SGB Executive talked this week with Kim Miller, the longtime CEO of Scarpa North America, and Jonathan Degenhardt, his designated successor, about the 88-year outdoor footwear brand’s heritage and current momentum, the lengthy CEO transition process, and what’s next for Scarpa and the outdoor industry.
Miller helped launch the Italian-based brand in Boulder, Colorado in 2005 and became CEO in 2006. Prior to Scarpa, he worked for Chouinard Equipment and was an employee-owner and part of the founding team that built Black Diamond, where he worked for over 20 years. Black Diamond had been Scarpa’s North American distributor.
This past March, Scarpa announced that Degenhardt would become the new CEO of its North American operation. joining the company in mid-April and working alongside Miller as co-CEOs until Miller’s official retirement early next year. Degenhardt joined Scarpa from Deuter USA and Ortovox USA, where he was managing director for the last six years for those two EU-based brands. In a homecoming, Degenhardt, known colloquially as “JD,” worked in sales for Scarpa at the outset of its North American operation 20 years ago.
As part of the leadership transition, Scarpa also elevated Mark Mathews, former VP of sales, to chief commercial officer, and Joe Higby, former VP of finance, to VP of finance and operations. The promotions removed three direct reports from the CEO role.
SGB: Let’s start with JD. Why did you take the job? What potential do you see in the brand?
Degenhardt: For me, the connection to Scarpa is personal. My first climbing shoes and ski boots were Scarpa. Many years after that, I started working with Scarpa North America (SNA) as one of the earliest employees at the outset, when SNA separated from the previous distributor and began working with Kim. That was a formative period in my career and being able to come back in a leadership role now is kind of a full-circle experience.
The chance to work with heritage brands is also something that’s really important to me. There’s only a handful of brands that have been out there for as many years as us with multi generations of ownership. It brings a level of quality with the history in innovation, and that’s special to me.
As far as potential, we’ve got fair bit of equity in the technical and vertical space. Our quality and performance really kind of drives that customer loyalty. But we’ve also got a lot of cool innovation in the pipeline in hiking and running in what I consider more horizontal disciplines. That’s exciting because I think a lot of the growth in the market and in participation is coming from that ‘less technical’ user that still wants quality footwear.
SGB: What’s behind the lengthy succession plan?
Degenhardt: Kim’s been with the organization for 21 years and working with the Parisotto family for many years before that. So this transition really ensures continuity in leadership and a smooth handoff in terms of a lot of the institutional knowledge that goes with working closely with a family-held organization. From my perspective, it’s been positive and very organic.
SGB: Kim, can you provide some details on how the succession plan came about?
Miller: The high-level leadership transition, especially CEO, can be one of the most disruptive kind of events in a company’s existence and I just thought there must be a better way. But the concept was based on my philosophy of leadership and mentorship and what’s the best way to finish strong in my position. You never really know how good a leader was until their last day.
So, I’ve been here for 21 years as the CEO, but I’ve been working with Scarpa for 36 years because of my time with Black Diamond when we were the distributor for Scarpa. And I’m the one of the founders of SNA and the only CEO this business has ever had, to date, so there’s a lot to share and going on here.
But a lot of the succession concept was based on what I learned from different areas besides the outdoor industry, In guiding, for example, there’s an apprenticeship phase. It doesn’t mean you’re not a good guide. There’s just a standard, a culture and a lot of other things to learn beyond just the job description. I would also look at aviation pilots. There’s a co-pilot and a pilot, and a co-pilot is basically getting the experience to become a pilot.
So, I think there’s a lot of collective brain power Jonathan and I are sharing through this transition, not just the transfer of knowledge, but the exchange of knowledge and the gestation of new ideas together so I can transfer to him many years of experience and say, ‘What do you think?’ ‘What do you want to do?’
The other idea is to respect the cultural side of this. Jonathan knows about business. We wanted him to get to know the people and learn about the culture and immerse himself in the company and that takes time. This is an 88-year-old family business, so there’s a lot of unique aspects to Scarpa. A lot of amazing and beautiful parts to it that are nuanced, besides just the cultural things. So the goal is to have Jonathan prepared to just easily take over and transition over a long period of time, not just overnight, and to be inclusive and transparent for everyone the whole way through. This is about what’s best for the company, what’s best for the people, and how can I personally set Jonathan up for success in the best way possible and finish strong to me.
SGB: Kim, can you talk about you early days establishing Scarpa in North America? What challenges the brand faced?
Miller: First, I would say if I got my bachelor’s in retail in the outdoor industry, I got my masters at Black Diamond and I’m just about to graduate with my PhD from Scarpa because this this has been a lifelong journey and an amazing one in this industry.
Scarpa is 88 years old. We were born the same year that REI was, in 1938. In the early years in Boulder when Jonathan was there, we used to call ourselves a 68-year-old startup. But the challenges were actually not as big as most people would face. This was an amazing brand that had been established and everybody knew. One early challenge was that we were known as a telemark ski boot company and we had to get some traction in the bigger market to become more of a mountain sports and lifestyle brand. But we didn’t have to build a brand. We just had to tell people about Scarpa and cast a bigger net.
We’ve endured all the broader industry challenges – the crash of 2008 certainly punctuated by the pandemic. But we’ve been on a growth trajectory since we founded the company. We’ve expanded into all channels in the industry, and all our categories are firing off well and resonating. We’re still primarily based in mountain footwear – climbing, skiing, hiking, mountaineering, and trail running. That’s our space for the moment.
SGB: Any pivotal moves that helped Scarpa gain a firmer foothold in North America?
Miller: I think the pivotal business decisions were focused on people – focus on team, focus on values, build a business on a philosophic platform that will weather all storms. Find your flywheels and be true to those. And always remember to follow the sports, to follow the consumer, the participant, and the answers will come to you. And really, the philosophy of being a values-driven business has been the guiding light. I think the highlight has been the people and the relationships within the company as well with the individuals in the industry and the community in general.
SGB: What does the Scarpa business look like today? What are the biggest categories and channels? Where’s the growth coming from?
Miller: Philosophically, we believe first, that we need to be in the top three brands in a category to call it a ‘win.’ For us, that means we are a leading brand in the categories of climbing shoes, climbing approach; mountain and ski. And then emerging categories like light hiking and trail running, where we’re steadily growing and embracing the opportunities.
The channels are also evenly distributed. Specialty is still our number one and most highly coveted sales channel because first, they’re the most expert and sensitive to the trends in the sports and industry, especially on high level innovative footwear. Secondly, I think the specialty side of the industry needs extra support and love right now, given the pandemic-related recoveries and all the consolidation in the retail and brand space. Regarding the other dominant channels, chain stores in the U.S. and Canada has been stable and showing material growth year over year. The Internet sales channel (pure play internet retail dealers) is doing especially well and predicted to be one of the top performing channels this year. Scarpa’s direct-to- consumer retail is also an emerging channel that has seen great growth this year. Because we have over 130 styles in our product line, we really see a lot of activity on our e-commerce direct-to-consumer channel on the peripheral categories, where people don’t always have access these products. There’s no retailer that carries 130 of our styles so DTC is the access point, especially for specialized models. For example, in the field boot category, wildland firefighting boots have unfortunately been one of our biggest sales growth products this summer due to all the fires in North America.
SGB: Jonathan, can you elaborate on where the opportunities are for Scarpa going forward?
Degenhardt: Echoing what Kim said about climbing being a real pillar for the brand, Scarpa historically has excelled in performance-oriented styles within climbing. But what we’re really investing in is also some other styles that attract climbers who are progressing in the sport, and that’s showing some really positive early signs. So we still think of climbing as having a lot of blue sky. In ski, what’s really kind of special is we’re basically the only Telemark boot manufacturer out there. That’s hyper specialization. I don’t think that’s going to be massive growth there, but it’s really awesome to totally own an entire category.
And then the light hiking category is obviously growing in North America. It’s got the biggest participation base of any outdoor activity, and I think we’re going to see a lot of really positive growth in that category just because it’s where the market’s headed. People are interested in ‘done in a day from their door’ kind of experiences, and Scarpa is poised to take 88 years of knowledge with cutting edge technology and materials and build something that is really on point for that. There’s a lot of new energy at the headquarter level and a lot of investment in both marketing and R&D around light hiking and trail.
SGB: How about newer categories such as apparel?
Degenhardt: This isn’t another category outside of footwear, but it’s worth mentioning that outdoor, approach-inspired footwear is having a moment in the fashion world right now, and the Scarpa Mojito was one of the first shoes to ever really do that. It’s been a global bestseller, and we’ve seen a lot of upticks in that. As Kim said, at the periphery of the assortment available at on our website, we’re doing really well with that product. So maybe there’s room for an expanded lifestyle offering somewhere in the future, but it’s a little too early to tell.
SGB: Is Scarpa exploring any changes in go-to-market approaches?
Degenhardt: Advocating for market needs. I think that’s the real salient point.
Colors, price points, fits and those types of things are subtly different when you go from the EU to North America.
And the brand is already doing this, but I think something that is important is taking a slightly different course toward the opportunity in hiking and running, which is more of a horizontal discipline in terms of people moving in the world as opposed to vertical when climbing and skiing. Working with Mark, our chief commercial officer, in pulling together that market research and product feedback and really feeding that back to the design team has been a great experience.
Another thing is just timelines and communications. Things happen in North America sometimes on a different calendar and with a slightly different communication style.
SGB: How is the outdoor industry faring these days?
Miller: The industry right now is going through a big transition period. We’re in a period of natural selection that’s generally across all business sectors. Things are changing quickly and have accelerated in the last three years. A lot of people say strategy is really a pipe dream now because we are being forced into a reactive posture and moving to whatever the latest new thing is. But we’ve learned to be much more agile. Anticipation has become much better in terms of guessing what might happen next.
The industry has been navigating its way through the chaos for years now and we are starting to see more stability and growth across the industry. We’re also seeing continued vendor consolidation at a high level with brands being brought into bigger holding groups. The idea of being a freestanding, independent brand these days has become more the exception than the norm. Unfortunately, we’re also losing freestanding indie retailers that have been the backbone of the industry for decades. These are big concerns and indicative of bigger trends and when you’re a specialty brand like Scarpa.
But in the end, it’s all about the consumer. They’re at the headwaters of all of this. What they feel trickles down to everybody, and consumers have a lot of concerns right now. Typically, the outdoor industry has weathered these periods of uncertainty really well because getting outside is about mental health, exercise, being with your people, having fun…But it’s a much broader consumer base now for the outdoor industry, and that may have been a traditional core value that not everybody now subscribes to. The pandemic created a ‘sport of the month club’ – kind of like ‘I just decided to get into backcountry skiing and now I’m not doing that anymore.’ So, we really want to follow the consumer, the participant, and see what’s inspiring them. What are their aspirations now? What’s giving them stress? How can we help?
SGB: Anything you want to add Jonathan on what you’re seeing?
Degenhardt: I’m glad Kim mentioned consumers and participation because you can’t really talk about retail health without talking about consumer buying behavior. There’s been so much disruption and uncertainty, plus massive increases in participants. It’s really changed the dynamic of how a lot of outdoor people are recreating, and that’s disrupted their repeat purchase frequency. Retailers are adapting to that, and now the brands are adapting to the retailers so it’s really an ecosystem.
But the big thing that I’ve noticed both here and in some of my other roles is just a higher level of risk aversion than we’ve traditionally seen in recent years. There are retailers that are less willing to try new assortments or even differentiate, and unfortunately, I see a lot of homogenous assortments from one store to the other. It’s like the surf and skate scene back in the day, where stores right next to each other carried the exact same products. I understand why you’d want to minimize your risk and inventory costs, but at the same time, specialty is still where people go for that experience and to discover new brands. I hope that value still hangs on after things stabilize a little bit.
SGB: What does success look like for Scarpa North America in 2030?
Degenhardt: Obviously growth. We want to get market share. We want to have increased number of shelves in some of the nascent categories and gain a really a stronger foothold in trail running and hiking over the next five years. But tying it back to consumers again, we do a survey every year to test our assumptions with our consumers. And if we continue to have positive consumer engagement and sentiment for the brand, I think that’s really important too. Again, it’s not one or the other. Those things have to happen simultaneously.
SGB: Kim, would you add anything?
Miller: Jonathan nailed it. Growth is obviously imperative from an enterprise standpoint. But success is also about value added to a brand and continuing to use our voice to elevate people and speak about the important things in our space and our world, especially around things like climate change, sustainability and giving more people access to the outdoors. Using our platform to speak to some of those things is the real icing on the cake for a truly world class brand in the way I define it. And then really staying connected. One of the most gratifying parts of the jobs is the people. The relationships are what makes this whole thing such a special gift.
Image courtesy Scarpa North America
