January 10, 2011
A Weekly Web Magazine for the Sporting Goods Industry
WEEK 1102 | SGBweekly.com
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Group Publisher / Editor–in–Chief James Hartford james@sportsonesource.com
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A Weekly Web Magazine for the Sporting Goods Industry
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FEATURE
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 PSR Update Sportsman’s Business Update Team Business Update SGB Weekly Team Business Weekly Sportsman’s Busness Weekly Footwear Business Weekly Outdoor Business Weekly
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Photo courtesy of Ubex
NEWS
4 SGB WEEKLY Year In Review 2010
FEATURES
10 FALL 2011 OUTERWEAR Performance Sells, As Do Fashion-Forward Designs 16 NEW WATERPROOF BREATHABLE TECHNOLOGY AND HYBRID FABRICS Combinations Heat Up Competition In The Category
DEPARTMENTS
22 CALENDAR On our cover: Photograph by Marcus Caston on location in Mt. Hood, OR Current World Cup Freestyle Champion Patrick Deneen wearing Lord Helmet by Shred featuring custom fit wheel, removable ear pads and interchangeable google buckle.
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 1102 | SGBweekly.com
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NEWS
2010
YEAR IN REVIEW THE YEAR’S TOP STORIES
CONSERVATIVE RULED THE DAY FOR MANY BUT OPENED THE DOOR TO NEW FORMATS, PRODUCTS AND TRENDS
1. Expansion/Consolidation Looms The last two years witnessed a rare retrenching for the sporting goods industry with many of the major chains slowing new store growth to a pittance and taking a sharper look to close many underperformers. But with sales perking up and funding getting somewhat easier, many chains have ratcheted up their expansion plans for the coming year. The leader, Dick’s Sporting Goods, plans to open 34 stores, up from 26 in 2009, telling Wall Street that it’s only halfway to its targeted base of 900 stores domestically. And with share prices bouncing back, the industry will likely see the return of M&A activity on the retail side. Except for the collapse of Joe’s Sports (G.I. Joe’s) that opened up an opportunity for Dick’s and The Sports Authority to grab more real estate in the Pacific Northwest, the sporting goods industry saw scant consolidation this year.
On the vendor side, a few deals got done. Hanesbrands acquired Gear For Sports, Easton-Bell Sports snapped up Talon Lacrosse and Kohlberg Sports Group, Inc., and the owner of Bauer Hockey, acquired lacrosse specialist Maverik Lacrosse. In outdoors, Clarus Corporation, a publicly-held company, acquired Black Diamond Equipment and Gregory Mountain Products and promised to become a major consolidator in the future in the outdoor lifestyle space under the new stock symbol BDE. Toronto-based Authentic Brands Group, headed by sporting goods industry dealmeister Jamie Salter, acquired four MMA apparel brands, including Tapout. Other brands finding new owners included Cloudveil, Isis, Mountain Khakis, Above The Rim and Nokona. But the mega-deals took the year off as none of the past big buyers (or at least those with deep pockets) such as VF Corp, Jarden Corp. (owner of K2, Rawlings, Pure Fishing and Coleman among many others) Columbia
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Sportswear, Nike, Adidas, Amer Sports, etc. made any acquisitions in space. Similarly, with stock multiples recovering and many touting new five-year growth plans, M&A activity will likely resume on the supplier side. A new major consolidator promises to be Puma. In October, its owner PPR, which also owns Gucci, Yves Saint Laurent and several other fashion brands and retail stores, said Puma will become the main brand of a new Sports & Lifestyle unit to pursue acquisitions in the space. Current Puma CEO Jochen Zeitz will become executive chairman at PPR and will run the new unit. The most noticeable consolidation erupted in the team dealer channel, driven by Genesco, Inc.’s acquisition of both Anaconda Sports, one of the largest independent team dealers on the East Coast and Brand Innovators, a sizeable dealer on the West Coast. Combining the two along with past acquisitions of Impact Sports and Great Plains Sports, Genesco brought its team sales presence to 43 states under its new Lids Team Sports division, with the potential to build that presence to 49 states. It now ranks as the number two team dealer in the U.S. Not to be outdone, industry leader Sports Supply Group acquired Coach’s Sports Corner in Sandusky, OH; Kattus Pro Team Sports in Cincinnati, OH; Greg Larson Sports in Brainerd, MN; and Pal’s Sports Center of Elmira, NY. It also scooped up the Gear 2000 football equipment brand. But its biggest deal was its own move to be acquired by the private equity firm Oncap Management Partners, a unit of Canada’s Onex. The purchase took Sports Supply private for the first time since 1998. The feverish M&A activity left the minions of smaller team dealers in the still highly-fragmented industry to reevaluate their competitive stakes at a time when school budgets were being impacted by the recession.
2. Nike Takes NFL On-Field Deal From Adidas/Reebok In October, the NFL announced plans to split its apparel licensing rights among seven companies starting in April 2012. The big winner was Nike which was granted the highly-coveted on-field licensing rights taking it away from its two rivals. The biggest loser was Reebok and parent adidas Group, which had held the on-field licensing rights since 2001 and will be left out of the deal when it commences in the 2012 season. The NFL deal was viewed by many analysts as the crown jewel in Reebok’s portfolio when it was acquired by the adidas Group in 2006. With the Reebok brand undergoing a resurgence positioned as a fitness brand, the loss of on-field branding rights may be less important than trying to make up for the estimated half billion in sales Reebok had generated in NFL apparel and headwear sales. Other companies attaining licenses for certain items as part of the new five-year NFL licensing deal were New Era Cap, Under Armour, VF Corp., G-III Apparel, Forty Seven Brand, and Outerstuff, Ltd. The valuable on-field headwear license, which had been part of the Reebok deal, will go to New Era. Long term, other leagues may explore a similar restructuring of their licensing contracts. Adidas controls both the NBA and NHL licenses. The MLB license is shared by Majestic Athletic, owned by VF Corp and New Era. Retailers will likely see some benefit after the NFL transfer occurs. “My assumption is that if I’m a New England Patriots fan, I’m probably going to want my jersey to have the Nike logo that Tom Brady wears, not the Reebok one he used to wear,” said Matt Powell, chief retail analyst for The SportsOneSource Group. But 2011 may very likely be a challenging year as Reebok will be forced to shift from offense to defense to address the category. Said Powell, “Reebok is going to try not to get stuck with a lot of product.”
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NEWS
3. Vendor-Owned Retail Expansion In 1990, the first Niketown opened in Portland and several of the major vendors in the sporting goods space have been steadily opening their stores to directly tell their stories - and ultimately sell to consumers. T he urgency exhibited by vendors to open their own stores seems to have accelerated in 2010. Not surprisingly, Nike spoke the loudest when management revealed at its annual analyst meeting in May 2010 that it planned to open approximately 250 to 300 new Nike-branded stores worldwide over the next five years as part of a strategy to double its direct-to-consumer sales (including online sales) for the Nike-brand, over that period. Nike said it is part of an overall goal to find ways to better connect with consumers that began in 2007 and resulted in an organization change. “The consumer was changing, they were becoming more sophisticated,” CEO Charlie Denson said at their meeting, referring to initial rethinking of its approach in 2007. “We talked about the consumer being more in charge than ever before. It wasn’t just about us talking to them, it was about them talking to us, and we needed to be more connected.” So far, Nike’s new experiment in retail has resulted in opening running stores in Stanford, CA and Covent Garden in London, two multi-sports stores in Roosevelt Field on Long Island and Santa Monica,CA and two action sports stores
(combining Nike 6.0, Hurley and Converse) at the Irvine Spectrum in Orange County, CA and Laguna Beach, CA. Converse also opened its first two stores in Boston and New York and Under Armour, which has often been lauded for its commitment to focusing on sales in the sporting goods channel, now has 54 outlet stores (up from 35 at the close of 2009) as well as four full-price stores. Its own direct-to-consumer sales grew 47 percent. Among other brands, Ugg, which has led footwear gains for many footwear sellers over the last few years, launched an aggressive storeopening plan while Merrell appears to be just getting starting. Other vendors with sizeable store counts that are growing include Adidas, Puma, Crocs, North Face, Patagonia, Skechers and Vans. The trend is leaving many retailers irked to find many of their primary traffic drivers looking to their own stores as their strongest growth drivers.
4. Toning Craze Led by Skechers and later complimented by Reebok, the toning phenomenon drove sales, stirred up traffic, and raised price points to play a critical role in boosting the footwear category for much of last year. With new players coming into the market and retailers again overplaying their hand by overbuying for back-to-school (which has never been key fitness products), supply quickly surpassed demand by
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NEWS the end of the year. In December, dollar sales in the toning category were down 3 percent - the first-ever decline since the category erupted onto the scene in 2008 - as markdowns ensued to clear out inventory. Said Matt Powell, “It’s classic sporting goods 101. We had forecasted toning sales would reach $1 billion this year and that’s amazing for a less than two-year old category. But the manufacturers made it like it was a $1.5 billion opportunity.” On the upside, Powell noted that unit volume was up 40 percent in December, indicating continued strong consumer demand for the product despite ongoing qualms in the press whether the product actually works. Nike’s arrival into the wellness category is also expected to support growth, especially given their marketing dollars. However, Powell said the category is in a precarious state as it may take six to nine months to right-size inventories and average selling prices continue to slide. Said Powell, “My gut feeling is that in the worst case scenario, we will probably have some retailers saying, ‘it’s over’ and a few will get out of the category. But then it will start to resurrect itself.”
5. Lululemon Envy Run specialty and outdoor specialty appeared to have performed strongly during the downturn, pointing to overall underlying strength in specialty concepts targeting the fitness and active enthusiast. But Lululemon took the lead in 2010. With sales per square foot averaging $1,500 and comps climbing 29 percent in the third quarter, several retail observers called their performance the tops in retail – not just athletic space - in 2010. Lululemon – with its yogatrained staff, local brand ambassadors, inspirational mantras, instore yoga sessions and run groups - has something special. While not embracing its yoga theme or its other quirky touches (such as its inspirational mantras), several other retailers busily began testing new concepts designed at the more serious athlete. The most notable is The Sports Authority’s launch of its S.A Elite concept and Famous Footwear’s launch of Mind Body Sole. Foot Locker, admitting that it wasn’t reaching the core running enthusiast in its flagship store, began testing a more upscale run concept in two locations while Finish Line tested a new concept aimed at a more mature consumer. Among women’s-only concepts, VF tweaked Lucy, The Gap launched its first Athleta store, and Title Nine, the women’s activewear pioneer, branched out of the Bay Area to open two stores in Chicago, its first store in the Midwest, and now has physical stores in nine states.
6. Running
Photo courtesy of Merrell
The buzz around running at retail came in the lightweight category with Nike, Adidas, Reebok and Saucony all scoring big at full-line and athletic specialty channels. With newcomers coming into the sport, the overall push toward wellness/healthy living , the hard-core
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SGB WEEKLY l JAN 10, 2011
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enthusiast sticking with the sport and offshoots such as tri, running participation looks like it will continue to support the category. Another trend toward barefoot/minimalist/natural running was driven by Vibram Five Fingers who generated substantial chatter but ultimately it appears to be a smaller opportunity reserved for only the most fit and elite runners. The Nike Free product and other minimalist models from running vendors in 2011, including trail running Five Fingers product from New Balance, are expected to fuel continued growth as athletes opt out of the traditional cushioned, motion control or stability categories and move closer to the ground with the new minimalist product. Matt Powell says lightweight models - which are dramatically lighter than traditional running shoes yet still feature support – continue to see strong demand and have the potential to be bigger than toning in 2011. For non-core runners, it will also likely continue to support the shift toward tech-as-fashion running shoes as an everyday shoe.
7. Recovery With some additional confidence and pent-up demand, the consumer came back in 2010. And with lean inventories across the channel, the traditional markdown frenzy was avoided to help the industry boost its bottom line. With two strong trends in lightweight running and toning, the footwear category – also critical as a traffic driver for other categories – particularly helped galvanize the comeback year. In the backto-school quarter, same-store sales improved 5.1 percent at Dicks SG, 12.5 percent at Hibbett’s, 8.1 percent at Foot Locker and 10.1 percent at The Finish Line. Also encouraging are only two major companies – Joe’s Sports & Outdoors and Schutt Sports landed in bankruptcy court. Efforts to shore up balance sheets clearly helped many companies weather the recession. The one shortfall is that overly-lean inventories led to some shortage of product. Retailers discovered the drawback of relying too heavily on replenishment. As the economy improves, vendors may become more aggressive at chasing growth in 2011.
8. Nike’s In-Store Play With the recession, retailers appeared to rely disproportionately on their tried-and-true major brands increasing the prime real estate in their stores. But Nike took matters into their own hands last year. Following on their successful House of Hoops partnership format with Foot Locker, Inc., Nike went on to develop the palatial Fieldhouse concept in Dick’s Sporting Goods as well as Track Club sections within Finish Line stores. Finish Line is on schedule to roll out Nike Track Club to approximately half of its chain by June 2011. The Fieldhouse in-store concept - ranging from 4,700 to 6,000 square feet - will be rolled out to 20 DSG stores over the next two years, primarily in two-level doors. About 55 Nike Evolution Plus shops - approximately 3,000 square feet in size – will also be installed over the next two years primarily in single level stores. Also losing ground to other core brands such as Under Armour, Adidas and North Face, secondary brands continue to feel the squeeze. The appetite for testing any emerging yet unestablished brands also appears small.
9. China With energy, cotton, transportation and labor costs all rising, production input costs rose in the latter part of the year and are expected to see even more pressure in 2011. But the lesser-discussed problem is how the reduction in ships and container capacity stemming from the downturn wound up crippling deliveries last year as the industry tried to ramp up production. Although most of these costs will try be passed onto consumers For Breaking Trade News Every Business Day Go To SGBUPDATE.com 10
SGB WEEKLY l JAN 10, 2011
NEWS
Photo courtesy of Nike
through price hikes, margins are expected to be impacted in 2011. The consumer proved during the 2010 Holiday selling period that they will get the lowest price possible and will either grab it earlier at a deep discount or wait until the end-of-season price cuts. The lean-inventory/replenishment model will also be tested by new factory capacity and transportation constraints as vendors and retailers explore new partnerships that will challenge the willingness to book early and/or risk paying airfreight costs later.
10. Comeback Kids Thanks to its sharp design takes on the toning category and the success of its ZigTech collection, Reebok was the band leader that enjoyed a renaissance out of the recession. Said Matt Powell, “Both their toning product and ZigTech system are uniquely American and have been very, very successful. It’s a
lesson for the industry that compelling product and well thought out execution can get a brand back very quickly.” Crocs also weaned through itsinventory issues and came out with stylish product to have a bounce-back year. Nike found its mojo again in the running category with innovations such as Lunar and Nike Free and helped drive the overall gains in footwear.” Brooks Sports is harvesting the fruits of its labor after investing ten years in turning the brand around. By the end of the year Brooks challenged (if not surpassed) Asics for the top share position in running footwear at running specialty and is rubbing against Nike’s dominant No.1 spot in running apparel at specialty. At retail, mall kingpins The Finish Line and Foot Locker, Inc. both rode the move back to athletic footwear as they cleaned up stores, re-positioned their brands and cleaned up inventories to turn in very robust gains by year-end.
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FALL 2011 PERFORMANCE SELLS, AS DO FASHION-FORWARD DESIGNS COLOR, INSULATION AND HYBRID FABRIC COMBINATIONS HELP BOOST AN ALREADY STRONG CATEGORY By Nancy Prichard Bouchard, Ph. D.
Photo courtesy of Obermeyer
Woolrich Women’s Arctic Jacket - hip-length version of the iconic Woolrich Arctic Parka, features removable faux fur ruff and the original Ramar 60/40 fabric. MSRP $250 Patagonia Men’s Ultralight Down Hoody - MSRP $300
E
xcitement is the word for Fall 2011 outerwear. Soft, light down is flying off the rack, and colorful shells, insulated jackets and classic “retro” designed wool and soft-construction pieces are the new must-haves. The dynamics driving sales are new materials and fabric combinations, better cutting, sewing and welding techniques and a broad assortment of exciting color combinations. Lightweight down and hybrids are selling well, new colorful zippers are adding pop and unique features (like tuck-away balaclavas, pass pockets and goggle-wipes) are encouraging consumers to upgrade. While product at the price-point level may drop (especially in waterproof breathable construction)—consumers seem poised to make big ticket purchases. High-end jackets and pants have silently crept up in price—defying all logic. While people have been conservative in their buying habits, they aren’t scrimping on technical outerwear. For example, racing past the $240 to $450 sweet spot for technical outerwear pieces, Helly Hansen is introducing two new jackets, the ASK and Embla, both $1500, that combine high-end resort fashion with top-of-the pyramid technical performance features like three-layer, four-way stretch fabric, Pittards leather on the shoulders, a zip-out down insulated jacket and cashmere wrist gaiters and balaclava. Patagonia shares this belief that consumers are more than ready to open their wallets for quality products with compelling feature sets and performance advantages. Tim Bantle, the company’s alpine business unit director, notes
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that the company is moving aggressively into the premium tier position. “Two years ago, at the bottom of recession, we saw strong business with premium tier products,” says Bantle. “For Fall 2011, we see opportunity in our premium hardshell group, premium soft shell group and premium down group.” From down sweaters to brightly colored insulated ski jackets, fashion has been the driving force in the sports outerwear category. With faux fur hood trim, sexy graphics and low-rise pants, manufacturers took the lead from mainstream fashion brands in order to appeal to a broader, less-performance focused group of end users. However, the pendulum is swinging back to a more technical, performance-driven category. For Fall 2011, outerwear expects a significant trend toward innovative fabrics, materials and construction methods. Says Topher Gaylord, president of Mountain Hardwear, “What is exciting is the combination of unique and exclusive technology with incredible style and fit.” At Obermeyer, founder and CEO Klaus Obermeyer notes that the combination of fashion and ski performance has resonated with customers. “There has been a confluence of fashion meets ski,” says Obermeyer. “ You are seeing it in a lot of ski wear companies and now there are fashion brands trying to make their product look like ski wear. Plus outdoor companies trying to move into Alpine. What is most important for our success is that it must be technical first—but when performance is dialed in, you can add a few crazy things like unusual button and zipper combinations. Skiing is a fun sport and the clothing for it should be fun. And we as a company should have fun making it.”
Chris Davenport is one of a handful of athletes brought on to develop Spyder’s collection of outerwear to compete with the top outdoor brands like Patagonia, Arc ‘Teryx, Rab, Marmot, Mammut and The North Face. Explains Davenport, “ These companies have continued to take market share in the traditional ski world and for Spyder to survive and prosper we needed to be playing in the technical apparel market, which they weren’t doing up until this year. Many mountaineering brands make apparel that is great for skiing, but few skiing brands make apparel that is great for mountaineering. We want to be the best at this--to use our great skiing heritage and brand identity to build the best possible gear for all mountain activities.” Davenport believes outerwear has improved over the year, and continues to evolve. “Fabrics have gotten technologically advanced with better breathability and water repellence,” says Davenport. “ Feature wise, there is only so much you can do with a jacket or pants and we believe in keeping it simple, light and clean. If you add a feature that the consumer might only use a few times, then it’s not worth the cost and the weight. Similarly, if you add a feature that only a small percent of purchasers are apt to take advantage off, then it’s not worth it either. “
IT’S ALL ABOUT COLOR (WELL, ALMOST) Tones, texture and color combinations will dominate Fall 2011 outerwear. Greg Houser, Marmot’s VP of Production, says the most exciting aspect of 2010 was color--especially the use of color to address the trend of personalization and creating one’s
Rab Women’s Latok Shell with midand heavyweight 3-layer eVent® fabric. MSRP $175
own identity on the slopes. He expects the trend to continue well into 2011 and 2012. For Fall, Marmot has an assortment of clear, bright bold colors designed to be mixed and matched. Explains Marmot’s Houser, “there is a lot of influence from the fashion industry to mute colors—especially with the use of gray. A year ago, the trend services presented us color palettes—there was a lot of gray. After the presentation, no one felt comfortable with the recommendations—they just didn’t feel right . We went with a terrific methyl blue and fun combinations of green. We do have a red paired with light gray, but the impact is vivid and rich— redefining both colors.” At Mountain Hardwear, look for the emergence of tonality, with tone-on-tone combinations such as blue on light blue and dark green and light green. The company’s Fall palette is a festival of bright orange reds, purples, brighter and lighter blues and blacks. The emergence of details, trims, and color hits that merchandize and tie back to the overall look is critical going forward. Says Gaylord, “It is not enough to have simply a “shell” or color story— customers are demanding complete garments with a unified look.” Neutrals aren’t expected to go away, but they are expected to shift from browns to grays. At Outdoor Research, blues for men’s outerwear have led pre-season sales, with oranges and reds staying strong. For women, neutrals are also moving into grays, with warm combinations of berry and purple. Outdoor Research is also seeing more mix and match of solid colored pants and jackets, especially in its women’s line. While black ski pants and blue jackets will remain staples in most people’s closets, colorful pants, especially for alpine
Outdoor Research Men's Havoc Jacket 60-gram Primaloft Eco insulation, Gore Windstopper shell. MSRP $225
Helly Hansen Women’s Enigma Flow Down with interior hexagonal down pillows and venting channels, high-loft PrimaLoft insulation and 20,000 mm waterproof breathable exterior fabric. MSRP $700
skiing and riding, are trending upwards. On the slopes, high visibility colors are the rule rather than the exception, with combinations of bright pink, orange and purple trending up. On the women’s side, look for true purple to reign in Winter 201112, with strong blues, Kelly greens and bright teals close behind. According to Scott Trepanier, marketing coordinator for Columbia, solid dark colors have traditionally led sales, but the company is expecting increased popularity in bright colors and patterns. Says Trepanier, “We are using bright colors and pop colors in our Fall 2011 line as a catalyst to draw in customers. They may ultimately decide to buy a black, or dark solid-colored jacket, but we plan to differentiate our product and get their attention with interesting, eye-catching colors.” Obermeyer’s senior VP of product and brand management Robert Yturri agrees that Fall 2011 will be a feast for the eyes. “We have a yellow you can see for 2.5 miles in the fog,” exclaims Klaus Obermeyer with a laugh. “And a fabulous blue and red.” One trend that is apparent at Obermeyer is the development of fabrics that take color better than ever—with deep, rich tones that are designed to prevail over time, altitude and sun. “We constantly test the saturation of our fabrics as some take the color better than others,” says Yturri. “It is important to pick the right color, but equally as important to pick the right fabric - some fabrics from China don’t hold color as well. You don’t want to buy a red jacket that three years later turns gray. We are lucky that we have real-world testing at over 8,000 feet, year-round!” Bill Hartlieb, lead product designer and brand manager at Stoic, reports that the company is still making black jackets for the guy who likes black, but that the brightest jackets are selling out first. The company’s bright blue Insulated Bombshell jacket was a best-seller in 2010, and for 2011, “it” colors are bright yellow and purple. Interestingly, Stoic is remaining more conservative with their women’s color palette, and with strong emphasis on navy for Fall 2011. We are seeing a strong business for women in black and navy with pop color,” says Hartlieb. “It is easier to mix and match, and our research suggests that women are increasingly interested in matching outfits.”
QUALITY AND TECHNICAL DETAILS Quality, construction and technical detail will be key elements that drive Fall 2011 outerwear sales. To meet this challenge, Mountain Hardwear has moved all designing in-house and is working to bring more modern, clean aesthetics into the product line with brighter and fresher color palettes. Says Topher Gaylord, president of Mountain Hardwear , “Form needs to follow function and we are working hard to have superior functionality. Our goal is unique differentiation from proprietary technologies and unique designs. For Fall 2011, it is all about going back to our roots - creating uncompromising solutions for our consumers so they can push the limits - whatever their activity.” 16
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Photo courtesy of Spyder
SOFT, SOFTER AND SOFTEST Soft shells continue to be a strong category—perhaps because the term covers such a broad range of fabric and technologies. There is continued strength in breathable stretch woven materials as well as bonded fabrics. The waterproof soft shell category is also one to watch, as is the development of insulated soft shells with fleece backing and body mapping for extra warmth. Melanie Sirirot, who oversees apparel for Outdoor Research, says that all indications are that down sales (feathers!) will be up next season. “I think more people are buying down product—we had 60 percent growth in forecasted sales,” says Sirirot. “People are moving from fleece to down because it layers nicely, offers great warmth, and looks good when worn alone.” Tim Bantle, alpine business unit director at Patagonia agrees.” Down sweaters continue to be strong, our Nano Puff collection is a whole new business category for us and is growing at a significant rate,” he says. In 2010, actor Jake Gyllenhaal was on two covers of US Weekly (the Hollywood gossip magazine) wearing a Nano Puff jacket. Greg Houser, Marmot’s VP of production, says the company also predicts consumer demand in insulated outerwear. “I don’t think layering is dead,” acknowledges Houser, “but because of new technologies - venting, breathable fabric for example - you can put garments together that don’t overheat. It’s OK to be warm, and we are finding people would rather be warm than cold.” Brian LaPlante, Marmot’s category manager for merchandising, notes that insulation comes in a lot of forms—it doesn’t necessarily mean a marshmallow-puffy down jacket. “We can use insulation to create a variety of goodlooking garments that are not necessarily the big Michelin man,” says LaPlante. “For Fall 2011, look for sleek, warm garments with the ability to mix and match outside shells and hybrid jackets. The outerwear category is really becoming a mixed medium with consumers able to dial in specific end use and an individualized look.”
Cande Ross Huez
Photograph courtesy of Rossignol
Body mapping - placing insulation in specific areas of jackets and pants - is also a trend to watch. Helly Hansen’s Enigma Flow Down Jacket has pockets of down that warm the core without distracting from the garment’s sleek lines. At Marmot, insulation is also “mapped” into the torso area to keep the core warm. Outdoor Research reports strong pre-season orders for Fall 2011 designs with body mapping to place insulation and specific technical fabric in key design areas.
WHAT IS HELPING TO BOOST SALES? In addition to better colors, materials and designs, expanded niche categories are credited with helping to spur outerwear sales. At a recent session with Mountain Hardwear athletes at Snowbird, the team brainstormed as to how many product-specific ski niches they could come up with. “We came up with over 10 different genres of skiers—from backcountry technical touring skiers, to uberlight weenies,” reports Gaylord. “ There’s a side country, slack country, and lift-assisted. And they all have different technical, performance needs (and different fashion parameters), so we are gaining sales due to more specific end-use demands.” Outdoor Research’s Sirirot suggests that the emergence of “side country” as a category has brought in new consumers, and encouraged long-time end users to add styles to their closet. “We are focusing on side country - using lift access to reach the back country,” says Sirirot. “They want the true benefits of an alpine jacket - full durability and waterproofness, but with plenty of features, like powder skirts, pass pockets, Recco and powder skirts. However, since they are usually carrying a pack, they also need breathability and quick venting.” Overall, companies who are excited about the outerwear success for Fall 2011 tend to be those who are consciously building products to last. Explains Spyder’s Davenport, “Our collection, while not exactly “bare-bones,” has only the features you absolutely need, and in the right places, and nothing more. Ultimately we want our consumer to love these products and keep them for years because they work perfectly, rather than buy a new product just to follow a fashion trend.” Klaus Obermeyer agrees wholeheartedly. “Our goal is to produce product that will last a long, long time,” says Obermeyer. “ When I see people wearing jackets that are 30 years old, I am happy.” At Marmot, Houser concurs. “We built our entire business on long-term durability,” Houser explains. “It is the challenge for our designers - it has to look good 10 years from now - it is the ultimate green story.” Perhaps Brian LaPlante at Marmot sums it up best. “We don’t want our garments to wear out, we want to create “new engagement garments” our customers want to have.” LaPlante adds that it is critical for outerwear companies to make sure jackets retain their value - whether they are used for years in the mountains, or repurposed for snow shoveling, soccer games or mucking out the barn. ■ WEEK 1102 | SGBweekly.com
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NEW WATERPROOF BREATHABLE TECHNOLOGY AND HYBRID FABRIC COMBINATIONS HEAT UP COMPETITION IN THE CATEGORY By Nancy Prichard Bouchard, Ph.D.
Look for a shake up in the waterproof/breathable category for Fall 2011 outerwear. Not only are there new membranes and laminates introduced into the market, but companies have more flexibility than ever to combine existing technologies with a variety of fabrics to create truly amazing pieces. Brands are striving to differentiate themselves from competitors by making items with greater air permeability and more waterproofness— with softer shell construction and lightweight materials. Whether it is Mountain Hardwear’s Dry.Q, Gore-Tex’s Active Shell, Polartec’s NeoShell, or Columbia’s Omni-Dry membrane, increased air permeability in waterproof-breathables is a dynamic and on-going story.
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With more flexibility from suppliers, apparel manufacturers are creating “miracle” fabrics at an accelerated rate. Glenn Crowther, product line leader for performance fabrics at GE, explains that by offering customers increased flexibility with membranes, more companies are using eVent technologies in their end product. “GE has found that a lot of companies are interested in the eVent family of technologies, but don’t want to use a component brand,” reports Crowther. “We’ve changed our go-to-market strategy. If people want to buy laminates and use the eVent name, they can, but we are allowing more freedom to brands going forward. We found that brands who have established relationships with fabric
Photo courtesy of Obermeyer
Stoic Welder Men’s Lo Softshell Jacket MSRP $270
Marmot Men’s Freerider GORE-TEX MSRP $450
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suppliers may want to purchase a membrane and then combine it with other technologies. If that is the case, then they are really coming up with a hybrid product. Our tagline is that we want our customers to be the hero brands. We want to be the hero at the trade level.” Crowther says that GE, under the eVent umbrella, expects that the interest in its air permeable membrane technology will only increase. “The objective was to have more product with air permeable membrane available to consumers,” says Crowther. “In our mind it is not critical that a manufacturer is using the eVent name, but that customer is getting the best product for his or her needs. We’ve been locked out of some brands because of the 800-pound gorilla on the block. So this is an opportunity.” Beginning in Fall 2011, look for the introduction of new-to-the world technologies from GE such as a 3-layer fleece, 3-layer softshell, and 2-layer windproof fabric—all with eVent membrane. “ Other new waterproof breathable stories include Obermeyer’s eco-friendly materials, with an emphasis on a new 2.5 layer waterproof, breathable Cocona shell fabric. Says Klaus Obermeyer, company founder and CEO, “It’s a sweet fabric, with a wonderful hand, performance, waterproof, and very breathable (up to 40,000mm). We are an eco-friendly company, and have been for the last 30 years and have worked very hard for the last several years to bring in proprietary eco-friendly fabrics. For the Cocona shell fabric, it was the breathability that sold us.” Topher Gaylord, President of Mountain Hardwear, says that it is about time the outdoor industry focuses on new fabric technology. “In the apparel industry, by and large, there has been nothing revolutionary for a long time in fabrics. In the ‘90s, there was some exciting new technology, but for the last decade, it has been a sea of sameness. If you look at leading waterproof breathable garments today, and if you remove the logos, they function exactly the same and are designed with the same design specification. Only the color, zipper color, length of pit zip and logos differentiate most pieces.” In 2009, Mountain Hardwear started working on changing the status quo in waterproof breathables. In conjunction with eVent and 25 other companies around the world, the material engineers developed Dry.Q. “We built a fabric by working with fabric suppliers in the rawest form,” explains Gaylord. “From the face and backer technology, to tapes and lamination machines—our new fabric was handcrafted in an artisanal way. We worked with a number of barrier technology companies, backer companies, and huge number of suppliers
Mountain Hardwear Men’s Drystein MSRP $425
to develop a series of unique fabrics and took innovation upstream. For too long, people were accepting the industry standard—which is not breathable. Gore technology allows the garment to build up humidity levels, so you are wet before the garment begins to breathe. Dry.Q dries instantly, so you are safer in the mountains when pushing limits.” Mammut is using Gore-Tex Active Shell in its new Eiger Extreme collection and is touting the attributes of minimal weight and maximum breathability. Patagonia is bringing to market 16 Gore products for Fall 2011. In addition to utilizing Gore-Tex Pro Shell, Performance Shell and WindStopper fabrics, Patagonia will also feature an exclusive new 100% recycled nylon Gore-Tex fabric in the Primo ski pieces. Tim Bantle, alpine business unit director at Patagonia, reports that the company did a full supply chain and materials platform audit with Gore and that BlueSign was “extremely straightforward” about Gore being the best laminate manufacturer in the industry and the benchmark for responsible manufacturing. The question is—will consumers understand all the new technology and nuances in terminology. Brian LaPlante, Marmot’s category merchandising manager, says the efforts of each company to use different terminology and technology can be confusing. “Everyone is trying to prove that one technology is better than the other,” says LaPlante. “Trying to get a consistent terminology is the biggest challenge. What is waterproof? What is more waterproof? Once it is already waterproof, is it really more waterproof than something else? The big question is, does the consumer know or care?” “Not necessarily,” says LaPlante. He feels that it is up to the brand to sort out technologies—and that customers then trust brands to have products that perform as advertised. Marmot is partnering with Polartec to launch NeoShell, a waterproof, breathable soft shell that is utilizing waterproof soft shell seam taping to produce a waterproof, breathable soft shell. Bill Hartlieb, Stoic’s lead product designer and brand manager, says for Fall 2011, there will be a “lot more waterproof/ breathable materials that aren’t Gore.” He says that the waterproof breathable market is still quite strong and that as competition heats up from materials and fabric suppliers, value will increase. “We are always hunting out new and better fabrics,” says Hartlieb. “At the Winter OR Show 2011, we will see an increase in value for customers, greater performance and higher standards for durability.” ■
Obermeyer Coco Jacket MSRP $400
WEEK 1102 | SGBweekly.com
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CALENDAR 13-16
NBS Winter Specialty Market Denver, CO
17-18
Let’s Play Hockey International Expo Las Vegas, NV
17-19
Sports Licensing & Tailgate Show Las Vegas, NV
18-21
23-24
WWRA Southern California Winter Market Costa Mesa, CA
MARCH 1-3
WWSRA Northwest Winter Market Seattle, WA WWSRA Northern California Active Sports Market Reno, NV
SHOT Show Las Vegas, NV
1-3 1-3
19-23
Outdoor Retailer Winter Market Salt Lake City, UT
1-4
EWSRA Winter Sports Expo Edison, NJ
27-29
PGA Merchandise Show Orlando, FL
14-17
NEWSR Winter Sports Expo Manchester, NH
27-30
SIA Snow Show Denver, CO
16-18
GDS Shoe Show Dusseldorf, Germany
31-1
SIA On Snow Demo Winter Park Resort, Co
APRIL
FEBRUARY 2-3
Mid-Atlantic Winter Market Oaks, PA
2-5
Sports, Inc. Outdoor Show Phoenix, AZ
6-8
EORA Southeast Winter Market Greenville, SC
6-9
ISPO 2011 Munich, Germany
7-9
WSA Show Las Vegas, NV
6-10
MRA Winter Market Boyne Mountain, MI
14-15 14-17
SWRA Winter Show Snowshoe, WV NEWSR Winter Sports Show Providence, RI
14-18
Magic Marketplace Las Vegas, NV
15-17
MAGIC Fall / Winter Show Las Vegas, NV
15-17
MNSRA February Show Madison, WI
21-24
Worldwide Spring Trade Show Reno, NV
23-24
WWSRA Inter Mountain Winter Market Salt Lake City, UT
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SGB WEEKLY l JAN 10, 2011
WWSRA Rocky Mountain Winter Market Denver, CO
14-17
Sea Otter Classic Monterey, CA
14-17
FIBO 2011 Essen, Germany
MAY 1-4
NSGA Management Conference and Team Dealer Summit Tucson, AZ
JUNE 14-16
Licensing International Expo Las Vegas, NV
27-29
EORA Southeast Summer Early Bird Show Greenville, SC
27-29
EORA Northeast Summer Early Bird Show Manchester, NH
29-30
TAG Spring / Summer Show St. Louis, MO
JULY 6-9
EORA Mid-Atlantic Summer Show Parsippany, NJ
AUGUST 3 4-7
Outdoor Retailer Open Air Demo Outdoor Retailer Summer Market Salt Lake City, UT
TRADE ASSOCIATIONS | BUYING GROUPS
JANUARY
For full year calendar go to sportsonesource.com/events
Athletic Dealers of America 1395 Highland Ave. Melbourne, FL 32935 P: 321-254-0091 F: 321-242-7419 athleticdealersofamerica.com National Sporting Goods Association 1601 Feehanville Dr., Suite 300 Mount Prospect, IL 60056 P: 847-296-6742 F: 847-391-9827 E: info@nsga.org www.nsga.org Nation’s Best Sports 4216 Hahn Blvd. Ft. Worth, TX 76117 P: 817-788-0034 F: 817-788-8542 nationsbestsports.com Outdoor Industry Association 4909 Pearl East Circle, Suite 200 Boulder, CO 80301 P: 303-444-3353 F: 303-444-3284 E: info@outdoorindustry.org outdoorindustry.org SGMA 8505 Fenton Street Silver Spring, MD 20910 t. 301.495.6321 f. 301.495.6322 E: info@sgma.com sgma.com SnowSports Industries America 8377-B Greensboro Dr. McLean, VA 22102 P: 703-556-9020 F: 703-821-8276 E: siamail@snowsports.org snowsports.org Sports, Inc. 333 2nd Avenue North Lewistown, MT 59457 P: 406-538-3496 F: 406-538-2801 E: info@hq.sportsinc.com sportsinc.com Sports Specialists Limited 590 Fishers Station Dr., Suite 110 Victor, NY 14564 P: 585-742-1010 F: 585-742-2645 sportsspecialistsltd.com Team Athletic Goods 629 Cepi Dr. Chesterfi eld, MO 63005 P: 888-796-0734 F: 636-530-3711 tag1.com
"I can't imagine having achieved the expanded retail space & growth of our business without regularly attending OR." – Marc Sherman, Outdoor Gear Exchange and GearX.com
201 1
2012
AUGUST 4-7, 2011 Salt Palace Convention Center Salt Lake City, UT
JANUARY 19-22, 2012 Salt Palace Convention Center Salt Lake City, UT
Open Air Demo AUGUST 3, 2011 Jordanelle State Park, UT
All Mountain Demo JANUARY 18, 2012 Wasatch Range, UT
VISIT OUTDOORRETAILER.COM OR CALL 949/226-5722 FOR MORE INFORMATION.
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