The Unbearable Heaviness of Business and the State of Outdoor Retailer

There is a cost of doing business in the outdoor industry, especially as a collective whole. Can social media alleviate some of that cost, or is it simply a mechanism for increasing the clutter of information coming from OR?

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by Ryan Jordan | 2009-01-22 09:52:00-07

A Heavy Industry, a Heavy Trade Show, and a Heavy Cost

My inside source (let's call him Mortimer) at an outdoor industry trade association tells me attendance at ORWM'09 (in terms of visitor-days) will be down significantly this year.

Some of this must be attributed to the economy. People are traveling less, and for shorter periods, to save money. Mortimer tells me that hundreds of faithful OR attendees may be skipping out this year, and most of the rest will be shortening their stay.

Maybe an environmental idealist will avoid going to the show to save on CO2 emissions. I almost never think about my own impact when driving down to Salt Lake City from Bozeman, but I can't help to start adding it all up in my head when I walk onto the Salt Palace floor and think to myself: "Do we all really need to be here?"

But it goes deeper than conservation, certainly. What if this same industry that touts its service to the environment and social causes channeled some of what it spent on Outdoor Retailer to actually fund, oh, I don't know, how about land acquisition for conservation and drinking water technologies in the villages adjacent to those cool places where we like to go trekking? We are talking about a pool of money well in excess of $100 million annually to tap into, if the Outdoor Industry completely nixed its trade shows and invented new ways of doing business. This is not a new idea, of course. Many industries have dramatically reduced their trade show footprint and are becoming more profitable as a result (simply through cost reduction!). It would seem logical, given that the average profit margin for a specialty retail shop is only 3%, that the industry would take a harder look at reducing its environmental footprint and lost opportunity cost by making Outdoor Retailer a little lighter.

In America, we are privileged to live in a capitalist culture where a single person starting out of their garage has the potential to create massive wealth. The Internet increases that potential, certainly. The Outdoor Industry Association has long advocated business growth as its primary objective. But just because you can grow huge, does that mean you should? One argument for a growing a trade group or industry is to increase that industry's voice in the fight for social (or political, or environmental, or ...) causes. But the costs of industry growth - including affluenza, development, and the unquenchable thirst for profit - cannot be ignored.

Syndicating Information from Outdoor Retailer: The State of Communications Technologies

Given the explosion of media technologies in the past three years, it's hard not to argue that the utility of the trade show as a meaningful mechanism of doing business may be waning in an age where phenomenal productivity can be realized via other forms of communications.

If the last decade has taught us anything as a business culture, it's that, actually, yes, meaningful relationships can be fostered remotely, and face to face relationships, while more emotionally fulfilling than an e-friendship, may not be as important as we think for doing business, especially in an economy where saving money and making sales are more important than spending on travel and other discretionary expenditures. The bottom line: the vast majority of routine business is done online today.

Seeking Ultralight Needles in a Heavy Stack of Heavy Hay

It's been fairly obvious to us over the years that the Outdoor Retailer summer and winter markets are not exactly hotbeds for launching ultralight innovation, and the actual number of groundbreaking "ultralight" products that have been introduced there have been very limited.

However, the same technology that may be killing the need for trade shows is also making them more exciting and accessible to the general consumer. We've certainly taken advantage of that technology in the past (and will continue to do so in the future) because we are committed to providing our members with as much information as possible to guide their consumer decisions.

Social Media Contamination

However, communications technologies are also cluttering the information space. We'll probably see dramatic increases in OR clutter this winter due to the explosion in popularity of Twitter, Facebook, and blogs over the past six months.

What that means to the consumer is that there will be more information to sift, more time to waste sifting it, and more energy put into (once again) trying to sort out marketing and the emotional excitement of a new products (and telling the world about them) from information that actually provides consumer value.

Some social media theorists believe that we are in a golden age of social media: rapid growth, excitement on behalf of both writers and readers, and expanding technologies. As with any technological golden age, social media too may "grow up" and normalize itself into a useful, efficient means of communicating.

But I don't see that happening for some time. I think the excitement of "being connected" is too irresistible to people, and the temptation to tell the world about useless things before hitting the SUBMIT button is too high.

Moving Towards Lighter Information Technologies

Instead, I see the meaningful evolution of social media through the growth of disciplined writers who care about providing useful information, and our own discipline in being extremely careful about what types of social media we are subscribing to, so we can effectively and efficiently filter the information to get exactly the information that we need. As for Mortimer, he admits that he's not tasked with the discipline of objectivity this January: you'll find him posting frequently on a time schedule, justifying the existence of OR with hype and enthusiasm.

Which brings me to a thesis about doing business in the future and how social media can be part of that. Imagine a virtual trade show by which we syndicate, perhaps, live HD video feeds from our home offices, showcasing our new product lines to whomever would like to "drop by" and see them - strictly opt-in of course. Companies could even schedule virtual "private" appointments (the porn industry has already proved the success of this) where more intimate business can be performed. Heck, retailers could even go through online order forms with their sales reps in real time and transmit orders to the warehouse before they closed the call. The company's marketing and PR folks could manage live news, interaction with the media and the public, and private appointments with huge audiences (and new customers!) in a way that could never be done on the floor of a trade show. This isn't utopia, of course. It's simply one alternative for making our industry footprint lighter in a dramatic way, and allowing more companies to play (a booth at a trade show like OR costs a company $10,000 or more - effectively pricing out the innovators in the industry that delivery cutting edge products to the earliest adopters and thought influencers - our cottage companies).

But for now, I suppose we all owe it to ourselves to experience the current and somewhat heavy state of social media by subscribing to as many Twitter feeds, Facebook pages, and blogs as possible, so we can have an appreciation later for obtaining meaningful value from a simpler, lighter strategy of information digestion.

After all, didn't most of us come to enjoy a light pack by experiencing the pain of a much heavier load?

Backpacking Light and Social Media

Like everyone else, we too are experimenting with Social Media. We haven't written our Social Media Vision Statement yet, but I do have a rough draft proposed: "We hope to not waste your time."

Enjoy the coverage this year from ORWM'09 - the media industry will insure that there will be no shortage of information about new gear this year!


Citation

"The Unbearable Heaviness of Business and the State of Outdoor Retailer," by Ryan Jordan. BackpackingLight.com (ISSN 1537-0364).
http://backpackinglight.com/cgi-bin/backpackinglight/heavy_business_outdoor_retailer_winter_market_2009.html, 2009-01-22 09:52:00-07.

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Forum Index » Outdoor Retailer Winter Market 2009 » The Unbearable Heaviness of Business and the State of Outdoor Retailer


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Ryan Jordan
(ryan) - BPL Staff - MLife

Locale: Greater Yellowstone
The Unbearable Heaviness of Business and the State of Outdoor Retailer on 01/22/2009 10:43:04 MST Print View

Companion forum thread to:

The Unbearable Heaviness of Business and the State of Outdoor Retailer

Brad Groves
(4quietwoods) - MLife

Locale: Michigan
Re: The Unbearable Heaviness of Business and the State of Outdoor Retailer on 01/23/2009 09:48:18 MST Print View

Just a few unorganized thoughts:

In some ways I think there's actually significant overlap between having the physical trade show and modern media communications. Although the show does have a significant cost, I suspect that the cost is much less than it would be if vendors had individual appointments with all the people they meet. I say this with both economic and environmental implications.

There is no doubt that the economic downturn has reduced attendance at OR. However, I also think it is precisely the increasing usage of electronic correspondence that has made people feel that missing the show is okay, that it isn't as "necessary" as it has been.

Meaningful relationships of all kinds, including vendor/buyer, can and do develop online. Shoot, my girlfriend knows a bunch of BPLers by name because I talk about y'all as though we just met at the pub for a pint of conversation. In some respects this is enough. However, there is also a point at which you need to physically see things. No OR would, I think, greatly increase sales call traffic, increasing travel costs, CO2 costs, and ultimately end product costs... because at the end of the day, particularly in buying for a retail store, physical presence and rack appeal are vitally important. There are some things you can only tell by visually inspecting and feeling. Many buyers will go to regional shows in place of OR, or do follow-up at the regional shows, though it isn't quite the same.

Although the cost of putting together OR is high, I think that doing away with the show, and/or the regional shows like it, could ultimately cause an increase in monies spent and an increase in environmental impact. I don't think it's a realistic idea to use the monies typically used for the show for land conservation or other such practices for that reason--although I like the idea behind it.

Anyway, that's my "brain dump" at the moment. Enjoy the show, and let's hope for a few UL wonders!

JR Redding
(GrinchMT) - F
People Still Love Hands On.. on 01/28/2009 13:56:28 MST Print View

While social internet technologies do clog the amount of quality information that is prevalent, it is still information. And although people may have to sift longer thru that information, in the end they would prefer to see, and touch what their research has brought to them. Hence, the need for shows or even demos at brick and mortar stores won't go away anytime soon.

However, you do make a good point on the use of "virtual" technologies. In the late summer of 05, I launched a company that dealt in video editing products and software. Within 16 months I grew that business to 250K in sales with 37% profit margin. (Average profit margin for normal software and hardware dealer is about 8%) The sole contributing factor in being able to do so was my use of the internet and associated technologies. Namely, we did live desktop demonstrations of software to those who asked for them. We trained people how to use the software via remote desktop connections, and we held weekly to bi-weekly webcast seminars on our products. We even provided support services live and on demand via remote connection and did so better than the software manufacturers.

While this did increase and boost our profit immensely, the larger faction of customers still wanted to have hands on experiences that you cannot get from a virtual meeting.

I see this being the same case with gear. People may buy online but if they can see it or try it on at a brick and mortar, they will and because of that conventions and shows will probably still be with us for some time to come.

Edited by GrinchMT on 01/28/2009 13:57:01 MST.

Richard Scruggs
(JRScruggs) - MLife

Locale: Oregon
Re: The Unbearable Heaviness of Business and the State of Outdoor Retailer on 02/04/2009 22:59:16 MST Print View

Thanks for your explication of outdoor gear marketing trends & issues. Common sense will hopefully lead the way to "better" shopping experiences, whatever that might mean for each individual.

Won't it be great, though, when someone finally invents the perfect pack, the perfect tent & the perfect sleeping bag -- with all three good enough to last a lifetime? Now that would be the ultimate advance for streamlining the gear shopping experience!

As for seizing the opportunity to suffer pains of advances in communication technology in order to better appreciate some later technological advance, I'll pass on the pain and just enjoy the gain when the hassle of the new mediums (and their novelty) ceases to interfere with the message.

As in: I very much enjoyed "reading" your analysis without even having to suffer any pain from unfamiliar technology.

Oh, for the good old days before twiggle, or twizzle, or whatever the latest fizzle might be.

JRS