Running Insight 5.1.19

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RUNNING INSIGHT

How Runs the JackRabbit?

RI catches up with CriticalPoint Capital two years after its acquisition of JackRabbit. / By Daniel P. Smith

J

ackRabbit limped to the close of 2016 a hobbled beast. The nation’s second-largest running retail group, The Finish Line-owned chain of 65 run specialty stores across 18 states endured mounting losses and swelling liabilities.

After years of hunting deals and purchasing well-known industry names such as Boulder Running Company, Run On!, Bob Roncker’s Running Spot and Garry Gribble’s Running Sports, JackRabbit struggled to be one cohesive enterprise. There was tumult and instability and a shaky, uncertain future.

But then CriticalPoint Capital appeared, confident in JackRabbit’s underlying portfolio

and specialty retail’s potential despite a rapidly transforming retail landscape.

The Manhattan Beach, CA-based private equity firm, which touts “patient capital and a thoughtful approach to growth,” purchased JackRabbit from The Finish Line in early 2017 for the grand sum of zero. Over the last two years, CriticalPoint has bandaged JackRabbit’s wounds, restored its confidence and supported revenue-boosting moves that have helped JackRabbit find its footing.

“The business you see today is radically different than the one we acquired two years ago,” CriticalPoint Capital partner Brad Holtmeier says of the now 62-unit JackRabbit

operation. “Our stores have comped up, our digital has grown and we’re on a mission to strengthen service, boost the brand and increase density in the channel.”

And industry insiders have noticed the shift.

One executive with a leading footwear brand says JackRabbit-owned stores continue working to re-establish their community credibility after The Finish Line “tried to sterilize” the business and install remote operations.

“I see a clear change in how they’re attacking things and much more focus on being the best version of themselves,” the executive

Located just steps from the finish line of the New York City Marathon, the New York Running Company store is one of 62 stores in the JackRabbit enterprise.

RUNNING INSIGHT ® is a registered trademark of Diversified Communications. © 2019 all rights reserved. Running Insight is published twice each month, is edited for owners and top executives at running specialty stores and available only via email.The opinions by authors and contributors to Running Insight are not necessarily those of the editors or publishers. Articles appearing in Running Insight may not be reproduced in whole or in part without the express permission of the publisher.

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RUNNING INSIGHT

How Runs the JackRabbit? (continued)

In 2019, JackRabbit units are actively trying to deepen their ties to local customers with an assortment of community events. The New York Running Company, for instance, hosts four distinctive fun runs each week, including Sexy Pace Mondays and Wild Card Wednesdays.

JackRabbit has worked to strengthen its relationships with key vendors such as New Balance, which has installed branded areas in JackRabbit showrooms.

says. “That’s definitely for the better.”

A veteran industry sales rep who regularly calls on JackRabbit units, meanwhile, cites heightened focus on operations and customer service as well as a more positive, optimistic tone among store staff.

“And that’s bred more confidence over the last year,” the rep says.

Holtmeier admits CriticalPoint, a run specialty outsider, had much to learn – and quickly – about the running retail landscape upon acquiring JackRabbit in 2017. He acknowledges CriticalPoint didn’t understand “all the things necessary to service the consumer,” both in brick-and-mortar stores as well as on the digital side, nor did the firm fully comprehend the important relationships between vendors and retailers in the channel.

“There’s been a lot of trial and error,” Holtmeier confesses.

And a lot of change.

Holtmeier and JackRabbit CEO Bill Kirkendall talked with Running Insight about JackRabbit’s evolution over the last two years.

On leveraging JackRabbit’s larger size...

When CriticalPoint purchased JackRabbit, Kirkendall called the deal “an outstanding result” for JackRabbit, expressing confidence that CriticalPoint’s strong backbone would support the retailer’s growth and its efforts to gain market share.

I nd e e d , C r it ic a l Poi nt’s focused presence has enabled JackRabbit to better leverage its size to improve store operations and optimize performance.

The company, for instance, has actively wooed talent with 4

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enhanced benefits and internal growth opportunities; delivered enhanced resources and proven systems into its stores; and developed a robust omnichannel approach that allows JackRabbit’s stores to service the customer anywhere, anytime. As a result, negative comps have turned positive, digital sales have increased and JackRabbit’s margins have improved.

“We’ve created a platform that has grown and is positioned to grow further,” Holtmeier says.

On JackRabbit’s relationships with running vendors...

After previously chasing some affiliated endeavors like active and CrossFit, JackRabbit has worked to strengthen its ties with running-specific vendors.

Through vendor-powered store events, shop-within-a-shop opportunities and more focused ordering, JackRabbit continues developing and deepening its relationships with the running market’s key brands.

“We’ve doubled down on running and that’s resulted in higher service levels, more knowledgeable staff and greater vendor support,” Kirkendall says.

At the same time, Kirkendall continues calling on brands to release innovative product and better control distribution so JackRabbit and its run specialty peers – those who give the vendors a valuable boost of authenticity – can best represent brands in the marketplace.

“If we have disciplined distribution and innovative product, then we will provide the experience to drive the customer in,” Kirkendall assures.

On the JackRabbit name...

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RUNNING INSIGHT

How Runs the JackRabbit? (continued)

Given the competition for real estate on footwear walls, CEO Bill Kirkendall calls on running brands to provide “disciplined distribution and innovative product.”

to convert all storefronts to the JackRabbit name, leadership has elected to withhold rebranding the entire fleet.

“During the due diligence process, we didn’t have a full appreciation regarding the powers of the brands we were acquiring,” Holtmeier says. “The reality is that some of these brands have great power in the markets they serve.”

While 22 stores currently bear the JackRabbit name, others, particularly those with potent names in their local markets like Boulder Running Company and Run On!, will retain their existing identity, albeit with some discernible affiliation to JackRabbit present in the store’s physical and digital identity.

“We will be selective about where we keep the name,” Kirkendall says.

On the biggest change of all, store autonomy...

Rather than simply existing as

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a local outlet of a national chain, Critical Point has given stores the ability to operate entrepreneurially and autonomously within their markets.

This critical shift has empowered individual stores to become the community hubs that running specialty shops are, by and large, designed to be.

Under The Finish Line, for example, store marketing was done from a central office in Denver. Today, however, individual store leaders oversee their own marketing budgets, which they can independently invest in the events, races or programming they regard as the most valuable.

“Giving stores more autonomy has been a tremendous morale booster and empowered store leaders to be more effective in their respective communities,” Kirkendall says.

Notably, Holtmeier says store events, which drive passion among customers as well as sales within the stores, increased in

2018 and will accelerate further in 2019.

“Retail is tough and we truly believe we have to create an experience for our customers,” he says. “Our management team has done a great job bringing traffic into our stores and our entire team is aligned to one goal, which is servicing the runner.”

On the next steps...

Just as it d id up on t he Jack Rabbit purchase, CriticalPoint leadership remains bullish on r un specialty’s potential.

“Our view is that niche retail will survive, that it is something wanted and needed,” Holtmeier says. “And, frankly, that thesis has held out.”

With that optimistic outlook and a more stable business in hand, JackRabbit has returned to growth mode. Over the last year, the company has purchased Rhythm Running, a specialty retailer in Nashville, as well as

Clever Training, a multisport e-commerce retailer. JackRabbit also opened its own doors with units in Houston, Fort Worth and Tampa.

“We have a healthy business that continues to grow and we expect this to continue down the road,” Holtmeier says, adding that CriticalPoint, which enjoys building through acquisition, will continue to monitor any and all growth opportunities, whether that’s adding stores or accelerating the digital business. “Our business is in a position to look at the next opportunities and we see a lot of different channels in which we can continue to grow.”

With confidence in its model for opening new units, leaders continue assessing different geographies, particularly the West Coast, as well as opportunities in JackRabbit’s current markets.

“We go from the East Coast to Salt Lake City, so we have runway … and there’s a lot more to be had,” Kirkendall says. n © 2019 Diversified Communications

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RUNNING INSIGHT

Atlanta Track Partners with Polar Electro Polar is named the club’s exclusive technology device provider.

P

olar has been named the exclusive technology device provider of Atlanta Track Club. Under the partnership, Polar will provide training, content and devices to Atlanta Track Club staff, who will utilize the information to enhance training for participants while measuring the efficacy of its programming.

The products will also be worn by members of Atlanta Track Club Elite’s team. Athletes will appear in Polar’s marketing along with Polar’s other sponsored endurance athletes, including Olympians Molly Huddle and Gwen Jorgensen. Polar products will be available for purchase at expos and number pickup events for the AJC Peachtree Road Race in July, Publix Atlanta Marathon, Invesco QQQ Thanksgiving Day Half Marathon and PNC Atlanta 10 Miler.

“This relationship with Atlanta Track Club is compelling on many levels,” says Stan Brajer, SVP–marketing and sales for Polar.

“They have an elite team led by Olympian Amy Begley and 33,000 members and they

produce more than 30 events each year. Plus the US Olympic marathon trials will be held in Atlanta on February 29, 2020,” he adds.

“Beyond these running-specific opportunities, ATC has a vision to re-invigorate high school track and cross-country programs in Atlanta public schools, which aligns perfectly with Polar’s expertise in physical education and team systems technology.”

Polar promoted the ATC partnership with visits to key Atlanta area run specialty stores Big Peach Running, Fleet Feet Sports and West Stride. Polar also plans on site activations at major events such as the Peachtree 10K (which is celebrating its 50th anniversary in July) and the US Olympic marathon trials. Polar will also help to develop ATC specific training programs utilizing its elite coaches and athletes and the brand will contribute to both on-site training at specialty store locations, ATC club events and schools, as well as offering virtual training.

“We are excited to work with Polar to share the value of heart rate-based training with

Staff members, ATC training group members and ATC run lead coaches at Big Peach Running in Alpharetta.

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Polar Electro’s Stan Brajer and ATC head coach Amy Begley (2008 US Olympian at 10K).

the In-Training for Peachtree participants,” said Atlanta Track Club Coach and Olympian Amy Begley. “Polar is the original heart rate monitor and its reputation as a leader in the industry is unmatched.”

With more than 30,000 members, Atlanta Track Club is the second largest running organization in the United States. In addition to the AJC Peachtree Road Race – peachtreeroadrace.org – the largest 10K running event in the world, the Publix Atlanta Marathon, PNC Atlanta 10 Miler and Invesco QQQ Thanksgiving Day Half Marathon, Atlanta Track Club directs more than 30 events per year.

Atlanta Track Club also maintains a number of community initiatives, including organizing and promoting the Kilometer Kids youth running program to metro Atlanta youth, honoring high school cross country and track and field athletes through Atlanta Track Club’s All-Metro Banquets and supporting the Grady Bicycle EMT program. n

© 2019 Diversified Communications

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RUNNING INSIGHT

Naperville Running Company Expands Again Chicago retailer opening The Annex to sell closeouts and provide more event space. / By Brian Metzler

K

ris Hartner knows that if you’re not proactively trying grow a business, it will start declining.

He’s developed the Naperville Running Company trio of running specialty stores in suburban Chicago into a successful business by fostering a high level of customer service, investing in his employees and being shrewd about every dollar spent and earned and yet always growing. Those things helped NRC become the only twotime winner of the Running Store of the Year (2009, 2013).

He made the bold move to relocate the original Naperville store down the block to a 5500-square-foot space when the business outgrew its smaller, initial space eight years ago. In 2015, when consolidation and flat sales were gripping the industry, Hartner added a second store at the south end of town despite Road Runner Sports opening up nearby. Two years ago, he opened a third store in neighboring Wheaton, a town that had seen two previous running stores fail.

Amid the growth, the NRC business is as healthy as its ever been.

In mid-June, Hartner is opening the Annex, a new 1200-square-foot retail operation seven doors down from the thriving original NRC shop that will mostly sell closeout-priced running shoes and apparel while also serving as an additional space to host promotional events for brands, athletes and big local races. It’s the same space that originally housed NRC when he opened it in 2000.

The Annex will sell the previous season’s unsold shoes and apparel from the three NRC stores – or in some cases from the previous month’s unsold gear – and possibly additional closeouts from brands if they can be acquired for the right price. For example, that might mean buying $130 shoes at 40 percent off from a brand that can then be sold at the Annex.

Hartner believes the new business will reach a different customer base that probably 10

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Naperville Running Company director of merchandising Mary Rose stands in front of the Annex, just a few doors down from the flagship NRC store. (Photo: Kate Hartner)

isn’t already shopping at NRC. That might be a discount-oriented consumer looking for a deal on last year’s models or the parent of growing kids who don’t want to spend a lot of money on shoes that will be outgrown before they wear out.

“There is a whole base of people out there that don’t come into (NRC) that don’t want to pay full retail, regardless of their income range,” Hartner says. “Our existing customers can absolutely go over there and shop, that’s not an issue at all — unless suddenly 2000 of our regular customers start shopping there. But I really think there’s a huge opportunity there.”

Hartner says NRC has always bought closeouts of its key shoe styles and mixed them in with the newer model during the

try-on process to let customers decide whether they want a deal or the latest and greatest. It’s been a smart way to keep a wider customer base happy — and more importantly not lose out to a big-box store or an online discounter. He doesn’t anticipating buying any mid-range shoes from brands, if only because the tighter profit margin wouldn’t really work. As it is, Hartner says his NRC stores do much better than selling $130 to $140 premium running shoes at a discount and hasn’t succeeded selling the second-level $100 shoes at full retail.

Terry Schalow, executive director of the Running Industry Association, thinks Hartner’s new venture is a good one because it offers a differentiation to consumers within the same community.

© 2019 Diversified Communications

RUNNING INSIGHT

The low-budget build-out of the Annex is highlighted by a reclaimed wood interior.

“Whether or not you open up a separate location or not, it brings up the question about what is the right cadence for season sales and discounts without diluting the premium nature of your store,” he says. “It’s about how you can maintain community focus on a premium running store that sells running products and yet expand that to attract new customers, either with your brand or your inventory – and that might mean more lifestyle inventory or last season’s inventory like Kris is selling – in such a way that you’re reaching a different audience.”

Hartner did a low-budget build-out of the Annex and has favorable lease terms with an easy opt-out clause. That’s partially because the building owner

In early May, Hartner is opening the Annex, a new 1200-square-foot retail operation seven doors down from the thriving original NRC shop that will mostly sell closeoutpriced running shoes and apparel while also serving as an additional space to host promotional events. has only rented the space two of the eight years since NRC moved down the block.

“The nice thing about doing this is that it will allow us to do some cool things with other brands that might feel left out,” Hartner says. “I’m nervous, but I’m excited. Yes, it’s definitely a risk, but it’s going to be great.” n

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RUNNING INSIGHT

running shorts Under Armour Is In a Rush This Spring

U

nder Armour is taking a 24-hour, 365-day holistic approach to the life of a runner with its release this week of UA Rush, its newest performance apparel line, designed to be worn at the time of sweat. This scientifically engineered fabric promotes improved performance and energy return. In simplified terms, UA Rush is intended to provide the same benefits to the body as an infrared sauna. During a run, the body emits energy in the form of heat — Rush apparel reflects it back to the wearer, thus recycling the body’s energy.

The key run pieces in the collection are the UA Rush Run HeatGear tights and short sleeve shirts. The mineral-infused fabric absorbs the energy the body emits and reflects it back into tissues and muscles, promoting more speed, more strength and more stamina.

The Rush collection is now available at UA.com, in UA Brand Houses worldwide and with select retailers. n

Hoy Joins Saucony As VP

Nike veteran Shawn Hoy has joined Saucony as VP–global product responsible guiding Saucony’s global brand footwear and apparel strategies, including design, development and product innovation. Hoy will report directly to Saucony president Anne Cavassa.

Hoy joins Saucony from Nike, where he held a variety of strategic planning and senior 12

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product roles, including the management of product portfolios in running, training, basketball and soccer. As Nike’s football (soccer) footwear product director, Hoy was a member of a team recognized with a Nike Global Maxim “Innovation” Award for work on the brand’s 2014 World Cup footwear line. Prior to Nike, Hoy worked as a management consultant with various firms, including McKinsey & Company and Bain & Company Hoy graduated from Grinnell College in Iowa with a B.A. degree in Economics and History. He received an MBA from Tuck School of Business at Dartmouth College Leki Offering Scholarship

For the second time, Leki is offering a Leki Full Ride Scholarship to Timothy Olson’s Run Mindful Retreat

taking place in Boulder, CO, June 13-16.

The scholarship includes registration fees, air travel, lodging and Leki Trail Running gear for one deserving trail runner.

Leki supports ultra-runner Timothy Olson as a sponsored elite athlete and stands behind his message of “Run Mindful,” bringing a passion for running and nature beyond the trails into mindfulness in daily life.

Leki and Olson will choose the winner of the 2019 scholarship based on their community involvement and passion for trail running. The contest will run through May 9 and is being supported by iRunFar.com.

For more information on the retreat, visit Running Retreats – Adventure Mindful n

© 2019 Diversified Communications

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RUNNING INSIGHT

running shorts Brooks Partners With November Project

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rooks Running and grassroots fitness movement November Project last week entered into a two-year partnership focused on inspiring people across the world to run and be active.

With a shared belief in the positive effects of running and exercise and that fitness should be inclusive to all, Brooks will support and help grow the November Project community.

As part of the agreement, Brooks is the exclusive footwear and apparel sponsor of November Project, working with co-founders Bojan Mandaric and Brogan Graham on supporting November Project’s mission of building communities through running and movement. Brooks will provide resources for November Project’s growth and expansion by providing financial support, access to footwear and apparel, leadership training, an annual November Project Summit, activations on a local and global level and entries into Brooks-sponsored running events.

“I’m incredibly excited about the partnership between Brooks and November Project because at the core of both of our brands is a deeply held belief that every day with a run or workout is better, whether you’re waking up for November Project or headed out on a run,” say Brooks Running CEO and November Project Seattle member Jim Weber.

November Project co-leaders and members will have opportunities for early access to Brogan Graham (left) and Bojan Mandaric

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Brooks’ performance footwear, apparel and sports bras so they can share feedback about their gear experiences. These insights will be used by Brooks’ product teams to further develop the company’s leading product portfolio for all who run.

Pro-Tec RM Extreme Mini

Pro-Tec Athletics has released the RM Extreme Mini–Handheld Contoured Roller. The single hand portable roller massager provides a targeted deep tissue massage, while the contoured surface effectively wraps around select body parts. The handle also offers a single point myofascial release technique option.

The RM Extreme Mini is the newest product in the Extreme Massage line from Pro-Tec Athletics. It can be used alongside the RM Extreme, Orb Extreme and Orb Extreme Mini for a full body package.

The RM Extreme Mini expands the extreme line by adding a portable handheld roller to the category of selfmassage. The extreme assortment allows users to achieve a full body self-massage with four firm and durable, deep tissue massage tools. n

Lend a Hand TRAVEL IS NOW OPEN TO A greater number of people than ever, and travelers are often looking for new adventures and experiences.

And yet with crises developing constantly around the planet, many travelers want to explore the world and do good at the same time.

With that in mind, running industry public relations pro Jeff Blumenfeld, a Fellow of The Explorers Club and Royal Geographical Society, shows them how in “Travel With Purpose: A Field Guide to Voluntourism” (Rowman & Littlefield, 2019).

You don’t need to be wealthy to travel to foreign lands to volunteer — you may not even have to go to foreign lands, as opportunities may exist within your own state, Blumenfeld, a resident of Boulder, CO, points out. In the book, the subject of a Fjallraven Boulder official book launch last week in Boulder, Blumenfeld tells travelers how to identify the right location and volunteer opportunity, how to go about planning trips and preparing for volunteering, how to reach out and how to help. It includes examples and first-hand stories from both recipients of volunteer work and the volunteers themselves.

For more information: www.travelwithpurposebook.com n

© 2019 Diversified Communications

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RUNNING INSIGHT

A UNIQUE PERSPECTIVE ON THE WORLD OF RUNNING.

running results

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New Indoor Marathon World Record Once mostly a quirky mid-winter event to stay fit and motivated in the Upper Midwest, indoor marathon running has become a real thing. So much so that C.J. Albertson ran a time fast enough to surpass the U.S. Olympic Trials qualifying standard en route to setting a new indoor marathon world record on April 13 in New York. Albertson, a 25-year-old runner from Fresno, CA, used a blazing kick to win the fourth annual Columbia University Irving Medical Center & New York Presbyterian Indoor Marathon in 2:17:59.4, or 5:16 per mile. Albertson wore a pair of Brooks Hyperion racing flats that he modified by removing the tongues and slicing

Norman Blazes to 4th Fastest 400 Wearing a pair of white and silver Nike Zoom 400 spikes, Michael Norman continued his assault on the 400-meter record book. The 21-year-old San Diego native and former USC runner

clocked a world-leading 43.45 seconds to win the men’s invitational 400 meters at the Mt. SAC Relays on April 21 in Torrance, CA. His effort not only broke the previous meet record of 44.45 set by Steve Lewis in 1992, but it also tied the third all-time American performer (Jeremy Wariner in 2007) and the fourthfastest of all-time behind South African Wayde van Niekerk (43.03, 2016) and American legends Michael Johnson (43.18, 1999) and Butch Reynolds (43.29, 1988). Norman’s time is the second fastest ever run on U.S. soil, trailing only Johnson’s 43.44 run at the 1996 Atlanta Olympics. It’s also the fastest 400 ever run in April; the other seven fastest times were run in August.

Hoka Runners Rule Lake Sonoma 50 slits in the side to make more room in the toe box for his wide feet.

Albertson is a former 3000-meter steeplechase runner for Arizona State and currently the Clovis Community College cross-country coach. He’s already qualified for the 2020 U.S. Olympic Trials in Atlanta based on his 2:16:45 win at the Modesto Marathon on March 31.

Albertson won $7000 for his efforts ($3000 for the victory and $4000 for the new world record.)

Steph Pezzullo won the women’s race in 2:42:11. The race entailed running 211 consecutive 200-meter laps around the track at The Armory and for the fourth straight year it produced an indoor world record.

Hoka-sponsored runners Jared Hazen and Anna Mae Flynn (in photo) dominated the Lake Sonoma 50-miler on April 13 near Healdsburg, CA. This year’s race boasted 280 finishers and while that might seem small compared to road races, the Lake Sonoma 50 is one of the biggest and most competitive ultra-distance races in the U.S. While Hazen dominated the race and won by more than seven minutes, Flynn won the women’s race by edging Yiou Wang by a mere 17 seconds. Hazen, a 23-year-old runner from Flagstaff, AZ, finished in 6:08:31, the third-fastest time in race history. Flynn, a 32-year-old runner from Marble, CO, crossed the line in 7:25:15, the seventh-fastest women’s time ever. Both runners wore Hoka One One Speedgoat 3 trail running shoes.

© 2019 Diversified Communications