SGB WEEKLY 1146 by SportsOneSource

NOVEMBER 14, 2011

NEWS & INFORMATION FOR THE RUNNING & TRIATHLON MARKET

PSST! PSR IS NOW SGB PERFORMANCE

ISSUE 1146 NOVEMBER 14, 2011

Group Publisher Bill Garrels bgarrels@sportsonesource.com 303.997.7302

NEWS & INFORMATION FOR THE RUNNING & TRIATHLON MARKET

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Editor In Chief James Hartford (704.987.3450 x104) james@sportsonesource.com Senior Business Editor Thomas J. Ryan (917.375.4699) tryan@sportsonesource.com Creative Director Teresa Hartford

Photo courtesy of Saucony

Graphic Designer Camila Amortegui Advertising Sales Account Manager Katie O’Donohue (704.987.3450 x110) katieo@sportsonesource.com Circulation & Subscriptions subs@sportsonesource.com Technology Chief Information Officer, Mark Fine VP Research & Development, Gerry Axelrod Manager Database Operations, Cathy Badalamenti

SportsOneSource Publications SGB TEAM Business Sportsman’s Business The B.O.S.S. Report Sports Executive Weekly SGB Update Footwear Business Update Outdoor Business Update Sportsman’s Business Update Team Business Update SGB Weekly

SportsOneSource Research SportScanInfo OIA VantagePoint SOS Research

NEWS 4 CITY SPORTS Builds Female-Friendly In-Store Shop 5 6 8 9

BROOKS SPORTS to Relocate Global Headquarters to Seattle FINANCIALS - Easton Bell, Heelys, Mizuno and Nautilus ECCO Opens 1,000th Store Worldwide NYC MARATHON The ING New York City Marathon, sponsored by Asics, rolled into town on November 5. PARAGON SPORTS Largest retailer presence in the ING New York City Marathon

GIVING BACK

10 TIMBERLAND Partners With Ringo Starr on Charity Effort

FEATURES 14 WHAT IF EINSTEIN RAN? Mizuno’s new marketing campaign turns to Albert Einstein to help explain its running footwear design philosophy 18 SAUCONY Launches Geometry of Strong

I AM...SGB PERFORMANCE

22 JIM HOFF, VP Sales, Brown Athletic

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Copyright 2011 SportsOneSource, LLC. All rights reserved. The opinions expressed by writers & contributors to SGB WEEKLY are not necessarily those of the editors or publishers. SGB WEEKLY is not responsible for unsolicited manuscripts, photographs or artwork. Articles appearing in SGB WEEKLY may not be reproduced in whole or in part without the express permission of the publisher. SGB WEEKLY is published weekly by SportsOneSource, LLC, 2151 Hawkins Street, Suite 200, Charlotte, NC 28203; 704.987.3450. Send address changes to SGB WEEKLY, 2151 Hawkins Street, Suite 200, Charlotte, NC 28203; 704.987.3450.

WEEK 1146 | SGBweekly.com

NEWS

Boylston Street store in downtown Boston

The women's in-store shop, including a Sports Bra Finder application. The Bra Finder offers an informative experience for customers shopping City Sports' collection of sports bras.

CITY SPORTS BUILDS FEMALE-FRIENDLY IN-STORE SHOP City Sports, the specialty sports chain, last month wrapped up construction on a new in-store experience for female customers at its Boylston Street store in downtown Boston - part of an update to the brand's flagship location. The women's in-store shop, including a Sports Bra Finder application, will become a standard feature at the athletic retailer's future outfits, including three new stores planned through the end of this year. "Active women have been central to our brand DNA since we opened our first store in Boston in 1983," said City Sports President and CEO Jeff Connor. "We're eager to showcase our elite women's offering that caters to the specific style and performance needs of our female customer, cementing City Sports' reputation as their premiere destination for athletic apparel." The specially curated shop-in-shop experience offers personalized service and private fitting rooms and a refreshed bra and pant wall, featuring items from top brands including City Sports' own CS line and Moving Comfort. The space will also include a communal table with an iMac that allows customers to access the City Sports Online Bra Finder and the brand's e-commerce site. 4

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"City Sports is a trusted partner of Moving Comfort, and we are thrilled to forward our mutual mission to bring the best in support, style and technology in women's activewear to consumers," said Julie Baxter at Moving Comfort. "The new women's experience and online Bra Finder is the next frontier in shopping for women looking to outfit their active lifestyle, and we look forward to taking part in this groundbreaking effort by City Sports." The Bra Finder offers an informative and streamlined experience for customers shopping City Sports' expansive collection of sports bras. Offering guidance and specific details on everything from fit to style, the virtual tool aims to make choosing the correct bra a simple and tailored process. The newly revamped women's experience will be a staple at all future City Sports retail locations, including new stores planned on the East Coast through the end of 2011 including openings in Wellesley, MA, Wayne, PA and Silver Springs, MD. City Sports operates 19 metropolitan stores across the East Coast, with locations in Boston, Providence, RI, New York, Philadelphia, Washington, D.C., Baltimore and Atlanta.

Brooks Sports announced October 20 it will be moving its global headquarters to the planned building at 3400 Stone Way North., a move that will bring 300 new jobs to Fremont and Wallingford, according to a statement from Mayor Mike McGinn. "That's a big deal for us right now," McGinn said in a October 20 press release from the Seattle Office of Economic Development. "It shows that Seattle has what it takes to attract significant new investment even in these tough economic times."

Seattle Mayor Mike McGinn

Below: A Rendition of Brooks Sports New Headquarters in Seattle.

Photo courtesy of Brooks

BROOKS SPORTS TO RELOCATE GLOBAL HEADQUARTERS TO SEATTLE Brooks Sports, Inc., the parent of Brooks and Moving Comfort, will be relocating its headquarters from Bothell, WA to Seattle's Fremont/ Wallingford area. With a move-in date scheduled for late 2013, Brooks Sports will occupy roughly 80,000 usable square feet of a new 120,000-square-foot building located across from Seattle's Burke-Gilman Trail. The ground floor will also house the brands' first retail concept shop. The five-story building, part of Seattle's Living Building Pilot Program that encourages sustainable construction, is being developed by Skanska USA, a subsidiary of Berkshire Hathaway, Inc. "We have an incredible opportunity to create a new home for our leading performance brands that exemplifies who we are and ingrains us in the local running community," said Jim Weber, president and

CEO of Brooks Sports, Inc. "Brooks' mission is to inspire people to run and be active, and it's our hope that we become a welcoming trailhead along the Burke-Gilman Trail. We believe runners, walkers and others will gather at Brooks to meet friends, start their workouts and celebrate a good run." The project is participating in the City of Seattle's Living Building Pilot Program, which encourages the implementation of sustainable strategies toward the Living Building Challenge. Designing a building to the requirements set forth by the City's Pilot Program—for example, water and energy use must be reduced by more than 75 percent—is rigorous and risky for today's developers. Such projects provide benefits to tenants and the community by lowering energy use, providing greater access to daylight and strong ground-floor community connection. WEEK 1146 | SGBweekly.com

NEWS

EASTON BELL SEES 7 PERCENT Q3 REVENUE GAIN Easton-Bell Sports said product innovations that address growing safety concerns in high school sports trumped rising input costs and consumer anxiety to boost sales and margins in the third quarter ended October 1. Easton-Bell, which owns the Bell Sports, Blackburn, Giro, Easton and Riddell brands, reported net sales of $212.5 million for the quarter, an increase of 6.9 percent compared to the third quarter in 2010. Net income increased 56.5 percent to $4.7 million due to higher sales and a 60 basis points margin improvement. Easton-Bell President and CEO Paul Harrington said the results validate the company’s growing emphasis on, and investment in, new product development. That includes a recently opened innovation center for helmet technology and recently announced plans for a Speed Institute focused on ice skates.

"We are pleased with our sales and margin growth driven by our new product launches, which allowed us to continue to invest in our brands while also increasing our profitability in the quarter," Harrington said. Team Sports net sales increased 13.9 percent, or by 13.0 percent on a currency-neutral basis. Growth came from the earlier-than-usual launch of Easton baseball and softball bats and RS ice hockey sticks (MSRP $249). Baseball/softball sales rose 25 percent reflecting shipments of a new line of Power Brigade bats for the high school market, which will adopt the NCAA’s BBCOR regulation in 2012. The regulation, which aims to reduce the risk of injury from hit balls, will force many players to stop using composite bats. Sales of Riddell football helmets rose 29 percent during the rush season, thanks to a 5-star rating of the Riddell Revolution Speed helmet by Virginia Tech. The university introduced the rating system this year to compare the ability of adult football helmets to reduce the risk of concussion. In Action Sports, net sales declined 0.5 percent, or 1.0 percent on a currency-neutral basis. Snow sport helmet sales stalled in Europe, where dealers are still trying to sell inventory purchased for the disappointing 2010-11 winter season. Those declines were mostly offset by double-digit increases in sales of Easton-branded wheels and components and strong demand for the new Giro Ionos cycling helmet (MSRP $250) and the brand’s first line of cycling shoes.

HEELYS SEES Q3 LOSS WIDEN DESPITE U.S. SALES REBOUNDING Heelys, Inc. revenues in the third quarter slumped 19.7 percent to $6.6 million as gains in the U.S. were offset by declines internationally. Its loss widened to $1.5 million, or 5 cents a share, from a loss of $69,000, or breakeven per share, a year ago. Domestic sales jumped 78.9 percent to $2.3 million, primarily due to increased unit sales resulting from expanded placement in both existing and new retail outlets. Heelys sold 9,500 pairs of older styles in the quarter at a reduced price-per-pair to one of its customers to reduce excess inventories. International sales decreased 37.7 percent to $4.3 million. Sales dropped in Japan to $500,000 from $2.7 million due to the 6

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transition from a third-party distributor model to direct sales as well as the impact of the March 2011 earthquake in the region. Continued declines were also seen in France and Germany, offset by significantly higher sales in its Italian market and to its independent distributor in Russia. On a conference call with analysts, Thomas Hansen, CEO, said momentum in the U.S. "remained strong" as the company added new retail doors and sustained the sell through gains made in Q2. Said Hansen, "We still expect our holiday door count to be up approximately 50 percent from last year and we're on track to continue our year-over-year sales growth in the U.S. through Q4."

MIZUNO - EARTHQUAKE IMPACT LESS THAN EXPECTED

Mizuno Corp. is maintaining its fiscal full-year sales forecast while bumping up its earnings forecast on a revised tax forecast. The company saw fiscal first half revenues rise 4.3 percent in currentneutral terms to ¥78.1 billion ($980 mm) for the six-month period ended September 30. Although Mizuno, like other Japanese public companies, only reports year-to-date results for the period, a comparison to first quarter results shows fiscal Q2 sales for the quarter grew 3.7 percent to ¥36.5 billion ($470 mm) from ¥35.2 billion ($410 mm) for the prior year period. The company saw fiscal Q2 earnings nearly cut in half, falling 46.7 percent to ¥289 million ($3.7 mm) from ¥542 million ($6.3 mm) in the year-ago quarter. Asia stumbled in fiscal Q2, with revenues declining 20.2 percent to ¥1.36 billion ($18 million). The domestic Japanese market was the biggest bright spot, posting a 6.0 percent increase for the fiscal second quarter to ¥27.2 billion ($350 million), although Europe also posted a 3.1 percent increase in sales to ¥3.34 billion ($43 mm). The Americas business was off 0.9 percent to ¥4.54 billion ($58 mm) when measured in Japanese Yen terms, but increased 9.4 percent when measured in U.S. dollar terms. On the product side, footwear continues to be the primary growth generator. Mizuno’s Footwear business was instrumental in offsetting declines in equipments and apparel, growing 10.0 percent in the fiscal second quarter to ¥8.51 billion ($109 mm). The Golf business showed the biggest decline for the quarter, with sales falling 4.9 percent to ¥5.49 billion ($71 mm) when measured in Yen terms. Baseball business was down 4.2 percent to ¥7.64 billion ($98 mm). Apparel was down 2.9 percent to ¥6.53 billion ($84 mm). Footwear was 23.3 percent of overall Mizuno revenues for fiscal Q2, compared to 22.0 percent in the prior-year period. The company updated its forecast of consolidated results for the fiscal year ending March 31, 2012, with the sales forecast holding steady at ¥152 billion, operating income up slightly to ¥5.0 billion and net income at ¥2.7 billion, up from a previous forecast of ¥2.5 billion.

NAUTILUS, INC. SEES THIRD QUARTER LOSS SHRINK ON EXPENSE CONTROLS, DIRECT SALES GAIN

Aided by more efficient advertising expenditures, Nautilus, Inc. reported income from continuing operations for the third quarter were $281,000, or 1 cents a share, compared to a loss from continuing operations of $2.4 million, or 8 cents a share, a year ago. Revenues slid 2.8 percent to $38.5 million. The significant improvement in results from continuing operations was due to a 16.8 percent reduction in operating expenses, primarily through reduced advertising costs. After including losses from its commercial equipment business, sold earlier this year, the net loss in the quarter came to $92,000, or a break-even result, against a loss of $4.3 million, or 14 cents, a year ago. Sales in the Direct segment increased 5.3 percent to $22.6 million. Gains from its Bowflex TreadClimber line offset a decline in sales of strength products due to sales promotions during the latest quarter and the maturing product life cycle for home gyms. Operating earnings in the Direct segment reached $161,000 against a $2.7 million year-ago loss due to the sales gains and more effective media advertising content that helped reduce costs. Sales in the Retail segment were down 14.9 percent to $13.7 million, primarily due to a sales promotion of certain cardio products in the 2010 third quarter that were not repeated in the third quarter this year. On a conference call with analysts, Bruce Cazenave, Nautilus' CEO, said retailers "caution and conservatism in terms of timing their inventory purchases" pushed deliveries from the third to the fourth quarter. Operating income in the segment was down 34.1 percent to $1.3 million as the sales decline lower gross margin was only partly offset by lower selling and marketing expenses. WEEK 1146 | SGBweekly.com

NEWS

ECCO OPENS 1,000TH STORE WORLDWIDE 8

SGB PERFORMANCE l NOVEMBER 14, 2011

ECCO in early November opened its 1,000th store worldwide at Mall of America in Bloomington, MN. ECCO Global COO Michael SĂ¸rensen and USA President Dave Quel along with invitees from the Minneapolis Chamber of Commerce, Danish and U.S. press, and the ECCO regional retail management teams were at attendance at the grand opening. "This is a significant milestone for ECCO as we look towards the future of the company and the growth of the brand," said Dave Quel, President of ECCO USA. "We are excited to be entering Mall of America as a true shopping destination for consumers from all over the US and the worldÂ and look forward to the servicing the people of the twin cities community." In honor of their commitment to local communities, ECCO made a donation of $5,000 to the Boys & Girls Clubs of the Twin Cities. The Boys & Girls Clubs of the Twin Cities enables all young people, especially those who need it most, to reach their full potential as productive, caring, responsible citizens.

THE ING NEW YORK CITY MARATHON, SPONSORED BY ASICS, ROLLED INTO TOWN ON NOVEMBER 5.

The Health and Fitness Expo attracted thousands of international runners and ran from November 3-5.With the notable exception of Nike and Reebok, major running brands showcased their wares including t-shirts. Most items were sold through local retailers such as Paragon Sports, Jack Rabbit Sports, Super Runners Shop, City Sports, Urban Athletics, Foot Locker and The Sports Authority.

PARAGON SPORTS, which had the largest presence among retailers at the ING New York City Marathon Health and Fitness Expo, partnered with Saucony to offer a free lunch (pizza and hot dogs) to marathon runners who attended the expo. A free shuttle bus covered with branding from Paragon Sports and Asics, the marathon sponsors, was offered from the expo at Jacob Javits Center at 34th Street and 11th Avenue to Paragon at 18th Street and Broadway. Attendees were given a chance to win 1 of 1,000 Paragon $25 gift cards with a grand prize of a $500 gift card. WEEK 1146 | SGBweekly.com

TIMBERLAND PARTNERS WITH RINGO STARR ON CHARITY EFFORT

Timberland announced "Canvas that Cares," a new program created to raise funds for non-profit organizations through the auction of custom-designed, limited edition Earthkeepers footwear. Rock and roll icon Ringo Starr is helping to create support for the initiative by lending his original peace sign artwork to the inaugural boot collection. Proceeds from the auction, which kicks off December 1 on eBay (hub: www.timberland.com/canvasthatcares), will benefit WaterAid, a non-profit dedicated to improving access to safe water, sanitation and hygiene in the world's poorest communities. "We're thrilled about the Canvas That Cares program, and could not think of a better partner for our launch than Ringo Starr," said Mike Harrison, chief brand officer, Timberland. "For nearly 40 years, Timberland has followed a mantra of 'doing well and doing good.' Beyond his undisputed influence on music history, Ringo, too, has long been known for his commitment to social justice. With Canvas That Cares, we have a great opportunity to join forces and raise much-needed funds for a highly deserving organization, Water Aid." Starr's original design will appear on 75 pairs of the Timberland Earthkeepers City 6" Leather and Fabric Side Zip Boot, each signed personally, marking the first time in more than three years that Starr has autographed memorabilia. A colorful peace sign on a canvas panel is symbolic of the artist's personal mantra of peace and love; three stars embroidered along the back of the boot are a nod to his name. "For thirty years, WaterAid has brought clean water to millions of people in the world's poorest communities," said Ringo Starr. "This partnership with Timberland will allow others to make a real difference in these people's lives, and the boots are a reminder I'm with them every step in this journey."

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WHAT IF EINSTEIN RAN? Mizuno’s new marketing campaign turns to Albert Einstein to help explain its running footwear design philosophy By Thomas J. Ryan

Channeling the persona and genius of Albert Einstein and serving as the platform for the 15th Anniversary of the Mizuno Wave Rider 15 running shoe, Mizuno launched a new running campaign, entitled “A Brilliant Run.” At its centerpiece, the campaign touts a unique interactive Parallax website, www.IfEinsteinRan.com, offering viewers unique content, including videos and “Mizuno’s Law,” a definitive set of truths that form the pillars of Mizuno’s running ideology. When visiting the website, viewers can see episode one of a two-part “A Brilliant Run” video where Einstein endeavors to solve the mystery of the ultimate run. Episode two, scheduled to be released on November 21, will offer the story’s conclusion. As it plays out, Einstein’s solution comes via observational research, and ultimately produces Mizuno’s theorem, (R+Id+E), for “A Brilliant Run.” "Consumers are engaging with content differently," explained Vicky Wilkens, Mizuno's running division brand manager, in an interview with SGB Weekly. "As a society, we are becoming used to using our fingers to scroll through content and Parallax taps

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into this evolving trend. The beauty of Parallax is that it ultimately allows you to tell a story and provides the ability to introduce elements of that story as you scroll down the page. Parallax was a perfect fit for Mizuno as we wanted to tell our story of innovation and product development while creating fun and engaging ways to interact with runners. The Parallax website also includes a gaming component. As visitors move through the sites, pages and various content attractions, they can accrue “Runners IQ points” for watching the videos and clicking through the “Like” and “Send” button for Facebook and Twitter. By reaching various point levels, visitors will be entered to win a variety of Mizuno running prizes, with a chance of winning the grand prize, a complete head-to-toe Mizuno running ensemble. Said Wilkens, "Each time they interact with these elements and as they increase their “IQ Points” gained, they become eligible to win higher tiered prizes." Why Einstein? Wilkens said developers of the campaign found that runners are looking for ways to “run smarter” and the famed physicist naturally came to mind.

"EVERYTHING SHOULD BE MADE AS SIMPLE AS POSSIBLE, BUT NOT SIMPLER" – ALBERT EINSTEIN

"Albert Einstein is such an iconic and recognizable persona that’s instantly associated with brilliance and innovation," said Wilkens. "We wanted to communicate to runners our unique development process and balanced technological approach, thus providing them the direction they need to have a “Brilliant Run.” Albert Einstein has served as our spokesperson for this development approach, ultimately connecting Mizuno to brilliance, creativity and science. The question, If Einstein Ran, was so intriguing to us as we like to think, if Einstein ran today, he’d be wearing Mizuno Wave Rider 15s." After the idea was formulated and confirmed, the Albert Einstein estate was approached to ensure Mizuno could license his likeness and name. Added Wilkens, "Thus far, we’ve received great reception from the estate on the campaign." This seven-figure campaign also includes a heavy focus on digital and print advertising across leading running websites and publications, and a suite of retail marketing elements that will be showcased across running retail locations, including Einstein-themed point-of-sale materials and premium items. Retail partners all received “Brilliant Run” in-store kits to create excitement and buzz around the product launch instore. Additionally, Mizuno showcased the campaign the week of the New York City Marathon at its New York City Marathon Expo booth. Mizuno's guerilla marketing teams at the marathon itself wore its “IfEinteinRan.com” t-shirts with signs asking, “If Einstein Ran?.” The “Brilliant Run” campaign started on November 1 and ends December 31 with Wave Rider 15 as the priority product.

CLICK TO VIEW "A BRILLIANT RUN"

But with the campaign content speaking to Mizuno Running's development philosophy overall, the campaign can be extended to the rest of its product line, including apparel, into 2012. "We actually have created another series of videos to showcase on the website," said Wilkens. "The series of videos provide another piece of content for consumers to engage with and to further speak to our Mizuno philosophy. The second series of videos includes internal Mizuno employees, local runners and retail associates speaking Mizuno “Truths”, a series of beliefs from Mizuno under the “Brilliant Run” umbrella. We are extremely excited to launch this video series as it provides a great amount of transparency to our company and to the people who live and breath the Mizuno brand each day." One of the videos explores the subject of the minimalism trend that has captivated the industry, including the brand's concerns. Fritz Taylor, VP & GM at Mizuno Running, said his big concern is that there is so much confusing information around minimalist running that the newer runner will get frustrated and give up rather than get out and enjoy a run. "Bottom line - running is so broadly appealing because it is so darn simple and if we continue to over-complicate things then we will ultimately alienate potential new runners," noted Taylor. "If you drill-down to the fundamental insight driving a lot of interest in minimalist running it is the age-old issue of staying injury free. The number one concern of every devoted runner is avoiding a lay-off due to 16

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injury and many runners, especially those with a history of injuries, will go to almost any length to avoid another one. Minimalist running is largely driven by a belief that running in less shoe helps runners avoid injury by strengthening their feet and legs and/or allowing them to run with better form." While admitting that it has taken the brand "a bit of time to get just right," Taylor said Mizuno will be coming out with its own unique approach to minimalism in 2012. "We fundamentally believe that the shoes we’ve been building for the last decade offer just the right balance of being light and low to the ground while still offering needed protection from the hard, unforgiving surfaces that 99 percent of us run on," said Taylor. "But what if we could offer runners another way to stay injury free other than sacrificing the great feeling of running in a shoe like the Wave Rider? We are actually taking a very traditional Japanese solution and translating that into a modern day running product that we will introduce in 2012. And we have some very impressive test results from independent Japanese laboratories that have really inspired us. The real beauty of our approach will be its simplicity. Stay tuned." ■

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SAUCONY LAUNCHES GEOMETRY OF STRONG The running brand is changing the heel-to-toe height of its iconic models - Guide, Triumph and Hurricane - from 12mm to 8mm to bring some of the benefits of minimalist construction to the average runner. By Thomas J. Ryan

Describing the change as the brand’s biggest product initiative ever, Saucony rolled out its Geometry of Strong platform that introduces a completely redesigned heel-to-toe offset on three of the brand’s traditionally best-selling models. Reflecting its own learnings from its minimalist push since first launching the Kinvara 4mm-drop shoe in 2010, Saucony is moving three of its flagship shoes - the Guide 5, Triumph 9 and Hurricane 14 – from a 12mm heel-to-forefoot drop to an 8mm heel-to-forefoot drop. The new Triumph 9, its premier neutral cushioned training shoe, and Guide 5, a stability model that is now also 1.5 oz. lighter, were unveiled at the New York City Marathon Expo while the Hurricane 14, its other stability model, is slated to launch in February. In an interview with SGB Weekly, Richie Woodworth, president of Saucony, said several events – citing the fascination over Christopher McDougal's Born to Run book, new scientific findings supporting the benefits of a forefoot or midfoot strike, as well as feedback from its team of elite running athletes – "inspired us to look at how various geometries could enhance the runner’s experience." That was galvanized over the last year by the strong response the brand was seeing to its growing number of minimal models, which also include the Mirage 4mm-drop road shoe, the Peregrine 4mm-drop

trail shoe, and the Hattori zero-drop shoe. The creation early last year of the Saucony Human Performance and Innovation Lab at its Boston-based headquarters served as a base for experimentation. "We learned that striking with your foot closer under your hip makes it easier to land on your midfoot, lowering the impact rate while allowing for a more powerful running stride," said Woodworth. "A 4mm shoe or even an 8mm shoe doesn't force you or necessarily make you change your gait cycle. But if you’re interested in becoming a midfoot striker, a lower offset will make it much easier to do. We also learned that elite runners and runners in general want to get the most out of their bodies. The idea of lowering the geometry from 12mm to 8mm and 8mm to 4mm puts the foot in the position to allow the muscles in the lower part of the leg - the GastrocnemiusSoleus-Achilles tendon system – to achieve a greater range of motion, making you a stronger runner.” Believing Saucony gained a "little bit of a head start" over competitors with its release last year of the Kinvara, Woodworth said its product team, led by Patrick O’Malley and Spencer White, found the 8mm offset for its iconic models and would lead to greater control, alignment and suspension. "We believe we're thought leaders in this area. We believe we're taking some bolder steps in going to 8mm

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from 12mm and we're processing what we've learned across our the whole line," he said. While bold, Woodworth said Saucony was "certainly not reckless" in both how it decided to make the lower-drop shift as well as how it was introducing the radical change to the marketplace. Along with recognizing in lab tests that shifting its top-selling styles from the average 12mm to 8mm allowed for a lower impact strike and more powerful running stride, Saucony also conducted blind tests with scores of Saucony loyalists as part of its wear–test program. Runners tested both 12mm and 8mm versions of the same shoe and "overwhelmingly" supported the 8mm-offset. On the education front, Saucony, well-before the shoes launched, talked to influential bloggers in the marketplace to "give a voice to this whole idea of Geometry and our brand" to build support and buzz around the change, according to Woodworth. Editors from the running world and retailers in the U.S. and the U.K. were invited to Saucony's headquarters to discuss the 8mm Geometry story and launch as well as to debate running biomechanics. Over 200 Geometry clinics were held in run specialty stores across the country with more planned to promote and reinforce the Geometry positioning. Woodworth also noted that the shift came amid evidence that "more of the classic and traditional models have slowed down at retail" while Saucony is witnessing "fantastic growth" with its newer lightweight/minimalism styles, represented by its 4mm-drop models and zero-drop Hattori. Coming soon will be the third-iteration of the Kinvara with a new material called FlexFilm™ allowing the upper to "have a little bit of form and substance to it" while not impeding flexibility in the foot, said Woodworth. The upgrade also features a more strategically placed rubber on the outsole for enhanced durability and a beveled heel to achieve an even smoother transition. A Kinvara trail version will also be introduced. POS materials in stores include QR-codes that link to a video explaining the Geometry of Strong technology. Messaging will also be incorporated into its successfully-received "Find Your Strong" marketing campaign. Regarding marketing, Woodworth described the brand's launch into national TV advertising in May this year as "pretty fantastic." He elaborated, "It's hard for us to metrically quantify it but certainly it elevated our brand and our message." Woodworth said an integral reason for Saucony's recent growth has been how its "Find Your Strong" campaign has resonated with consumers and increased brand awareness. "One of the great things that's a big part of the Saucony story today is the way that we're going to market," he said. “We've got a great new chief marketing officer, Chris Lindner, who's been here a year now. Under his leadership, the idea of story-telling and bringing a message and a voice to our brand is being elevated in a particularly emphatic way with the 'Find Your Strong' campaign. TV was certainly a seminal moment for us. But we're going to up the ante on the 'Find 20

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Richie Woodworth, president of Saucony

Your Strong' marketing message next year as it plays both in product and on the relevance that this message has for our consumer." In response to the campaign, runners have written their personal stories on overcoming challenges and what the idea of "Find Your Strong" means to them. He said the campaign has "lit a little spark" in many people’s lives. Added Woodworth, "We've had tons of emails and posts on our site about how this idea of finding your strong 'is inspirational and personal to me.' We think we're completely right on with the messaging and we're going to platform it to more directly reach consumers on an even deeper emotional level as we head into 2012." Saucony will also continue its commitment to cross country sponsorships to further reach the younger runner that has provided the brand with the leading position in the cross country footwear segment. Among its sponsorships are the Saucony XC Spike Nights, a nationwide grassroots program now in its fifth year, and the 2011 Foot Locker Cross Country Championships. "That's the competitive heartbeat of our sport," said Woodworth. "That 16 year old kid running and buying their cross country spikes. Our ability to be number one and invest in the market is important not just for the trade but for the growth of the sport as well.” The London Olympics are also expected to shine a spotlight on many of Saucony's star endorsers, including likely participants such

Triumph 9

Guide 5

Hurricane 14

as Wallace Spearmon, Jr. in the 200 meters, Magda Lewy-Boulet in the marathon, and Molly Huddle in the 5000 meters. Said Woodworth, "Those are people who are at the tip of the spear in American running and are proudly wearing Saucony. They also inspire us to look at and change our thinking around what we're doing in shoe design and engineering; they're actively engaged here in our Innovation Lab helping us figure out how to do things better." With the 8mm-drop, Saucony extends the range of shoes by offering runners a choice between 0mm, 4mm, 8mm and 12mm offset. Woodworth said runners are increasingly recognizing the benefits of different heel-to-toe drops and rethinking their shoe needs based on a better understanding of their gait cycles. "While I might use an 8mm shoe on a long slow distance run, tomorrow I might pull out my Kinvara's and do an up-tempo,

more active training run," said Woodworth. "This conversation is happening now, and we love the fact that we're changing the language around running." But Woodworth said the biggest factor giving Saucony confidence in its move to reduce the offset on its traditional models – as well as its commitment to the minimal/lightweight trend – is that both are not being driven by the industry like past trends, but by consumers. "The best part about it is that this is a trend that is really coming from the consumer. I dislike that word because trends turn into fads, but the consumer is driving this and that makes it far less likely to be a faddish concept. This is authentic and true to our sport and it’s a way for us to evolve, change and be dynamic in how we look at the sport of running and what role shoes play. It’s all about enhancing the runner's experience. That's what we do." ■ WEEK 1146 | SGBweekly.com

I AM... SGB PERFORMANCE

JIM HOFF VP Sales, Brown Athletic

WHAT WAS YOUR BEST SPORT GROWING UP? Soccer was king in St. Louis.

I was fortunate to have coaches who immigrated from Europe and who really knew the game. We were taught the game as it was meant to be played - as a team. Through the years soccer has helped me to value teamwork in all aspects of my business career; no one does it alone. My proudest moment was receiving a scholarship to play soccer at Southern Illinois University in Edwardsville, IL.

YOUR FIRST JOB? A paper route in our neighborhood in North St. Louis. I

rolled 200 newspapers every Wednesday, walked the neighborhoods and threw the papers on the front porches of the houses on my route. At the end of the month, I collected 10 cents from each house and received 10 percent of what I collected. It taught me responsibility. I graduated to a snow cone route two years later and went from $2 a month to $2 a week...I was on a roll!

F IRST REAL JOB? At Central Hardware Company in St. Louis. I worked 25 to 30 hours a week from senior year in high school through college. I was part of a small group that ran the credit office at night and weekends. During the summer, I worked full-time in the office or in one of the six retail stores. When I graduated from college, I stayed on as a retail store manager for several years. T HE TURNING POINT OF YOUR CAREER? A friend introduced me to a salesman with Spalding Sporting Goods.He was being promoted and had to find someone to work his territory covering Eastern Missouri, Southeastern Iowa, Southern Ill, and Western Kentucky. Selling sporting goods was a dream come true for a kid who grew up loving sports. I was blessed to be taught by some of the best people in the industry at the time.

ID YOU HAVE A KEY MENTOR? Dick Miller had a big influence on D my business development. But Lou Zambello, one of my bosses at Spalding, stands out. He became VP of sales at Avia, when it was owned by Reebok, and asked me to join him as a regional manager. That led me to my long career at Asics of 18 years. WHAT WAS IT LIKE WORKING AT ASICS IN ITS EARLY DAYS IN THE U.S.? The team took a company losing a lot of money and turned it into a profitable and strong entity. The team-building skills that I learned led me back to Avia and, of course, Ryka and Nevados. Brown Shoe Company bought the privately-held American Sporting Goods in February 2011. We are now called Brown Athletic. I am blessed to be part of a great team whose goal is to build the brands to new heights in a difficult, competitive and wonderful footwear industry. DO YOU HAVE DÉJÀ VU FINDING YOURSELVES BACK AT AVIA AND ST. LOUIS? The fate in all of this is that my mom and dad met after WWII in St. Louis while they were working at International Shoe company. My grandfather owned a shoe store and his father was a cobbler. My first job at Central Hardware was purchased by International Shoe Company’s corporation, Interco. And now I am employed by one of the shoe industry's icons based in St. Louis, Brown Shoe. Funny how life leads you to where you are supposed to be. All of this has allowed me to enjoy a career in sporting goods and raise three great children with my wife Delene. And, periodically play a round of golf with friends and family. I am a lucky man.

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