Adio President on new distribution strategy

So where will you sell? Not to the core, but to mid-tier only?

Our retail structure will be less about the core although they can still buy ADIO if they want to have an authentic skate brand at our new pricing. We plan to do more business within the mainstream stores like Shoe Show, Shoe Carnival, Big Five, and Sports Authority.

We originally were spending a lot of money investing in the brand’s marketing and now we are going to the next phase to make it profitable with today’s business environment.

We plan to still give back to the skate market, but you have to generate sales and profits to be able to give back to the market. We invested a lot into the brand with the (SST) Skate Specific Technology series and the Going Forward marketing campaign.

How big is ADIO now and many doors are you in?

Size-wise we are not as big as our brand awareness. For doors, I’d say we’re probably in around 4,000 doors domestically but our international business is strong and growing. Our new pricing strategy rolls out this spring so we’ll probably add a lot of doors.

How have retailers responded to ADIO’s changes?

Mainstream retailers seem to be okay with it - specialty stores were disappointed. To mainstream accounts, we think it’s a better strategy because we are offering our products to a broader consumer base with better margin structure.

How many mainstream stores do you plan to sell to? Will you sell to Target or Wal-Mart?

No, we will not sell Target, K-Mart, Wal-Mart, or Payless. Airwalk is in Payless. We will probably compete against World Industries directly unless some of the other skate brands decide to compete at lower retail price points as well.

We have less direct competitors than we did before. It’s a smart strategy. We think we will double in sales this year and quadruple in size in next three years.

Besides running Adio, you are also partners in a music company?

Yes, I am an owner/partner and board member of Dirtbag Music, which is a record label and an apparel company targeted to musicians from fledgling bands to high-level rockstars. Dirtbag just recently became an independent record label partner with Warner Music, which is like getting Nike to join forces with your company. I was attracted to the company because of the brand authenticity and impact that music has on popular culture in every industry, especially action sports.

I also sit on the board of the San Diego Sports Innovators (SDSI) with Chairman Bill Walton. SDSI is a non-profit organization that helps companies in all aspects of the sports business by mentoring young entrepreneurs, providing access to working capital, connecting new technologies to the sports industry and providing a networking platform for companies and individuals.

Through SDSI, I have become involved with Code Technology and Neptunic Technologies, both companies that have break-through technologies that have huge potential to be game changers the sports industry.