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APRIL 30, 2012ISSUE 1218
The Weekly Digital Magazine for the Sporting Goods Industry
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APRIL 30, 2012 | SGBWeekly.com 3
NEWS 4 European Slowdown Hits PUMA'S Q1 Results 5 BSN SPORTS Renews Pursuit of Acquisitions, Acquires Ken-Tenn Sports MOVERS & SHAKERS 8 WIGWAM Becomes Official Sock of Ironman Mont Tremblant 70.3 WOLVERINE WORLD WIDE'S Q1 Hurt by European Weakness 9 UNDER ARMOUR Raises 2012 Outlook on Strong Q1
GIVING BACK 10 FINISH LINE and Special Olympics Announce Multi-Year Partnership
FEATURES 12 NEW BALANCE’S Retail Play 14 NEWTON Ramps Up For Growth 16 SAUCONY Launches Find Your Strong Project
DEPARTMENTS 18 CALENDAR
ADVERTISERS 2 SPENCO 4 INJINJI 5 IMPLUS 7 MCDAVID 9 BALEGA 11 2XU 19 SGB WEEKLY 20 OR MARKET
16
Copyright 2012 SportsOneSource, LLC. All rights reserved. The opinions expressed by writers and 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
The Weekly Digital Magazine for the Sporting Goods Industry
APRIL 30, 2012ISSUE 1218
Managing EditorThomas J. Ryan (917.375.4699)
Editors At LargeAaron Bible
Fernando J. DelgadoMackenzie Lobby
Creative DirectorTeresa Hartford
Graphic DesignerCamila Amortegui
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Account Manager / MidwestBarry Kingwill (847.537.9196)
Account Manager / MidwestJim Kingwill (847.537.9196)
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
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Sharon Barbano, Saucony's VP, Public Relations, interviews Luis Escobar, a renowned ultra-marathoner, at the Find Your Strong Project launch event. Escobar gave a special tribute to the memory of Caballo Blanco, mythic hero of Born To Run. Photo courtesy of Saucony
Cover photo courtesy of New Balance
4 SGBWeekly.com | APRIL 30, 2012
NEWS NEWS
Puma SA reported that consolidated first quarter sales increased 6.1 percent to €820.9 million ($1.08 bn) despite a low single-digit decline in the EMEA region. Currency-neutral sales rose 4.2 percent. Overall gross margins declined 120 basis points to 51.2 percent of sales. Resulting net earnings decreased 4.9 percent to €73.9 million ($97 mm), or €5.17 ($6.45) per diluted share, compared to €4.92 ($7.04) per share in the year-ago period.
“After a strong finish in 2011, Puma’s first-quarter sales growth could not keep pace with that of recent quarters, translating into weaker bottom line results, said Franz Koch, CEO of Puma SE. “Our first quarter sales performance indicates that we are facing challenges in Europe. As a consequence, we have begun to respond to these challenges, optimizing the efficiency of our business model in the EMEA region. In addition, I am confident that the product innovations we have in the pipelines will contribute to achieving our full-year sales and earnings targets against the background of this extraordinary sports year.”By region, sales in the EMEA region softened by 1.4 percent currency adjusted to €368.0 million ($482 mm), as restrained consumer spending in the wake of the financial crisis in the Eurozone continued to impact demand. In addition to the challenging overall business climate, the late arrival of winter in Europe dampened sales at wholesale accounts and retailers, which slowed the in-take of spring collections and therefore had an effect on Puma’s first-quarter sales.
As a consequence, Puma has begun to respond to these challenges, optimizing the efficiency of its business model in the EMEA region. To this end Sergio Bucher, formerly Puma’s Head of Global Retail, was appointed the new General Manager for Europe. In line with the transformation outlined in the “Back on the Attack” growth strategy, the company is currently in the process of streamlining the country organizations and centralizing some of the back-office functions on a regional level.
A strong sales performance in Asia/Pacific and the Americas counterbalanced the softening sales in the EMEA region. Fueled by growth in India, Korea and Japan, which all saw significant demand for Puma’s Motorsport, Running and Lifestyle products, Asian sales climbed 10.2 percent currency adjusted to €192.1 million ($252 mm).
Sales in the Americas improved by 8.5 percent currency adjusted to €260.8 million ($342 mm). Within the Latin American region, Mexico, Argentina and Brazil in particular posted strong, double-digit growth rates. North America was up, supported by the new joint ventures Wheat Accessories and Janed socks and bodywear.
EUROPEAN SLOWDOWN HITS PUMA'S Q1 RESULTS
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6 SGBWeekly.com | APRIL 30, 2012
BSN Sports promoted Bob Dickman to the role of director of acquisitions and Tevis Martin to the role of EVP corporate development as part of an overall plan to resume its strategy of acquiring sporting goods team dealers. It also noted that it recently closed on the acquisition of Ken-Tenn Sports, Inc. of Martin, TN.
Adam Blumenfeld, the chairman and CEO of BSN Sports, stated, "During the past eight years, BSN Sports has acquired a number of strategically located sporting goods team dealers. These team dealers were chosen based upon their solid customer base and, more importantly, the strength and manage-ment talent of their owners. All of the owners from the acquired team dealers are on the BSN Sports management team today."
Each of these acquired team dealers continued to operate as separate entities under their own brand names and on separate computer systems until recently. This past year BSN Sports reduced its acquisition activity so it could focus its time and attention on rebranding all of the individual company names under the BSN Sports brand name and migrating all of these entities onto one computer system. The rebranding effort and the computer migration have been completed. BSN Sports now has a much more robust and scalable platform that will enable them to easily add more team dealers and sales pros to its infrastructure.
As part of its renewed acquisition strategy, BSN Sports has created a team of people dedicated to acquiring team dealers and ex-panding its sales force. Tevis Martin moves from an operations and sales management role within the company to the position of EVP executive vice president corporate develop-ment. Martin will focus exclusively on new business development projects related to ac-quiring sales teams, team dealers and corpo-rate joint ventures. He will work closely with Bob Dickman in executing transactions and transitioning them into the BSN Sports culture and onto the company's operating platform.
Dickman closed by stating, "This industry is becoming more difficult to successfully operate due to a variety of factors that team owners don't control, including more well-capitalized competitors, school budget cuts, increases in cost-of-goods and slow paying customers. I believe there are a number of team dealer owners who are not ready for retirement but, at the same time, want to convert their business into cash due to the more competitive environment. Deciding to sell Kesslers Team Sports to BSN Sports in 2004 was a very difficult decision for me and my family, because we enjoyed the independence of operating our own busi-ness for more than 20 years; however, in retrospect, our decision to sell our business and become part of BSN Sports has been a huge win for me, my brothers and our re-spective families."
BSN SPORTS RENEWS PURSUIT OF ACQUISITIONS, ACQUIRES KEN-TENN SPORTS
MOVERS & SHAKERSFreedom Group has appointed George Kollitides as its chief executive officer. Kollitides had been serving since March as acting CEO of FGI, which owns Remington Arms, Bushmaster, DPMS and Marlin.
Modell’s Sporting Goods has appointed Daniel Sheehan as chief operating officer. Sheehan was SVP and chief information officer of Dunkin' Brands, Inc., where he handled the brand's retail technology strategy and execution, enterprise information systems, technical operations and business process integration.
The Red Wing Shoe Company appointed George Curleigh as vice president of its Vasque business unit. Curleigh joins Red Wing from his most recent position as vice president, sales at Arc'teryx. Prior to his tenure at Arc’teryx, he was managing director, Salomon UK.
The Adidas Group appointed André Maestrini, currently managing director Adidas Group France, as managing director Adidas Group Spanish Latin America, effective June 1. André Maestrini’s successor in France will be Alain Pourcelot, currently brand director Adidas in France.
Polar, the supplier of heart rate training devices, appointed Herb Baer as president of Polar USA. In his role, Baer will be responsible for the overall direction and day-to-day operations of the company, overseeing all segments of the business including consumer fitness, running, cycling, physical education, club solutions, team sports and OEM.
Klean Kanteen named Scott McGuire as the company’s director of sales.
Quiksilver, Inc. appointed Ryan “Scano” Scanlon as SVP of marketing, Quiksilver Americas, effective immediately. Taylor Whisenand has joined the company in the role of SVP of marketing operations, Quiksilver Americas.
BECOMES OFFICIAL SOCK OF IRONMAN MONT TREMBLANT
70.3
Wigwam, the performance sock company, has become the official sock of Ironman Mont Tremblant 70.3 and the full Ironman Mont Tremblant races. After having been the official sock of Ironman races in the U.S. for 18 years, Wigwam is now expanding its sponsorship to two of the newest Ironman races up in Mont Tremblant, Canada.
“We’re constantly looking for more opportunity to support our Ironman product and ways to support the Ironman brand," said Natalie Stangl, field marketing manager at Wigwam. "Being a part of the inaugural races will help boost awareness of the Wigwam brand and drive sales on a local and national level.”
The Ironman Mont Tremblant 70.3 will take place on Sunday, June 24, and the Ironman Mont Tremblant will follow on Sunday, August 19.
WOLVERINE WORLD WIDE'S Q1 HURT BY EUROPEAN WEAKNESS
Wolverine World Wide reported revenue for the first quarter ended March 24 was $322.8 million, a decrease of 2.4 percent. As expect-ed, growth was tempered by macroeconomic and financial uncer-tainty in Europe. The company slightly lowered its revenue guidance due to the overseas weakness but raised its earnings outlook. The top-line also faced challenges versus the prior year's first quarter when revenue grew approximately 16 percent. Foreign exchange negatively impacted revenue by $2.2 million in Q1 this year.
Earnings dropped 28.5 percent to $31.2 million, or 64 cents a share, but were significantly better than the company's expectations going into the quarter. The decrease in revenue, a modest decline in gross margin and moderate SG&A deleverage was partially offset by a significantly lower effective tax rate. Analysts on average had expected first quarter earnings-per-share of 55 cents, on revenue of $332.58 million.
On a conference call with analysts, Blake Krueger, the company's chairman and CEO, said that while WWW had planned for relatively soft revenue growth in each of the first two quarters of the year, revenue performance in the first quarter was slightly below its internal plan and was impacted by weak retail conditions in Europe, attributable to the recessionary environment in that region. First quarter revenue was also impacted by the timing of shipments from its lower margin military business. Said Krueger, "At this point, we do not expect any significant short-term improvement in Europe and have adjusted our full year revenue guidance to reflect the recessionary market conditions in that region."
On a brighter side, he said earnings exceeded its internal plan, as SG&A discipline and proactive pricing increases helped the company maintain a healthy gross margin. He added that globally, fashion and macro lifestyle trends continue to work in Wolverine's favor. "The global consumer is interested in authentic heritage brands, brands that stand for something and have withstood the test of time,” said Krueger. “Americana styling and prep also continue to drive con-sumer demand around the world. The boot trend and the consumer focus on health and wellness also remains strong."
8 SGBWeekly.com | APRIL 23, 2012
APRIL 30, 2012 | SGBWeekly.com 9
UNDER ARMOUR RAISES 2012 OUTLOOK ON STRONG Q1Aided by a growing Direct-to-Consumer business and strong re-sponse to new styles such as ColdBlack and Armour Bra and RC running shoes, Under Armour, Inc. reported first quarter earnings rose 20.8 percent to $14.7 million, or 28 cents a share, exceeding Wall Street's consensus estimate of 24 cents a share. Revenues climbed 22.9 percent to $384.3 million.
The company now expects operating income in the range of $203 million to $205 million in the current year, representing growth of 25 percent to 26 percent over 2011. That's better than its previous estimates calling for earnings to come in at the higher end of its 20 percent to 25 percent long-term growth target. Sales are now expected to range between $1.78 billion to $1.80 billion, representing growth of 21 percent to 22 percent over 2011.
Previously, Under Armour had guided revenues to come in at the low end of its 20 to 25 percent long-term growth target.
On a conference call with analysts, Chairman and CEO Kevin Plank noted that Q1 marked the eighth consecutive quarter of top-line above 20 percent.
By category, apparel grew 22.9 percent in the first quarter to $283.3 million, driven by balanced performance across men's, women's, and youth apparel businesses. New product and innova-tion was also "well received," including the reinvented Tech Tee, ColdBlack apparel, and the women's Studio Line and Armour bra.
Footwear grew 23.8 percent to $63.7 million in Q1, driven by new introductions in running footwear, including the Split II and Charge RC, as well as strong performance in baseball cleats. Ac-cessories moved ahead 25.9 percent $29.6 million with manage-ment noting that Under Armour has now fully lapped last year's transition of its hats and bags business in-house.
10 SGBWeekly.com | APRIL 30, 2012
The Finish Line, Inc. and its Finish Line Youth Foundation an-nounced a multi-year pledge to support Special Olympics as part of the retailer's ongoing mission to celebrate the everyday achievements of athletes everywhere.
Finish Line will support Special Olympics through multiple op-portunities, including:
• Employee activation and volunteer participation in 2012 Special Olympics Summer Games in Indiana as well as the Chicago and Atlanta markets in year one and additional mar-kets nationwide in coming years.
• Serving as the only national sponsor of Special Olympics’ new TRAIN program—a first of its kind sports assessment and nutrition education program designed to help athletes stay active, stay healthy, and achieve their personal best. In addition to helping to finance the program, Finish Line employees will help activate the TRAIN program for Special Olympics athletes in key markets.
• Sale of specific merchandise in Finish Line’s more than 635 stores and online nationwide beginning with the 2012 back-to-school shopping season to benefit Special Olympics.
• An in-store and online holiday season customer and employ-ee donation program to benefit Special Olympics.
"Finish Line has always supported worthy non-profit organiza-tions, yet we searched for some time to identify a single signature
cause that our employees, customers, and vendors could help us rally around in a meaningful way and make an enduring impact," said Chairman and CEO Glenn Lyon. "Special Olympics is the one organization that our customers and employees cited in recent independent research as a cause that they are not only passion-ate about, but that also suits our brand particularly well.”
"Finish Line is all about having fun, being active, and helping ev-eryone reach their own finish line, whether it means competing as a Special Olympics athlete or playing college intramurals. The added opportunity to be the only national sponsor of the TRAIN program is exciting as this is a true breakthrough in assessing, developing and tracking sports skills among individuals with intellectual dis-abilities. This program will contribute to the overall health, fitness and quality of life for individuals with intellectual disabilities and we are thrilled to help take it to the next level through our support."
"This partnership is a great fit for us," said Dr. Timothy P. Shriver, Chairman and CEO of Special Olympics. "We are a sports orga-nization and Finish Line is a great sports brand with a passion to celebrate the achievements of athletes everywhere. Their mission is a testament to the power of what Special Olympics athletes have shown time and time again – that we are all true champions and each of us has the ability to reach our own personal best. Fin-ish Line's commitment to supporting our athletes with intellectual disabilities will be a tremendous asset as we continue to work to promote acceptance and inclusion for all people."
FINISH LINE AND SPECIAL OLYMPICS ANNOUNCE
MULTI-YEAR PARTNERSHIP Special Olympics athlete, Jerry Moore, runs the 10-meter dash while Roger Underwood, Finish Line Senior Vice President of e-Commerce, Operations and Technology and President of the Finish Line Youth Foundation, tracks his time
Special Olympics athlete, Kylene Webber, dribbles a soccer ball while Finish Line Merchandise Planner, Kelly McCulloch, tracks her time. Photos courtesy of Finish Line / Business Wire.
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12 SGBWeekly.com | APRIL 30, 2012
ew Balance celebrated a milestone with the opening of a store on April 13 in Boston’s Copley Square neighborhood, just steps
away from the finish line at the Boston Marathon. The opening came 40 years after Chairman Jim Davis acquired New Balance on the day of the 1972 Boston Marathon.
While the store on Boylston Street showcases the brand’s 106-year heritage in Boston, its breadth of product, and distinction as a domestic manufacturer, also represents another major step in an evolving and increasingly far-reaching retail strategy for the brand.
In an interview with SGB Weekly, Stephanie Smith, VP of retail for New Balance, said the brand’s retail side is divided into three segments. The first is its in-dependently operated network of stores. The stores aren’t franchised and owners don’t pay royalties; they “purely buy inventory from us,” said Smith.
Smith said the independent stores are currently seeing “unbelievable success,” marked by 19 straight months of comparable-store growth. “We’ve been doing this since 1995 and even older stores are seeing amazing results and still growing the business,” said Smith.
The stores have enabled New Balance to showcase a full assortment of New Balance product to the public. New Balance also works with Buxton, the site-selection firm, to place stores where the brand is under indexed across its wholesale channels.
Currently, there are 154 independent locations run by 85 separate owners, many of who already worked with New Balance as owners of nearby multi-brand footwear stores. Smith said the independent stores represent the biggest part of the brand’s retail push with an average of 10 to 15 stores opened annually in recent years. By the end of 2012, 170 stores are expected to be open.
Beyond the footwear retailing smarts of the store operators, Smith believes that this side of the business has thrived because complete
ownership – unlike a franchised model - leads to the store operators being “100 percent invested in this business.”
The second retail segment is its 19 factory outlet stores that largely sell factory seconds and discon-tinued footwear.
The third are the newer, corporate owned stores, which now total four in the U.S. with the new Copley Square location. They include a 3,600 square-foot store in the Pentagon in Washington, DC, that is open 24-hours a day. As the only athletic shoe
company that currently manufactures shoes in the U.S., New Balance has been designated as an official footwear and apparel provider for the U.S. military. A nearly 4,000 square-foot corporate location in Dedham, MA, is used more as a conceptual testing space. Both locations opened in 2010.
NEW BALANCE’S RETAIL PLAY
Stephanie Smith, VP of retail for New Balance
New Balance's new Copley Square store pays particular homage to the runner through race bibs and a map of the city’s marathon that are imprinted in plaster as well as the “Running Since 1906” sign in the store’s entryway.
N
By Thomas J. Ryan
APRIL 30, 2012 | SGBWeekly.com 13
In 2011, the first Experience Store opened on New York City at Fifth Avenue and 20th Street, with the Boylston Street location representing the sec-ond in North America. New Balance over the last few years has also opened “Experience” stores in Beijing, Hong Kong and Australia. New Balance hopes to open a third “Experience” store in the U.S. in San Francisco in 2013.
In prime real estate spots, the “Experience” stores are designed to build awareness for the New Balance brand and support its indepen-dently-owned stores and wholesale accounts. With both buildings over 100 years old, both the Boston and New York stores pay homage to the brand’s history. The Boston store, for example, features restored original brick walls, floor tiles and rolling grill doors. Underscoring the brand’s commitment to domestic manufacturing, both feature a live video feed to its Lawrence, MA manufacturing floor during work hours.
The stores also highlight the fullest collection of New Balance’s of-ferings. These include colorful footwear, fun graphic t-shirts, its newer yoga collection, and other somewhat edgier takes that New Balance designers have introduced over the last few years to try to attract a younger consumer to the brand.
“What is fun is that even when my 13 and 15 year olds walked into the New York store for the first time, they were like, ‘Mom! Look at all the colors! You guys make cool shoes!’ So a lot of people are surprised to see the breadth of the line and colors that we can do. We’re not your mom’s or dad’s shoe anymore.”
Finally, the “Experience” stores promise to bring a unique ‘experience’ to retailing. For instance, the NYC store, which measures 4,000 plus square-feet, features a two-lane running track along its perimeter and a glass-enclosed area where employees assemble running shoes on site.
The newly opened Boylston Street location, measuring 2,500 square-feet, did not have the room to include the manufacturing operation or the running track but it is more tripped-out on the tech side than the NYC store.
Utilizing RFID technology, a “Line Up’’ wall showcases the company’s products on eight video screens. Said Smith, “The minute you pick one of the shoes up, the screen comes on and tells a story around the shoe.”
Examples of content include Team New Balance athletes in action, New Balance Hubway bike availability, and behind-the-scenes views of how the brand crafts shoes in America.
A brand DNA ribbon on the store’s ceiling ductwork from the en-trance to the back of the store takes the customer through a chrono-logical journey documenting the brand’s past, present and future, using vintage and modern images. The store also pays homage to the runner spirit through race bibs and a map of the city’s marathon imprinted in plaster as well as the “Running Since 1906” sign that is cast in the store’s entryway.
Beyond head-to-toe brand looks, the store features areas for both the latest performance product as well as its fashion-forward and heritage lifestyle offerings. The back wall of the store features a Fen-way Area with a yellow replica foul pole and imagery highlighting the brand’s partnership with the Red Sox.
Smith said each “Experience” store is designed to be “unique to
the area.” The New York store even has a more lifestyle approach than the Boston store, which is more focused on running. As such, the New York City store recently held an event for sneakerheads. Events supporting the running community are expected from the Boston store.
Besides branding, the “Experience” stores give New Balance the opportunity to test new products and particularly explore what fash-ion-forward takes click with consumers. Smith said that the company has particularly used the store to show wholesale accounts the reach of the New Balance brand.
As part of the New York City launch event, for example, about 40 local retailers were invited to explore the brand’s messaging and the depth of its product. Said Smith of the event, “Many were surprised at the depth of our product line. But what we were saying is we want to be very open to share how sell-throughs are going and what the trends are. We were basically saying, ‘If they’re working in our store, they’re going to work in your store.’”
Overall, Smith stressed that the retail focus for New Balance re-mains on expanding its independent shops in areas where the brand is underpenetrated. The fact that owners – many multi-brand store operators - are eager to open more New Balance stores is a good sign of the health of the brand, she augered. Said Smith, “They’re completely relying on us to hit home runs so that says a lot about the New Balance brand.”
Regarding expansion for its corporate stores, Smith said the optimal goal is to open one a year in key cities although the company is taking a cautious approach to make sure the stores align with the needs of its retail partners and work for branding purposes. She added, “These are expensive stores to open and we want to be thoughtful.”
She noted that it took three years to find the ideal NYC location and four years to find the Boston store. She is still not sure if New Balance will be able to land a San Francisco spot in 2013. She said, “Our eyes are set for San Francisco for next year but if it doesn’t happen, it doesn’t happen.” ■
New Balance's Boston "Experience" Store at 83 Boylston Street in Copley Square opened within steps of the finish line at the Boston Marathon.
14 SGBWeekly.com | APRIL 30, 2012
stake. Lee and Danny Abshire, who co-founded the business with Lee in 2005, retained a majority stake.
But Lee also said the business is taking off and was ready to make a bigger marketing stand. Said Lee, “Obviously the affect of having the Fireman investment has helped us do that but also we felt like we were there. It was time for our company to step out and be more active in the advertising world.”
While declining to provide sales figures, he said Newton had an ambitious goal of reaching “half a billion” in revenues in five to sev-en years. In an interview around the time of the sale, Dan Fireman had indicated that Newton’s sales were approximately $10 million in 2010 and were looking to end in 2011 with $17 million to $18 million in sales.
“Business is going really well,” said Lee. “Our first quarter ending March 31 was more than double our first quarter last year. It’s been really good.”
Newton is now in about 435 specialty running stores in the U.S. and 230 internationally. Lee expects its store count reach to grow by around 35 percent this year.
Growth will be supported by a stepped-up advertising push in 2012, which Lee estimated will amount to “about ten times more than we did last year.” In 2011, for example, Newton ran about three ads each in Runners World, Triathlete Magazine and Lava Magazine. Lee expects about 25 to 30 print executions this year as part of a ”much larger campaign.”
Newton chose to invest around the Boston Marathon because “it’s
NEWTON RAMPS UP FOR GROWTH
Dramatically illustrating the benefits of last year’s equity infusion from Fireman Capital Partners, Newton Running was on full display at this year’s Boston Marathon.
As part of a major media blitz, pedicabs covered in Newton brand-ing offered free rides in downtown Boston over the marathon week-end. Wearing Newton Running shoes, the drivers gave out coupons that could be redeemed for a free pair of socks at Marathon Sports and City Sports, local Newton Running dealers.
Newton also wrapped Green Line Trolleys in Boston, placed a handful of billboards around town, and handed out branded cheer signs at the two retailers as well as to spectators to wave during the marathon. Water bottles were also part of the giveaway mix.
Finally, a series of Newton Natural Form Running clinics led by Newton Running's Director of Education, Ian Adamson, were held at Marathon Sports and City Sports as well as at the race expo at the Seaport World Trade Center between April 11 and 15.
That’s a far cry from Newton’s presence at the 2011 Boston Mara-thon, when Newton Running CEO Jerry Lee said “no advertising” around Newton could be found.
In an interview near the Newton booth at the race expo Lee told SGB Weekly that the funding from Fireman Capital Partners had pro-vided the support needed to help Newton better get the word out.
In June 2011, Fireman Capital Partners, the Boston private equity firm that Reebok founder Paul Fireman launched with his son Dan about three years ago, invested close to $20 million in the Boulder, C0, natural running company in gaining approximately a 30 percent
By Thomas J. Ryan
APRIL 30, 2012 | SGBWeekly.com 15
the granddaddy of marathons.” But he expects similar grassroots and social marketing pushes at the New York and Chicago mara-thons.
Another driver of the brand's growth has been a dramatic increase in its rep force. Newton now has 18 full-time sales reps versus just three in July 2011. Said Lee, “That’s made a huge difference. We’ve been able to visit the specialty running stores much more often, pro-vide much more technical support, and do a lot more clinics and so forth. Our team of sales guys will be at over 1,000 clinics and expos in 2012.”
Beyond funding, the Fireman Group with Paul Fireman, Dan Fire-man, and its operations team, has provided the upstart with both financial smarts as well as another level of experience in growing brands. Said Lee, “We were real fortunate. When I knew I needed to bring some money in, I wanted to be very selective of who that was. It was not just about the money because we had a lot of people who wanted to give us money. I wanted somebody who had operated a company and then here appeared the Fireman Group. Of course, Paul took Reebok from $8 million to $2.8 billion so he knows how to manage growth.”
He said Paul Fireman has acted as a “confidant” in helping guide the company since making the investment. Added Lee, “He’s always available by phone. We’ve been very fortunate.”
What hasn’t changed is the brand’s commitment to social respon-sibility, or what Lee terms “good stuff.” Newton regularly teams up with Athletes For A Cure annually to raise funds for the Prostate Can-cer Foundation. Newton also donates thousands of pairs of shoes annually to people in need through organizations such as One World Running and supports non-profits such as Trickle Up. In April, the company was awarded the 2012 Glen and Mildred Robbins Leet Humanitarian Award from Trickle Up, a New York-based, non-gov-ernmental organization dedicated to alleviating poverty, for such ef-forts over the years. Also in April, Newton announced it was donating 350 pairs of shoes as fundraising incentives for participants of the
Revlon Run/Walk for Women series in New York City and Los Angeles that supports cancer research and awareness.
Lee said that even with the Fireman funding and knowhow, New-ton can’t come close to matching the marketing budgets of the major running brands. As such, Newton’s future success will be tied to its product and technologies.
“The only reason we launched the company is that we had the dif-ferential in technology,” said Lee. “We didn’t feel we could compete against the giants because they can out-market you and they can outspend you. But what they can’t do is duplicate our technology and that’s why we’ve been successful.”
Newton’s performance trainer continues to drive the business. But the brand's development team is working to launch a number of new, innovative products to debut 2012 “that I think are going to really support us with our growth,” said Lee.
Overall, Lee believes the running market remains “really healthy.” Among other factors, he believes the industry is being supported by a still challenging economy. Said Lee, “I think when the economy looks bad, people look at places to help themselves feel better and so forth and running happens to be one that people transition to, which is good for us.”
At the same time, he expects there will be a shakeout among the many running brands that have reached the marketplace over the last several years. While he believes Newton has proven the merits of its technology and has a solid foothold in the running community, he sees other brands facing bigger challenges as more clarity around the natural and minimalism movement occurs.
“I think right now one of the issues the industry faces are questions like ‘What’s the right heel-to-toe drop?’; ‘What’s a minimal shoe?’; ‘What’s a barefoot shoe?’; ‘What’s a natural shoe?’. Everybody has different definitions,” said Lee. “That’s going to be shaken out. And people that don’t have the technology or don’t have the marketing power of the big guys are going to end up finding it very hard to compete as things start to define themselves.” ■
16 SGBWeekly.com | APRIL 30, 2012
VP of global marketing at Converse, said the initial “Find Your Strong” branding was designed to put a “new voice on a brand” through greater engagement with runners.
“We needed to sort of establish a voice in the category,” said Lindner. “We were known quite frankly as this sleepy New England running brand who people thought highly of. But we wanted to create a more emotional and passionate connection with our runners through ‘Find Your Strong’ to evolve into a more inspirational global athletic brand.”
Lindner, who has also worked for Nike Bauer Hockey and Electronic Arts in the past, said the campaign, which included the brand’s first TV ads ever, was “extremely well received” with thousands of consumers sending in stories of their own inspiration through blog entries, Facebook posts and other ways.
“We had these amazing stories about people seeing the campaign and saying, ‘I’m going to get up and run my first 5K,’" said Lindner. “Or one about a consumer losing 100 pounds and running his first marathon. We had a guy wear an orange wig with ‘Find Your Strong’ painted in orange across his body as he ran the Chicago Marathon. But many just said ‘Thank you!’ for doing this for the running community. So the outpouring has been fantastic and it’s been fun
On the eve of the Boston Marathon, Saucony launched its Find Your Strong Project. Building on the success of last year’s launch of its aspirational ‘Find Your Strong’ branding campaign, the socially-driven initiative invites runners to share their personal 'Strong' story - mental, physical, spiritual and emotional - while connecting with others who share a similar passion for running.
The hub of the project is a microsite, saucony.com/strong, that’s as much about building relationships within the running community as it is about sharing content, said Chris Lindner, Saucony’s chief marketing officer, in an interview with SGB Weekly at the launch event held in Boston on April 13.
The Find our Strong Project’s digital platform delivers the following elements:
• A 12-week period of community challenges where runners are invited to share their strong through words, images and videos, creating a digital mosaic of inspiration;
• A series of micro-documentaries featuring inspiring runners and everyday athletes, including: Dorothy Beal, a mother of three and a 19-time marathoner; Gary Muhrcke, the first New York City Marathon winner and a legendary running store owner; and Mark Herzlich, 2012 NFL Super Bowl Champion and cancer survivor.
• The Find Your Strong Speaker Series kicked off at a launch event in Boston over Boston Marathon weekend on Friday, April 13, with inspirational speeches by Mark Herzlich, Bill Rodgers and Karen Smyers.
Lindner, who joined Saucony in September 2010 after previously holding the position of
for us because it’s brought us closer and closer to runners.”
The Find Your Strong Project looks to builds on those exchanges by creating a digital hub where runners can share the campaign. The first phase will run 12 weeks and includes weekly challenges to drive inspiration.
“One weekly challenge may be, ‘Send us your best running advice,’ or ‘Take a picture of something that inspires you,’ ‘Tell us where you love to run,’” said Lindner. “The whole idea is beginning a much longer conversation with our consumers.”
That outreach will be complemented by ten micro-documentaries, including Gary Muhrcke delivering “an amazing running tour” of Central Park as well as several stories of
Chris Lindner Saucony’s chief marketing officer
By Thomas J. Ryan
SAUCONY LAUNCHES FIND YOUR STRONG PROJECT
APRIL 30, 2012 | SGBWeekly.com 17
inspiration, according to Lindner.One of the documentaries focuses on
Mark Herzlich, a linebacker for the New York Giants. Speaking in Boston at the launch event, Herzlich told attendees how at the age of 18, he was diagnosed with a rare form of bone cancer in his left leg. A potential first-round NFL pick starring for Boston College at the time, Herzlich was told that not only would he never play football again but never be able to run again and would be lucky if he could one day walk without a limp. Devastated, Herzlich went home and sulked in self-misery for about two hours in bed. But after seeing a photo of a much-younger version of himself plowing over a defender with the same leg that was crushing his dreams, Herzlich became inspired. He said, “My leg in the photo was ripped and I said to myself, 'That’s the leg that’s trying to ruin my dream? That's so strong and so powerful? That's holding me back?' So I decided then that that’s not going to happen. I’m not to accept failure. I’m not going to accept defeat. I’m not going to let someone tell me that just because I have a little thing called cancer, I can’t do what I want to do.”
He dedicated himself to not only beating cancer but to playing football again and started setting goals. Recognizing he couldn’t run, he biked, swam and lifted while taking radiation treatment that left third-degree burns down his entire leg. With successful surgery, he began slowly running again and eventually joined his teammates on the field of Boston College opening day in 2010. While he also credits his family, friends, and teammates for their support during the crisis, Herzlich was also thankful to have found the inner drive that forms the basis of the Find Your Strong campaign. Regarding his first day back on the field, he said, ”That was the day that I truly believed that anything is possible. Anything in this entire world is possible. If you set a goal do everything you can to achieve that goal, and you find strength inside yourself.”
Other inspirational speakers at the event included Karen Smyers, one of the U.S.'s most decorated triathletes who fought back from a series of setbacks, including getting hit by an 18-wheeler as well as by thyroid cancer.
Bill Rodgers, 4-time winner of both the
Boston and New York City marathons, noted that the explosion of runs for charities or causes in recent years has created a much bigger opportunity to “Find Your Strong” for others as well as for yourself. While the running legend admitted that his obstacles weren’t as monumental as the other two speakers, Rodgers did note that he was “not the most talented runner” and only succeeded through perseverance. He also noted a few times when he failed to finish the Boston Marathon, jokingly recalling one time he ditched the race while a camera crew was following him. He said whether overcoming a major setback or just the daily running grind, the “Find Your Strong” message resonates with the running drive. Said Rodgers, “You can always make a comeback.”
A special tribute to the memory of Caballo Blanco, mythic hero of Born To Run, was also given by Luis Escobar, his close friend and a renowned ultra-marathoner. Blanco, whose real name was Micah True, was expected to speak at the event but suddenly passed away earlier in the month.
Lindner said the saucony.com/strong microsite is already flooded with stories and inspirational quotes coming from runners around overcoming challenges, finding motivation and reaching goals, particularly around running. In the week prior to the official launch, Saucony already saw almost 3,000 people posting images of themselves or offering marathon running advice on the microsite. One quote read, "Fall seven times. Get up eight."
Said Lindner, “There was an amazing response and once we started tweeting live from the event, it picked up some more energy."
Lindner said Saucony has found digital works as a "more efficient way” to not only inspire runners but better connect and learn from them. As a result, while 2011’s TV effort was “a really good way for us to make a statement about the brand shift in positioning last year,” TV won't be part of Saucony's marketing mix year. Instead, plans feature a stepped-effort around digital approaches such as banner ads, pre-roll ads, and social media along with print executions. The Kinvara 3 marketing roll-out, the brand’s largest launch effort to date, debuted on April 26, including a 45-second online spot to inspire viewers to get out and run as well as print partnerships, in-store experience kits and custom key account programs.
Lindner said that after the first 12-week phase of the Find Your Strong Project digital campaign, Saucony is determined to capitalize on the response it's been receiving to let the Project's fans guide the next phase. For instance, Lindner said the next set of mini-documentaries may come from the many of the runners who have written in detailing their own inspirational stories.
”We're going to let our runners tell us where they want to go," said Lindner. "That's what’s most unique about this in some way. I grew at big brands like Nike and Electronic Arts where product marketing campaigns were very clicked and tied. This is more fluid. This is us and our running community creating this together. We're providing the platform and we have we have some thoughts about where phase two will be go. But we're also inviting our runners to help guide us in that direction.” ■
Stories of inspiration were shared at Saucony's Find Your Strong launch event. From left to right, Karen Smyers, Mark Herzlich, Bill Rodgers and Saucony's VP of Public Relations, Sharon Barbano..
MAY
6-9 NSGA Management Conference and Team Dealer Summit San Antonio, TX
JUNE
12-14 Licensing International Expo Las Vegas, NV
18-20 EORA Southeast Summer Market Greenville, SC
21-22 NBS Specialty Outdoor Market Austin, TX
25-27 EORA Mid-Atlantic Market Parsippany, NJ
25-27 EORA New England Summer Market Manchester, NH
28-30 Sports Inc. Athletic Show Indianapolis, IN
29-1 TAG Spring/Summer Show St. Charles, MO
JULY
11-13 NBS Summer Market Indianapolis, IN
11-13 ASA-ICAST International Sport Fishing Expo Orlando, FL
12-15 European Outdoor Trade Fair Friedrichshafen, Germany
19-21 ADA Spring Show Orlando, FL
AUGUST
1 Outdoor Retailer Open Air Demo Salt Lake City, UT
2-5 Outdoor Retailer Summer Market Salt Lake City, UT
9-11 Sports Inc. Outdoor Show Indianapolis, IN
20-22 PGA Expo Las Vegas, NV
20-23 MAGIC Las Vegas, NV
28-31 Worldwide Fall Show Reno, NV
CALENDAR For full year calendar go to sportsonesource.com/events
Athletic Dealers of America1395 Highland AvenueMelbourne, FL 32935t 321.254.0091f 321.242.7419athleticdealersofamerica.com
National Shooting Sports FoundationFlintlock Ridge Office Center11 Mile Hill RoadNewtown, CT 06470t 203.426.1320 f. 203.426.1087nssf.org
National Sporting Goods Association1601 Feehanville Drive / Suite 300Mount Prospect, IL 60056t 847.296.6742f 847.391.9827nsga.org
Nation’s Best Sports4216 Hahn Blvd.Ft. Worth, TX 76117t 817.788.0034f 817.788.8542nbs.com
Outdoor Industry Association4909 Pearl East Circle / Suite 200Boulder, CO 80301t 303.444.3353f 303.444.3284outdoorindustry.org
SGMA 8505 Fenton StreetSilver Spring, MD 20910t 301.495.6321f 301.495.6322sgma.com
Snow Sports Industries America8377-B Greensboro DriveMcLean, VA 22102t 703.556.9020f 703.821.8276snowsports.org
Sports, Inc.333 2nd Avenue NorthLewistown, MT 59457t 406.538.3496f 406.538.2801sportsinc.com
Sports Specialists Ltd.590 Fishers Station Drive / Suite 110Victor, NY 14564t 585.742.1010f 585.742.2645sportsspecialistsltd.com
Team Athletic Goods629 Cepi DriveChesterfield, MO 63005t 636.530.3710f 636.530.3711tag1.com
Worldwide 8211 South 194thKent, WA 98032t 253.872.8746f 253.872.7603wdi-wdi.com
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Special Olympics athletes and Dave Lenox, Vice President of Leadership Development and Education for Special Olympics, discuss the results of their personalized TRAIN assessments with employees from Finish Line. Photo courtesy of Finish Line / Business Wire.
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THE
RISE OF
OUTDOOR
To exhibit or attend, go to outdoorretailer.com/SGB––– SUMMER MARKET –––
“The energy at this show was tremendous
and it rebooted everything for me as I head back to my store.
Talking with the manufacturers I work with, their business results
are up. Our sales are up. People are excited.”
– Shelley O’Neill, Tooth of Time Traders
SNEWS Retailer of the Year
SHOW • AUGUST 2-5, 2012Salt Palace Convention Center, Salt Lake City, UT
DEMO • AUGUST 1, 2012Jordanelle State Park, Heber City, UT
