Embed Size (px)
DESCRIPTION
SGB WEEKLY 1125
Citation preview
June 20, 2011
The Weekly Digital Magazine Service for the Sporting Goods Industry
Minimal in volume,
but BIG on function!
NEW PROFORM Ultra-Thin Inserts
by
Designed to offerLightweight, Contoured, Flexible Supportfor minimalist and natural running shoes.
Call 1-800-877-3626 or email [email protected]
To Order a FREE Sample Today!PROMO CODE: PFMSGBMY11Expiration date: July 31, 2011
Spenco®
Love Your Feet ™
®R
egis
tere
d a
nd
™Tr
adem
ark
of
Sp
enco
Med
ical
Co
rpo
rati
on
. ©20
11 S
MC
. All
Rig
hts
Res
erve
d
Proform Fits: Designed to FIT, where other insoles can't. The deep heel cup and contoured shape, along with our multi-density materials, help provide the RIGHT amount of support and cushioning. Spenco® PolySorb® Proform makes any shoe FEEL like it was made for your customers.
WEEK 1125 | SGBweekly.com 3
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.
NEWS 4 VF CORPORATION to Acquire Timberland Co. 5 KKR To Acquire Academy Sports + Outdoors APPLE'S Retail Chief to Head J. C. Penney TEAM SHORTS 6 BY THE NUMBERS SCHUTT Acquires Adams USA’s Football Helmet/Faceguard Assets 8 RUBEL Exits Collective Brands; Olivet Assumes Chair UNDER ARMOUR Poised To Double Business By 2013 9 CRAMER Expands into Apparel with Stromgren Deal MOVERS AND SHAKERS FEATURES
10 PLAYING BY THE RULES Consumers, manufacturers and retailers in the diamond sports market will be dealing with new regulations and the economy which is slow to recover as they look ahead to 2012. 18 TAKE ME OUT TO THE BALL GAME Team tailored color combos, lighter materials, better lasts and unique cleat patterns keep sales well within the strike zone.
DEPARTMENTS
The Weekly Digital Magazine Service for the Sporting Goods Industry
June 20, 2011
Minimal in volume,
but BIG on function!
NEW PROFORM Ultra-Thin Inserts
by
Designed to offerLightweight, Contoured, Flexible Supportfor minimalist and natural running shoes.
Call 1-800-877-3626 or email [email protected]
To Order a FREE Sample Today!PROMO CODE: PFMSGBMY11Expiration date: July 31, 2011
Spenco®
Love Your Feet ™
®R
egis
tere
d a
nd
™Tr
adem
ark
of
Sp
enco
Med
ical
Co
rpo
rati
on
. ©20
11 S
MC
. All
Rig
hts
Res
erve
d
Proform Fits: Designed to FIT, where other insoles can't. The deep heel cup and contoured shape, along with our multi-density materials, help provide the RIGHT amount of support and cushioning. Spenco® PolySorb® Proform makes any shoe FEEL like it was made for your customers.
Editor In ChiefJames Hartford (704.987.3450 x104)
Senior Business EditorThomas J. Ryan (917.375.4699)
Editor/AnalystKyle J. Conrad (704.987.3450 x111)
Contributing EditorsNancy Prichard Bouchard, Ph.D.
Fernando Delgado
Creative DirectorTeresa Hartford
Graphic DesignerCamila Amortegui
Advertising Sales DirectorCasey Vandenoever (303.997.7302)
Advertising Sales / Account ManagerKatie O’Donohue (704.987.3450 x110)
Circulation & [email protected]
TechnologyChief Information Officer, Mark Fine
VP Research & Development, Gerry AxelrodManager 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 Business Weekly
Footwear Business Weekly
Outdoor Business Weekly
Group PublisherBill Garrels
SportsOneSource, LLC2151 Hawkins Street • Suite 200 • Charlotte • NC • 28203
t. 704-987-3450 • f. 704-987-3455www.SportsOneSource.com
18 Mizuno 9-Spike Finch 5 MSRP $75
On the cover: New York Yankees starting pitcher, A.J. Burnett. Photo courtesy of Louisville Slugger
VF Corporation (VFC) reached an agreement with Timberland Co. that will combine two of the largest publicly-traded companies in the outdoor space and double the size of VFC’s already rapidly growing Outdoor & Action Sports coalition. When completed, the deal will push the coalition’s revenues to 50 percent of VFC's total, or $5 billion, this year and 60 percent of projected VFC revenues by 2015.
Timberland is expected to remain headquartered in Stratham, NH.
"We look at Timberland as a brand that has over 30 years of heritage deeply rooted in the rugged New England lifestyle and a brand that is growing and has a global reach," said Steve Rendle, group president of the coalition, in an interview with SGB Weekly. "They have very strong platforms, for instance, in Japan, and a good business in Europe. As we look at their business here in the United States, we feel confident with their current management team and their strategy focusing on interesting initiatives like Earthkeepers, the Mountain Lifestyle collection, and Timberland Boot Company. They have some really good, strong initiatives in place from product to how they manage their distribution that gives us confidence that this is a good brand to add to our portfolio. And then you look at SmartWool - a brand that's growing double-digits and has a very dominant position within the outdoor industry when it comes to wool-based product, specifically socks."
The merger will be complementary on several levels. First, Timberland earns 72 percent of its revenues from footwear. Second, it will boost VFC’s international
revenues from 30 to 35 percent. And lastly, it caters to a less active customer.
"The North Face is a brand that takes you to the top of the mountain or what we like to say, 'Above the tree line,' " said Rendle. "Then you have the Timberland brand that really is 'Below the tree line' with that rugged New England outdoor lifestyle. So these are products you use on the mountain but also in your everyday life. It's not that top-of-the-mountain positioning but it has a really core outdoor positioning due to its longstanding New England heritage. We feel we can position the two side-by-side very nicely. They already sit there today. But we think that through careful brand management we can come together and strengthen those complementary positionings and grow the brands nicely."
The two companies have identified about $35 million in costs they can cut in 2012, but VFC will derive even more value by helping Timberland accelerate its higher margin apparel business and sharing best practices from its direct-to-consumer businesses. Timberland is also forecasting its revenues will grow 12 percent to $1.6 billion in 2011 with more than half of that coming from international markets.
VFC will pay Timberland shareholders $43 per share, representing a total enterprise value of approximately $2 billion net of cash acquired. The price represents a premium of 43 percent over Friday's close price, an 18 percent premium to the 60-day average and is 5 percent below the last 60-day high. The merger agreement was unanimously approved by both companies’ boards of directors and will now go before shareholders and regulators. Closing is expected to occur in mid-September.
Timberland will become VFC’s fifth billion-dollar brand alongside The North Face, Wrangler, Vans, and Lee and boost VFC’s international presence.
“This acquisition more than just moves the needle for VF,” said Eric Wiseman, chairman and CEO of VF Corporation. “It knits together two powerful companies into a new global player in the outdoor and action sports space.”
VF CORPORATION TO ACQUIRE TIMBERLAND CO.
NEWS
Kohlberg Kravis Roberts & Co L.P. (KKR) in early June reached an agreement to acquire Academy Sports + Outdoors, which for its 73-year history has been controlled by the Gochman family. Terms of the deal were not disclosed, but sources told SGB Weekly that the deal was pegged at 11X EBITDA, or an acquisi-tion price in the $1 billion range.
Upon completion of the transaction, Rodney Faldyn will assume the Academy CEO reins, replacing David Gochman, grandson of the company’s founder. He will also continue in the role of president. Faldyn, an avid sportsman, former Deloitte consultant and Enron execu-tive, first got his “dream job” at Academy as CFO and was promoted to president in 2007.
The Gochman family will retain a minority ownership stake in the iconic Katy, TX chain. The transaction is expected to close in six to eight weeks, subject to cus-tomary closing conditions.
The buyout is expected to help Academy Sports, which generated sales last year of $2.7 billion, to grow beyond the 11 southern states where it currently con-
TEAM SHORTS Boxercraft, the supplier of spiritwear, campus apparel, and licensed collegiate ap-parel, appointed Charles Sutlief as its new CEO.
LIDS Sports Group has acquired Buckeye Corner Stores, which operate in the Columbus, OH area. The acquisition is made up of four store locations, the e-com-merce site, buckeyecorner.com, and a catalog business. Terms were not disclosed.
Under Armour will introduce its first line of inflatable basketballs and footballs with licensee PSI 91, Inc. The Under Armour football features proprietary Horween leather with UA Gripskin technology and Armour Grabtack laces that promises to give ath-letes a 107 percent increase in grip compared to standard laces. The new footballs will be available this month and the basketballs will hit stores in November.
Jeff Bowyer has been promoted to the position of national wrestling sales man-ager for Brute Wrestling. Bowyer will be responsible for national wrestling sales and customer service including the development of sales strategies/programs and team initiatives. Bowyer was formerly director of sports marketing and events.
Maverik Lacrosse announced that former University of North Carolina standout Billy Bitter, a three-time All-American selection, and 2010 ACC Player of the Year has become the newest addition to its roster of elite lacrosse athletes.
3d Lacrosse, the creator of events, training, and spring break programming, an-nounced the formation of a strategic marketing and sponsorship relationship with Easton Lacrosse. During the next twelve months, Easton Lacrosse will be the pre-senting sponsor of several events and programs, including the Denver Shootout, 3d Spring Break and all 3d Select Club teams.
APPLE'S RETAIL CHIEF TO HEAD J. C. PENNEY
Ron Johnson, who joined Apple more than a decade ago to build the computer company’s retail stores, has been named J.C. Penney’s next chief executive, effective November 1.
He will replace Myron E. (Mike) Ullman, III, chairman and chief executive officer of Penney. Ullman will become executive chairman.
Johnson is widely credited with helping Apple develop a formidable retail presence. Over the course of the past decade, the company has expanded from its initial two stores (in Tyson s Corner, Va., and Glendale, Calif.) to more than 300 locations worldwide. He joined Apple after 15 years at Target Corporation, where he was a key merchandising executive.
Penney’s 2010 revenues rose 1.2 percent to $17.76 billion, and same-store sales increased 2.5 percent. But observers said the department store operator is losing market share to other department stores like Macy's and Kohl's, as well as upscale discounters such as Target.
ducts business. Of its 131 stores, 80, or about 60 percent, are in Texas. It also has locations in Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Missouri, Oklahoma, South Carolina and Tennessee. It has approximately 16,000 associ-ates.
"This transaction with KKR will help accelerate Academy's continued growth and provide even greater flexibility to achieve our strategic goals," said Faldyn in a statement. "KKR understands our industry and our business well, and will be a tremendous partner as we build upon our leadership position, continue to imple-ment our strategic plan and continue to exceed the needs of our customers."
Academy management indicated that the KKR acquisition could expand its an-nual store-opening plan to a rate of about 18 to 20 stores annually. Academy is on track to open 12 new stores in 2011.
"We are long term investors who look for leading retail franchises and Academy Sports + Outdoors is a perfect fit," said Mike Calbert, a member of KKR and head of the firm's retail investment team. "The Gochman family has built an unparal-leled business and we look forward to continuing in their tradition of providing great value, outstanding service and an unrivaled shopping experience for its cus-tomers. We are excited to partner with the management team, the Gochmans and all the associates of Academy in accelerating the company's future growth."
KKR's current and previous retail investments include Sealy, Dollar General, Toys 'R' Us, Pets at Home, Maxeda, Duracell, Gillette, RJR Nabisco, and Safeway.
KKR TO ACQUIRE ACADEMY SPORTS + OUTDOORS
6 SGB WEEKLY l JUNE 20, 2011
SCHUTT ACQUIRES ADAMS USA’S FOOTBALL HELMET/FACEGUARD ASSETS
Schutt Sports has acquired football helmet and faceguard assets from Adams USA. The deal will give Schutt a much larger presence in the youth market, while freeing Adams to pursue its other team sports businesses. Financial terms of the transaction were not disclosed.
The purchase consists of only Adams USA'S football helmet and faceguard product lines. All football accessories as well as other sports categories remain with Adams USA. Schutt will assume responsibility for manufacturing the acquired product lines and will continue marketing helmets and faceguards under the Adams brand name.
"We are excited because this acquisition will expand our relationship with the team dealer market and will enhance our lineup, allowing us to offer quality football products to a wider variety of customers," said Robert Erb, Schutt's CEO, in a statement.
Speaking to SGB, Glenn Beckmann, director of marketing communications at Schutt Sports, said the football assets Schutt acquired from Adams USA were direct competitors of the company "in small slices of our key markets, specifically portions of the youth football market."
He said Schutt management sees the acquisition of the Adams USA assets enabling the company to reach dealers it wasn't able to sell to before.
"This expands our market along the youth lines in a meaningful way, as well as increases our reach into the team dealer market," said Beckmann. "That’s something that’s important to us, as we are dedicated to the team dealer channel of distribution. In terms of brand positioning and brand value, the market won’t see much change. We’ll continue to focus both brands on their core customers."
Beckmann added that the acquisition is the first step put in place by Kranos Corp., its new parent, and Schutt's leadership team to expand in the sporting goods space both organically and through acquisitions.
"Kranos has made it known in the industry that they are looking for great companies and brands for strategic partnerships and there’s no reason to think that this is the final step," said Beckmann. "But, that growth will be managed smartly and done with long-term stability and growth paramount."
As reported, Kranos, an affiliate of Platinum Equity LLC, headquartered in Los Angeles, acquired Schutt in a bankruptcy auction in late December. With Schutt’s TPU Cushioning as well as Aqua Tech Water Graphics being extending this summer from football to baseball as well as the support of Kranos, Schutt continues to enjoy a successful exit from Chapter 11 proceedings.
"Our sales in the first two quarters are strong and it looks as if the third quarter will be strong to very strong for us," said Beckmann.
For its part, Adams will focus on manufacturing other sports-related equipment.
"We sold our football headgear product lines in order to focus on improving and expanding our offerings in other areas of the sporting goods market," said Adams USA CEO David Wright in a statement. "Adams has a proud football heritage and we have great confidence in Schutt Sports' ability to build on that tradition and move forward with these products."
BY THE NUMBERS
12% Overall revenue improvement in the first quarter of 2011 for manufacturers tracked by SGBW
83%Number of companies (39 of 47) that reported revenue growth for the first quarter of 2011. Sixty-eight percent, or 32 of 47, reported earnings growth in Q1
36.3%Under Armour’s revenue growth in the first quarter. The spike in sales was driven by the company’s apparel business and owned retail business
15%Amount Cramer Products, Inc. expects sales to grow after acquiring Stromgren Athletics late last week
$37 billionHow much retailers lost last year to theft, according to an annual survey conducted by the University of Florida. Employee theft made up the largest portion of theft, accounting for $16.2 billion, or 43 percent, of the total losses.
5.2%May year-over-year improvement for retail sales at sporting goods, hobby, book and music stores, according to advance estimates released by the U.S. Census Bureau
3.9%Profit increase reported for Lafuma Group for the first half of 2011, marking the first time since 2007 the company has recorded a profit
$98 millionAmount Puma was originally ordered to pay its Spanish licensee andholder Estudio 2000 S.A. for its remaining trademark rights in Spain. A district court in Madrid overturned the ruling, however, and Puma is no longer required to pay the sum.
Whether it’s doing backside 360s at the skatepark or 10k
on a black diamond hiking trail, CORDURA® Denim fabric
provides the comfort and style people want from their
denim. With the exceptional durability they expect. Take
it to the edge. No, take it further. Visit cordura.com/denim
to learn more.
©2011 INVISTA. CORDURA® is a registered trademark of INVISTA for durable fabrics. Property of INVISTA. CORDURA.COM
S:9”
S:10.875”T:9”
T:10.875”B:9.25”
B:11.125”
NEWS
Under Armour, Inc. has set a goal to double sales by 2013. The lofty projection to reach the $2.13 billion mark, made by company Founder, Chairman and CEO Kevin Plank at Under Armour’s investor meeting on June 16, would assume a compounded annual growth rate (CAGR) of 26 percent.
The growth plans will rely on continued growth in apparel and con-tinued expansion in the direct-to-consumer (DTC) business through 2013. Plank said the DTC business, comprised of Internet sales, outlet stores and brand stores, would reach 30 percent of the busi-ness by 2013 from 23 percent currently. UA will have 80 owned-retail doors this year. The Direct business was said to be margin-rich, with gross margins in the 60 percent neighborhood.
Beyond 2013, UA sees footwear as a key driver in 2014 and Inter-national in 2015, which management expects to be as large as the domestic business “over time.” International is expected to reach 8 percent of total revenues by 2013, compared to 6.2 percent of the total last year.
Under Armour talked about three new apparel businesses helping to drive sales growth in the category. Charged Cotton represents about 4 percent of current sales and is reportedly not cannibalizing the non-cotton business. Storm Fleece, which is treated to repel wa-ter but has a pure cotton hand and breathability. Cold Black, which is treated to repel the sun’s UV rays and keep the body cool. Man-agement said the product even works in dark colors, hence the Cold Black name. They see the greatest application in golf and running.
The company is also expanding its men’s underwear program, with plans to have UA underwear programs in 600 department stores nationwide, including Nordstrom, Macy’s and Bloomingdales, by next year.
On the women’s apparel side, the company is rolling out a new line of sports bras called the Armour Bra and a yoga/fitness bottoms collection called Perfect Pant to focus efforts on females in their late 20s to early 30s. Plank said the company continues to forecast that the women’s apparel business will surpass men’s business.
UA plans to roll out two new key footwear products over the next year. The new releases include the Charge RC, a running shoe that will launch in October at $120. UA also featured a women’s-specific footwear product called the Micro G Strut, which will retail at $87 for Spring 2012.
While continuing to open its own stores, Under Armour is also ramping up its shop-in-shop programs with its major retail partners this Fall. They see opening 50 of the “All American” format shops in Dick’s Sporting Goods by the end of this year, with over 700 expecta-tions planned with Sports Authority, Dick’s Sporting Goods, Hibbett Sports, Finish Line and others. They expect to have 100 of the new formats in Sports Authority stores alone. Fixtures are designed to hold 20 percent more merchandise than conventional fixtures
UA said the shops will impact 50 percent of revenues within two years.
OTHER POINTS FROM THE CONFERENCE:• UA will continue to spend approximately 12 percent of its net revenues on marketing • UA sees operating income growing at a 31 percent CAGR rate through 2013 • Expects to show operating margin leverage during growth • “Light and Strong” is the UA basketball footwear message• Footwear staff has grown from 54 employees in 2008 to 119 today
Collective Brands Inc.'s Chairman and Chief Executive Officer Matt Rubel resigned last week and a search for a permanent replacement was launched.
Michael Massey, a 15-year veteran at the company, was named the interim CEO and Scott Olivet became non-executive chairman. Massey, who currently heads international growth and overall business devel-opment, informed the board that he does not wish to be a candidate for the CEO position. Olivet, a former Nike exec who was most recently CEO of Oakley, has been a member of Collective board since 2006.
Rubel's resignation comes after several years of underperformance by the company, dragged down by weak traffic at its Payless chain. Continued high unemployment and rising gas and food prices on the chain's target customers, particularly African-Americans and Hispan-ics, have impacted Payless.
UNDER ARMOUR POISED TO DOUBLE BUSINESS BY 2013
Along with higher product costs, first quarter earnings fell 49.6 percent to $28.2 million, or 42 cents a share. Revenues dipped 1.0 percent to $859.0 million. The Payless weakness offset strong sales at Saucony and Sperry Top-Sider. Last week, Standard & Poors lowered its outlook on the company.
Rubel became Collective's CEO in mid-2005 after running Cole Haan.
PSS also added the presidents and CEOs of its three business units to its governing executive committee, including LuAnn Via, president and CEO of Payless ShoeSource; Gregg Ribatt, president and CEO of its Performance + Lifestyle Group; and Bruce Pettet, who heads Collective Licensing.
RUBEL EXITS COLLECTIVE BRANDS; OLIVET ASSUMES CHAIR
WEEK 1125 | SGBweekly.com 9
CRAMER EXPANDS INTO APPAREL WITH STROMGREN DEAL
Cramer Products, Inc. has acquired Stromgren Athletics in a deal that provides the maker of sports medicine and physical education products a pathway into protective apparel product and compression apparel. The deal is expected to increase Cramer revenues by approximately 15 per-cent. Terms of the deal were not disclosed.
Cramer Products, based in Gradner, KS, has been primarily focused on sports medicine products like braces, tapes and supports, while Stromgren, which is based in Hay, KS, is more protective gear and some sports medicine, according to comments by Cramer President and CEO Tom Rogge in an exclusive interview with Sports Executive Weekly.
Rogge told SEW that there are no immediate plans to consolidate opera-tions. He said the companies will continue to run separately. Steve Arens-dorf, COO at Stromgren, will continue in that role and report to Rogge.
Rogge said they saw opportunities in the Stromgren deal due to the brand’s penetration in the team dealer market and the new realities of the sports med market. He went on to say the primary reason for the deal was building revenue through the team dealer business.
“The sports med market has moved away from the team dealer market and has moved more toward medical suppliers,” said Rogge. “Trainers see themselves more as true health care professionals and increasingly purchase athletic training supplies from medical suppliers.” Still, the CEO said sporting goods retail is currently Cramer’s fastest-growing business, with expanded programs at Dick’s Sporting Goods, Sports Authority and many others. Rogge said he sees opportunities for Stromgren at the retail level as well.
Both companies have a domestic production capability, with both man-ufacturing product in Kansas. Stromgren produces about 20 percent of their product domestically, primarily quick turn goods, but also as a hedge against lower inventory levels in compression product, girdles and other protective goods. Cramer produces about 35 percent of its product in its facility in Hays.
Stromgren has 20 employees and will maintain its current sales orga-nization.
Cramer Products, with 16 employees currently, was founded in 1918, and the company is celebrating its 93rd year in 2011. Its first product was an athletic liniment created by pharmacy student Chuck Cramer to soothe his sore ankle. He and his brother, Frank, began selling the prod-uct to local athletic teams.
In the early 1980s, Cramer expanded its product lines to include physi-cal education equipment, and in 2004, acquired Cosom Sporting Goods to further increase its line of physical education products. In 2008, Cra-mer acquired Active Ankle Systems, Inc., a worldwide leader in the devel-opment of high-value, high function ankle and foot products, continuing Cramer’s commitment to developing products that heal, protect and help prevent injury.
MOVERS AND SHAKERS
Jeff Bowyer has been promoted to the position of national wrestling sales manager for Brute Wrestling. Bowyer will be responsible for national wrestling sales and customer service including the development of sales strategies/ programs and team initiatives…
American Recreation has promoted Gwyn Benedict from her position as key account manager at Royal Robbins to sales manager at Isis, the women's apparel line it is relocating from Burlington, VT to Boulder, CO...
Nike, Inc. announced that Jill K. Conway and Ralph D. DeNunzio have decided to retire from the Nike board of directors and not stand for re-election at the annual meeting of shareholders in September 2011. Conway, 77, who joined Nike's board in 1987 serves as Chair of the board's Corporate Responsibility Committee, and a member of its Nominating and Corporate Governance Committee. DeNunzio, 79, who joined the board in 1988, serves as Chair of the board's Compensation and Nominating and Corporate Governance Committees, and a member of its Finance Committee…
Maverik Lacrosse announced that former University of North Carolina standout Billy Bitter, a three-time All-American selection, and 2010 ACC Player of the Year is the newest addition to its roster of elite lacrosse athletes. Bitter, who was selected third overall in the 2011 MLL draft by the Denver Outlaws, will assist in the design and development of Maverik's next generation of equipment and represent Maverik at clinics and tournaments across the country…
Reebok and Dallas Mavericks star guard Jason Terry jointly announced a charitable auction featuring Dallas Maverik's Jason Terry's autographed Reebok Zig Slash sneakers worn during the series-clinching NBA Finals. All proceeds from the auction will benefit the Jason Terry Foundation to help youth achieve their dreams through education, self-empowerment and community involvement…
Summit Sports, Inc., a Bloomfield Hills-based outdoor recreation and sports retailer, has named Brad Kopitz Internet marketing manager.In this position, Kopitz is responsible for overseeing all Internet marketing efforts across the company’s nearly 20 e-commerce websites with revenues of $12 million...
Suunto's North American subsidiary has hired David Grayson as national sales manager for the US. Grayson brings experience from run, bike and outdoor specialty as well as general sporting goods. Grayson most recently served as national business manager for PowerBar, where he developed strategic sales and marketing plans across the sport specialty channel leading to double-digit growth. Prior to PowerBar, Grayson led successful sales teams at RockShox both in the U.S. and Europe…
10 SGB WEEKLY l JUNE 6, 2011
In the diamond sports market, 2011 has proven to be a year of both transition and tumult. As players and manufacturers deal with the confusion resulting from multiple baseball bat regulation changes from governing bodies, a business which suffered a slow start to the selling season due to inclement spring weather in parts of the country, and looks to establish consistency despite uncertain economic conditions. After gradually recovering from the nationwide economic downturn which started in 2008 and affected sell-through numbers in 2009, diamond sports manufacturers and retailers adjusted to a consumer market which is marked by smaller school budgets and limited discretionary income. Looking ahead to Spring 2012, baseball and softball manufacturers will be faced with the challenge of offering innovative products to an increasingly dedicated and specialized player without exceeding a price point which has become more conservative over the past several years. RULES AND RAIN An exceptionally rainy spring led to a slow start for baseball and softball sales, as the beginning of the baseball season was delayed by a matter of weeks in many parts of the country, especially in the northeast. Rule changes and waivers for baseball bats adopted by the Baseball Rules Committee of the National Federation of State High School Association (NFHS) complicated matters.
“It was a challenging market this year initially because of the weather. The second issue was the rule changes,” says Jim Bel Bruno, VP of sales & marketing at Mattingly Sports. “You had inclement weather over most of the country, which stifled business, and then all the
changes in the rules from the governing boards wreaked havoc and made for a lot of confusion in the marketplace.”
In order to get a better read on the diamond sports market, it is necessary to first understand the new rules which have not only drastically changed the baseball bat industry, but also caused a great deal of confusion among players, manufacturers, and retailers. In large part due to concerns about the safety of young players, the Baseball Rules Committee of the NFHS origin all issued a ruling in the summer of 2009 which prohibited the use of composite bats. TEAM Business covered the effects of the new rules in February/March 2011, since then new developments and reactions in the market have surfaced. Thanks to the insight of Elliot Hopkins, baseball rules editor and liaison to the Baseball Rules Committee for the NFHS, it is possible to understand a basic summary of recent events leading to the current regulations, including the reasons for a temporary waiver - in place for 2011 only - granted on behalf of bat manufacturers for composite bats.
In 2008, the NCAA announced they were implementing a new BBCOR standard for all collegiate bats. The Federation followed suit in the summer of 2009, adopting the same standard effective January 1, 2012. Prior to 2009, the Ball Exit Speed Ratio (BESR) standard for composite bats had been in effect for almost a decade. However, the NFHS determined that the BESR standard couple be improved upon. “The BBCOR standard was better science,” explains Hopkins. “It got us closer to what we wanted as a rules-writing group, which is a wood-like standard. We want bats to perform like a wood bat.” In the summer of 2010, the NCAA found that some composite bats of the BESR standard were faster and performed better than what they allowed, so
Consumers, manufacturers and retailers in the diamond sports market will be dealing with new regulations and the economy which is slow to recover as they look ahead to 2012
PLAYING BY THE RULES By Fernando J. Delgado
they placed a ban on those composite bats in late summer of 2010. The NFHS, after conferring with scientists used by the NCAA, independently decided to also ban composite bats in July of 2010. During August and September of that same year, several bat manufacturers asked for a waiver for their composite bats for the upcoming 2011 season if they could prove that the trampoline effect - the speed and manner which a baseball bounces off the bat - did not increase over the course of repeated testing. “I like to use the analogy of a speed limit,” says Hopkins. “If the bats stayed at the same speed limit, and didn’t get any faster, would we grant them a waiver to be used for this upcoming season in the spring of 2011?” The board and rules committee agreed to grant waivers for many composite bats which passed tests at the certification laboratory at Washington State University. As a result of the testing at the Washington State University Sports Science Laboratory, the NHFS lists 1661 BESR Certified bats which were deemed safe to use for the current 2011 baseball season, and 216 Unapproved bats. With the baseball season already completed in all parts of the country - with the exception of Iowa and its summer season - the BBCOR standard will be in full effect going forward.
The rule changes, and in particular the waiver for BESR bats for the 2011 baseball season, confused people in all areas of the baseball business. Manufacturers were left with obsolete bats, retailers were stuck with inventory that they either couldn’t sell, or could only sell for the upcoming season, and players were unsure of exactly which bats were legal. “People make a lot of crazy accusations and inaccurate claims,” says Hopkins. “But this was all based on better science, and I anticipate we’ll have more changes in the future. I hope it’s not soon, but the nature of the beast - of people manipulating bats to gain an unfair advantage - will likely force us to change the standard again.” Hopkins emphasizes that the safety of young players has always been the underlying reason for the recent rule changes. “That’s why we’re in the business,” he says. “To minimize risk.”
As if the firestorm caused by the rule changes had not been challenging enough, actual storms complicated sales and inventory for retailers and manufacturers during the recent spring season. According to Mattingly’s Bel Bruno, manufacturers in particular were hurt by the postponements caused by rain and other weather conditions because the already short selling window for retailers was cut short by as many as 30 to 45 days. “Bad weather impacts inventory because you don’t have as much opportunity for replenishment and refill orders from the retailers, as they are
Photo courtesy of Mizuno
By Thomas J. Ryan
struggling to sell through their original inventory,” explains Bel Bruno. “It just sets back the entire selling period.”
Travis Copley, VP of sales & marketing for Old Hickory, agrees that weather caused various delays, including on the production side. “From a manufacturing standpoint, the weather in the northeast being so rainy made it tough for loggers to go in an get the logs we use to make our bats,” he says. “There was a delay for almost all the wood bat companies in getting their lumber. On the sales end, different parts of the country start their seasons at different times, obviously, but it seems that everything was pushed back this season due to the weather.”
BBCOR CONFUSIONThe NHFS ban on composite bats, and subsequent waiver, forced manufacturers and retailers to adjust without warning.
“It caught us, and pretty much every other manufacturer, off guard,” says Dave Terranella, marketing manager for Akadema. “We were getting ready to come out with a new bat around last year at this time (July 2010), and 6 months ago we got the word that we had to switch over to BBCOR certification, so that rendered the proposed new bat pretty much useless.”
Since scrapping the proposed composite bat, Akadema and other companies have had to adopt BBCOR standards for new bats through production trial-and-error. “We had a create a new bat and get it certified, and at first it came out too hot,” explains Terranella, using a
term which references the trampoline effect which BBCOR measures. “So we had to go back to the drawing board and start all over again with our BBCOR certification.” The new bat regulations have had an adverse affect on retailers as well. Mike Miros, owner of First Team Sports in Greenville, SC, says that business has been difficult this year. “It’s been a really tough year for bats, with all the rule changes and the move to BBCOR,” he says. As can be expected, the NFHS ban on composite bats was unwelcome news for retailers who didn’t have much time to rid their inventory of bats which would only be legal for the 2011 baseball season - thanks to the NHFS-issued waiver. Both the ban and waiver caused a great deal of confusion not only in retail stores, but on the baseball fields. “At first, what they did for the start of this year was essentially ban all composite bats. I imagine manufacturers went back to them and said they needed a break on the bans,” states Miros. “It’s caused a lot of confusion. Checking of the bats was done on site by the umpires, and unfortunately many umpires don’t know all the legal bats and all the exact rules. It was a big mess most of the time. There wasn’t a lot of consistency in terms of what the umpires were allowing kids to use, and what they weren’t allowing them to use.”
Making matters worse, the timing of the bans gave retailers little time to sell the bats which would be illegal starting in 2012. “Trying to move all those BSER’s was tough - we took a beating,” admits Miros, who estimates that his store was forced to discount between
Photo courtesy of Easton
WEEK 1125 | SGBweekly.com 13
30 to 40 percent of their baseball inventory. “I ended up selling $300 bats for $100 and $75 just to move them off my shelves.”
Greg Gray, sales associate at Varsity Team Sports in Chattanooga, TN, agrees that the past sales year has been tenuous. “There was lot of uncertainty, not only from the consumer standpoint, but also from the retailer standpoint, as far as what bats would be legal this year,” recalls Gray. “A lot of business was driven to the internet. It made us gun-shy to bring bats in - not knowing whether they would be legal or not - because we have to order them back in July and August of the previous year to get them in for the spring.”
Gray also shared some observations with regards to specific products. “Glove sales have been really slow this year,” he says. “I think most players are sticking with what they already have for now. That’s probably a financial issue.”
However, the NFHS decision to require BBCOR bats has predictably caused a spike in certified-ready bats. “The Rawlings BBCOR has been incredibly hot, that’s been our best selling bat,” Gray says.
The move to BBCOR does give retailers reason for optimism. First Team Sports’ Miros already looks forward to next year, when the rules will be standard, settled, and in place. “Starting next year, it’s going to be pretty straightforward: BBCOR. It has to be on the bat. If it’s not on the bat, you can’t use it,” he says. “We’re beginning to see kids showing interest in the BBCOR, so we’re starting to sell a few of those. I’m hoping that with the fall (2011) and winter (2012) seasons, and this upcoming Christmas, that this will be a great year for bats.”
Manufacturers look forward to 2012 as well. “We’re finally getting ready to take advantage of the market that’s really chomping at the bit for the new BBCOR bats,” Akadema’s Terranella says. Akadema expects to receive shipments of their new Apocalypse BBCOR bat from their production facility sometime in the middle of June 2011, with the bat becoming available to customers shortly thereafter.
FINDING NEW WAYS TO APPLY TECHNOLOGYMizuno USA’s business unit manager for ball gloves and protective gear, Tim Rumer, explains that high school and college-level players look to technology more directly in order to gain an edge over their competition. “When you start getting into the kid who is playing all the time - whether it’s the serious travel player, high school player, or college player - then technology takes over,” he says. “The player asks, ‘How is this going to make me perform better?’ - because everyone’s good at that level.” Manufacturers find themselves asking the same question.
With fewer ways to improve their bats, the burden is on bat companies to stand out to such competitive players looking for an edge which has become razor thin. Since the new BBCOR regulations for 2012 will make all non-wood bats adhere to the same strict performance standard, there is very little innovation which manufacturers can introduce to the barrels of their bats. “From what I’ve seen and heard from every bat manufacturer, the new BBCOR bats will perform just like wood, so I think there’s going to be a lot of backlash,” predicts Akadema’s Terranella. “No one’s really going to be able to have the
hottest bat on the market anymore. Everyone’s going to be inside of a box, so to speak, and everyone will be in the same boat with the same kind of bat.”
It is because of such a level playing field that Mattingly’s Bel Bruno believes that more creativity and development of more subtle technologies in other aspects of the bat will be required for 2012 and beyond. “It puts a lot of pressure on both the manufacturer and the retailer to differentiate in order to sell higher-end products,” says Mattingly’s Bel Bruno. “There needs to be noticeable performance or enhancement in the products. You can’t expect to turn out the same old traditional products and simply demand a higher price point for it.”
Akadema’s Terranella shares one such way his company is offering new technology in order to stand out. “With our bats, we have what we call counterbalance, which pushes some of the weight down towards the handle, which will enable the barrel to get through the zone faster,” he says. “Improvements like that will help differentiate ourselves from the rest of the market.” A RETURN TO WOOD Another interesting trend in the baseball market is the burgeoning use of wood bats. Once a staple of youth baseball, the wood bat began to be replaced by aluminum bats in the 1970’s, ultimately disappearing from collegiate and high school play. Surprisingly, due to the new BBCOR regulations, wood bats have experienced a renaissance of sorts among youth players.
“The wood bat market is exploding right now,” says Old Hickory’s Copley, whose company specializes in wood bats. “We’re seeing younger kids - 12- to 14-year-olds - using them more and more, especially with the new BBCOR’s coming into play next year.” Copley
DeMarini’s CF5 (-8) Fastpitch Bat is purpose-built for the elite player looking for the smallest length-to-weight ratio available. The Tri-Strut TR3 composite handle and barrel come together at the molecular level to create a geodesic formation, providing strength and efficiency at the surface of the barrel. MSRP $300
Rawlings’ BBCOR 5150 Bat makes quicker bat speed possible due to a thinner barrel at the end of the bat. Precision-Optimized Performance™ (pOp™) Technology creates maximum trampoline and barrel flex. Using aerospace grade 5150 alloy formulation to provide unparalleled durability, the 5150 is exclusively swung by more than 100 of the top collegiate baseball teams. MSRP $200
also points out that there has been a noticeable increase in wood bat usage among youth leagues, including more tournaments which use wood bats exclusively. The reasons for the growth in wood bat usage are interesting, and they vary by age group. A pronounced change seems to be occurring at the youngest levels of youth baseball, and wood bat manufacturers have seen an increase in demand for their products. A motivating reason for the BBCOR regulations resulted from the serious injuries and deaths resulting from young players getting struck with baseballs coming off of composite bats.
“At the younger ages - 6 to about 13 - it’s more of a safety issue,” observes Copley. “First hand, my 7-year-old son is playing some of these big barrel tournaments that still allow the composite bats. At 7 years of age, there’s not a lot of fast-twitch muscle fiber to be found in these kids. So you’ve got some of these kids who are blasting baseballs at the infielders who don’t have much of a chance to protect themselves, much less catch it. From that standpoint, that’s why I think you’re seeing a growth in wood bats.”
The rules change assumes that wood bats make the game safer to play. But Copley believes that the resurgence of wood bats is also due to same reason aluminum bats originally came into favor - to make the game more fair. “When
aluminum bats were first introduced, it was to level the playing field. Only the big, strong kids could swing the big wooden bats, and they had a distinct advantage,” he says. “Now, with everyone using composite bats, the -13 all the way up to the -10, it’s almost swung that pendulum all the way back in the exact opposite direction. By going back to wood, it’s leveling the playing field because, with technology, now we can make a light-weight wood bat that’s going to last that a 7-, 8-, 9-, 10-year-old can swing, and we’re also less worried about the composite bats hurting somebody or seeing and abnormal rate of home runs.”
Whereas very young players are starting to use wood bats with safety concerns in mind, older players on the Little League and high school levels seek a competitive advantage.
“At the older age groups - 14- to 18- years-old - a definite reason is that they want to be seen by pro scouts using the wood bats,” says Copley. Since the new BBCOR standards are meant to make aluminum bats hit more similarly to wood bats, younger players are beginning to find wood bats more desireable. Akadema’s Terranella has noticed the increased usage as well, and his company is making an effort to showcase its line of maple and ash bats, including the A529-33 wood bat. “Because the BBCOR is going to hit like wood, you see a lot high school kids coming in and looking for wood bats to use for practice, and you see a lot more wood bat leagues popping up,” says Terranella. “I definitely see a trend with that.”
Additionally, affordability is a major factor in the rise of the wood bat, especially in an economic climate which has seen parents and players lowering their price points considerably over the past three years. Compared to its BBCOR counterparts, which can range in price from $100 on the low end to $300 on the high end, wood bats can range from $40 to $100. Now that BBCOR bats are manufactured to essentially produce the same results as wood bats, it will not be surprising to see the trend of increased wood bat usage continuing.
A SLOW RECOVERYThe diamond sports market first felt the affects of the nationwide economic slowdown in 2008, and was hit hardest in 2009, when sales suffered and inventory problems complicated matters. 2010 saw manufacturer accounts stabilized, and 2011 has seen the recovery continue. Yet a struggling economy persists. Two developments stand out which are symptomatic of the economic problems, which in turn have affected retailers and manufacturers: school athletic program cuts, and lower discretionary spending by consumers. Chicago White Sox, Gordon Beckham
Photo courtesy of Old Hickory
WEEK 1125 | SGBweekly.com 15
Varsity Team Sports’ Gray believes that while school budget cuts haven’t negatively affected sales this past year to the same extent as they did in 2008 and 2009, retailers must now adjust to a slower sales process. “It’s made school team fundraising much more difficult. Teams have had to work a whole lot harder to raise the money to get the products they want,” he says. “So the cuts may not have affected sales, but it’s affected the amount of time we’ve had to wait for the customer to pay. So it’s greatly affected cash flow.”
Working class families are still feeling the economic crunch, but baseball and softball still represent a worthwhile expenditure for familes. “I think it’s still very tough out there. People are still struggling and having a hard time,” says First Team Sports’ Miros. “But the one good thing is that parents haven’t given up on their children yet. When Johnny needs a new bat or a new glove, they’re going to do their best to take care of them.” According to Miros, lower price points are here to stay as long as the economy struggles. The key for manufacturers will be to understand the situation most consumers face, and to offer more value at price points in the $100 range in order to differentiate themselves. “They may not buy the top of the line item, but they’re going to get him something,” he adds. “That’s why the $100 glove is selling better than the $150 or $200 glove.”
Many manufacturers and retailers feel that the economy will eventually recover, and consumers will start spending more as their discretionary budgets increase. It is a question of when that recovery will actually develop. However, many within the industry feel that lower price points will continue for at least another two years. “Most parents are cutting back. They’re either not buying, or they’re definitely buying a less-expensive model,” contends Varsity Team Sports’ Gray. “The only way that’s going to change is if we actually have an economic recovery - which we’ve been expecting for two years now, but still hasn’t happened yet.” Gray says that, in cases of similar competing brands of products, parents have been spending less on well-known premium brands in favor of less expensive, lesser known companies. “They‘re the same material, they just don‘t have the same brand logos on them. Parents are buying the lower-priced item,” he says. “I think that way of spending is how parents will continue to buy. I think some will stay there, even after the economy recovers, because they realize they’re getting the same product for less money.”
Mattingly’s Bel Bruno also feels that the economy will take a while to recover, and lower price points will persist in the short-term. “The economy has definitely impacted retail in general, and sporting goods and the baseball industry is no different,” he says. “We have definitely seen a slide towards lower price point-bats.” Bel Bruno believes that sub-$100 bats will be more sought after by consumers next year. “I think this is what we’re going to be seeing for quite a while,” he contends. “Until the economy turns around from a macro perspective, I think the pressures on pricing are here to stay.”
Not all outlooks in the diamond sports market are cautious. Unlike their counterparts in the baseball, the fastpitch softball business has been spared the controversy of new bat regulations. Maria Marrs, brand manager for Worth Sports, points to some promising aspects of the growing sport. “I feel the fastpitch softball market is increasing,” says Marrs. “The amount of exposure that the fastpitch collegiate games are receiving on TV is only helping to promote the game and draw interest. The Women’s College World Series this year had record-breaking attendance. I think this a very positive sign for the fastpitch market.”
Finally, potential good news regarding the long-term outlook for business has come to light. According to the most recent Sporting Goods Manufacturers Association (SGMA) Participation Report, total baseball participation is up for the first time since 2009. While not a certainty, such an indicator bodes well for the future of the baseball and softball market. ■
Old Hickory’s Custom Pro Wood Bats are the same bats that go to the pros. Available in custom colors and up to one line of personalization. MSRP $120
Worth’s FPX Composite (-12) Fastpitch Softball Bat combines a 100% composite construction, optimized handle flex, and balanced loading to result in a consistently high performing softball bat. The silencer grip provides maximum sting and vibration reduction for better feel. MSRP $150
16 SGB WEEKLY l JUNE 20, 2011
1. Louisville Slugger’s BB126 Omaha Bat takes advantage of ST+20 alloy construction to provide superior durability and toughness, ensuring this bat provides top performance all season long. Other features include a patented Pro Cup® end cap, synthetic grip and a -3 length-to-weight ratio. BBCOR-certified. MSRP $200
2. Easton’s Power Brigade XL Series Bats offers an extra-long barrel giving power hitters a bigger sweet spot and more mass. XL2 shown. MSRP $300
3. Mattingly Baseball’s V-Grip™ Ripped BBCOR Adult Bat promotes proper hand alignment for increased bat speed. Features Direct Power Transfer and Tru Balance™ weighting technology for control and feel. MSRP $200
4. Louisville Slugger’s BB12EX2 Exogrid® 2 Bat utilizes unique Power Disc Technology. An AC21 Scandium alloy/composite hybrid, the Exogrid 2 has a synthetic grip and 31/32” tapered handle. MSRP $300
5. Easton’s Power Brigade Speed Bats Series gives hitters power through a lighter swing weight which results in faster swings. The Power Brigade bats feature THT100 alloy, which has allowed Easton to design bats that generate power at the plate through maximizing swing speed and control or maximizing barrel length and sweet spot. MSRP $300
6. Mattingly Baseball’s Saber BBCOR adult baseball bat has a traditional round handle and uses MB7500 alloy for a perfect mix of value and performance. A Direct Power Transfer stiff handle design allows for explosive energy transfer, and the extended barrel has a massive sweet spot. MSRP $150
7. Combat’s BY4B (-10, -12) youth baseball bat takes advantage of blended fiber technology to provide maximum allowable performance. The bat features variable stiffness technology, a super-sized sweet spot, and single wall construction. MSRP $220
8. Combat’s B3 AB (-3) adult baseball bat uses new Localized Stiffening Technology (LST) to make the bat legal for BBCOR play without hurting the performance on either side of the sweetspot. The bat combines a low swing weight with durability. MSRP $350
9. DeMarini’s CF5 (-3) Bat is designed to provide strength and stability. Carbon fibers come together at the molecular level to create a geodesic formation, providing maximum strength and efficiency at the bat’s surface. MSRP $400
10. Louisville Slugger’s BB12Z Z-1000 bat is BBCOR-certified and features Swing1 inner Disc (S1iD) Barrel Technology, which allows the barrel to flex to its maximum allowable performance level. The bat has a synthetic grip and 31/32” tapered handle. MSRP $370
1
10
2 3 4 5 6 7 8 9
OBJ .COM
EVERY JOURNEY BEGINS WITH A GREAT JOB. HAVE YOU LANDED YOURS?FOR INFORMATION CONTACT 704.987.3450 OR [email protected]
18 SGB WEEKLY l JUNE 20, 2011
TAKE ME OUT TO THE BALL GAME Team tailored color combos, lighter materials, better lasts and unique
cleat patterns keep sales well within the strike zoneBy Nancy Prichard Bouchard, Ph.D.
According to the most recent SGMA participation report, cleats are big business. There were 14.6 million baseball players in the U.S. in 2010, a 5.2 percent increase in participants from 2009. The same year, 2.4 million people played fast-pitch softball in the U.S., a 9.4 percent drop in participation from the previous year. The number of slow-pitch softball players reached 8.4 million in the U.S. in 2010, losing just over 1 percent from its 2009 high. In all, there were an estimated 20 million people playing baseball or softball in the U.S. in 2010. As a point of contrast, that same year saw just over 14 million soccer players taking
the field in the U.S., stronger by nearly 3 percent from 2009. Baseball and softball are two sports where the cleat business is
directly tied to participation trends, especially the ‘frequent’ player base. The more dedicated and ‘hard core’ the baseball and softball player, the more likely he or she is to spend money on an upscale pair of cleats - primarily because of how often they play and practice. According to SGMA statistics, in 2010, the baseball (and softball) cleat market was about $236 million dollars (at wholesale), up slightly from $230 million (at wholesale) in 2009. The baseball cleat market is
Miz
uno
9-S
pik
e S
wift
Cle
at
WEEK 1125 | SGBweekly.com 19
second only to soccer cleats - $278 million. Clearly, soccer players are willing to spend more money on shoes, and purchase new ones more frequently but, as both manufacturers and retailers know, there is significant cross over in categories. Explains Mike May, SGMA director of communications, “when analyzing the baseball (and softball) cleat market, you must also consider the soccer cleat industry because some athletes wear the same shoes for both sports - especially girls.”
CONNECTING WITH YOUTHGreg Willenbrink, senior VP at Easton/Elan Polo, said that the baseball footwear market has been more challenging than both soccer and football for the past several seasons. “This past year in particular is the toughest the retailers have faced in many years,” explains Willenbrink, citing weather as the sports biggest enemy. Early snow in many areas, coupled with an extremely wet spring made getting outside for practice and games difficult.” Participation levels for baseball are also flat-to-down depending on what data you look at,” said Willenbrink, as children have become more specialized and participate in fewer sports, with many of them opting for sports such as soccer, flag football and even lacrosse.
Ken Ueda, business unit manager for cleated footwear at Mizuno USA, agrees that the cleated category has been flat but steady. At Mizuno, baseball cleat sales were up single-digits in the past year, with the increase being balanced out by a similar single-digit decrease in fast pitch sales. “You don’t see a lot of spike in these categories,” explained Ueda, “When you look at the 10-year trend, some markets may still be down, as kids have a lot more activities to interest them than sports, but generally, our sales are pretty even.” And there is no doubt that kids are important to the baseball and softball category. At Reebok, Thomas Wood, footwear product manager, said that the company’s target consumer is between the ages of 12 and 18 - a group that makes up an estimated 50 percent of the total baseball market.
Aaron Kahn, business unit director for Adidas cleated sports footwear and accessories, said that the baseball/softball category is pretty steady at this point. “We’re seeing growth with our core consumer base (team specialty, premium products), and more flat trajectory with our recreational products. Adidas’ primary customers are high school baseball (boys) and softball (girls) players.
At New Balance, Mark Clinard, strategic business unit manager for team sports, said he considers the baseball/softball cleat market steady, with any offset in baseball participation countered by the growth in fast pitch softball. Clinard noted that the age/gender discussion is dominated by youth. High participation rates drive large volume as kids learn these sports. Another large volume segment is entry level, rubber molded product that is fueled by recreational slow-pitch participants.
SGMA’s Mike May posits that the cleated category has never been stronger from top to bottom. “Without a doubt, the consumer is getting a better ‘bang for their buck’ today than ever before,” he suggests, pointing out that there are quality cleats at every price
point in the marketplace. May contends that if the baseball world can motivate more of its strong fan base to take its enthusiasm for the game and use it to become a player, as many are currently doing, the cleated footwear business will grow accordingly.
PRICEThe consensus is that the baseball/softball footwear categories are the most price sensitive of any cleated sport - ranging from $30 to about $130 dollars (on the higher end is Mizuno’s new Kangaroo Leather Cleat, a soft, supple, lightweight shoe that conforms to the foot and appeals to athletes with a sense of luxury, performance and tradition). The professional players mostly wear fixed metal cleats or TPU’s, while the Rec league player generally reaches for molded rubber models. The greatest price sensitivity is, understandably, in cleated footwear designed for younger, recreational players. Although, all players expect elite level fit, performance, and durability in their products, most competitive players are willing to pay extra to gain a competitive advantage. Special materials, minimized weight, and extraordinary comfort are elements that can command premium prices. High school and college players are more interested in quality and brand recognition and, as a result, are willing to pay more for higher-priced shoes. With cost of materials, manufacturing and transportation continuing to rise, the biggest trend in baseball/softball cleats is the focus on new construction methods and unique materials to drive price/value and to maximize production efficiency. Explains Easton’s Willenbrink, “Growth in the category can be summed up in two words—fit and function. People want cleats that are comfortable and serve their purpose. If that means $10 more for a cleat that accomplishes these goals, they are willing to pay the price.” Of all baseball/softball cleats sold, it is estimated that half of the sales are to teams, and half to individual users. Many college or high school coaches buy shoes as a set, so their players have a uniform look - head to toe.
Mizuno 9 Spike Swagger Mid cleat combines comfort with in lightweight shoe for speed with support. MSRP $90
20 SGB WEEKLY l JUNE 20, 2011
COLOR, COLOR EVERYWHEREA continuing trend for Spring 2012 is increased demand for multi-colored styles, such as black with blue, red or white as players and coaches look for footwear to accentuate team colors and uniforms. Easton is introducing a team color program giving customers new options to the traditional black cleat. “We are excited about Easton’s team color program this season and believe more color overall will do well,” said Willenbrink. “Every year color becomes more important as players strive for individuality in look.” According to Willenbrink, while black is still the favored baseball/softball cleat color, blue is growing in popularity, followed by red. Easton has expanded the palette by adding orange, purple and green to their lineup. Black-based styles will remain the most commercial colorways in 2012, but expect to see growth in grey-based styles to capitalize on the opportunity to tie into away game uniforms.
FLOAT LIKE A FEATHERLightweight is one of the buzz words that comes to everyone’s mind when discussing the proper cleat. Players want to be faster, quicker and more agile and believe a lightweight shoe will help them achieve these goals. For 2012, Adidas is focusing on maximizing comfort while minimizing weight. The company will launch a new plate and cleat combination which will shave off more than two ounces per shoe. Said Kahn, “This will allow us to over-build the internal comfort elements, and make every athlete one step faster.”
FIT AND FUNCTIONThe story for 2012 is dominated by better lasts, more durable materials, and removing underfoot spike pressure. New Balance’s new lead shoe, the MB4040, has a new last with a custom fit (with narrow to wide widths), and pushes the concept of dropping the athlete closer to the ground than ever before.
New for Easton is the Team Metal program with six colors and the company’s new V-Cleat Technology and Ideal Fit comfort system - both patented technologies.
Mizuno offers slow pitch-specific shoes with stud placement designed for recreational players. The studs are not so aggressive
for the high school, college and pro teams, and are designed to adapt to fields that may not be as rigorously maintained as pro fields. These recreational cleats have a more forgiving stud placement. At the slow pitch recreational soft ball level, Mizuno offers rubber molded cleats. What is unique about Mizuno, is their patented proprietary 9 Spike technology, based on analyzing players, how they run, hit and throw. The company has also built a spike placement for their women’s specific models (Gender Engineering). The new 9 Spike Advanced is used for the female specific and youth shoes.
ATHLETE FEEDBACK AND BRANDING EFFORTSShopping for baseball/softball footwear can be a daunting experience for even seasoned athletes. If retailers/brands make the shopping experience fun, simple, and entertaining, the payoff will be returned many times over. Most brands have an integrated marketing person dedicated to baseball/softball, who works on providing point-of-sale and digital tools for retailers (often at no cost to them) to help increase sales in these categories. Is your company planning any specific marketing/advertising campaigns, POP displays or events to help raise awareness of new baseball/softball cleats?
According to Thomas Wood, footwear product manager at Reebok, to increase sales and reach the core consumer, retailers must deliver brand technologies and utilize brand iconic athletes to authenticate the performance of the product. To support its new Zag cleats, Reebok will convey an off-field/on-field message around the technology, as well as utilize the brand’s iconic athletes (such as David Ortiz) to demonstrate how the Zig in their cleats helps athletes perform at their highest level.
Pro and college athletes are important to both branding and R&D. Reebok encourages its athletes to perform community service as part of their sponsorship agreement. Feedback from elite athletes is an important component of most shoe brands with high level athletes bringing ideas from the Diamond back to R&D. Said New Balance’s Clinard, “We have a terrific roster of over 150 MLB athletes that provide constant feedback that we use in the product process. There is nothing more satisfying than working with athletes to help solve issues and then watch them perform astounding feats on the field,” he concluded. ■
New Balance MB4040 cleat is lightweight with a low-profile cleat dynamic performance on the field. A new spike plate features engineered cut outs and sculpting to enhance traction and reduce weight 30 percent. MSRP $95
Adidas aZ Pro Trainer cleat features high-speed, 3-stripes on a breathable, full mesh upper. Adituff™ toe reinforces and protects the toe-drag area. Synthetic/mesh or nubuck/mesh upper for lightweight durability. Adituff™ overlay on the toe area is provided for added protection. Textile lining. EVA insole inlay. Compression-molded EVA Midsole. Minimalistic split-rubber outsole. 9.6 oz. Available November 2011. MSRP $80
WEEK 1125 | SGBweekly.com 21
Adidas adizero Pro Metal cleat features a light sprint frame, PU sock liner, geometric cleats that shave an ounce off per pair, synthetic upper, nonslip textile lining, and Protrax plate outsole with innovative cleat shape to reduce weight. 9.7 oz. Available November 2011. MSRP $100
Mizuno 9 Spike Finch 5 Women's cleat is specifically de-signed for the fastpitch athlete. Gender engineered out-sole provides traction and support for softball. MSRP $75
Easton Diamond Low LL65 is the Little League World Se-ries Cleat. MSRP $35
Reebok Pro Cooperstown Low / Zig Men’s Cleat features synthetic leather upper that is lightweight and breathable with minimal break in, mesh collar lining with 360 degree ETC to wick away foot moisture and molded EVA foot bed with ETC top cover. Superb cushioning with a top cover reduces friction and heat build up. New 9 Spike plate with full length Zig midsole provides superior lightweight cushioning, flexibility and promotes muscle efficiency. MSRP $115
Adidas Fastpitch 4 TPU softball cleat is designed for women with EVA comfort and durable toecap that cuts down on drag. Synthetic leather upper for lightweight durability. Adituff™ toe for durability against toe drag. Textile lining. EVA inlay insole. Compression-molded EVA Midsole. Lightweight TPU with TRAXION® plate and 8x4 cleat configuration on the outsole. Available August 2011. MSRP $60
Mizuno 9 Spike Global Elite cleat features Mizuno's newest lightweight spike with enhanced support and cushioning. MSRP $105
5
Job Classifieds
Materials Research Lead Mountain Hardwear As Lead Materials Researcher responsible for outerwear, sportswear and equipment, you will manage the fabric development process from concept to commercialization by working closely with design/merchandising, sourcing, our contractors and liaison offices to ensure that fabrics are developed within established timelines, target prices, design integrity, and quality is maintained.
Director, Men’s Apparel Graphic Design Under Armour This is an opportunity to design for the best performance products in the world. We are looking for a strong creative individual to innovate and invent best in class designs. As our Graphics leader, you will drive your team to success with passion, integrity and motivation. We are an authentic brand that pushes the envelope every day. Innovation is a key part of our success.
Marketing Manager, RunningPUMA North America As our Marketing Manager for running, you will manage the development, creation and execution of the running category marketing plan that drives brand strength, fuels consumer demand, strengthens our connection with consumers and drives sell-through of running product. You will lead category, seasonal and product-specific initiatives that require cross-functional integration within the organization.
Merchandise Manager/Buyer Big 5 Sporting Goods The Merchandise Manager/Buyer will lead and/or manage the development of specific categories and product lines to deliver merchandise with tremendous consumer appeal and value. He or she will develop and maintain relationships with new and current vendors, negotiate beneficial terms and conditions with all vendors, and improve sales while managing inventory levels.
National Sales ManagerMarucci The National Sales Manager is responsible for managing relationships at key retail accounts, leading a team of internal and external sales representatives, and providing management with insight into sales targets and performance. Additionally, he or she will be responsible for developing and managing sales programs for baseball bats and accessories across all distribution channels.
Independent Sales RepTrue PowerTrue Power is looking for well-qualified Independent Sales Representatives/Agencies in several regions across the United States. We are looking for dynamic individu-als who can successfully develop accounts within their assigned territories to spread a rapidly growing brand. Ideal candidates will have established relationships and a proven track record of delivering superior levels of brand-building sales and service with the sporting goods/mass merchant retailers in their territory.
Product Manager/DeveloperOGIO This product manager/developer is responsible for overseeing the efforts to develop and launch new products in our Sports/Lifestyle segments. Key responsibilities include overseeing and implementing product development policies, objectives, and initiatives. He or she will lead research for new products, product enhancements, and product re-design.
Product Manager - Team Sports Dick's Sporting Goods The Product Manager is responsible for all aspects of new product development for a single product from conception to commercialization. He or she interacts with merchants and vendors to achieve company goals and provides insight, direction, and leadership for new product and merchandizing needs, trends, and opportunities for the category based upon statistical analysis, market trends, and practical knowledge of the industry.
Sales Representative Nat Geo Snorkeler Responsibilities include the execution of established terri-tory sales goals within your territory, implementing com-pany developed sales programs, training retailer employ-ees, visiting all accounts on a regular basis, working with the National Geographic Snorkeler sales team, attending major trade shows as well as regional shows and follow-ing up on orders.
EVERY JOURNEY BEGINS WITH A GREAT JOB HAVE YOU LANDED YOURS?
FOR INFORMATION CONTACT 704.987.3450 [email protected]
