Let’s face it, 2016 was a really challenging year for many in my circle of friends, colleagues and the industries I work in. We all realize that in the particulars of challenge are the seeds of opportunity… but as one mentor and great friend put it, ‘after this year, I feel like a boxer in the 15th round, bloodied and beaten up, about to head out for more’ (paraphrased). Whether the loss of other mentors (I’ve lost 3 this past 18 months), or the fast-changing landscape of events for the industry, or the pace of change in technology affecting specialty retail and media (including trade shows/business events), it’s definitely been the Year To Blame for all the world’s ills.
To quantify a bit, although on the surface retail sales were comfortably strong (4.2% ish growth YTD), retail sales were slightly anemic and worse in Sporting Goods (NRF recent report here). It is notable that in 2016, both Sport Chalet (47 stores) and The Sports Authority (463 stores) disappeared from the retail landscape.
Maybe 2016 will be remembered as the year Tights finally actually became Pants for real, or the year ‘Unpresidented‘ accidentally described our election process, or something other than the year of intense personal loss. If you are interested in those stories, you’ll have to search elsewhere (or just click the links, silly). This is my business blog that focuses on issues affecting our industry of outdoor recreation, our remaining wild places, human gatherings and the people who explore them. So here are some quick trend mentions as we hurtle into 2017 with a bullet.
NEW EVENT STYLES EVOLVING – 2016 is definitely the year that big, traditional trade shows dropped in on the wave set of significantly earlier dates, ostensibly to match better the production cycle of the complex supply-chain equation for apparel and footwear. At the same time, smaller, focused and targeted events gain ground and bring new models to bear on markets searching for streamlined solutions across their operations as brand stories become more and more important to the end consumer.
NEW TECHNOLOGIES – this ad says it all (almost) – from disruption in ride-sharing, point-of-purchase and transaction security, electric and autonomous vehicles, wearable tracking and measuring devices, to heat maps for events and matchmaking software, new tech is a must-pay-attention-to for every business, period. More on this as we enter 2017 and CES and other shows go deeper into the category.
NEW CATEGORIES AND PRODUCT INNOVATION PIPELINE – Almost in direct opposition to the ‘commit 9-12 months in advance’ momentum driven by supply-chain dynamics, new solutions for speed-to-market and rapid prototyping design techniques shorten the time and distance to the end consumer. Whom, by the way, has more options and intel than ever.
DATE CHANGES first SIA (later rescinded), then OutDoor Europe, Eurobike, then Outdoor Retailer/Grassroots, and still more to come. The entire constellation of events relevant to businesses in outdoor recreation will continue to shift until a ‘new normal’ settles in. New events will no doubt spring up to capture the void left in the ‘Just In Time’ window, which will expand as consumer demand drives the recreation economy more (and the supply-side, less).OutDoor Europe started the exodus from July/August, even though SIA announced an early move but soon rescinded after some serious pushback. Eurobike and both OR shows followed suit, and only Surf Expo and Interbike have yet to announce any changes in the ecosystem of relevant shows to the outdoor recreation business ecosystem.
CHALLENGES TO PUBLIC LANDS – This should be in the below ‘things not changing’ but with the lineup of the new administration taking form, I had to put it up here. Our public lands outlook has been existentially threatened by privatization efforts of the Republican party platform, to cede lands to ‘states and local management solutions’. They are now the party in power across both houses of Congress and the Executive Branch. Don’t think it’s going to be much of an issue? See posts from Outdoor Alliance, Outside Magazine, Access Fund and National Geographic and stay heads up on this critical topic in the weeks/months ahead. and THIS JUST IN on Bears Ears National Monument! No doubt the challenge will be on in 2017 but kudos for the President to lean in, and even include Climbing as a named recreational activity appropriate in National Monuments.
INTERNATIONAL RELATIONS AND TRADE – This also had to be lifted up as a significant change factor looking ahead… not only are we feeling the shift of manufacturing from China to other regions (India, Vietnam, Eastern Europe), but the new administration is signalling significant changes or elimination of treaties and agreements like TPP(Trans-Pacific Partnership). Not that trade will diminish with other regions and countries, but it will for sure become more contentious unless the administration dramatically changes from it’s current rhetoric.
Some things not changing much in 2017 are
THE IMPORTANCE OF INDEPENDENT SPECIALTY RETAIL – Though it’s common to under-estimate and write off this category of business in Outdoor, the strong stores are getting stronger, tools for using big data and sophisticated marketing are scaling down to small and mid-size retailers, and much of the weakness has already quit the market. Simultaneously, trust in mega-businesses like Wal-Mart and ‘the Zon’ are eroding and pushing consumers to local solutions. There are still challenging headwinds but you can read the tea-leaves in the current maneuvering of my alma-mater Outdoor Retailer, or any number of super strong brands like TNF and Columbia Sportswear. Specialty Retail deserves support and is getting it.
THE NEED FOR BUSINESS PEOPLE TO MEET FACE-TO-FACE – This is back to Dr. Michio Kaku’s ‘Caveman Theory‘ of social science… if you want to know how people will behave now, look back 10,000 years and try to understand that. Because our behavior is very much based in our genetic foundation and we are a social creature, craving contact and connection to others in our Tribe.
CONSUMERS HAVE MORE INTEL AND BUYING OPTIONS – Formerly known as ‘showrooming’, this phenomenon is just getting started… as consumers have instant access to gear reviews, opinions and direct information about brands’ support systems and connections, buying will morph into an increasingly quick assessment of a product’s ‘total story’, a mix of measures curated by the consumer that reflect what the important priorities are and how any particular product ‘stacks up’. Think of it as the ‘HIGG Index’ for all measures important to consumers. It’s coming.
So, with that out of my system, let me say a swift ‘Adieu!’ to 2016, with a bullet. And a hearty welcome to 2017 and the wonders it will bring to us all in this ‘time of miracle and wonder‘ (from 1986, my first full year in the outdoor industry, when I met my wife Susan and the year I graduated as a UCLA Bruin). Safe travels and Wicked Good Adventures to you all, and most of all thanks for lending an ear to my voice!
p.s.- OK it wasn’t a complete shit-show in 2016, despite the loss of so many mentors and disruption in the market of outdoors. Here’s some images that tell the positive side of 2016 from our lens here at Kenji Consults