OR Winter Market: Sidecountry, Innovation and Abundant Snow Fuel Sales and Optimism

 

Data released by Snowsports Industries America a week after the show  showed U.S. snow sports sales broke $1 billion for the first time in December, with equipment sales leading the market with 22% increase in dollars sold and 11% in unit growth. While alpine ski equipment sales were up 27% for the August through December period, dollars sales were up more than 90% for AT/Randonee equipment, 165% for reverse/mixed camber skis and 58% for reverse camber snowboards. 
“We’ve had snow all over the place so that makes us all look like we are a lot smarter,” said Mike Harttrup, director of telemark and alpine touring at K2 Sports.

Several exhibitors remarked on how impressed they were with the All Mountain Demo, which was moved from Snowbasin to the Solitude Mountain Resort within a half hour of the Salt Palace that hosts the show. 

“Moving it to Solitude made a big difference,” said Scott Deur, North American sales manager for Genuine Gear Guide (G3), which was completely sold out of skis and probes by the time of the show and is now building skins to order after exhausting its inventory.
The Vancouver, BC-based company returned to the show after a one-year hiatus, during which it tried to service its dealers individually. “We were slammed,” Deur said of the demo, noting he had booked appointments with more than 100 dealers.

Many executives that spoke with The B.O.S.S. Report indicated that skis, boots and bindings were selling through at good prices and margins because dealers cleared out carry-over inventory last winter and manufacturers are offering little to no close-outs this year. That may point to strong preseason orders for the 2011-12 Fall/Winter season.  It looks like there was little left on the floor leading in President’s Day weekend, historically the key weekend for seasonal inventory.

“I think the industry will exit the 2010, 2011 cleaner than it has been in my lifetime,” Black Diamond Inc. President and CEO Peter Metcalf told analysts in an earnings call last week. “And, I don't think that's an exaggeration. People have been more cautious because of the 2008, 2009 economic implosion, a couple of bad winters and this year has been good. It's been good globally. And, the supply chains are very clean.”

In recent years, ski makers have become much more disciplined and rational about ordering and managing inventory under a new set of “more rational” owners, Metcalf said. That has created a healthier dynamic for vendors and dealers alike.

“Yes, we wish we had, had some more product in key categories and key models,” Metcalf said. “But, at the same time, it sure feels good to have people wishing they had gotten more product from us and it helps with the pre-season ordering cycle that we're in now and I think it helps actually train the consumers, which is very healthy, to buy before New Year's if you want to get your coveted ski or boot.”

Several factors are driving growth. First and foremost, as usual, has been the weather. Second has been the improving economy, which has prompted the affluent-skewing ski crowd to resume spending on gear and travel after a two-year hiatus. Hard core enthusiasts and younger skiers, meanwhile, are responding to rising prices for lift tickets by heading for the sidecountry and backcountry in growing numbers. This continues to fuel sales of not only freeride gear, but has also led to a resurgence in cross-country skiing and stoked interest in Randonee racing and uphill skinning for calisthenics in the United States, said G3’s Deur.

Another factor driving sales has been technology and innovation, which accelerated with the introduction five years ago of the Marker Duke binding that allowed North America’s alpine skiers to access the side country and backcountry powder with an unparalleled feeling of confidence, comfort and safety.

“In the last two years the technology has changed so much,” said Chico Bukavansky, national sales manager for park and accessories maker Dakine. “There are a lot or reasons to upgrade.”

Blurring of the lines between resort and backcountry skiing remained a strong them at the show with the most striking example being Black Diamond’s announcement just weeks before the show that it would become the lone hardgoods sponsor of the Subaru Freeskiing World Tour in 2011.  Several industry sources said they were surprised by the announcement and one alpine retailer even called it “bizarre.” Another example was Marker-Volkl’s decision to exhibit at the show for the first time. 

Up until the introduction of the Marker Duke binding five years ago, North America’s backcountry skiers relied predominantly on European style bindings like the Fritschi, which were designed  to be light and fast for alpine touring (AT) and Randonee racing. To cater to American backcountry skiers, European companies began beefing up their AT/Randonee bindings to handle aggressive downhill runs.  Marker, by contrast, started with an alpine binding and strived to make it lighter for touring, i.e.; skinning up hills to reach the “virgin pow-pow.”  This gave American freeride skiers the “torsional rigidity” they needed to handle jumps and extreme descents in the backcountry of places like Jackson Hole, Snowbird and Whistler-Blackcomb. Beefier backcountry boots soon followed with the result being that it is now common to see fat skis not only in the backcountry of the Rockies but on the showrooms of outdoor retailers.

“If you were an alpine skier, you had to drastically lower your expectations because the bindings and boots were inferior,” said Mike Hattrup, K2’s director of Telemark/Alpine Touring. “The Fritschi binding was the first one you could put an alpine boot in, but with the Marker Duke there is zero sacrifice in performance.” 

Many of the new products at ORWM last month were again aimed at the sidecountry market, which is drawing resort skiers. These skiers rely on lifts to get up the mountain, do minimal skinning and therefore require different gear.

While they still must carry a safety kit – shovel, probe and beacon – they don’t need to carry as many extra layers, food or water. Vendors are responding by trimming down packs that minimize discomfort on the lift, and using more carbon and new resins and designs to shave grams off their skis, boots, bindings, probes and shovels.

Also driving the inevitable move toward smaller, lighter, faster is growing competition for space inside the pack, which is getting fiercer with the emergence of float bags. These safety devices could be heard hissing across the floor in product demos throughout the show and seem well on their way to become standard equipment.

While U.S. companies introduced bags in well below the $1,000 price range charged by many European brands, look for float bags to take more of wallet and pack share going forward.  The trend is already causing vendors to pack more features and functions, like inclinometer, rulers and emergency litters into ski poles and other gear. 

While AT/Randonee gear skewed toward getting skiers between huts as quickly as possible, North American-style freeriding gear skews toward enabling skiers to bomb downhill. This is causing iconic backcountry brands like Black Diamond Equipment, G3, Garmont, SCARPA and Dynafit to move toward the alpine world with fatter, twin tip skis, beefier boots or stouter bindings, while the alpine brands focus on shaving grams off their gear. Some say, U.S. designs are now clearly driving Europe’s freeride market.

It will be interesting next season to see how outdoor specialty and alpine shops carve up the booming sidecountry business going forward. Many resort alpine shops are now carrying backcountry safety gear and brands and many outdoor shops are increasingly carrying fatter, early rise, reverse cambered skis.

“We’re entering that market more just because that's what the manufacturers are offering,” said Scott Cahoon, operations manager for Cole Sport, which operates four alpine shops in Park City, Utah. “All the traditional alpine boot companies now have backcountry/sidecountry boots.”

This winter, Cole Sport began carrying Black Diamond skis and committed to safety gear in a much bigger way. The retailer sold through most of that gear by Christmas and has been chasing it ever since.

“My kids ski Snowbird, but they may go out of bounds once in a while,” noted Cahoon. “That's who we are going after. We are not going after the guy who is parking on the side of the road and skinning up.”
For more on the snow sports coverage at OR Winter Market, look for next week’s issue of The B.O.S.S. Report.