.com, in April 2011. It has since launched a number of new sites targeting pets (Wag.com), home products (casa.com) and toys (yoyo.com).
Amazon has not yet formally commented on the afterschool.com website.
AMAZON TO LAUNCH KIDS SPORTS AND OUTDOOR
GEAR WEBSITE
EMS LAUNCHES FIRST LOYALTY PROGRAM
SEPTEMBER 17, 2012 | SGBWeekly.com 7
EMS LAUNCHES FIRST LOYALTY PROGRAM
MOVERS & SHAKERS
Reebok International, Ltd. has reorganized its senior management and eliminated the position of global president. Uli Becker, previously Reebok’s global president, will now serve as president of Reebok North America, continuing to report to Adidas CEO Herbert Hainer.
The Finish Line announced that Scott Hoffman has joined the company as EVP & chief merchandising officer. Hoffman was most recently managing director for Echo Design Group and previously was chief merchandising officer at Steve and Barry’s.
Crocs promoted Scott Crutchfield to COO. He has served as SVP Worldwide Operations at Crocs since May 2010.
Woolrich has promoted Donna Fitch to VP Merchandising and hired Karuna Scheinfeld as VP Design.
Skechers USA, Inc. appointed David Beecroft as managing director of Skechers USA Canada.
Honey Stinger hired Jennifer Shea as its national sales manager. In addition, current sales team member Christian Boeri has been named key account rep for the grocery category.
Burton Snowboards hired Matthew Ross as VP & Creative Director for apparel and bags.
Apex Sports Group added two leaders to its sales team in Boulder, CO, including Todd Poseley, who has been named as the brand’s director of sales and marketing, and TJ Larson, who joined the company as national sales manager.
Nation’s Best Sports (NBS) added Dave Nacke to its merchandising team in the role of VP Merchandising.
Aided by notably improved profitability at its Payless Domestic chain, Collective Brands, Inc., in likely its last report as a public company, returned to profitability in the fiscal second quarter ended July 28. In its wholesale segment, strong gains at Sperry Top-Sider and Stride Rite offset a rare decline at Saucony.
In May, Collective agreed to sell itself to Wolverine World Wide and private investment firms Blum Capital Partners and Golden Gate Capital for $1.3 billion, or $21.75 per share. Wolverine will acquire the Performance + Lifestyle Group (PLG) unit, which includes Sperry, Saucony, Keds and Stride Rite. The PE firms will acquire Payless and Collective Licensing International. The sale is expected to close late in the third calendar quarter or early in the fourth.
Net earnings in the fiscal second quarter reached $9.7 million, or 16 cents per share, com-pared to a loss of $35.0 million, or 58 cents per share, in the second quarter of 2011. The profit came despite costs totaling $11.9 million on a pre-tax basis, or 18 cents per share after tax, to cover the review of strategic alternatives/pending sale of the company. On an adjusted basis in both periods, EPS nearly doubled to 34 cents a share from 16 cents a year ago. Adjusted EBITDA increased 14.2 percent to $61.3 million from $53.7 million in the prior year.
Companywide sales inched ahead 0.4 percent to $886.0 million, driven by the company's 2.9 percent comp store sales increase and sales growth of 6.1 percent in the PLG Wholesale segment, offset in part by operating 375 fewer stores. According to a 10-Q filing with the SEC, footwear average selling price per unit grew 11.5 percent company-wide, offsetting an 11.8 percent unit sales decline.
COLLECTIVE BRANDS SWINGS TO PROFIT IN FISCAL SECOND QUARTER
10 SGBWeekly.com | SEPTEMBER 17, 2012
artin first joined Vibram USA as national sales manager in its new FiveFingers division in January 2007 just after the prod-uct’s launch. He had previously been Director of Sales Operations at Atomic Ski USA, a com-pany he joined in 1994. In his new position, Martin will oversee sales, profitability, design and development, marketing, distribution and sourcing for FiveFingers, and will also support global sales, marketing, sourcing and distribu-tion of FiveFingers.
In addition, senior retail marketing associate Michael O’Brien was promoted to marketing manager. O’Brien will be responsible for developing and managing a holistic approach to marketing, aligning both the FiveFingers and Vibram’s soling business as well as global alignment of the Vibram brand.
VIBRAM USA
Promotes Michael Martin to GM, Vibram FiveFingers and Finished Goods, NA
By Thomas J. Ryan
Vibram USA, a wholly-owned subsidiary of Vibram S.p.A of
Italy, promoted Michael Martin to General Manager of Vibram
FiveFingers and Finished Goods – North America. Martin previously served as VP of sales, FiveFingers
at Vibram USA.
NEWS
M
Michael Martin, GM Vibram FiveFingers and Finished Goods, North America
SEPTEMBER 17, 2012 | SGBWeekly.com 11
"Michael Martin was instrumental in the growth and success of Vibram FiveFingers in North America and has been a stellar leader to the sales team," explained Vibram USA’s CEO and President Michael Gionfriddo. "With this promotion we are recognizing his past efforts and also utilizing his expertise to address demand and competition in a rapidly growing category. Also, with his retail marketing experience, Michael O’Brien brings another crucial dimension to the role of marketing manager, enabling us to closely measure the pulse of our customers."
In early June, Gionfriddo, who had been Vibram USA’s COO, replaced Tony Post as president and CEO.
The promotions come as the FiveFingers business appears to have largely overcome its recent inventory issues and is ready to resume growth in 2013, said Martin in an interview with SGB Weekly.
As reported, following several years of triple-digit growth after being launched in 2006 and becoming the poster child for the barefoot and minimalist movement, Vibram’s sell-through began to slow in the latter part of 2011 and many retailers suddenly en-countered inventory gluts. The slowdown was partly caused by the flood of other mini-mal options reaching the market over the last two years, including the Merrell Barefoot and New Balance Minimus series in partner-ship with Vibram, and many other brands entering the game.
Martin said FiveFingers’ sales are ex-pected to be down for 2012 overall, but the number is still very good. He added that FiveFingers’ inventories are “in better shape” across retail and had been helped by retail-ers “figuring out how big the market is for minimalist footwear in their own stores.”
He added that FiveFingers’ sell-throughs “are picking up and we’re seeing a lot more dealer reorders coming in.”
An especially strong response is being seen for the SeeYa LS, designed as a multi-sport
shoe launching to retail on October 1. Paying particular attention to style, the upper combines traditional lacing, suede overlays and a non-stretch polyester mesh upper, reminiscent of a performance canvas for casual chic. The lacing and non-stretch fabric also creates a snug and personalized fit. At the same time, the LS shaves ounces wherever possible to weigh in at a mere 5-ounce average while retaining the grip,
protection and feel of the popular SeeYa road shoe. A national ad and PR campaign around this style is already underway and initial consumer response to teasers is reportedly strong.
Said Martin, “We’re working to see that the SeeYa LS launch models are going to give our retailers a shot in the arm in the last quarter of the year, and give the consumer something cool and innovative to talk about – and buy.”
Martin said FiveFingers’ fans continue to ask for new approaches.
“We still have a very active, loyal and en-gaged customer base,” said Martin. “When new things come out from us, they go out and buy again.”
For Spring 2013, Vibram is overhauling much of its line across men’s and women’s
with 40 to 50 percent new styles and colors, while discontinuing an equal amount of leg-acy and seasonal models and slowing color options. Martin noted that despite the intro-ductions, FiveFingers is keeping its net SKU count the same to simplify the buying and inventory management for dealers as well as to hone in on key stories for consumers.
The Classic and Sprint models that had been in the line for over five and six years
are being discontinued and replaced by new shoes at the same entry price levels to extend their reach to "casual fitness" or "multi-use." Several watersports-focused models are being added to address kayaking, surfing and stand-up paddle boarding. The FiveFingers’ design team also gives its take on a sandal with a 4mm Trek outsole in addition to other fashionable extensions. “We’re raising the level of technology and innovation in the new models.”
Despite escalating input and production costs, Vibram has also maintained whole-sale and retail prices of FiveFingers for sev-eral years.
Martin said the early response to Spring 2013’s lineup has been encouraging with healthy initial orders. Said Martin, “Things are definitely looking up.” ■
SeeYa LS, designed as a multi-sport shoe, will launch to retail on October 1
12 SGBWeekly.com | SEPTEMBER 17, 2012
™
SEPTEMBER 17, 2012 | SGBWeekly.com 13
support of National Childhood Obesity Awareness Month, Saucony launched Saucony Run4Good, the running industry’s first-ever iPhone app dedicated to battling childhood obesity. With every mile, runners will be earning money for community youth running programs, putting kids back on the fast track to health.
The launch comes as a third of American children are overweight or obese.
An emerging triad of running, charity, and technology is the driving force behind Saucony’s powerful new app. According to Running USA’s 2012 State of the Sport, Americans are running in record numbers and the rise in charity runners is fueling a second running boom. The survey reports that the U.S. running community is fast becoming an app nation unto itself, with running apps set to increase more than tenfold by 2016 according to market research firm ABI Research.
Recognizing the confluence of these trends, Saucony developed
the GPS-enabled app, opening the door for runners everywhere to join the fight against childhood obesity without having to enter a charity race or open their wallets. Simply by running, the Saucony Run4Good app allows people to support the cause by earning dona-tions for miles run. Each month, when a predetermined mileage goal is reached, Saucony will double its donation to selected youth run-ning programs, inspiring individual runners to both unite over their passion for running and combat the childhood obesity epidemic. On the app’s monthly leader boards, runners can challenge friends and join teams that compete together to accumulate mileage toward the monthly goal.
“At Saucony, our brand mission is to inspire others to run - and that includes our kids,” said Chris Lindner, chief marketing officer and senior vice president of commerce for Saucony.“This is an extraordinary opportunity for the community to do good by doing what we love - running. As a brand focused on runners,
THE RACE TO END
IN
IS ONCHILDREN OBESITY
SAUCONY LAUNCHES OBESITY-FIGHTING RUN APP
By Thomas J. Ryan
14 SGBWeekly.com | SEPTEMBER 17, 2012
innovation and social responsibility, we believe the Saucony Run4Good app offers a new world of possibilities to engage with our community in a relevant, innovative and meaningful way while inspiring a strong unity of purpose to make a difference for our kids.” “Delivering the first app in the running industry that address child-hood obesity underlines our continued commitment to this issue,” said Richie Woodworth, president of the Saucony Run For Good Foundation Board of Directors and Saucony, Inc. “We started the Saucony Run For Good Foundation seven years ago to help in the national effort to eradi-cate this epidemic. Since that time, we’ve awarded nearly $1 million in grants to over 100 organizations nationwide, all dedicated to getting more kids active. The Saucony Run4Good app is an impactful way for more people to connect as a community and take action.” Five non-profit organizations were recently awarded a grant from the Saucony Run For Good Foundation. For the next five months, beginning in September, a community mileage challenge will be set, and one of the recent award winners will be profiled. If the commu-nity mileage goal is reached during that month, Saucony will double its contribution to the featured organization. The American Diabetes Association New England Division is the highlighted organization for the September launch of the Saucony Run4Good app. ADA New England is launching Run For Your Life!,
a clinical weight loss program for overweight and obese youth in the Greater Boston area. The ADA’s program will use running as the foundation of physical activity to facilitate significant lifestyle changes in the program’s participants. The complete list of the Saucony Run For Good Foundation grant winners to be featured on the Saucony Run4Good app in the coming months is as follows: • American Diabetes Association New England, Boston, MA• Eric Thomas Foundation, Houston, TX• Mount Desert Island YMCA, Bar Harbor, ME• Marathon High, Austin, TX• United Way of Northeast Florida, Jacksonville, FL In the future, Saucony plans to invite the community to nominate and select future Run For Good grant winners. The brand also welcomes like-minded organizations and corporations to gain access to the Saucony Run4Good app, allowing their employees to join Saucony in the fight against childhood obesity. ■ Note: To learn more about the Saucony Run For Good Foundation, please visit sauconyrunforgood.com.
Click to view the Saucony Run 4 Good video
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RUN SPECIALTYSHRUGS OFF MINIMALIST BLUESWeathering the slowdown in the minimalist craze, the run specialty channel appears to have racked up another stretch of solid growth this past spring/summer selling season.
By Thomas J. Ryan
Still, run specialty remains in transition. With demand for ever-lighter models remaining, the industry is exploring whether that just means lighter-weight conventional running shoes, lower heel-drop conventional models that support the feel-the-ground push, or even some of the newer shoes and models that encourage midfoot or forefoot striking - albeit with some support. FiveFingers and other more extreme models are still seen as many as a two-day-a-week training tool.
The following is a roundup of spring/summer results and the latest trends from a few key run specialty stores.
John Rogers, principal at Maine Running Company, said his two stores in Portland
and Brunswick delivered a “terrific” spring and summer with revenues ahead in the double-digit percentage rates. Footwear was the driving force, both as a percentage of sales and the greatest gain up over 5 percent in share of the total business. Among brands, Brooks continues to gain market share and increased by 3.5 percent in share in its stores, coming mainly at the
Most run specialty stores limited their exposure to some of the more extreme-minimalist models such
as FiveFingers or at least managed their inventories smartly enough to avoid the full brunt of excess stock. Despite the hype, traditional models with more cushioning and stability features have made up the majority of sales in the channel. With FiveFingers also a hot item in the outdoor specialty channel, some run stores apparently never even were able to secure the line to capitalize on its rocketship growth.
Strong demand for lightweight running overall is clearly supporting the channel. Dick’s Sporting Goods, Finish Line and other more mainstream sellers have also pointed to technical running driving their footwear departments with even several family footwear chains touting tech running’s strength. Fleet Feet indicated earlier this year that its business across its franchises was benefiting from similar lightweight/neutral trends while comps at The Running Company, acquired by The Finish Line last year, were up 7 percent in its parent’s first quarter ended June 30.
expense of its number-two brand, Asics. Adidas, though coming from a lower base, has doubled its market share with New Balance and Mizuno also performing well.
Rogers said Maine Running is seeing a maturation of the ‘minimal’ category, but was able to manage its inventory, SKU pro-liferation and new introductions “extremely well” through the phase. He estimates the minimal offerings are about and will continue to be about 10 percent of its footwear busi-ness. He said Vibram’s FiveFingers line con-tinues to decline as a result of cannibaliza-tion of other brands, non-repeat purchases and mainstream customers gravitating to "other" Natural Running brand options offer-ing greater support.
Rogers believes new brands are challenged because all brands continue to develop “great product and concepts and are really honing in on UMAP policies and offering exclusives or lead times on product.” Operationally, most are getting better with the ease of doing business and continue to be great partners.
“New brands are going to have to come in with a differentiation to get on the wall, but
16 SGBWeekly.com | SEPTEMBER 17, 2012
SEPTEMBER 17, 2012 | SGBWeekly.com 17
RUN SPECIALTYbrands like Altra, Newton, Merrell and concepts like Pure, Kinvara and Minimus have created great options for our customers in Natural Running and have affected the way franchise products are being evolved,” said Rogers. “It's good for retailers, consumers and the channel and indicates that we aren't getting stagnant.”
Apparel continues to be only 10 percent of Maine Running’s business and is relatively flat, but reducing inventory by 45 percent resulted in greater turns, margins and profitability. In accessories, the development of a hydration, safety and accessory center in partnership with Nathan has more than paid off.
“Our hydration was up over 150 percent, mainly because we have a true focus on it, moved our merchandise to be more categorized and accessible and making a story out of hydration,” said Rogers. Maine Running also saw a stellar response from the hosting of three Hydration nights with Nathan. Added Rogers, “What we are seeing is a tremendous opportunity to educate our existing customers, but also provide educational opportunities to acquire new customers.”
Regarding concerns, Rogers cited vendor partnerships and strenthening UMAP policies, competition from other channels, customers being fit in the store only to buy cheaper online, and the overall economy. But Rogers said he remains optimistic because Maine Running continues to evolve its overall in-store experience as well as its outreach through programs such as its Spike Nights.
Believing community to be a key differential, Maine Running has particularly stepped up its efforts around "Social Currencies," including Facebook, training groups, social events and community outreach, and has put a dedicated person in charge of all communications. Added Rogers, “Our focus on our social and com-munity currencies versus our product currencies are going to continue to drive our business and we have to get better at that.”
Ed Griffin, co-owner of the Fleet Feet Syracuse, said his store had “mixed” results over spring/summer.
“The very mild winter made Q1 huge and it just changed the cycle of when people needed shoes, accessories and apparel,” said Griffin. “Q2 saw growth, just not at the pace of Q1 which was event driven in the Northeast.”
Trendwise, sales of minimal footwear have shifted from individual-toe products such as FiveFingers to minimal or lightweight product in traditional forms. Traditional running shoes remain the bulk of Fleet Feet Syracuse’s sales and are “holding steady,” although Griffin is hearing more customers vex over the steady rise in prices over the last three years. He adds, “Space is being created for anyone who develops products at the $100 sweet spot.”
Apparel has been the highest growth category for the store in 2012. Griffin credits that to a dedication to helping customers with fit and other issues, matching the level on the footwear side. Added Griffin, “Bright fashions and coordinated outfits are doing really well. We also are making progress with extended sizing for new runners.”
In accessories, Fleet Feet Syracuse is seeing upticks in compression gear, re-covery injury prevention and flexibility products. New nutrition products, including gluten-free options, are also doing well.
Looking to fall, Griffin said, “We continue to see and expect growth in all cat-egories during the period, but not without a lot of hard work on our end. We are increasing our marketing in events, social` media, medical marketing and various other promotions.”
18 SGBWeekly.com | SEPTEMBER 17, 2012
ed Kushion, merchandise manager at Gazelle Sports, which has three stores in the Greater Grand Rapids region, said spring was
“great” with the help of seasonally warm weather. He added, “We were able to really capitalize on all the people that ran through the winter.”
Gazelle Sports’ customers don’t appear to be overly-impacted by any economic woes and Kushion admitted to being surprised that several price increases have been passed through “and there’s been very little sensitivity to the price increase so that’s encouraging.”
In footwear, the fastest growth is coming from Nike, with particular strength in the LunarGlide series. Kushion said Nike has risen to be-come the chain’s number two footwear brand with the help of such innovation, as well as its recommitment to servicing run specialty over the last few years.
Brooks is also seeing modest growth and “continues to be a nice business for us,” said Kushion. He’s particularly looking forward to the launch of Asics GT-2000, which debuts in October. Said Kushion, “That’s a shoe that’s traditionally been very safe and conservative so the update looks more like a Nike-type style with all the colors. And color continues to a huge driver across running shoes. We continue to be surprised about the breath of color that customers are accepting.”
Among the newer brands, Altra has gained a foothold at Gazelle Sports. But Kushion said the overall minimalist trend is “definitely ta-pering off and we’re starting to see a swing back to more traditional midsoles.” He noted that many of the traditional shoes have become ever lighter with a few adopting some of the other characteristics of minimalist models.
On the apparel side, Nike continues to lead the category with sum-mer sales “really strong.” Brooks and Saucony are also seeing good apparel sell-throughs with Lole, the Canadian-based activewear brand, standing out as a “yoga/run crossover lifestyle brand.”
Given the start, Kushion remains bullish on the back half given “at least until the first snowstorm hits.” One concern is that customers are coming into his stores to be properly fitted and then shopping online and elsewhere to buy. His buyer team is continuing to push vendors for special make-ups to “differentiate ourselves from some of the big boxes.” He praised Nike and New Balance for particularly stepping up and is hoping other brands follow suit. Said Kushion, “It does help to level the playing field.”
At Sedona Running Company in Arizona, a majority of business comes from the tourist market, making spring the store’s big
season. Said Adam Gifford, owner, “Our spring numbers were up over 15 percent from 2011 due to a combination of increased tour-ism, marketing genius, and pure luck (we try to be as honest as possible with ourselves). Our summer started with a slow June since tourism numbers were down for that month and unseasonably high temperatures kept many people off of the trails. The remainder of the summer showed a slight increase in sales over 2011 with a large increase in margins.”
Given the region, nearly 75 percent of Sedona Running’s footwear sales come from trail running. Sales during 2011 saw a spike in sales stemming from the barefoot movement, specifically with the New Balance Minimus and the Merrell Trail Glove. But sales have declined for both of those models this year.
“The ‘I read ‘Born to Run’ crowd is sitting at home nursing their stress fractures and plantar fasciitis,” remarked Gifford.
Still, Sedona Running is finding a “great deal of success” with 4mm-drop shoes as trail runners like the lower heel and more natural gait along with ample cushioning and underfoot protection. Its biggest sellers in this category are the Saucony Peregrine, Brooks PureGrit, and La Sportiva Vertical K. Added Gifford, “I am anxious to see how the Salomon 6mm-drop does against these brands in 2013.”
Like many run specialty stores, its largest selling brand is Brooks. “The Brooks Cascadia is perpetually our top selling or second best-
selling shoe on our wall,” said Gifford. “We have also had a great deal of success with the La Sportiva Mountain Running line. We are one of the few retailers in Arizona to carry this line and actually have people from outside of our target area come specifically to purchase the brand.”
On the accessories side, hydration is always a big seller being situated in a relatively warm and dry area. Said Gifford, “We tried a number of brands and currently have the most success with Nathan. We bought into the hype of UltrAspire but found that their 40 per-cent higher price (than Nathan) wasn’t warranted by the marginal increase in quality.”
Gifford said he’s optimistic for the second half because tourism in the area is trending upwards and the stores is coming into its sec-ond peak season (fall). Said Gifford, “We also have a number of new events that we are doing this year that will add a positive aspect to our grassroots marketing plan.”
Andy Kimerling, owner at Westchester Road Runner in White Plains, NY, said business picked in the latter part of summer
with kids heading back to school. But he describes his store’s overall spring/summer business as just “okay” and believes the economy is likely the culprit.
“It’s been an up-and-down year,” said Kimerling. “My own feeling is that it’s tough for our economy to get a real big boost because everything in the world is more interconnected. If Europe is hurting and if China and India are slowing down as well, it’s tough to get a boost here.”
Among brands, Brooks “continues to get stronger” and Saucony is likewise gaining traction in his store. Asics has been hurt this year by shortages of its popular GT-2170 and the women’s GEL-Noosa series. Among newer brands, Altra and Hoka One One are doing well for Westchester Road Runner.
Kimerling said the bulk of footwear sold continues to be more tra-ditional models although vendors continue to shave more ounces off them every season. The store sells a number of “very lightweight” shoes from Brooks, Saucony, Asics and New Balance’s Minimus line, with many customers using more minimal models as an off-day
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training shoe. Said Kimerling, “It’s been a good little addition to the market.”
On the apparel side, he wishes many vendors would broaden their basics offerings. While customers also prefer the lower prices, Kimerling also finds many members of the latest running boom – being more female-and-charity driven with many first timers - “really don’t care” as much about the touted performance technologies. Said Kimerling, “At running races I see a tremendous amount of Under Armour clothing or Nike t-shirts, which aren’t necessarily technical but they look better.”
In the same vein, GPS watches focusing on basics such as speed and pace that are selling at around $100 are doing better than the pricier tech-loaded models.
Kimerling’s optimistic about the back half with a lot of fall marathons in the New York area but still remains cautious on the overall outlook more due to global uncertainties rather than the upcoming election. He said, “What happens around the world is more important.”
Curt Munson, co-owner of Playmakers in Okemos, MI, said busi-ness has been “good” although the mild weather earlier in the
year hurt sales of cold-weather items such as jackets and wool tops. On the footwear side, he said Brooks “continues to be really strong
and their product continues to be real nice and consistent.” Saucony likewise “continues to have some real nice product coming out.”
Munson believes the minimal trend “is still there but I think it’s settling in” alongside more lightweight models that still provide the support of traditional models. He still believes minimalist shoes offer “different tools in the toolbox” for a runner in addition to a maximally cushioned option such as Hoka One One, which recently received an investment from Deckers Outdoor. Munson said that while Hoka seems to be taking off with the ultra-runner crowd in places in Colo-rado, it’s representing a welcoming recovery shoe for many in his market. Said Munson, “The kind of feedback we’re getting from the Hoka is unlike any other in terms of customers getting positive re-sults after they get injured.”
Among the less-established brands in the run channel, Munson said Merrell looks like they’ll “be a player,” particularly on the outdoor side with its trail and road shoes. Altra, Scott and Pearl Izumi are also gaining traction. Munson said Playmakers might add Newton back to its mix, crediting their grassroots efforts as well as some modifica-tions that have made their shoes “a little more mainstream.”
On the apparel side, Munson continues to be bullish on Merino wool with brands like SmartWool although apparel overall “has been a bit soft” due to the mild winter weather. In accessories, he eyes a bigger opportunity for Playmakers in bras, pointing to Fleet Feet’s success with its fit program.
Looking ahead, Munson remains ”really positive” given underlying participation and health trends supporting running. He also believes his stores’ focus on service will provide the differential against any newer competitors online or offline.
“It continues to come down to education,” said Munson. “We have
two Good Running classes a week as well as one injury clinic each week. And we have to provide those services because we think without them, we’re going to lose all those customers who are so loyal to us.”
Monte Keleher, owner, A Runner's Mind, described spring/summer as
“fantastic” for the store in Burlingame, CA although it’s only in its second year. Kele-her used to work at Burlingame’s Runners' Feet and came back to open his own store after finding out it closed.
On the footwear side, Keleher believes the more-extreme barefoot movement “was more of a fad or style going on” and runners soon realized “it’s not natural to run on cement when you’re barefoot.”
But he continues to be a big believer in proper running form and his store is doing well with models such as Newton, Brooks PureCadence and Saucony’s tra-ditional models that have been lowered to a 8mm-drop that encourage more of a mid-foot strike. Nike’s Lunar series has also “definitely done better” with the ap-peal of their color pops. Merrell has done well in his store with its Mix Master multi-sport series while New Balance overall has benefited by infusing more “lighter, faster and more fun” elements across their col-lections. The North Face, Pearl Izumi and Mizuno are also coming on stronger. The store also sells Merrell and New Balance’s more minimal models although Keleher recommends them more for activities like cross-training that requires more lateral movement.
Overall, A Runners Mind’s best sellers continue be the more moderate stabil-ity shoes that most runners are used to, but the fastest trend are the midfoot strik-ing shoes. Said Keleher, “We’re all about teaching form and being more efficient so you can be in less of a shoe. But we fit every single person individually.”
In apparel, Nike is the dominant resource although North Face’s GTB line, which uses volcanic rock in the fibers for enhanced breathability, has been
a standout. In accessories, foam rollers and the Tiger Tail massage stick are highlights.
Keleher continues to be upbeat about the business with the current back-to-school time again providing an opportunity to meet his new neighbors. Said Keleher, “We’re seeing a lot of moms and dads come in and we’re getting some running groups going so we’re very encouraged.”
Amanda Charles, director of operations at Boulder Running Company, which has four stores, said although the
mild winter depressed apparel sales early on, spring was “very strong” and that has continued through the summer months. She said, “We’re in a very forgiving climate in Colorado so it allows for people to be active year-round.”
She likewise sees the minimalism trend weakening. On the positive side, however, she believes runners are more open to education around proper running form because “they’ve realized that there’s much more to running than strapping on a lightweight shoe that will make them run easier.”
Boulder Running Co. does sells some of the minimal mod-els, including stocking Nike Free since its launch. But Charles looks at them more as a “tool to have in your tool box” rather than an everyday running shoe. The bulk of shoes sold by Boulder Running Co. continue to offer more stability than the lightweight models. She added, “We really try to pay attention to injury prevention, alignment and balance and we do that more so now than ever.”
Among brands, Brooks “continues to be strong for us” as well as Inov-8, with both having some promising launches coming out. Scarpa’s new trail shoes look strong for spring 2013. Hoka One One, which addresses natural running as well as injury prevention, has particularly appealed to Boulder Running Co.’s customers.
On the apparel side, Merino wool continues to be an emerging category, led by Icebreaker in apparel and Smart-Wool in socks. Charles said customers are starting to under-stand the benefits of Merino wool beyond the outdoors in activities like running and fitness. In accessories, compres-sion across socks, tights and sleeves, are expected to have another winning season with fall marathons approaching. Hy-dration packs from UltrAspire and Ultimate Direction that offer more storage and other features for longer runs have also stood out this year.
Charles is hoping the economy improves to provide an extra “surge” in the coming year but she also notes the Boulder Running Co. continues to have a number of store events and functions planned in the months ahead to make sure they’re reaching local communities. Said Charles “We’re dialing in on a lot of events to make sure we’re connecting with customers on a regular basis and making sure we’re at the forefront of their mind when it comes to running.” ■
CALENDAR For full year calendar go to sportsonesource.com/events
Athletic Dealers of America1395 Highland AvenueMelbourne, FL 32935t 321.254.0091f 321.242.7419athleticdealersofamerica.com
National Shooting Sports FoundationFlintlock Ridge Office Center11 Mile Hill RoadNewtown, CT 06470t 203.426.1320 f. 203.426.1087nssf.org
National Sporting Goods Association1601 Feehanville Drive / Suite 300Mount Prospect, IL 60056t 847.296.6742f 847.391.9827nsga.org
Nation’s Best Sports4216 Hahn Blvd.Ft. Worth, TX 76117t 817.788.0034f 817.788.8542nbs.com
Outdoor Industry Association4909 Pearl East Circle / Suite 300Boulder, CO 80301t 303.444.3353f 303.444.3284outdoorindustry.org
SGMA 8505 Fenton StreetSilver Spring, MD 20910t 301.495.6321f 301.495.6322sgma.com
Snow Sports Industries America8377-B Greensboro DriveMcLean, VA 22102t 703.556.9020f 703.821.8276snowsports.org
Sports, Inc.333 2nd Avenue NorthLewistown, MT 59457t 406.538.3496f 406.538.2801sportsinc.com
Sports Specialists Ltd.590 Fishers Station Drive / Suite 110Victor, NY 14564t 585.742.1010f 585.742.2645sportsspecialistsltd.com
Team Athletic Goods629 Cepi DriveChesterfield, MO 63005t 636.530.3710f 636.530.3711tag1.com
Worldwide 8211 South 194thKent, WA 98032t 253.872.8746f 253.872.7603wdi-wdi.com
TRAD
E AS
SOCI
ATIO
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BUYI
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ROUP
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SEPTEMBER 2012
19-21 Health & Fitness Business Expo Las Vegas, NV
19-21 Interbike International Trade Expo Las Vegas, NV
27-29 Imprinted Sportswear Show (ISS) Fort Worth, TX
OCTOBER 2012
3-5 OIA Rendezvous Boston, MA
6-7 The Retailing Summit Dallas, TX
NOVEMBER 2012
3-4 NBS Fall Athletic Market Indianapolis, IN
8-9 TAG Fall/Winter Show N. Charleston, SC
13-14 A.D.A. Fall Show Las Vegas, NV
18-20 Athletic Show Sports Inc. Las Vegas, NV
DECEMBER 2012
3-4 Sports Inc. Footwear & Apparel St. Charles, MO
3-5 EORA Southeast Market Asheville, NC
5-7 Atlanta Fashion Shoe & Accessory Market Atlanta, GA
JANUARY 2013
5-7 ASI Orlando Orlando, FL
7-8 ATA Show (Archery Trade Association) Louisville, KY
10-12 Surf Expo Orlando, FL
15-18 SHOT Show Las Vegas, NV 17-20 NBS Winter-Specialty Market Denver, CO
17-19 Sports Licensing & Tailgate Show Las Vegas, NV
18-20 Imprinted Sportswear Show (ISS) Long Beach, CA
22 Outdoor Retailer All Mountain Demo Salt Lake City, UT
23-26 Outdoor Retailer Winter Market Salt Lake City, UT
23-26 PGA Merchandise Show Orlando, FL
24-27 ASA-ICAST Chicagoland Fishing, Travel & Outdoor Exposition Schamburg, IL
29-31 WSA Show Las Vegas, NV
31-3 SIA Snow Show Denver, CO
FEBRUARY 2013
1-5 NBS Spring Semi - Annual Market Fort Worth, TX
3-6 ISPO Munich 2013 Munich, Germany
5-7 FFANY New York, NY
6-8 ASI Dallas Dallas, TX
13-15 Magic Marketplace Las Vegas, NV
13-16 Sports Inc. Outdoor Show Phoenix, AZ
14-17 ASA-ICAST Greater Philadelphia Outdoor Sportshow Oaks, PA
17-20 WDI Worldwide Spring Show Reno, NV
22 SGBWeekly.com | SEPTEMBER 17, 2012
SEPTEMBER 17, 2012 | SGBWeekly.com 23
Athletic Dealers of America1395 Highland AvenueMelbourne, FL 32935t 321.254.0091f 321.242.7419athleticdealersofamerica.com
National Shooting Sports FoundationFlintlock Ridge Office Center11 Mile Hill RoadNewtown, CT 06470t 203.426.1320 f. 203.426.1087nssf.org
National Sporting Goods Association1601 Feehanville Drive / Suite 300Mount Prospect, IL 60056t 847.296.6742f 847.391.9827nsga.org
Nation’s Best Sports4216 Hahn Blvd.Ft. Worth, TX 76117t 817.788.0034f 817.788.8542nbs.com
Outdoor Industry Association4909 Pearl East Circle / Suite 300Boulder, CO 80301t 303.444.3353f 303.444.3284outdoorindustry.org
SGMA 8505 Fenton StreetSilver Spring, MD 20910t 301.495.6321f 301.495.6322sgma.com
Snow Sports Industries America8377-B Greensboro DriveMcLean, VA 22102t 703.556.9020f 703.821.8276snowsports.org
Sports, Inc.333 2nd Avenue NorthLewistown, MT 59457t 406.538.3496f 406.538.2801sportsinc.com
Sports Specialists Ltd.590 Fishers Station Drive / Suite 110Victor, NY 14564t 585.742.1010f 585.742.2645sportsspecialistsltd.com
Team Athletic Goods629 Cepi DriveChesterfield, MO 63005t 636.530.3710f 636.530.3711tag1.com
Worldwide 8211 South 194thKent, WA 98032t 253.872.8746f 253.872.7603wdi-wdi.com Facebook.com/SPORTSONESOURCE // twitter.com/SGB_MAG
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SALT LAKE
TRADESHOW | JANUARY 23-26, 2013 | SALT LAKE CITY, UT
ALL MOUNTAIN DEMO | JANUARY 22, 2013 | WASATCH RANGE, UT
TRADESHOW | AUGUST 1-4, 2013 | SALT LAKE CITY, UT
OPEN AIR DEMO | JULY 31, 2013 | JORDANELLE STATE PARK, UT
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