Hey! Look at All the Retailers! Good News From Vegas

Flying in from ASR in Long Beach, where the consensus was that the number of retailers was down significantly, it was a relief to get to the SIA show in Vegas and see the place jumping. It was simply the best show since some time in the mid 90s. Not just by energy level but, in my perception, business being done.

 How come? What happened? When there are still too many trade shows back to back to back, and the economy is soft, how did SIA and the snow sports industry manage to pull this off?
Uhhhh, well, actually, I don’t know for sure and I don’t think anybody else does either, but let’s explore some of the factors that may have made the difference and see what they might mean for snowboarding.
New, New, New
I guess we start with the new location. The food was better, the accommodations more convenient, the walking easier, the ride from the airport shorter, and the smaller footprint helped keep it exciting. Like in your high school physics class, when you compress molecules into a smaller space, they move faster.
It even kept it exciting, more or less, all over the show. Use to be that all the energy was in the snowboard section and up in the ski part of the show, nothing would be going on. But this show, for the first time ever in my memory, there was even some buzz, and apparently some retailers, in the nonsnow board part of the show. This extended beyond the couple of ski booths, like Line, that had a distinctly snowboard feel to them.
Product was new too. Oh, not so much new technically, but because of the earlier show date, most people, especially from the non chain retailers, are seeing product for the first time. That can generate some excitement.
There were perhaps a half dozen new, or recently arrived, small snowboard companies. There’s been lots of talk (some in this column) about the opportunity that smaller brands may have. Their arrival suggests a level of optimism and enthusiasm for the snowboarding business that may be stronger than it has been over the least couple of years. I don’t want to underestimate the business challenges they face, but I sure want to see them succeed. One of the reasons they may is that they seem more business focused than most of the many new brands that popped up eight to ten years ago.
One of the things that caught my eye was the quality of the decks’ fit and finish. Graphics, in a word, were generally spectacular. We went through a period of year where graphics seemed kind of taken for granted. Now, with functionality being so good for all brands, graphics may emerge again as a basis for product differentiation.
Nitro had a level of detail in its graphics that required a close look and careful study if you didn’t want to miss any of the points of interest and, in some cases, sheer fun that long time Nitro designer Mike Dawson had included. Arbor combined their traditional wood with eye catching screened graphics on certain models in a way that I thought gave their original look a run for its money. Volkl had a finish with two textures that made you stop and figure out what you were touching as you ran your hand over the board.
New exhibitors like Volcom added their unusual presentation and irreverence to the mix. I’m glad I didn’t have to clean up all those tortillas.
Also new was a four day show, after five days in recent years. Obviously, if you squeeze the same number of retailers and business meetings into four days instead of five, things will look busier even if the same amount of work gets done. I’m okay with efficiency- how about three days next year SIA? How long did retailers really stay at the show?
Trade Show Politics
The retailers (and the brands for that matter), have more trade shows than they want or can possibly attend. Organizations being the way they are, the companies that put on trade shows are going to keep putting on their shows and hope the other guy goes away. From what I’ve seen and heard at other trade shows this trade show season, SIA seems to be the one that gets to hang out and say “Our show rocks! And yours doesn’t.” That means, I guess, that any talk about snowboard companies exhibiting at ASR instead of Vegas won’t be more than talk. It probably never would have been anyway. Even if the snowboard companies are soul mates to the skate and surf companies exhibiting at ASR, they have to do business with the many ski shops that come to Vegas but not to ASR.
SIA’s successful show might also put them in a better arrangement to negotiate a merger with Outdoor Retailer, with whom I hear they overlap a day next year. A number of people I talked to about trade shows in general suggested that would be the best thing to do. But there’s still the same problem that existed last year when the two organizations talked about some kind of merger. OR is for profit and SIA isn’t. How you negotiate starting from those two completely different perspectives continues to be beyond me.
Business Trends
The earlier show dates are consistent with the strategy I see snow retailers pursuing in their purchasing. Either because they are smarter, the economy is soft, boarders aren’t buying new stuff as often, or because the brands will tend to let them get away with it, snowboard retailers are going to be continuously cautious in their ordering. I expect to see preseason orders for basically what they think they can sell through Christmas and maybe a little beyond. Then they can come to Vegas and get any end of season products they need at better prices.
Some brands have said they will only produce to preseason orders, with the usual increment for team, warranty, demos, etc. So some retailers may find they can’t fill in after the holidays with the product they want.
I don’t see selling product at large discounts after January 1 as a big money maker for anybody- especially for brands who paid preseason order prices for product. Maybe the best thing that could happen to the industry is if there was just a bit of product scarcity from time to time. So I hope the retailers are cautious in their ordering and the brands are cautious in their production. That would be the best for the snowboard industry overall.
In another outburst of raging optimism, I’m hopeful that the quality of the show is at least partly the result of all the time, effort and money that the whole winter sports industry, especially the resorts, has spent on programs to improve facilities, the learning experience, and the overall customer experience in the last five to eight years. That has got to be having a positive impact, and maybe we’ve seen it at the show for the first time.
One other thing I’d like about the early show as a brand, or at least as the finance guy for a brand, is the ability to deal with retailers who haven’t paid me in January instead of March. In January, you can have the, “Well, we’d like to take your order and give you the show and preseason discounts, but we need to clean up this old receivable first” conversation with a higher probability of success than in March. Receivables that are open in March and April tend, in my experience, to be receivables you don’t collect until it’s time to ship next summer/fall if then.
Finally, this was a busy, upbeat, exciting show. But it wasn’t that way, like in some previous Vegas shows, because of people who snuck in for the vibe or companies thrown out for various amusing behaviors. It was like that because the snowboard business community was excited to be there, to see new products, and to do business. That’s good to see.
My Quandary
Well this is kind of a problem. I’ve gone and written an unabashedly upbeat, glowing and positive article about the show and the prospects for the industry it seems to represent. This is going to ruin my reputation. I’ve got to complain about something.
Ah! The signage sucked. You couldn’t find your way around. I spend the whole time looking at the damn map and even that didn’t help. I’m going to call SIA President David Ingemie and asked him how come that was so screwed up.
Oh dear. Turns out they did it on purpose. David points out that the aisles and signage in a department store are laid out to “encourage” you to see more product in more locations, and they did the same thing at the show. He did agree that the restroom signs needed to be a little easier to see. I imagine I’m not the only one who noticed that problem.
Okay, I guess I might as well drink the Kool Aid here. I shouldn’t be this easily seduced by one good show, but I have some hope that a confluence of events in retailers, resorts, and brands may mark a turning point for snowboarding and the winter sports business in general. Perhaps business cycles are longer than we think. We didn’t just need to consolidate, but to get over and come out of it. Ski and snowboard had to, in some sense, come together. The large brands had to solidify their market positions to make room for smaller ones to emerge again. Retailers had to start and do better business and those that didn’t had to go away. Resorts had to give their customers a better experience.
The retail numbers don’t necessarily support this kind of perspective- at least not yet- but in a soft economy, I’m willing to see the glass half full instead of half empty.