OR Winter Market: Fall 2010 Outdoor Footwear Shines in Surging Categories

With continued strength in trail running as well as a pickup in the hiking category as consumers adopted a “back to basics” mentality during the recession, footwear has been more than holding its own during the recession. 

 

At Outdoor Retailer Winter Market, brands not surprisingly brought out ever-lighter trail runners and hikers. A few touted new technologies to improve traction, increase support, enhance cushioning — and further eco-design. Style also clearly became more imperative, especially as consumers look to use outdoor shoes for multiple-purposes.


“With outdoor footwear, it’s becoming more and more important to look good with jeans,” said Peter Worley, president of Teva.


Not surprisingly, the UGG phenomenon continued in force with many brands adding shearling touches across their lines. But many also saw a return to more authentic, rugged styling, again reflecting consumers desire to return to their roots during a downturn.


Among newer categories, toning footwear increased its presence at the show. Skechers, the maker of Shape-Ups, tripled the size of its booth since its first OR appearance at ’09 Summer Market. Avia showcased its AviMotion collection and MBT extended into lush leather boots in the toning category. The natural running category also reached OR with GoLite, Saucony and New Balance all moving into the category during the show.


But the recession didn’t slow down some brands from extending into other categories. Chaco and Teva were among those significantly expanding their closed-toe footwear lines and Ahnu expanded its NPS (neutral positioning system) technologies into more urban styles. Spenco introduced its first full collection of sandals featuring its PolySorb Total Support technology, while Oboz came out with its own insole or footbed that’s the equivalent of most after-market insoles.  Five-Ten continued to expand its collections to fit activities such as mountain biking, base jumping and slacklining.

 

Footwear Brands See Opportunities in New Categories

 

Teva has big hopes for the launch of its MXT multi-sport performance collection that includes the Forge Pro, Sear eVent and Charge WP. Last year, Teva only had one style in a limited approach to the multi-sport category.  The pinnacle of the collection is the Forge Pro, which will be the official shoe of the Teva Mountain Games.


“It’s loaded with performance features,” said Peter Worley, president of Teva. “It’s got a compression molded EVA with an external Shoc Pad for heal stability. It’s got a super removable sock liner, synthetic leather and mesh upper, etc. – plus it looks great. So it’s a really fun exciting shoe and so far we haven’t missed with our key accounts. It’s not for everyone because its starts at $100, but we want to put it where it’s relevant to create some excitement.”

 

The MXT is expected to add momentum to Teva’s push into closed-toe footwear. The brand last year came out with a “very lean modest collection” for fall, but had a number of winners among those that reached selling floors. For example, the $130 Riva waterproof hiker was a best seller at REI throughout the fall. The women’s Montecito leather boots have also been a hit.

“It wasn’t a lot of styles but everything we put in the market last fall did well,” said Worley. “Now we’re back for fall 2010 with a more expansive, more comprehensive closed footwear line with some better value propositions.”


According to Worley, Teva will show a decline in 2009 as it cleaned up distribution following a “very significant closeout business.” But the fewer markdowns lead to a “healthier” bottom line and also reset inventory levels for a top-line revival in 2009.


“We had terrific sell-throughs last spring in all key channels and that continued in fall with our closed footwear line which resulted in a record pre-book for spring 2010 and what will undoubtedly be a record pre-book for fall 2010,” said Worley.


GoLite Footwear is launching its Baretech series to provide an outdoor answer to barefoot running.


“We believe a road running shoe is not the answer for somebody in the mountains,” says Doug Clark, founder and designer of New England Footwear, which licenses the GoLite brand from Timberland. GoLite is also addressing the popularity of basic distressed brown leathers with its Outdoor Series.

 

Merrell looks to increase brand awareness in 2010…


At Merrell, a major initiative is raising awareness for the brand. “We have a fairly low awareness rate with the brand with consumers,” said Jim Zwiers, president of The Outdoor Group at Wolverine World Wide. “It’s a great brand for those who know it but it’s still a brand to be discovered for many people. Unaided awareness is pretty low.”
On the positive side, he notes that the ‘intent to purchase’ for the brand is one of the highest in the industry, with most surveys showing Merrell ranking one or two alongside Nike.


“So when we ask, ‘If you own one pair, do you intend to buy another?’ the ‘Yes’ responses are off the charts.  So if we can get more people to try their first pair of Merrell, the trajectory for building our business would be really, really strong.”


As such, Merrell is reallocating its marketing dollars with social media, print media as well as retail in-store efforts to get its aspirational message out and more directly “encouraging try.”  While Merrell will continue to be active at music festivals and community events, tapping social media will be a particular effort in reaching consumers. “We’ll be talking to consumers more directly and this will be a bit of new territory for us,” said Zwiers. “But creating those consumer experiences is a real opportunity.”


On the product side, Merrell is focusing on updating its core franchises, particularly the World program in men’s and the Encore program in women’s.


“It’s a great place for retailers to invest their open-to-buy dollars,” said Zwiers. “The consumer loves the product and we’ve updated it and taken it forward.”


Zwiers also said retailers are looking to expand in other categories due to Merrell’s solid overall performance in 2009. He also said Merrell’s product development team has been restructured to create more dedicated teams for men’s, women’s and children’s to make sure Merrell isn’t missing any opportunities to grow.


“We call it ‘Go Small to Go Big,’ ” said Zwiers. “We can be there with great product, great styles, reliable performance, again and again. Retailers are looking for to satisfy even more with their needs.”
A third major initiative continues to support the launch of Merrell apparel, which is seeing orders up double-digits. While the apparel design continues to improve styling and the hook-ups to Merrell footwear, a new innovation introduced at the show is a Merrell jacket with a hood that converts into a neck pillow.  With airlines charging for pillows and blankets these days, the jacket could pay for itself rather quickly for seasoned travels.


At Patagonia Footwear, Zwiers said Wolverine’s Outdoor Group continues to do a better job understanding the Patagonia customer. “Patagonia is very, very hot right now,” said Zwiers. “Their product design is industry leading and continues to be and that connection to the consumer is really powerful. So the products that we’ve launched this season really hit on that.”


For example, Patagonia has partnered on a collection for One Percent for The Planet on a co-branded line with proceeds going toward the organization. The Patagonia Footwear team also continues to refine styling for the collection. A winner has been the Boaris, which is designed to connect with the Southern California culture.
“It’s got great styling, great features and great comfort in a very Patagonia way so I think we’re getting better at understanding the styles that not only resonate with that Patagonia consumer but allow the line to provide some differentiation in the marketplace. We’ve had a good season for Patagonia for fall ‘09 and are really looking for even bigger opportunities for Fall ‘10.”


At Chaco, the major initiative is the arrival of a full autumn/winter collection that Zwiers believes will resonate with Chaco fans. “It has bio-centric footbeds so your foot sits right on the PU, which has always been a trademark of the Chaco brand,” said Zwiers. “It’s got the Chaco webbing. So it feels just like Chaco but it has foot covering and an aging and a patina to it. We believe it will really connect with that Chaco customer.”


He also noted that Chaco brand has undergone a successful integration process and being under Wolverine’s infrastructure has particularly helped in Chaco’s ability to service retailers. 
“We knew it was a very, very strong brand but to tell you the truth it’s stronger than we thought it was,” said Zwiers.


Overall, Zwiers said 2009 marked a year when better brands and particularly Merrell gained share on the competition in terms of replenishment rates and maintaining gross margins.  “It was a year when we think we took market share and actually got closer to our retailers and actually became more important to our retailers and our consumers,” said Zwiers. “Chaco was a transition type year when we really had to put a base under the business and we really think we were successful with that. With Patagonia and Merrell, we really feel that we expanded market share and got closer to our retailers. So they’re ready to move forward with us more in 2010.”


>>> Look for more OR footwear in next week’s issue of Sports Executive Weekly…

About The Author

OR Winter Market: Fall 2010 Outdoor Footwear Shines in Surging Categories

With continued strength in trail running as well as a pickup in the hiking category as consumers adopted a “back to basics” mentality during the recession, footwear has been more than holding its own during the recession. 
 
At Outdoor Retailer Winter Market, brands not surprisingly brought out ever-lighter trail runners and hikers. A few touted new technologies to improve traction, increase support, enhance cushioning — and further eco-design. Style also clearly became more imperative, especially as consumers look to use outdoor shoes for multiple-purposes.


“With outdoor footwear, it’s becoming more and more important to look good with jeans,” said Peter Worley, president of Teva.


Not surprisingly, the UGG phenomenon continued in force with many brands adding shearling touches across their lines. But many also saw a return to more authentic, rugged styling, again reflecting consumers desire to return to their roots during a downturn.


Among newer categories, toning footwear increased its presence at the show. Skechers, the maker of Shape-Ups, tripled the size of its booth since its first OR appearance at ’09 Summer Market. Avia showcased its AviMotion collection and MBT extended into lush leather boots in the toning category. The natural running category also reached OR with GoLite, Saucony and New Balance all moving into the category during the show.


But the recession didn’t slow down some brands from extending into other categories. Chaco and Teva were among those significantly expanding their closed-toe footwear lines and Ahnu expanded its NPS (neutral positioning system) technologies into more urban styles. Spenco introduced its first full collection of sandals featuring its PolySorb Total Support technology, while Oboz came out with its own insole or footbed that’s the equivalent of most after-market insoles.  Five-Ten continued to expand its collections to fit activities such as mountain biking, base jumping and slacklining.
 
Footwear Brands See Opportunities in New Categories
 
Teva has big hopes for the launch of its MXT multi-sport performance collection that includes the Forge Pro, Sear eVent and Charge WP. Last year, Teva only had one style in a limited approach to the multi-sport category.  The pinnacle of the collection is the Forge Pro, which will be the official shoe of the Teva Mountain Games.


“It’s loaded with performance features,” said Peter Worley, president of Teva. “It’s got a compression molded EVA with an external Shoc Pad for heal stability. It’s got a super removable sock liner, synthetic leather and mesh upper, etc. – plus it looks great. So it’s a really fun exciting shoe and so far we haven’t missed with our key accounts. It’s not for everyone because its starts at $100, but we want to put it where it’s relevant to create some excitement.”
 
The MXT is expected to add momentum to Teva’s push into closed-toe footwear. The brand last year came out with a “very lean modest collection” for fall, but had a number of winners among those that reached selling floors. For example, the $130 Riva waterproof hiker was a best seller at REI throughout the fall. The women’s Montecito leather boots have also been a hit.


“It wasn’t a lot of styles but everything we put in the market last fall did well,” said Worley. “Now we’re back for fall 2010 with a more expansive, more comprehensive closed footwear line with some better value propositions.”


According to Worley, Teva will show a decline in 2009 as it cleaned up distribution following a “very significant closeout business.” But the fewer markdowns lead to a “healthier” bottom line and also reset inventory levels for a top-line revival in 2009.


“We had terrific sell-throughs last spring in all key channels and that continued in fall with our closed footwear line which resulted in a record pre-book for spring 2010 and what will undoubtedly be a record pre-book for fall 2010,” said Worley.


GoLite Footwear is launching its Baretech series to provide an outdoor answer to barefoot running.


“We believe a road running shoe is not the answer for somebody in the mountains,” says Doug Clark, founder and designer of New England Footwear, which licenses the GoLite brand from Timberland. GoLite is also addressing the popularity of basic distressed brown leathers with its Outdoor Series.
 
Merrell looks to increase brand awareness in 2010…


At Merrell, a major initiative is raising awareness for the brand. “We have a fairly low awareness rate with the brand with consumers,” said Jim Zwiers, president of The Outdoor Group at Wolverine World Wide. “It’s a great brand for those who know it but it’s still a brand to be discovered for many people. Unaided awareness is pretty low.”
On the positive side, he notes that the ‘intent to purchase’ for the brand is one of the highest in the industry, with most surveys showing Merrell ranking one or two alongside Nike.


“So when we ask, ‘If you own one pair, do you intend to buy another?’ the ‘Yes’ responses are off the charts.  So if we can get more people to try their first pair of Merrell, the trajectory for building our business would be really, really strong.”


As such, Merrell is reallocating its marketing dollars with social media, print media as well as retail in-store efforts to get its aspirational message out and more directly “encouraging try.”  While Merrell will continue to be active at music festivals and community events, tapping social media will be a particular effort in reaching consumers. “We’ll be talking to consumers more directly and this will be a bit of new territory for us,” said Zwiers. “But creating those consumer experiences is a real opportunity.”


On the product side, Merrell is focusing on updating its core franchises, particularly the World program in men’s and the Encore program in women’s.


“It’s a great place for retailers to invest their open-to-buy dollars,” said Zwiers. “The consumer loves the product and we’ve updated it and taken it forward.”


Zwiers also said retailers are looking to expand in other categories due to Merrell’s solid overall performance in 2009. He also said Merrell’s product development team has been restructured to create more dedicated teams for men’s, women’s and children’s to make sure Merrell isn’t missing any opportunities to grow.


“We call it ‘Go Small to Go Big,’ ” said Zwiers. “We can be there with great product, great styles, reliable performance, again and again. Retailers are looking for to satisfy even more with their needs.”
A third major initiative continues to support the launch of Merrell apparel, which is seeing orders up double-digits. While the apparel design continues to improve styling and the hook-ups to Merrell footwear, a new innovation introduced at the show is a Merrell jacket with a hood that converts into a neck pillow.  With airlines charging for pillows and blankets these days, the jacket could pay for itself rather quickly for seasoned travels.


At Patagonia Footwear, Zwiers said Wolverine’s Outdoor Group continues to do a better job understanding the Patagonia customer. “Patagonia is very, very hot right now,” said Zwiers. “Their product design is industry leading and continues to be and that connection to the consumer is really powerful. So the products that we’ve launched this season really hit on that.”


For example, Patagonia has partnered on a collection for One Percent for The Planet on a co-branded line with proceeds going toward the organization. The Patagonia Footwear team also continues to refine styling for the collection. A winner has been the Boaris, which is designed to connect with the Southern California culture.
“It’s got great styling, great features and great comfort in a very Patagonia way so I think we’re getting better at understanding the styles that not only resonate with that Patagonia consumer but allow the line to provide some differentiation in the marketplace. We’ve had a good season for Patagonia for fall ‘09 and are really looking for even bigger opportunities for Fall ‘10.”


At Chaco, the major initiative is the arrival of a full autumn/winter collection that Zwiers believes will resonate with Chaco fans. “It has bio-centric footbeds so your foot sits right on the PU, which has always been a trademark of the Chaco brand,” said Zwiers. “It’s got the Chaco webbing. So it feels just like Chaco but it has foot covering and an aging and a patina to it. We believe it will really connect with that Chaco customer.”


He also noted that Chaco brand has undergone a successful integration process and being under Wolverine’s infrastructure has particularly helped in Chaco’s ability to service retailers. 
“We knew it was a very, very strong brand but to tell you the truth it’s stronger than we thought it was,” said Zwiers.


Overall, Zwiers said 2009 marked a year when better brands and particularly Merrell gained share on the competition in terms of replenishment rates and maintaining gross margins.  “It was a year when we think we took market share and actually got closer to our retailers and actually became more important to our retailers and our consumers,” said Zwiers. “Chaco was a transition type year when we really had to put a base under the business and we really think we were successful with that. With Patagonia and Merrell, we really feel that we expanded market share and got closer to our retailers. So they’re ready to move forward with us more in 2010.”


SCARPA’s collection is ski and mountaineering focused for Fall 2010, as expected. But Kim Miller, CEO of SCARPA North America, also noted that the company continued to put some lifestyle models on the table that are built in the Italian heritage and quality for which the SCARPA brand is known. One of those models for 2010 is the Caipirihna, a shoe built for around-town use but inspired by the styling and function of some of its new approach shoes.


“While the Caipirihna is built more for lifestyle use, it’s still quite at home in the SCARPA collection in that it has all of the high-quality attributes the brand is known for – European construction, really high-grade suede, a unique Vibram sole, a webbing ribcage, and a good bit of attitude,” explained Miller.

But Miller said SCARPA remains committed to technology. As an example, its new mountain boot collection has a proprietary midsole technology that makes the boots about 30% more shock-absorbing than boots in this class have been in the past.

“For the athlete, that amounts to substantial energy savings over a day of climbing while carrying a heavy pack. It’s that kind of thing that sets the SCARPA brand apart. So for us, new technology is less about tying into trends, and more about setting the bar,” Miller remarked.  

Overall, Miller said he sees customers looking for a variety of boots.
“They’re either going with heavier, more traditional backpacking boots or they’re going all the way to the light end of the collection, in our case the Alpine Cross line and low-cut hikers and trail runners,” noted Miller. “That said, mid-weight boots still sell very well in certain markets. So niche performance is very real, and customers are becoming very niche regionally about what they want out of outdoor footwear. And they are looking to retailers who offer them the kinds of choices they are looking for. So our most effective retailers are people who are very in touch with these kind of regional and niche trends.”  

 

Keen President and CEO James Curleigh said one big initiative for the brand is to build on its Hybrid Life philosophy.  “It’s about urging people to ‘create, play, and care’ and we recognize that we have the opportunity to bring Hybrid Life to life,” Curleigh explained. “So we’re going to do that with our image, our different marketing avenues, our different creative, and really try to bring Hybrid Life to life in a more exciting and compelling way. We know when we tell the Hybrid Life story one-on-one with people, they really get it. But we don’t have the luxury of one-on-one dialogues with everyone out there. So we need to bring it to them in a more creative, compelling, impactful way.”
The second initiative is to “make every season a Keen season,” said Curleigh. While it found its way into the market through an innovative sandal, Keen has expanded across a number of categories.


“We have spring, summer, fall transition and winter and now we’re at the stage where we’re confident that we belong in every one of those seasons,” noted Curleigh. “We have the items, the products, the categories and expertise from a product perspective to be there.”
Indeed, Curleigh said Keen has seen strength across several categories, with kids “absolutely going ballistic,” trail performing “very, very well,” and the lifestyle piece, known as Market Street and Boulevard, having a “phenomenal” year in 2009. At the same time, the Whisper model in the sandal category was a big hit. The broad strength fed another year of growth for Keen.


“We genuinely worked very hard but we did not prescribe to the theory that ‘flat is the new up’,” he added. “We’re only a seven year old company and we don’t know words like ‘economy’ and ‘recession.’ So every year is a record year for us and 2010 looks like another breakthrough year.”


At La Sportiva, the focus continues to be on ever-lightweight materials but the brand is finding particular success with its ECO hiker line. It features a Flex Control system that creates a comfortable and highly adaptable fit as well as nubuck leather uppers. But it’s built with eco-conscious materials.  “We’re just trying to use more sustainable materials and processes across our lines but the ECO has done really well for us,” noted Jonathan Lantz, president of La Sportiva, N.A. “We expect the consumer will react very positively to it.”


Trail running, which the company calls Mountain Running internally, also continues to do well for La Sportiva and Lantz expects a 35% gain in the category for 2010 based on order patterns. While core users are using it on trail, it’s also tapping the multi-sport category.
“It features that sticky rubber for traction, it’s really supportive, and has a really good EVA for cushioning,” explained Lantz. “So you can use it for all those purposes — whether hiking, or walking the dog or walking to the coffee shop.”


In mountaineering, Lantz expects to see an uptick in 2010 due to pent-up demand as consumers have been holding off purchases during the recession. Climbing has remained steady, but hiking and trail running continue to be the growth vehicles for La Sportiva.


“We had modest growth goals last year and we ended up 11% in 2009 over 2008,” Lantz noted. “And in 2010, we’re looking for continuing growth in mountain running and hiking and look at be up about 5%.  So our business has been solid.”

 

At Salomon, trail running has also been driving footwear gains over the last five or six years.


“It’s really been all about expanding into that and growing that area and obviously the movement into light and fast hiking,” said Jeff Larsen, director of footwear at Salomon. “But the real key story is how the technologies we’ve developed in trail running are now really permeating through all our categories.”


Larsen said the trail running category is being supported by a 20% increase in the number of events, and participation rates are growing even faster.


“We see that whole market growing and we’re excited about that,” added Larsen. “I think that pie will expand for all the participants in that category.”


He said consumers continue to respond to newer models focus on lighter, faster and lower profiles.


“Our company had its best year ever,” Larsen noted. “And certainly wasn’t without its challenges. We had been very conservative with some of our winter boots and some of the products that we ordered for fall and found ourselves short and that we could have supplied a lot more.”


The one challenge for outdoor footwear, according to Larsen, is the possible hike in duty and tariffs with the MTB.
“Right (now) we’re selling well. We’re seeing a lot of interest in the waterproof breathable product and people are still demanding that performance,” says Larsen. “But there’there’s also this damper on with the duty rates going to zero to 37%. We’ll see some impact on that”

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