CFA, WELLS FARGO: Invitation to next "Crystal Ball" breakfast session, "Private Label vs Branded Manufacturing."
STOKES ME: SIMA Humanitarian Fund campaign kicks off this week with "Add-A-Buck" promotions in 76 core-store doors.
Details on Industry Insight.
Iconic outdoor brand Patagonia is becoming a well known name in the surf market. With some of the best surfers in the world on their team from Gerry Lopez to the Malloy brothers and a very forward environmental story, the brand has been getting a lot of attention.
Despite all the press, I still don't see the brand in many stores. That could be on purpose. I sat down with Rob Bondurant, Patagonia's vice president of marketing, at Outdoor Retailer and asked him about Patagonia's surf strategy, including its goal of selling environmentally-friendly custom wetsuits online, why slow growth works and why the company targets the 25- to 40-year-old market.
What's your current positioning in the surf market?
I think to understand our current positioning you have to look at our history. We were founded by a rock climber who lived in Ventura during the winter when rock-climbing conditions weren't good in Yosemite. Living in Ventura was a purposeful choice so that he could make rock climbing equipment and surf. Our first catalog said to expect slow service when the waves were good. We came from a history of craftsmanship because the tools that we were making were tools for climbers. Over time as the company matured we entered into other categories.
How long have you been in surf?
We've been making boardshorts and surf apparel for almost 15 years now. We've been handcrafting surfboards through Fletcher Chouinard for over 12 years. We have a little boutique Quonset hut where we shape our boards. We make about 1,000 boards a year. We could do more but everything we do is handcrafted.
How much do your boards retail for? I thought they were pretty expensive.
They retail for about $900 to $2,000. They are all very high end epoxy boards. We build our boards to be durable and that's a part of the company. We really like sort of tinkering with design; we are always after a better mousetrap design philosophy.
Why only 1,000 boards a year?
Because we want all of our boards to be handcrafted, built by surfers, for surfers. We respect the relationship between shaper and surfer and we know if we shape a board correctly, chances are we'll have their business forever. So for us, it's crucial we grow slowly and not artificially. Artificial growth generally results in a spike and then an equal decline.
(At right: Patagonia VP of Marketing Rob Bondurant.)
Tell me about your wetsuits.
We literally can't make them fast enough. We have at least 200 people on our waiting list at all times. It's literally because the factory we make them in Thailand is at capacity. Our goal eventually is to offer custom wetsuits. You could go online and you could send in a spec package and eventually we'll be at a point where we can make you a better wetsuit. That was also a better mousetrap design for us. We wanted a wetsuit that was more environmentally friendly, more flexible, more durable and I think we achieved that by using non PVC knee pads, organic merino wool that allows the suit to be warmer, more flexible and tells a better environmental story.
How about your apparel and board shorts?
The board shorts we make have the same philosophies. We work really closely with our athletes. Nothing gets created without our athletes. They are all deeply involved. The Malloys and Mary Osbourne live in Ventura so they can be in the office and they work with me directly. We have this symbiotic relationship that allows us to produce really relevant products for surfers.
I don't see Patagonia in a lot of shops. Why is that?
That's on purpose. Our strategy for wholesale distribution has been to go into the best surf shops in California, up and down the east coast, up to New York, and to be in the best shops and shops willing to represent the entire Patagonia line. We want retailers to understand we are a brand as much as a we are an apparel company, and our approach to design and approach to environmentalism and the way we do business is different that a lot of traditional surf companies.
Tell me more about this approach and your Green Mission
It's baked into our DNA. Our mission statement is to build the best product and cause the least harm. We believe real design for real athletes results in something where there's not much more to add - there's just nothing to take away. So we have a minimalist approach in the way we build our clothes. The better you are and more experienced you are as an athlete, the more you realize what you don't need. That's the way we approach design and our business so those are the relationships we are building with our wholesalers.
How many shops are you guys in?
We think maybe we'll get to 200-300 accounts, 300 at the very most and that will be it for us.
In the next year?
Maybe for the next ten years. We're a private company - we don't have to grow for the sake of growth. We can do what we want which is wonderful. I have no analysts that call me Monday morning and ask me what happened over the weekend. The only one I work with is Yvon Chouinard and Fletcher.
What stores are you in besides Hobie?
Cleanline Surf in Oregon, Greenhouse in Arcata, Freedom Surf Shop in Virginia Beach, Cinnamon Rainbows in New Hampshire, Outer Banks Boarding Company in North Carolina, and Wetsand Surf Shop in Ventura.
How have you managed to show surfers that you belong in the surfing space since you guys are really known more as an outdoor company?
We don't have anything to prove except that we approach the sport of surfing the same way we approach all the other sports where we do business, which is real, soulful, down to earth, not artificial in anyway, and true. So if you look at our ads, you won't find us dumping a bunch of photoshop filters on the ad. Instead, what you'll find is what we hope to be - the best photojournalism in that given month.
We believe our approach to the soul of the sport is interesting and relevant to a certain sector of the surf market. We're not about competition and we're not going to expect to pull that competition surfer into the brand's arm. But as surfers go through the experience from grom to toes on the nose, they mature and they change and at some point they are going to discover the Patagonia brand and when they do, we feel that we're compelling enough to have them as a customer for life.
Who is your target consumer?
Our target is 25 to 40. I can't expect to get younger than that based on the maturity of our customer base. It's a really interesting lifecycle in that most of our long term customers are introduced to the brand through their parents or through an outdoor experience. It may be a surf camp, it may be an outward bound course and then they associate their Patagonia apparel kind of like a trophy and it becomes like a badge and it represents for them a period of their life that was very influential. And if I can do that, I'll lose them through the teen years because let's face it, we're a premium brand. Everything we make is guaranteed for life, but that doesn't mean they're not watching and they're not paying attention.
Are there others trying to compete in that space?
I don't really see anyone with the same messaging that Patagonia has. I see that the environmental aspect in the sport and culture of surfing is much more prevalent than it was five years ago. I won't be so grandiose as to say that it was because of Patagonia, but I think coming in with a message that says we can have low impact and still enjoy our sports and we can run our business sustainably is one that is encouraging and inclusive. It's exciting for us as a company to see other manufacturers in this space now producing their own environmental products because that lifts the bar for everyone. If Patagonia is the only company in the industry with an environmental stance, it's absolutely not going to be an important part of our culture.