Specialty stores are riding a surge of consumer interest fueled by expertise, community and can't-find-this-online service.
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Malcom Daly has been a self-described “floor warrior” at Neptune Mountaineering, in Boulder, Colorado, for years. And sometime back in January, he watched as an older couple—obviously old-school outdoor, in a hobnailboots sort of way—walked into the shop shortly after it underwent a remodel and a reimagining. They took at look at the in-house coffee shop. They wandered past the guide shop and the bootfitting area, the lifestyle displays. The woman turned to the man and said, “Honey, are you sure we’re in the right store?”
Throwback as they may have been, the couple was onto something: The successful specialty retailer of the future seems—and will have to become—dramatically different to adapt to a consumer who has become more discerning, busier, more distracted, and more sophisticated than ever. And while that same consumer will continue to be pulled toward online shopping, it pays to remember this: a recent Deloitte report showed that the vast majority of retail sales—some 91 percent—still happen within the walls of brick-and-mortar stores.
That doesn’t mean retailers can coast. “If you’re used to being towed along, you’re not going feel very optimistic about the future,” says Mike Massey of Massey’s Outfitters. “But if you play to your strengths, the future looks pretty bright.”
The key is to make the in-person experience more dynamic and more informed. To make it an experience that’s so, well, experiential that it’s impossible to find it anywhere else. Specialty is the very thing that consumers crave right now, and what big-boxes and even the most inviting websites aren’t: personal.
The Fork in the Road
That same report calls it “the great retail bifurcation.” In a nutshell, successful retailers seem to be moving into two distinct camps: price-based (pick your favorite big-box) and premier (specialty retailers), with stores that try to do both—called balanced retailers—losing out in the middle. In fact, premier retailers have seen 40 times more growth than balanced retailers over the last five years, and customers are 110 percent more likely to recommend those shops to others. And while price-based retailers have seen revenues grow steadily over that same period, at 37 percent, the premier group saw a jump of 81 percent. And the balanced retailers? Flat.
Perhaps that’s because, as Massey says, “A brand or a retailer can’t just go, ‘give me everything!’ They need to target a demographic, whatever that is.” It may explain the recent tumult when Walmart’s premium outdoor site went live. Brands like Black Diamond and Leki, who thought they were entering into an arrangement in which Moosejaw curated products for them, found instead that their products appeared to be on sale at Walmart.com.
To Black Diamond’s John Walbrecht, it was a bait and switch: BD doesn’t sell products for everyday consumers, and it’s fully committed to being premier rather than balanced. “We’re selling experiences and equipment to people who know what it’s used for,” he says. “If you want to know whether to buy a Camalot X4 or an X4 offset, you won’t get it at Walmart.com.” Adds Leki’s Greg Wozer, “We’ve built our brand on the backs of specialty retail, not in big-boxes,” he says. “That image gap between our name and the Walmart name was too big. I hope we didn’t betray anyone’s trust in the brand, because specialty retail is where we really belong.”
Conversely, Craghoppers, another brand on Walmart’s outdoor site, decided to stay in. “What’s important to us is that we can protect our prices, and we can tell our brand’s story,” says Dennis Randall, president of Craghoppers North America. “We believe in Moosejaw’s ability to curate, and this situation is not at all changing what we do as a company.” For Randall, the balanced approach just might be the right one. “People deserve to be in the outdoors at any economic level,” he says. “And this feels to me like a great way to invite more diversity.”
River Sports Outfitters in Knoxville, Tennessee
Walkabout Outfitter in Virginia
Townsend Bertram & Company in Carborro, North Carolina
Adventure 16 in Southern California
Make Yourself Indispensable
So say you decide to go premier. What does that look like? For some retailers, it’s a matter of offering something that’s too big, too expensive, or too complicated to buy online. Take Lee Hoffman, who opened his overlanding store, Altitude Industries, in Evergreen, Colorado, last year. “We have a lot of products where people are unsure about how to use them, and there are a lot of options, and they need expert guidance,” he says. That includes rooftop tents, racks, and the like—objects that consumers want to touch, feel, and lift. “Overlanding is sort of a project for people, not a single product,” Hoffman says. “People want to build a rig, and they want to partner with someone hand in hand.”
Trent Thomas, of Black Dome Mountain Sports in Asheville, North Carolina, made a conscious decision to focus more on hardgoods than softgoods because hardgoods are more difficult to suss out online. “It’s more difficult to get real expertise on a computer screen,” he says. Thomas offers heat-molded bootfitting at his shop, and the pull is obvious. “Let me know when you can get a custom fit online and I’ll change my tune,” he says.
Because the immersive experience is already built in, location is key for some retailers. “We have an advantage because we’re right on the playground,” says Kat Jobanputra, senior vice president for rental and retail at Alterra Mountain Company, which owns 14 ski resorts in North America. Their shops are slopeside, where consumers can take skis and snowboards out for a demo, seeing other people using hardgoods and softgoods exactly where they’re supposed to be used. The built-in environment is already vibrant. The inspiration is front and center. Says Thomas, “We’re really region-specific—we sell hiking boots and climbing gear that works for the terrain and conditions of our area, or for people coming up from Atlanta,” he says. “It’s just another way to find a good niche.”
Community Center, Not Computer Screen
For Betsy Bertram, brand manager at Townsend Bertram & Company Adventure Outfitter, our phones and computers are now work, plain and simple. “With our leisure time, we don’t want to feel like we’re in the office,” she says. “We want to get away from our screens and have experiences—and that includes in-person shopping.” Bertram considers her store more of a community center than a retail shop, a place where people come in for a great conversation with a favorite staff member, or a place where picking up a boot and turning it in your hands can be the real inspiration for a dream. “It’s a really limited view to think of specialty outdoor shops as [just] stores,” she says. “There’s nothing about a computer that’s inspiring.”
What’s inspiring? In short, everything that’s not selling products. The shop’s monthly yoga classes—which cater to a cross-section of women in their 70s, parents and children, and people who might be intimidated by a studio—are so popular that they’ll become weekly in January. Their monthly Adventure Friday events combine films, speakers neighborhood roasteries and breweries. They’ve collaborated with local nonprofit The Monti for live storytelling evenings. “You need to look outside of the industry, out of the box, by connecting to meaningful causes, even if they don’t seem to have anything to do with the outdoors,” she says. “Insert yourself into a group with a strong following and shared values and you become an experience, too.”
The value of a passionate, informed staff can be leveraged in a major ways, says Black Diamond’s Walbrecht: “Online or in a big-box, you can’t have a clinic about how to use gear from someone who’s truly knowledgeable. What tent should you buy? It depends. Where are you going? What season?” He continues, “As a brand and an industry, we want people to have great experiences that bring them back. A retailer you trust is a way to guarantee that: it will keep experienced consumers and make sure a new consumer’s experience is a good one.” Thomas says he’s had employees who have been with him for 30 years. “I think our newest employee has been there for 10,” he says. And Hoffman is a true believer that his own passion is the greatest asset at his store. “I’m not selling stuff just to sell stuff,” says Hoffman. “I love our products, and that doesn’t translate across a computer screen.”
Bertram believes that the pendulum is starting to swing back to a craving for specialty experiences and personal connection over online shopping. She cites recent studies about how time spent on Facebook is a risk factor for depression. A Goldman Sachs memo from November 2017 found that 51 percent of consumers prefer to buy clothing and shoes in-store, 44 percent want to experience a product by touching it, and 23 percent of customers say socializing is the reason they visit stores. Emily White, of Roads Rivers and Trails in Milford, Ohio, agrees: “Consumers who are inundated with screen time are seeking out physical connections,” she says. “When there’s a true community, it builds a collaboration where the consumer can actually take ownership of the retail business and its continued success.”
Teddy Schiavoni of Summit Ski and Board in Boston asks this question: If brick and mortar retail were dead, then why is Amazon opening up stores? “Just to light a sign?” he says. “No, it’s because they know consumers want to go in and experience something real. They want to go into the local shop because, quite frankly, opening a cardboard box isn’t that gratifying.”
This article was originally published in Day 2 of The Daily (Winter Market 2018).