MONTEREY, Calif. (BRAIN)—The message to retailers is simple: Embrace changes in the marketplace, especially consumer fixation with e-commerce, or your business could be in jeopardy.
That was the focused message from three panelists — consumers want to shop when they want, where they want and how they want. And specialty retailers can no longer ignore the shift, three panelists told attendees at the Bicycle Leadership Conference.
Tom Barney, the former CEO of Osprey, summed up the changes this way: There is a real and permanent shift in consumer behavior and the delivery of products. And, he added, "don't resist, engage."
Elysa Walk, Giant's former general manager and now Burton Snowboards' general manager of the Americas, said she was taken aback at the number of channels that Burton was selling boards, apparel and accessories through. "It took me a day-and-a-half to realize we have to have a multichannel strategy that goes to straight to consumers who now shop anywhere at anytime," she said.
The challenge for vendors, she added, is maintaining a consistent brand presentation throughout all channels.
And Steve Meineke, the former president of Raleigh USA who recently stepped down as president of Keen footwear, said that whether you're a vendor or a retailer, build a "pathway to the consumer." And, he added, "get digitally competitive really fast."
While all three recognized the rapid changes ongoing in the market, Barney said direct-to-consumer models in the outdoor industry have faced their share of issues.
The pursuit of digital growth has been indiscriminate and an individual pursuit. Few accommodations have been made for reps and retailers as vendors shift online. And there are increasing questions over the true value of store-level e-commerce sites.
From a financial standpoint vendors are not sharing margin with their retailers, price promotion undercuts brick-and-mortar dealers, and inventories originally ordered by retailers are in some cases getting redirected to vendors' retail websites, Barney noted in a series of slides he used to make his points.
The question Barney raised that the outdoor industry faces is will the need for an independent dealer network and the benefits of local representation offset the shift and financial impacts of vendors selling direct to consumers?
Meineke voiced the same general concerns. The industry is in the midst of destabilizing change, and digital communication is driving the transformative changes.
"It's the consumer first, and we need to find pathways to the consumer," he said, pointing out that e-commerce now accounts for 12 percent, or $340 billion, in U.S. retail sales. And it's growing. For example, sales through outdoor specialty retailers grew 3.2 percent last year, but specialty e-commerce grew 7.2 percent.
Today's consumers are "channel agnostic," and success depends on innovation, marketing and communication. "The real math has not changed — innovate product and connect with consumers," Meineke said.
But Walk pointed out that despite Burton's aggressive play online, retailers tied to Burton and who are focused on building their own brand will succeed.
"Burton gets the hate mail, the threats — that we've lost our soul selling online — but these are retailers hanging on by a thread. But Burton isn't the predator as some dealers think. We're just not taking a lot out of dealer sales," she said.
Then she flipped to a slide of Burton's "Beeracuda," a sling filled with beer cans. At $24.95, it's the company's top seller online.