4 Hot Topics From Outdoor Retailer Winter Market
Exhibitors and retailers offered mixed reviews of last week’s Outdoor Retailer Winter Market—the first in November and first in Denver—with the majority of companies that SGB interviewed saying they lamented the show’s lack of attendees and overall dearth of energy but lauded the show’s new date.
Some described the show as “slow,” “dead” and even a “waste of time and money,” and perhaps the first sign that this show differed from past events was the lack of beer lines at the brands’ daily happy hour festivities. Another (and probably more telling) sign was the absence of some large brands—including one that recently announced it was moving its headquarters to Denver—which either opted out of the show altogether or operated out of a private meeting space on the lower level of the Colorado Convention Center.
Not all the response was negative, however. More than a few companies, especially smaller brands, told SGB that the lighter attendance and relaxed pace allowed for more meaningful conversations and the ability to more easily maneuver through the aisles. And immediately following the Grassroots Outdoor Alliance gave some brands and retailers a chance to see many channel partners in the same locale within a few days of each other.
Just as SGB did with our Summer Market recap, this report is focused on the business side of the show rather than product highlights (for more about the latest offerings from brands, including some great photo collages, check out SGB Today).
Here are four hot topics—in the form of questions and their corresponding answers—plus a few other trends that were culled from this reporter’s notebook over three full days at the show. Look for much more reflection on OR and additional details on some of these stories in SGB in coming weeks.
Is November the right date?
This is the million-dollar question. Actually, the dollar value of this question might be much larger as event organizers look to 2019 and wonder what to do with the show—keep it intact and try to attract more buyers, move it back to January, combine it with Snow Show or something else altogether.
Ever since the new dates were announced, brands and retailers have privately expressed confusion over whether or not they should attend, even as Outdoor Retailer clearly explained that the number of shows hadn’t changed, just the ownership and dates of the shows. But a week and a half ago, a very public debate over the show’s performance emerged just before OR was set to begin.
On Nov. 1, when Outdoor Retailer parent Emerald Expositions Events Inc. reported third-quarter earnings, the company announced it was reducing organic revenue growth expectations for 2018, in part because of smaller-than anticipated numbers for Winter Market.
Phil Evans, who became Emerald’s interim president and CEO on November 8 following the resignation of David Loechner (read SGB’s article on Loechner’s resignation by clicking here), talked at length on the company’s earnings call with analysts about why Emerald had lowered that guidance.
“…With the reduction in our expectations for the new Outdoor Retailer November show and the deferral of two planned [trade show] launches, we’re now expecting to be slightly below the lower end of those guidance ranges with the year largely complete,” Evans said on an earnings call with analysts.
Evans went on to say that while industry support for the November show, which was timed to better align with the apparel sales cycle, “has been quite positive,” the industry “will need a full cycle of shows to adapt to the new cadence” of the following OR schedule: Snow Show in January, Summer Market in June and Winter Market in November.
Adapting will clearly take some time. While Denver was again viewed as an ideal host for the show and the November date was seen as preferable primarily because it’s at the front end of the selling cycle, the inaugural November Winter Market didn’t have the retailer numbers to justify the booth and travel cost, not to mention brands being away for more than a week because of the preceding Grassroots Outdoor Alliance.
For example, the dates worked great for apparel and accessories brand Kavu, but the lack of buyers frustrated the company’s founder and CEO, Barry Barr. “It’s noticeably smaller and has fewer dealers,” he said. “But it’s in transition and it is what it is. We’ve been coming for 25 years, so we’ll see what happens. If they can get more dealers here, it’s worth it.”
Scott Newman is president of Sven Can See, a Holbrook, MA-based company that makes lens cleaners and anti-fog sprays for glasses and goggles. His company’s booth was outside the main entrance, where Newman said he benefited from good traffic, so he is looking forward to that same spot for Snow Show in January.
“The reality is you get out of it what you put into it,” Newman said. “We always do well. We catch the right people and people find us. We do incredible pre-show marketing that makes people interested in us. Is the traffic down from January? Yes. Is it very noticeable? Absolutely. That being said, we can sit down and have conversations with people for 10 minutes. In January the show is jammed and you can’t have a conversation with anybody. So there’s a quality of relationships that you can build at a show like this that is a little more mellow.”
Mellow wasn’t a word to describe the scene at Fjallraven’s booth, which seemed to constantly be bustling with buyers. “We’ve been really busy,” said Nathan Dopp, deputy CEO and president of the Americas for Louisville, CO-based Fjallraven North America. “It’s really good timing from the brand side, and we want to support that. It’s also important for us to support OR—and it’s important for us to support OR in Denver.”
Adidas Outdoor was another booth that was constantly busy, and not because of early happy hours, according to Pete Schuster, director of sales and head of Adidas Outdoor USA’s Golden, CO, operation.
“It’s been a good show,” he said. “It’s been slower than we expected, but I’ve been able to spend more time with retailers than usual. It’s usually more quantity than quality, and this show has been more quality. That’s been a nice surprise. Would I like to see more people here? For sure. But we opened some new dealers, we sold some product and actually wrote some new business here. That might be a direct result of having more time to spend with people and finding out their needs. I would love for this to work.”
Look for more on the future of Outdoor Retailer Winter Market in SGB, including comments from show director Marisa Nicholson and any date or format changes if Outdoor Retailer or Emerald decide to go in a different direction.
Are “ingredient” brands the only ones innovating?
This question is hard to answer, but there is a perception among the financial side of the industry—investment bankers and venture capitalists—that outdoor brands not only operate on razor-thin margins but also aren’t doing enough on the innovation side to warrant large infusions of cash. Their argument is that too much product on the show floor is the same gear with different logos splashed on them.
A look at some of the “ingredient” brands—the companies that supply everything from waterproofing and insulating layers to insoles and outsoles—paints a different picture. For example, PrimaLoft’s new material Bio was named product of the year at the inaugural Outdoor Retailer Innovation Awards, and 11 outdoor products were selected as winners by the judging panel. The other winners were:
Black Diamond Equipment: Jet Force Pro
Cake: Kalk Electric Motorbike
Costa Sunglasses: The Untangled Collection – Baffin Sunglasses
Crescent Moon Snowshoes: Eva Foam Snowshoes
DPS: Phantom Permanent Waxless Glide
GoLite: GoLite ReGreen Windshell
Tecnica: Plasma S
United By Blue: Bison Puffer Jacket
Yale Cordage: Forj Thermoplastic Tape – Ribbon
The Innovation Awards might change some people’s minds about what’s happening in the industry (another suggestion from an attendee was a similarly themed marketing award). And the night’s big winner has some thoughts on innovation too.
Last month SGB interviewed PrimaLoft’s president and CEO, Mike Joyce, about the company’s new (and eventually award-winning) innovation Bio, and here was his response to the question about a perceived lack of innovation in the outdoor industry (read the full interview by clicking here: SGB Executive Q&A: PrimaLoft President & CEO Mike Joyce).
“I don’t disagree with the comment about innovation, but I’ll dilute that comment a little bit by saying this: I think the outdoor industry can be pretty critical of each other,” he said. “For example, the fashion industry is coming to the outdoor shows to do nothing other than to look at innovation in that segment. With the outdoor industry, if you take the logos off every jacket and you lay them down, they all look the same. And so the outdoor industry needs to go to the fashion shows and get inspired by how they execute and how they design. I think the sweet spot is somewhere between, and we’re getting there. Fashion is becoming more technical, and hopefully the outdoor market will become more stylish. Between those two polar opposites is where, I think, value is created. So I do think that there is innovation.”
Plenty of other “ingredient” brands had some of their innovations on display, including Schoeller, which celebrated 150 years of innovation with an anniversary party on Friday, and W.L. Gore & Associates, which is on its continued quest to remove PFCs of environmental concern from the company’s consumer laminate shipments by 2020.
Is specialty retail still the preferred channel?
Light attendance at OR doesn’t undermine the role that independent specialty outdoor shops play for outdoor brands, according to numerous exhibitors at Winter Market who said the channel remains the No. 1 option for a variety of reasons even as many look to build an omnichannel sales strategy.
“The outdoor specialty retailers understand the value and they’ll hold the value of a brand really well, which is good,” said Michael Millenacker of apparel brand Royal Robbins. “They can tell the story better than some of the other retail channels that are out there. For us, with our size, it makes a lot of sense to focus there for years to come and not get distracted by chasing other channels. There’s so much good opportunity with this brand in the outdoor specialty channel and we’re going to stick to it.”
Aventura and Ecoths are sister apparel brands that sell through the independent outdoor specialty channel, according to the company’s president and CEO, John Kirsch, and its VP of sales and marketing, Tom Williamson. They both said that while the two brands (Aventura is women’s apparel and Ecoths is men’s) are in some larger retail chains, independent shops are better able to share message of what helps a smaller brand stand out, from fair trade practices to garment quality to sustainable sourcing.
“With some larger retailers,” Williamson said, “it’s harder to tell those stories.”
How are brands differentiating through storytelling?
More brands are adopting content marketing as part of their messaging efforts to win mindshare and build loyalty. As companies seek ways to differentiate, they are finding creative ways to highlight not only their heritage stories, but also the unique ways they are sourcing or engaging consumers through social media and other channels.
“Content is king,” said David Petri, VP of marketing for Nester Hosiery and Farm to Feet. “You want people to come back and if you’re just a product-oriented brand and website, once they’ve been there, they’ve seen it all and they may not come back until they’re ready to shop again.”
Merrell‘s booth space near the front of the show floor allowed the brand to showcase its One Trail project, a campaign built around “celebrating diversity on the trail and seeking to contemporize attitudes about outdoor participation,” according to the company.
Todd Spaletto, president of the outdoor and lifestyle group for Merrell parent company Wolverine World Wide, said the campaign was about ensuring that Merrell about “new, contrived brand positioning” as a way to differentiate, but instead is calling attention to the brand’s authenticity as a way to stand apart.
“There are soulful origins of this brand,”Spaletto said. “This brand started as a custom backpacking boot brand and really its whole goal was that if we get good shoes on people’s feel, they’re going to have a good experience. A lot of what you’re seeing in our creative is how do celebrate this defining purpose of the brand that has allowed people to have shared experiences? Great brands express themselves as functionally and emotionally. We believe that a brand has its purpose and on one side is the functional expression of that purpose and the other side is the emotional expression of that purpose. [One Trail] is the emotional expression of our purpose.”
Other Trends from the Show Floor
Tariffs remain top of mind: The tariff situation is a “disaster,” said Kavu’s Barr, who was among the brand executives to also use some descriptive words not fit to print when asked about how tariffs are impacting the bottom line. “It’s a big stress,” he added. “It’s going to cost us a lot of money this year. Duties on a bag go from 17 percent to 27 percent. That hurts. The big scare for me is if it happens to apparel, there’s going to be a retail meltdown.”
Is the sustainability message getting drowned out? Companies throughout the show floor touted their sustainability efforts, and while many are bringing transparency to their supply chains as way to bolster their claims, there remains some doubts about the how “green” these companies really are. When every brand shouts their sustainability message from the rooftops, do customers stop listening?
New faces, new brands: This was the first show for Mammut North America without Joe Prebich, who left the company last month for undisclosed reasons (read SGB’s story about the split by clicking here). His departure came just six months after being named to the brand’s top North American position, and Kris Kuster, managing director for Mammut Switzerland, was appointed to replace Prebich. There is no word on a permanent replacement.
In other leadership news, Vibram’s new president for the USA, Fabrizio Gamberini, was at the show. Look for an upcoming Q&A with him in SGB on his vision for the sole company.
And the show saw some new brand entrants like Kathmandu, which bought Oboz last spring and debuted its products for North America market at Winter Market.
Tactical category increases in presence: From footwear companies like Garmont to gear companies like Mystery Ranch (and plenty more in between), tactical gear had a visible presence in booths throughout the show. SGB will be writing about how outdoor brands are branching out into the tactical category.