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Tuesday, May 29, 2018
Volume 2, Issue No. 21
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Mon, Aug 28, 2017
Vol 1, Issue No. 33

New Licensing Jackpots May Be on the Horizon

Photo: Michael Miller, via Wikimedia Commons

Heading into last night’s Game 7 match-up of the Western Conference Finals between Houston and Golden State, the NBA and NHL were drawing fan and mainstream interest not seen in recent seasons. For the first time in 39 years, both the NBA’s Eastern and Western Conference Finals reached the full seven games. In the East, Nike’s marquee basketball endorser LeBron James cemented his legacy as a basketball legend with his eighth consecutive trip to the NBA Finals by seemingly singlehandedly helping his Cleveland Cavaliers overcome a two games to none deficit and defeat the young, rising stars of the Boston Celtics, four games to three. Nonetheless, he heads into the championship series as a decided underdog as his Cavs face Steph Curry’s Warriors for a fourth consecutive season. But it’s likely even casual basketball fans will be tuning in to see if James can defy the odds and win his fourth championship in nine attempts. And that should be good news for Nike’s NBA licensed and basketball shoe businesses. 

In hockey, the storyline drawing surging interest in licensed gear is the underdog Las Vegas Golden Knights, who won the first game of the Stanley Cup Finals last night against the Washington Capitals. The first-year expansion team and Sin City’s first professional franchise faced 250-to-1 odds to capture the Western Conference title and 500-to-1 odds to win the championship when the season began. The team’s Cinderella story has helped it become the NHL’s top team in merchandise sales and is helping the city’s recovery from the Harvest Festival shootings, much like the NFL’s Saints lifted a reeling New Orleans four years after Hurricane Katrina; the MLB’s Red Sox carried the “Boston Strong” mantle after the Boston Marathon bombings with their improbable 2013 World Series win and the Houston Astros won a World Series championship last October in the aftermath of Hurricane Harvey. Genesco-owned Lids, which has 21 Las Vegas locations, recently confirmed that the Knights’ postseason sales volume has been the best among all NHL clubs. 

More Licensing Buzz: NFL, MLB, Nike, Under Armour & Fanatics
Other news on the licensing front last week involved the NFL, MLB, Nike, Under Armour and Fanatics. Under a 10-year partnership that commences in 2020, Fanatics grabs exclusive consumer product licensing rights to make and distribute all Nike NFL adult products sold through retailers, including, individual club shops and brick and mortar locations. With the exception of headwear, Nike retains its status as the exclusive on-field supplier of uniforms, base layer and sideline apparel for 32 NFL franchises. NFL product will continue to be available at and in Nike retail outlets.

Meanwhile, the Sports Business Daily and CNBC were among the first to report that Nike is jockeying for Under Armour’s 10-year on-field apparel rights with the MLB that is slated to begin with 2020 season and replace Majestic as the on-diamond uniform brand. None of the parties, including the league, have yet to comment publicly on the expected change. But the SBD reported that it would likely be officially announced around the MLB All-Star Game in mid-July and was prompted by a UA decision to withdraw from its league contract and save approximately $50 million.

Retail Round -up
Kohl’s Goes All in with Active

Photo: Mike Kalasnik from Fort Mill, USA, Wikimedia Commons

The 1,100-door department store chain, under new CEO Michelle Gass, is pleased with the ongoing growth of its Active segment, including a 10 percent sales increase in the first quarter. In August, KSS intends to test a new active and wellness presentation in 30 doors with a 40 percent increase in dedicated square footage and nearly 50 percent more SKUs. 

“To think about our overall strategy and really where Kohl’s can set itself apart is we think about it as both active and wellness,” Gass told analysts last week. “…And we feel like we’re uniquely positioned because it’s for the whole family. So we’re seeing active growth across the board in men’s, women’s, home, footwear and kids…People aren’t using these products just to work out any more. There are living in them. So that gives us a broad permission to really expand the category.” 

The expanded Active presentation test at Back-to-School, with more space for additional brands, is expected to provide Gass and other Kohl’s senior management with insight on how far it will roll out and scale the segment in its stores. National brand sales rose 6 percent in the first quarter ended May 5, bolstered by strong results from the banner’s top three active brands—Nike, Under Armour and Adidas.  

Elsewhere, KSS realized a nearly 20 percent increase in first quarter digital sales with mobile representing more than 70 percent of digital traffic and nearly half of digital sales. Recent enhancements to the digital experience include a feature that shows the customer the “net price” after promotions and another that incentivizes customers with “Kohl’s cash” to pick-up their orders in-store. Earlier this month, Kohl’s began the conversion of 200 stores to smaller footprints with the additional space dedicated to a complimentary business with its own entrance. The project will continue through the third week of July. Meanwhile, an eight market, 100-store rollout of a next-generation loyalty program will go chainwide sometime in 2019.  

Foot Locker Taking Hyper Local Approach

Foot Locker is working on a new store concept, with a hyper local approach. Picture above circa 1980's.

Foot Locker, positioning itself for a steady stream of fresh, new products for the remainder of the FY by proactively managing inventory (It declined 5.4 percent in Q1 as total sales rose 1.2 percent.), is working on a number of new store and digital initiatives. Among them: “Power Stores,” a concept to inspire and build community with a hyper local approach that promises to “deliver premium products and experiences” that will debut in London and Liverpool, England over the summer before being expanded to the U.S. later this year. Also on tap: More off-mall format tests and the migration of all the retailer’s websites to a common platform that will focus on both consumer-facing looks and back-end changes that will enable subsequent alterations to be made more easily and efficiently.  

For the full year, the retailer, which currently counts nearly 3,300 company stores worldwide and a Q1 cash stash of $1.29 billion, is forecasting “flat to a low single-digit” sales gain. In Q2, FL is forecasting 20-50 basis point improvement in gross margin, bolstered by an improved product flow that should also help with the recovery of merchandise margins.

In the first quarter, there were bright spots despite an overall 2.8 percent decline in comparable sales fueled by a low double-digit comp decline at Foot Locker Europe. Kids Foot Locker generated a high-single digit comp gain on improved availability of premium styles and kids’ sizes. Meanwhile, Foot Locker U.S. and Eastbay posted low-single digit comp improvement. On the footwear side, Nike Air Max products, Jordan Retro, Nike Air Force I’s and Vans drove results in the U.S. Within apparel, the strong gainers were Adidas, Nike NBA, Nike T-shirts, Brand Jordan and Champion.

Deckers Brands Still Eyes 2020 Targets

DECK, coming off a strong FY18 that was bolstered by a cold winter that had a positive impact on its brands, intends to rationalize its brick-and-mortar and online wholesale accounts for its UGG brand this year as it continues to invest in its Hoka One One brand. Also, the current FY strategy will focus on tightening international distribution for the Teva and Sanuk brands to help return both labels to top line growth. In total, the changes planned for UGG should negatively impact the brand’s revenues by approximately $50 million as Hoka grows in the mid-20 percent range, bolstered by U.S. and international expansion. In total, the company is forecasting 2 percent top line growth in FY19 following a year where annual revenues increased 6 percent to $1.9 billion.  

“We still think we can exceed the 2020 targets of $2 billion in annual revenues and a 13 percent operating margin, and we’re tracking toward that,” President and CEO Dave Powers told analysts last week. “But we’ve taken this opportunity this year to be realistic and smart about the distribution of the inventory.”

In the recently completed FY18, UGG sales, fueled by international wholesale and global ecommerce, rose 4 percent to surpass $1.5 billion. HOKA, which recently launched collaborations with Outdoor Voices and Engineered Garments, generated a 47 percent revenue increase to $153 million as U.S. wholesale improved nearly 40 percent. DECK sees Europe as the largest near-term growth opportunity for the brand. Elsewhere, Koolaburra sales more than doubled over the 12 months to $18 million, and Teva sales rose 13 percent to $134 million on high-teens growth in U.S. ecommerce.

Dr. Martens, Carhartt Land New Executives

U.K.-based Dr. Martens, controlled by Permira Funds since 2013, has hired retail executive Kenny Wilson as its new CEO. Wilson, a former 19-year veteran of Levi Strauss where he rose to president of European operations, comes to the industrial footwear brand from Cath Kidston. During his seven-year tenure at the British specialty retailer, Wilson expanded the brand’s international business while reportedly growing total revenues to more than $170 million. At Dr. Martens, he takes the helm of a brand with 95 stores worldwide and 56 licensed shops in South Korea.

Janet Ries, new VP of marketing at Carhartt.

Meanwhile, family-owned workwear brand Carhartt, approaching its 130th anniversary in 2019, has hired Janet Ries as VP of marketing. Most recently, the industry veteran of more than two decades implemented a newly-structured integrated marketing practice for the Rockport brand. Prior, she served as senior marketing director for fitness & training at Reebok. At Carhartt, Ries will report to Tony Ambroza, chief brand officer of the Dearborn, MI company.

At JC Penney, Marvin Ellison, CEO since 2014, is departing to become CEO at Lowe’s in July. He previously worked for Home Depot.

The Buzz

’47 Founder Arthur D’Angelo, who owns The Souvenir Store across from Fenway Park, is named the first “Special Achievement” inductee into the Boston Red Sox Hall of Fame.

Riddell launches its InSite Training Tool (ITT), a web-based data center that collects and analyzes on-field head impacts. ITT is the newest platform in the brand’s InSite impact monitoring platform that uses data collected from more than 5 million impacts gathered from a decade of on-field monitoring. Colgate University began using ITT during its 2018 spring football practices. Currently, more than 1,000 youth, high school and college football programs in the U.S. are using InSite.

RYU Apparel, which generated 94 percent revenue growth in the first quarter to nearly $908,000, intends to have eight retail stores opened by year-end, including Brooklyn, NY and Los Angeles. The brand has secured strategic wholesale account status with Nordstrom, Equinox Canada and Rise by We.

Shoe Carnival, which experienced a mid-single digit comparable increase in athletic shoe sales during the March-April timeframe, is reducing its number of projected store closures this year to 20-25 from 25-30 due to improved store performance and better terms with certain landlords. Openings will be in the low-single digits.

Sportsman’s Warehouse now has more than 1.6 million loyalty members after 27 percent program growth in the first quarter. The 89-door specialty chain enjoyed 3.4 percent growth in comparable store sales, which includes ecommerce, in the first quarter helped by strength in firearms and ammunition. SPWH has expanded its online assortment in numerous categories through drop-ship programs with vendors with more slated to come onboard in the second quarter.

Tubes of the Week


Numbers In Play
The Sports Insight Index is our opinion of what we think are the 30 most important public companies in the industry, 15 vendors and 15 retailers. Space considerations prevent us from tracking more, but we will make changes over time.
Index base of 100 is key to the closing prices of 12/31/14
Segment falls less than 1 percent for the period, with 10 stocks up and five down, as the Dow gains less than a half percent. Sportsman’s Warehouse reports a 17.5 percent rise in comparable firearms sales in Q1 and a 14.9 percent increase in unit sales as it continues to gain market share in the category. Genesco-owned Lids is reportedly forced to abandon an online ad campaign that used the U.S. Marine Corp. name. Shoe Carnival reports a mid-single digit increase in athletic sales for the March-April period as says trend, “shows no sign of slowing down.” Chain is preparing to launch a vendor drop-ship program to broaden the selection currently available at its website. Kohl’s is going bigger with Active & Wellness (see story above), and Sports Direct takes a hit in the United Kingdom over changing rooms that are said to be unsuitable for female customers trying on swimwear. Hibbett Sports said 58 percent of first quarter sales were generated by loyalty members versus 53 percent in the year-ago period. HIBB, which closed 18 underperforming doors in the first quarter, says it will continue to optimize its 1,068-store base to improve its Return On Invested Capital (ROIC).
Segment lifts more than 2 percent after gaining nearly 3 percent last week as 11 stocks rise and four decline. Deckers Brands-owned Teva generated 13 percent revenue growth in FY18 due to high-teens growth in the U.S. and higher ecommerce sales. UGG sales, meanwhile, cracked $1.5 billion for the 12 months with international wholesale and global ecommerce accounting for the majority of the gain. Ahead of the World Cup that commences in Russia next week, Quartz Africa reports the Nigerian Football Federation received three million pre-orders for its Swoosh-adorned kit that goes on sale today (May 29). Under Armour is launching a signature shoe collection around Dwyane “The Rock” Johnson, according to the Bleacher Report. Adidas Canada intends to shutter its team manufacturing unit in the province of Ontario at year-end. The facility, established in 1977 and purchased by Adidas 10 years ago, makes sports jerseys.





Retail Name (Ticker Symbol)
Close on 05/17/18
Close on 05/24/18
% change over week
Big 5 Sporting Goods (BGFV)
Sports Direct (LON: SPD)
Camping World (CWH)
Dick's Sporting Goods (DKS)
Finish Line (FINL)
Foot Locker (FL)
Genesco (GCO)
Hibbett Sports (HIBB)
Kohl’s (KSS)
Macy’s (M)
Sportsman’s Warehouse (SPWH)
Shoe Carnival (SCVL)
Tilly’s (TLYS)
Walmart (WMT)
Zumiez (ZUMZ)
Brand Name (Ticker Symbol)
Close on 05/17/18
Close on 05/24/18
% change over week
Acushnet Holdings (GOLF)
adidas (ADDYY)
Amer Sports (AGPDY)
Callaway (ELY)
Columbia Sportwear (COLM)
Deckers Brands (DECK)
Fitbit (FIT)
GoPro (GPRO)
lululemon (LULU)
Nautilus (NLS)
Nike (NKE)
Skechers (SKX)
Under Armour (UA)
VF Corp. (VFC)
Wolverine Worldwide (WWW)

Sports Insight Extra Podcast Series

Nikki Barua

The old way of retail is dead, and there is a massive opportunity to re-invent, proclaims the CEO of Beyond Curious in Los Angeles.

Matt O’Toole

President of Reebok dishes on the brand’s mission and objectives from its headquarters in Boston.

Gabriella Santaniello

Retail expert dishes on what’s going right and wrong in industry today and weighs in on the Walmart vs. Amazon tussle.

Guy Yehiav

The CEO of Profitect addresses the right medicine for changing the paradigm of accountability—prescriptive analytics.

Pat Ryan

Batter Up! The global product director for baseball/softball at Wilson Sports details the new USA Baseball standard that took effect January 1 and what it means when you hit the store this spring looking for a new stick for junior.

Patrick Clark

President of Nextwave, a Buford, GA system integrator, discusses benefits of an on-demand apparel microfactory, a bridge to Just In Time manufacturing, from Sourcing at MAGIC in Las Vegas.

Shawn McBride

Ketchum Sports & Entertainment EVP talks Olympics—impact of three consecutive Games in Asia, social media, corporate guerilla marketing and drawing in younger consumers.

Tyson McGuffin

Tennis pro Tyson McGuffin, 28, talks about the rising popularity of pickleball and how he became a champion in the sport.

Bob Mullaney

The 20-year shoe and retail industry veteran, recently named president and CEO of RG Brands, dishes on the comfort footwear business and Barry’s iconic Dearfoams brand.

Bob Smith

The design consultant who began his 20-year career as a graphic artist for Nike dishes on the blur between lifestyle and performance and the importance of Struktur, the creative conference for active, outdoor and urban design.

Rob & Mike Barnes

The co-founders of Selkirk Sports, a Hayden, ID maker of Pickleball paddles and accessories, dish on the rise of the sport that counted 2.5 million participants in 2015.

Brendan Candon

CEO of SidelineSwap, an online marketplace for used sports gear and equipment, dishes on the market and whether it steps on the toes of traditional, full-line retailers.

Dave McGillivray

The long-time race director and long-distance runner weighs in on marathon participation, the future of event marketing and his latest venture that may bring a marathon to a MLB ballpark near you.

Paul Froio

Reebok’s VP of U.S. Retail and Direct-to-Consumer channels talks about the company’s new South Boston headquarters and adjacent global flagship store.

Aquiles M. Bermùdez P.

The former president of the Dominican Association of Free Zone Companies and current member of the National Commission of Footwear addresses the industry, Dominican Republic’s infrastructure and Footwear Technology Institute.

W. Andrew Martin

The managing director for Baird in Charlotte, NC discusses the M&A climate, consumer loyalty to brands today and the impact of private label.

Mark Sullivan

The president of Formula4Media, LLC previews The Running Event conference and trade show set for November 28-December 1 in Austin, Texas.

Bryan Smeltzer

The general manager of Zamst Americas talks sports protectives, dispelling some of the consumer and athlete misconceptions about the category.

Emily Walzer

Formula4Media colleagues Emily Walzer, Textile Insight editor, Jennifer Beaudry-Ernst, footwear specialist, and contributor Kurt Gray, owner of SimplyGrayDesign, dish on key trends from the final Outdoor Retailer trade show in Salt Lake City.

Judith A. Russell

Shifting consumer purchasing patterns are vital to understanding today’s marketplace. Russell, a marketing and strategic planning professional, offered up her thoughts at TexWorld in New York on a panel with Sports Insight Extra’s Bob McGee.

Will Decker

Family-owned Silicon Valley firm Plug and Play, which dubs itself the “Ultimate Startup Ecosystem,” has raised over $6 billion in venture funding during its 11 years while bringing corporations, venture capitalists and start-ups together.

Matthew Lyon

In the fragmented hydration market, where price points for performance products are on the rise, HydraPak is an OE supplier to numerous brands and has its own lightweight, flexible products.

Eric Hayes

Superfeet Celebrates 40th Anniversary. The employee-owned company introduces footwear and rolls out a 3D printed insole program.

Shawn Neville

BOA introduces New Tech and Names New CEO. Nothing will constrict Boa Technology CEO Shawn Neville from helping the Denver company improve its customized fit solution.

Waingarten and Frydlewski

No strings attached. The married Argentinean couple has raised nearly $20 million for Hickies, a Brooklyn company addressing how athletic shoes are closed around the foot two eyelets at a time.

Michelle Carmichael

The Co-founder and Managing Partner of Partners Growth, which brings premium brands into the U.S. market, talks Finnish children’s wear brand Reima. 

Brian Beckstead

Six-year old Altra is teaming with Utah State University to develop outdoor design talent.

Declan Condron

Let's Go Hyperwear: Former Equinox personal trainer merges the innovative, functional fitness gear from Austin, TX company with programming for schools, camps and institutions.

Hugues Gontier

Sly and Simple. and its technology enable a retailer to interact with customers in store and track traffic. No beacon required. The CMO explains the benefits of the platform.

Reza Raji

The CEO of Xenio Systems talks about the company’s new platform that tracks where shoppers spend time in physical stores and its patented hyper-positioning technology.

Jacob Torres Espino

The director of export promotion for Mexico’s Guanajuato State government agency addresses the proposed impact of the Border Adjustment Tax by the U.S. and the possibility of a renegotiated NAFTA free trade agreement.

Isabelle Ohnemus

The founder and CEO of EyeFitU, a former investment banker, talks ‘glocal’ assortments, shoppers’ personal sizing and global web payment options.

Tom Cove #2

The president and CEO of the SFIA addresses the most serious threat the industry has faced in the past half-century and the expected re-introduction of the PHIT Act by Congress.

Matteo Scarparo

The Italian global trade expert in footwear talks about the present and future of TheMicam trade show and the potential impact of a Border Adjustment Tax in the U.S. on imported shoes.

Dr. James Eakin

Dr. James Eakin, chief marketing officer and director of U.S. operations for Xenoma, discusses the Japan company’s e-skin shirt and entire wearable category.

Rusty Saunders

Industry senior statesman Rusty Saunders dishes on industry leadership, pressing issues and the inactivity pandemic.

Barbara Barclay

Expert Barbara Barclay, president of RightEye, talks eye-tracking technology and her company’s recent alliance with Major League Baseball and USA Baseball.

Julie Sylvester

Julie Sylvester, Executive Producer at Living in Digital Times, talks trends likely to emerge at Sports and FitnessTech Summit at CES in Las Vegas.

Chris Palmer

Chris Palmer, Founder and CEO of BoxFox, talks excess inventory and solutions for vendors, retailers and distributors.

Susie McCabe

Susie McCabe, SVP of global retail for Under Armour who previously spent 16 years at The Ralph Lauren Corp., dishes on UA’s retail strategy and new Brand House in Boston.

Tom Cove

On the eve of Election Day, we talk to three leading industry lobbyists on how the results may impact trade in the sporting goods, outdoor and apparel and footwear industries.

Rich Harper

On the eve of Election Day, we talk to three leading industry lobbyists on how the results may impact trade in the sporting goods, outdoor and apparel and footwear industries.

Stephen Lamar

On the eve of Election Day, we talk to three leading industry lobbyists on how the results may impact trade in the sporting goods, outdoor and apparel and footwear industries.

Bill McInnis

The president of Reebok Future discusses the intent of the unit and the brand’s plans to develop footwear in a new way.

Tom Fowler

Polar USA CEO Tom Fowler talks technology and the future of smart wearables.

Paul Schille

TREW CEO Paul Schille dishes on the eight-year old company in the process of completing its Series A round of funding and his dual career.

Jason Kaplan

Milestone Sports CEO Jason Kaplan dishes on the company’s low-cost, wearable pod and how it will help specialty retailers connect.

Duncan Finigan

OOFOS marketing executive talks about the recovery footwear brand and candidly about her courageous personal health journey.

Matt Priest

Footwear Distributors and Retailers of America President Matt Priest the likelihood of the Trans-Pacific Partnership being passed soon.

David and Josh Higgins

ING Source executives dish about compression technology and the Hickory, NC company’s breakthrough OS1st Brace Layer System.

Charles Liberge

Jones & Vining’s Charles Liberge addresses strategies and directions for the iconic brand.

Jim Baugh

PHIT America’s Jim Baugh dishes on the inactivity pandemic.

Sue Dooley and John Daher

Rockport Group senior executives talk about the brand’s fresh start under new ownership that has a major emphasis on versatility.

Josh Shaw

Mission Athletecare CEO Josh Shaw says thermoregulation is the New York company’s singular focus.

Tim Porth

Tim Porth of Octane Fitness talks trends, Zero Runner and the company’s January acquisition by Nautilus Inc.

David Costello

The principal and founder of Rising Tide Associates talks about industry advocate lobbying for the domestic textile and footwear industries.

Steven D’Angelo

The ‘47 brand executive dishes on the Boston company and long-time MLB licensee founded by his father Arthur and his late Uncle Henry.

Pam Gelsomini and CB Tuite

Pam Gelsomini, president, and CB Tuite, VP–sales, discuss the company’s products, partnerships and what’s new for the season ahead.

Kenneth G. Andres

The tradeshowdirector for the American Sportfishing Association casts comments on the activity’s popularity, and trends in fishing.

Dick Sullivan

The principal and founder of Rising Tide Associates talks about industry advocate lobbying for the domestic textile.

Dave Coradini

The VP of sales and sponsorships for Spalding, Dave Coradini talks Shot Tracker and basketball.

Scott McGuire

The executive brand and product innovation leader dishes to F4M’s Emily Walzer on an array of topics.

Kelly Davis

Snow Sports Industries of America’s Kelly Davis talks weather, participation trends and how to handle the psyche.

Kevin Davis

The CEO of Performance Sports Group dishes on new bat standards and Own the Moment.

Gene McCarthy, Pt 2

Gene McCarthy, president of Asics America, speaks to Jen Ernst Beaudry on specialty run and more in the second part of the podcast.

Gene McCarthy, Pt 1

Gene McCarthy, new president of Asics Americas, dishes to F4M’s Jen Ernst Beaudry in the first of a two-part podcast.

Richie Woodworth

Saucony’s Richie Woodworth offers his views on brand’s running business and what it takes to manage through change.

Bruce Cazenave

Bruce Cazenave, CEO of Nautilus Inc., recently ranked 23rd on Fortune’s “Fastest Growing Companies” list.

Tony Armand

Armand is leading USB, created after the April merger of Shock Doctor and McDavid.

Gary Smith

Gary Smith has been at the helm of the Lawrence, MA firm for three years, and his 2016 strategies will broaden Polartec’s scope.

Marty Hanaka

City Sports CEO Marty Hanaka has 42 years in retail, starting at Sears in 1973.

Mike Dowse

Wilson Sporting Goods, one year removed from its 100th anniversary and a major restructuring, has a renewed focus and strategy.