Battles for Space in Surfwear Shops Heat Up
Flashy ads and in-store displays are reaching new heights as surfwear makers jockey for prime positioning in front of shoppers in retail shops.
Leading makers such as Billabong USA, Quiksilver Inc., Hurley International, O’Neill and up-and-comer Volcom, all based in Orange County, say it’s not enough just to deliver trunks and T-shirts to surf shops. They’ve got to make a statement loud enough to cut through the maze of products and grab customers’ attention.
“The dynamics have really changed at the retail level in the past few years,” said Andeaux Borunda, who heads visual merchandising and design at Irvine-based Billabong USA. “You have new companies that just didn’t exist before jockeying for real estate space in stores. Retailers are demanding a lot more and getting it.”
The increased competition has prompted the industry’s largest manufacturers,Huntington Beach-based Quiksilver and Billabong,to devote larger chunks of their marketing budgets to in-store programs. The advantage: increased sales, according to Borunda.
Simple chrome racks, crates or in some cases piles of clothes on the floor have been supplanted by branded fixtures and trendy displays by companies with big wallets. They command center retail space with ever-changing bold signage, surfing images, giant floor stickers, light stencils and, in some cases, personalized flooring. The big-name displays literally push smaller brands to the sides.
“People have staked their claim,” said Lyndon Cabellon, manager at Huntington Surf & Sport, a retailer in downtown Huntington Beach.
Quiksilver attempts to build entire shops within a retail store, according to Greg Macias, the company’s vice president of retail marketing.
“We don’t want our products mixed on a rounder with 10 other brands,” he said. “When you do that, the product sells through only as well as the health of the store.”
The manufacturer studied the concept years ago in department stores, where Macias said “real estate jockeying” already was under way with brands such as Tommy Hilfiger, Polo Ralph Lauren and Nautica.
Quiksilver quickly realized that brands that command more space get better retail play and more control over their images, Macias said.
Plus, he said, the company also was one of the few companies in the surfwear industry with a budget to create “act” at the retail level.
Not anymore.
“I do see it getting more competitive,” Macias said.
More brands have followed suit and pushed to section off their products and develop innovative looks. But Macias said the surfwear industry,typically behind classic retail,has “a long way to go.”
Still, the battle of the brands is so intense that sometimes sabotage goes on, according to Billabong’s Borunda. He said he’s walked into stores and seen a stencil of a rival company illuminated above the company’s section.
“The jockeying for position is really cutthroat these days,” Borunda said. “Sometimes you laugh about it and take it in stride. Sometimes it gets you a little bit peeved.”
The competition is impossible to miss at Jack’s Surfboards and Huntington Surf & Sport. The two surfwear retail icons sit on opposite corners of Main Street and Pacific Coast Highway in Huntington Beach,long considered the “Times Square” of the surfing industry and coveted as prime real estate.
“These windows are worth money,” said Ron Abdel, owner of Jack’s, referring to the giant windows in front of his store. “All the companies are trying to get in.”
But Jack’s, which is said to set trends for other national and global retailers, predominantly features the leaders, such as Quiksilver, Billabong and O’Neill inside and outside the store. The retail floor is filled with so many branded sections and signs it resembles a mini-tradeshow.
“We get calls everyday from companies that want to be in our store,” Abdel said. “But we don’t carry everybody. We have limited space open.”
Word on the street has it that one undisclosed manufacturer dropped from Jack’s,which may go through 15 to 20 brands in a few year’s time,even offered the store money to be allowed to stay.
Quiksilver, however, isn’t faced with that problem. The company is one of handful with the muscle to stake a claim in Jack’s giant front window.
Recently Quiksilver, which wasn’t taking full advantage of the exposure, Macias said, woke up to the power. Now, the company spends more money on the display (it changes the sign every 60 days) and has blown up images to lure drive-by customers as well as pedestrians.
“We began to realize this is a billboard. And we should treat it like a billboard, like Coca-Cola treats the sign they have on Times Square,” Macias said. “Thousands of people are seeing it in the right environment.”
Meanwhile, Billabong, the second largest surfwear maker behind No. 1 Quiksilver, has made one of most aggressive pushes in the past year. The company now devotes 25% of its multimillion-dollar marketing budget to in-store programs.
“It’s another form of branding your image and making sure that people are aware of what you’re doing in the heart of so called Velcro Valley,” said Graham Stapelberg, vice president of marketing at Billabong.
As the bigger guys make their moves, so do smaller players in the market, such as Irvine-based Rusty. The maker of apparel and surfboards has significantly increased its in-store program spending in the past two years.
Bill Holford, Rusty’s director of marketing, said the manufacturer may be up against bigger companies’ marketing muscles, but it tends to concentrate more on its own tactics.
“We measure ourselves against ourselves,” he said. “We feel that with innovative products, innovative (point of purchase) and advertising, we’re going to capture the customer in our target market.”
At the end of the day, Holford said, Rusty’s success, particularly with real estate, depends on its relationship with customers and ability to perform well for retailers.
And stores such as Huntington Surf & Sport realize the flipside to that equation.
“For them to do well, we have to do well. It’s a partnership,” Cabellon said. n
