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AUGUST 29, 2011

The Weekly Digital Magazine for the Sporting Goods Industry


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ISSUE 1135 AUGUST 29, 2011

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Boston Celtics Point Guard Rajon Rondo Photograph courtesy of Nike

NEWS

4 BROWN SHOE Posts Fiscal Second Quarter Loss; Cuts Full-Year Outlook BROWN SHOE Sells And 1 5 CAMELBAK Products Acquired by Compass Diversified Holdings 6 COLLECTIVE BRANDS Sees Woes Continue in Second Quarter; Explores 'Alternatives' 8 MOVERS & SHAKERS OLD NAVY Recalling Misspelled T-Shirts RUSSELL ATHLETIC Launches 'Together We R' Ad Campaign

FEATURES 8 BASKETBALL ON THE REBOUND Basketball footwear sales appear to be on the rise 16 ADIDAS Brings Barefoot to the Gym

DEPARTMENTS

18 CALENDAR

ON THE COVER Adidas adiPure Trainer worn by women's National Soccer Team Midfilder Heather O'Reilly Copyright 2011 SportsOneSource, LLC. All rights reserved. The opinions expressed by writers & contributors to SGB WEEKLY are not necessarily those of the editors or publishers. SGB WEEKLY is not responsible for unsolicited manuscripts, photographs or artwork. Articles appearing in SGB WEEKLY may not be reproduced in whole or in part without the express permission of the publisher. SGB WEEKLY is published weekly by SportsOneSource, LLC, 2151 Hawkins Street, Suite 200, Charlotte, NC 28203; 704.987.3450. Send address changes to SGB WEEKLY, 2151 HAWKINS STREET, SUITE 200, CHARLOTTE, NC 28203; 704.987.3450.

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NEWS

BROWN SHOE POSTS FISCAL SECOND QUARTER LOSS; CUTS FULL-YEAR OUTLOOK Brown Shoe Company, Inc., the parent of Famous Footwear, reported a loss of $4.6 million, or 11 cents a share in the second quarter stung by weakness in the toning category that impacted both retail and wholesale operations. BWS slashed its guidance for the year to a range of 85 to 97 cents a share due to ongoing global economic uncertainties, consumer acceptance of pending price increases, and expected cost pressures. They had previously forecasted an EPS of $1.25 to $1.32 a share for the year. Adjusted for debt charges tied to its February acquisition of American Sporting Goods, Brown Shoe earned 6 cents a share in the second quarter missing analysts' expectations by 2 cents. Revenue rose 7.2 percent to $628.1 million for the period. On a conference call with analysts, company President and CEO Diane Sullivan said the company saw a more rapid than expected decline in toning and decided to reduce the carrying value of its entire toning inventory, resulting in a write-down of 6 cents per share in the quarter. Its SAP software implementation also negatively impacted profits by 7 cents a share due to increases in allowances and charge-backs, margins related to lost sales, and incremental stabilization costs. Sullivan also noted as part of a previously-announced review of its portfolio, that it reached an agreement to sell the And 1 basketball brand, acquired through its ASG purchase, for $55 million in cash. Famous Footwear sales dipped 0.7 percent to $344.9 million as significant deterioration in year-over-year toning sales was only partially offset by stronger running and sandal sales. Comps

increased 0.2 percent overall and would have been up 3.9 percent excluding toning. Famous Footwear operating earnings slumped 52.5 percent to $7.5 million. Gross margins at Famous were reduced to 43.2 percent of sales from 46.0 percent of sales in the prior-year quarter. Sales month-to-date for August were up 1.2 percent with both average unit retail and pairs per transaction up. While traffic counts are down slightly, conversions have been up. Sullivan noted that during the prior week, Famous recorded BTS sales of $49.4 million, up nearly 5 percent over the same week last year, marking its largest single week in history. Added Sullivan, "We still have about 3 weeks left of traditional backto-school selling and based on last week's record-selling sales, we look forward to heading to a solid finish."

Brown Shoe Company, Inc. agreed to sell the basketball footwear brand And 1 to Galaxy International, a newlyformed brand management company, for $55 million in cash. The transaction is expected to close within 45 days and is subject to customary closing conditions and Galaxy obtaining financing. Proceeds will be used to pay down debt. And 1 was attained by Brown Shoe as part of its February acquisition of American Sporting Goods, which also owns Avia, Ryka and Nevados. The company paid $145 million in cash plus assumed debt for ASG. For its most recently completed fiscal year, ASG's sales were $232 million. Brown Shoe officials indicated that And 1's sales were about $35 million last year. The brand represented about 15 percent of ASG's sales, with Avia making up 60 percent; Ryka, 15 percent; and smaller brands such as Nevados, 10 percent. When Diane Sullivan took over as president and CEO of Brown Shoe in May, she said one of her top priorities would be evaluating Brown Shoe's portfolio of brands and

divesting from those that did not fit into its strategic focus in key categories. On the company's second-quarter conference call last week, Sullivan said the basketball brand "didn't clearly align" with Brown Shoe's focus around supporting active and healthy lifestyles. She said, “As a brand with potential, we believe it's a better fit for a company that can dedicate the resources it needs to move it to the next level. I believe the sale of And 1 shows we are moving in the right direction with our strategic review and are committed to delivering value to our shareholders by potentially monetizing some of our less strategic brands." Galaxy International was described as a New York-based brand acquisition and development firm recently founded by a team of industry veterans, although no officials have yet been identified. Rob Purvy, And 1's executive director, noted to SGB Weekly that most of the current product team will be retained.

BROWN SHOE SELLS AND 1

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COLLECTIVE BRANDS SEES WOES CONTINUE IN SECOND QUARTER; EXPLORES 'ALTERNATIVES' Collective Brands, Inc. announced plans to close approximately 475 underperforming and low-volume stores in the next three years, representing 10 percent of its Payless locations and about 20 percent of its Stride Rite store base. More than 300 will close by the end of the current fiscal year. Collective also indicated second quarter margins were impacted by aggressive markdowns to liquidate inventories at Payless as well as higher product costs and increasing marketing costs. On the plus side, the Saucony and Sperry Top-Sider brands continued to see strong growth in the company’s Performance + Lifestyle Group (PLG) wholesale segment. The news that woke up Wall Street was that the company said it would "conduct a review of strategic and financial alternatives to further enhance shareholder value" and adopted a short-duration rights plan to protect shareholder rights. On a conference call with analysts, Collective Brands’ Interim CEO and SVP, general counsel and secretary Michael Massey said that working with advisors, Perella Weinberg Partners and Kurt Salmon, the board and management “will explore a full range of alternatives for Collective Brands.” Shares of Collective Brands jumped 33.5 percent last  week to close at $12.70 on Friday. Speculation ensued that its hotter brands, Saucony or Sperry, might find an attractive price with a strategic buyer or the entire company could  

be sold to a PE buyer well above its currently depressed trading levels. Impairment and severance charges reduced pre-tax income by $83.6 million in the quarter. The impairment charges consisted of $33 million in asset impairments primarily related to the net book value of stores at both Payless and Stride Rite; $31 million in trade name impairments mostly related to Stride Rite; and $10 million in goodwill impairment in Payless Domestic. In addition, the company recorded a $10 million severance charge. In June, former CEO Matt Rubel resigned. A search for a replacement continues. Excluding the impairment and severance charges, earnings were $9.9 million, or 16 cents per share, down from earnings of $21.1 million, or 32 cents, in Q2 2010. Sales for the quarter increased 4.9 percent to $882.4 million due to growth in three of four segments - PLG Wholesale, Payless International and PLG Retail. Comps declined 0.7 percent due to weakness at Payless Domestic.

CAMELBAK PRODUCTS ACQUIRED BY COMPASS DIVERSIFIED HOLDINGS Compass Diversified Holdings, Inc. last week reported it paid $257.5 million for an 89.9 percent stake in CamelBak Products. The price was based on a total enterprise value of $245.0 million including $12.5 million of cash and working capital adjustments, or roughly two times CamelBak’s 2010 sales of $122.2 million. The EBITDA multiple was pegged at just over 8X. CamelBak becomes Compass Diversified's second company in the active lifestyle space. In 2008, Compass Diversified acquired Fox Factory, Inc., maker of Fox Racing Shox, which derives most its sales from selling suspension systems to makers of mountain bikes.

Sally McCoy, chief executive officer of CamelBak, will continue to serve in the same capacity at the company. For the year ended December 31, 2010, CamelBak reported revenues of approximately $122.2 million. "CamelBak is an industry pioneer with strong brand recognition as the premier innovator of personal hydration products, offering superior performance as well as important health and environmental benefits," said Alan Offenberg, CEO of Compass Diversified. "We expect to capitalize on the company's strong market position, as well as favorable macro trends, including the growing demand for improved everyday hydration. We believe CamelBak will continue to evolve its leading product and innovation platform and strengthen its relationships with top retailers and the military, thereby increasing consumer penetration levels globally. We look forward to working with CamelBak to continue to accelerate their growth."

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MOVERS & SHAKERS David Campisi has resigned as CEO and president of The Sports Authority. Darrell Webb, the chairman and CEO of Jo-Ann Stores, was named interim CEO of the company. Campisi joined Sports Authority in 2004 from Kohl's and served in various executive roles prior to being named CEO and president in 2010. Robert Marcovitch, formerly president and CEO at K2 Sports, was appointed president and CEO at The Coleman Company. Anthony De Rocco, formerly EVP of global brand and product development at K2, was promoted to head of K2 Sports. Both Coleman and K2 Sports are owned by Jarden Corp.

OLD NAVY RECALLING MISSPELLED T-SHIRTS Old Navy is reprinting thousands of college T-shirts to correct an embarrassing error. The shirts debuted this month, featuring the names and mascots of dozens of schools. Printed at the top of each shirt are the words "Lets Go!!" The problem is that "lets" is missing an apostrophe and should read 'Let's Go." The shirts are part of Old Navy's new  "Superfan Nation,"   a just-launched instore shop that sells college- and professional-licensed sports gear. "We're sorry about the error in some of our Superfan Nation graphic T-shirts," said Louise Callagy, a spokeswoman for parent company  Gap, Inc., in an email. "To ensure Old Navy customers can enjoy this collection fully, we're replacing the faulty [T-shirts] at our stores and online as soon as possible."

Alleson Athletic, a supplier of stock and custom uniforms, appointed Mark Watts as the new director of national sales. Watts most recently oversaw domestic and international sales, including big box retail accounts, for Schutt Sports as the regional director of sales. Erica Kerner, Adidas’s global Olympic Games director and head of London 2012, is leaving the company in September to become VP of marketing for Polo Ralph Lauren in Asia Pacific. The Finish Line, Inc. appointed Torrence Boone, managing director of agency business development for Google, to its board. Moving Comfort announced the addition of Laura Savery as technical bra design manager. Savery specializes in plus sized cup pattern cutting and grading techniques. Currie Technologies, the maker of electric bicycles under the IZIP and eZip brands, hired bicycle industry veteran, Russell Bockin as national sales manager, IBD sales.

RUSSELL ATHLETIC LAUNCHES 'TOGETHER WE R' AD CAMPAIGN

Russell Athletic is launching an advertising campaign this fall, entitled, 'Together We R,' featuring real players and designed to demonstrate the power of 'team.' Directed by Sam Bayer, acclaimed for the recent Eminem-Chrysler Super Bowl spots, the campaign will be air in three 30 second TV spots - on ESPN, FX, and CBS. Print ads and interactive units will also run throughout the college football season. The 'we' message will further penetrate the college football market through Russell Athletic's title sponsorship of FX network's Saturday night college football series. "This campaign excites us because it reflects the substance and genuine spirit of team sports," said Gary Barfield, executive vice president for Russell Athletic. "College and high school football are the golden standards of that spirit - and the perfect place for our brand.  No celebrities or glitz -just real players and coaches doing what they do best and love most. This philosophy is what the Russell Athletic brand is all about." Online elements of the campaign include the launch of a new Russell Athletic blog (blog.TogetherWeR.com) as an outlet for athletes, coaches, parents and fans to engage in inspirational conversation - to share their wins, losses and everything in-between. In addition, Russell Athletic is the exclusive team uniform provider of ESPN's 'Rise UP' - an ESPN original series that tells the story of four communities coming together to renovate their local high school athletic facilities.


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LA Clippers Power Forward Blake Griffin wearing the Nike Zoom Hyperdunk Photograph Courtesy Of Nike

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BASKETBALL REBOUND ON THE

By Thomas J. Ryan

fter a few rough years, basketball footwear sales appear to be on the rise. The pick-up is driven by Nike, the dominant participant in the space, but it’s clearly encouraging that older and newer brands are taking a fresh look at the category. Matt Powell, senior analyst for The SportsOneSource Group, said retail point-of-sales figures from SportsScanInfo indicate that basketball footwear sales are growing this year at about a 5 percent rate. That’s soft compared to the dizzying 20 percent rate the running category is seeing, but it does mark a recovery compared to the slight gains basketball footwear had been generating for much of the past decade. The category peaked around 2001. “What clearly has not revived are kids wearing basketball shoes for fashion,” said Powell. “Kids are buying basketball shoes to play in but are wearing other shoes to the court, and changing.” With fashion waning, the team channel becomes more important. Fashion-brands such as Jordan as well as more sports-focused brands are increasingly looking to ratchet up their technical features to meet the needs of actual basketball players. Nike, Adidas and Under Armour in particular have been aggressively signing more elite high school basketball teams to endorsement contracts, supplying both footwear and uniforms. Converse, Fila, And 1 and Nfinity are doing more to support local tournaments and youth camps across the country to reach the team player. Another new

brand, Ektio, has been handing out free product at inner-city courts to gain traction. Another event that could put the basketball spotlight stronger on the team world is the NBA lockout. If the NBA season does not start on time and pro players aren’t available to promote the major launches, brands will have to rely on their college stars to showcase new product, said Powell. He believes this partly precipitated Nike’s deal with Ohio State, Kentucky and Miami for its LeBron James collection. Also creating excitement in basketball for some brands is the lightweight trend, the momentum-driver in running. But that’s not all basketball developers are stealing from running. Said Powell, “Many styles look like modified running shoes. Low tops overall are more important than they used to be.” Not surprisingly, some vendors see an emerging opportunity for the category at both retail and in the team channel with the help of some fashion touches. “The last 18 months has obviously seen an almost rebirth of the category,” said Rob Purvy, And 1’s executive director. “The influence of running, the increased use of color and non-traditional basketball materials and applications has been welcome and much needed.” As far as heights, mid-cuts are still where the bread and butter is for the category, Purvy believes. He added, “It seems, however, that it is more

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about where the brief and design take you than anything else. I have seen more players go with lows but I have not necessarily seen it translate yet - to retail significantly, aside from Kobe. Demicuts and non-traditional heights are somewhat the norm. I see the envelope continuing to be pushed as we strive to be relevant and change agents.” Under Armour’s Director of Basketball Ryan Drew added, “We’ve seen a lot more low tops on-court at the college, high school, and AAU level, but it hasn’t translated into sales in stores. I think the biggest aesthetic change in the last 12 to 18 months has been the consumer’s acceptance of see-through meshes and textiles on basketball shoes. There was a time in the business when mesh on a basketball shoe meant ‘cheap.’ Today, performance basketball is being defined by how well you can see your sock through the upper mesh.” The vendors appear to agree that lightweight is currently the most influential trend in performance basketball footwear. “They want benefits they can see, and feel,” said Paul Froio, Reebok’s head of U.S. Men’s Sport, Marketing and Merchandising. “Lightweight product, with visual technology, is a key trend in this category.” Drew added that with the 10oz barrier having been broken, it will be interesting to see how lightweight product evolves. Said Drew, “A lot is being stripped out of footwear in an effort to say ‘We’re the lightest,’ while athletes are getting bigger, stronger, and faster. Our goal is to make lightweight product, but we also want athletes to know that our shoes are comfortable, supportive, and durable.”

adiZero Ghost Men’s offers vertical and horizontal strength through TPU technology. Sprintweb technology is a lightweight web layout incorporated into the upper to reduce weight and provide support. Closed mesh textile lining with PU footbed. IMEVA midsole and nonmarking rubber outsole. MSRP $90

just like runners’ legs naturally benefit from wearing lighter shoes when running long as well as short distances, basketball players can benefit by carrying less weight. “When you’re shedding off weight, it gives you a better chance to be faster,” said Norman. “We’ve certainly done a lot of research on this. It’s like anything else. If you lose 20 pounds, you feel lighter and faster. It still has the support and the performance benefits of the greatest basketball shoes.” On the company’s second-quarter conference call with analysts, Adidas CEO Herbert Hainer raved that the Crazy Light boasted a 75 percent sellthrough rate 45 days after introduction. Overall, Adidas’ basketball footwear sales grew double-digits in the quarter. Hainer said “momentum for the brand is accelerating” in the category, driven by the success of the adiZero Rose, the Crazy 8 as well as the Crazy Light introduction. For the Fall/Winter 2011 season, Adidas’ biggest launch is the adiZero Rose 2, which will be supported by a full marketing campaign around league MVP Derrick Rose. The adiZero Ghost will launch exclusively at Dicks Sporting Goods in early September, but also have a national advertising campaign featuring Josh Smith for its broader launch in early October. Other key styles for the season include additional colorways of the adiZero Crazy Light and two new models, the adiPower Howard (Dwight Howard’s new shoe) and Pro Model Zero.

Nike Zoom Hyperdunk gives a combination of Flywire bundles and breathable mesh locking the foot in place. The midsole is equipped with an ultra-lightweight, strong glass-reinforced shank that wraps up the sides of the foot and covers a wide area along the bottom for firm, yet flexible stability. The midsole features a foam midsole for resilient cushioning. Housed in the forefoot is a low-profile Nike Zoom unit that delivers additional cushioning and impact absorption. Extra cushioning at the collar helps keep ankles comfortable and protected. Modified herringbone traction pattern at outsole provides versatile traction. MSRP $125.

NIKE BRAND

adiZero Rose 2 Men’s has both a textile and synthetic upper with Sprintweb technology for support and comfort. Ankle lock system and solid leather toe cap. Sprintframe positions an external heel counter reducing weight and allowing energy return and motion control. Molded EVA lightweight midsole. Non-marking rubber with herringbone traction outsole. MSRP $115

ADIDAS Adidas shocked the basketball community launching this past June the adiZero Crazy Light, weighing in at a mere 9.8 ounces in a men’s size 10 and touted as the lightest basketball shoe ever. Basketball shoes in size 10 are typically at least 14 ounces. “It’s 15 percent lighter than a comparable mid-cut and it’s actually a half ounce lighter than any low-cut,” Lawrence Norman, Adidas vice president of global basketball said at the launch event. But Norman stressed that 10

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For its part, Nike last December launched Kobe VI, its lightest model at only 10.6 ounces (at men’s size 9) and in April introduced its lightest shoe under its Lebron series. Featuring Hyperfuse construction, the Lebron 8 shed 1.5 ounces from the regular season model (U.S. men’s Size 9) to bring it to 14.5 ounces. But Nike – controlling over 90 percent of the basketball business through its Nike, Jordan and Converse brands - has seen its flagship brand revive in basketball in recent years with the success of the Hyperdunk. Initially borrowing from its Flywire running technology that shaved off weight while adding strength, the collection eventually added Lunarlite for springy cushioning in the forefoot as well as Zoom Air in the heel. In its fiscal year ending in June, Nike basketball sales (including Jordan Brand) rose 11 percent to $1.9 billion. Nike basketball had an “extremely strong year, with double-digit growth and exceptional results across key markets of North America and China,” said Trevor Edwards, Nike’s vice president of global brand and category management at Nike’s analyst


meeting held in June. The Lebron franchise “continued to accelerate,” with Lebron 8 selling over 500,000 pairs. Black Mamba, the campaign backing Kobe VI, generated more than 15 million views online. While follow-ups on the Lebron and Kobe statement collections will be coming next year, the focus this fall will be on Nike Zoom Hyperfuse 2011, the first shoe for Rajon Rondo, and Nike Zoom Hyperdunk, likewise the first shoe for Blake Griffin. In an online interview, Leo Chang, footwear design director, Nike basketball, said the three most important technologies in the Zoom Hyperfuse 2011 are lightweight, durability and breathability. “The Hyperfuse upper brings breathability and durability together. It is a composite system adding a layer of skin in zonal regions of the foot,” he pointed out. “And then we have a lateral stability wing in the midsole that keeps you on the foot bed of the shoe with a higher side wall and midsole wrap. And with that too, taking some of the bulk out of the collar in the 2010 Hyperfuse and engineering some structure back in without the bulk and then adding zoom cushioning in the forefoot for a responsive toe off.” With the Zoom Hyperdunk, the composite uppers with its Flywire technology provide breathability and comfort while an upgraded shank enhances support. Said Chang, “It has a lot of great 3-D geometry giving the shank its structure so that the shoe does not bend in the mid-foot area. We listened to the basketball player in that they really want that responsive cushioning and the best responsive cushioning that Nike makes is Zoom technology.”

JORDAN FLY 23 combines both textile and synthetic materials for the strong and aggressive basketball player who wants a lightweight, durable and supportive fit. Also features a combination of a Max Air unit in the heel and a Nike Zoom unit in the forefoot for impact protection and lightweight responsiveness. Modified elephant crackle pattern on the outsole and multidirectional traction. MSRP $125

CONVERSE Converse has been on a roll since being acquired by Nike. In its fiscal yearended June 30, Converse’s revenue grew 15 percent to $1.1 billion and management’s goal is to double revenues to $2 billion in fiscal 2015. But much of the legendary basketball brand’s stupendous growth over the past several years has been driven by Chuck Taylor canvas classics. At its analyst meeting, President of the Nike Affiliates Roger Wyett noted that the Chuck Taylor franchise has grown from 2 million pairs at the time of the acquisition in 2004 to 70 million pairs currently.

JORDAN BRAND At Nike, Inc.’s annual analyst meeting, Trevor Edwards, VP-global brand and category management at Nike, said the launch of Air Jordan 2011 marked a renewed focus on performance for the brand. “It includes an innovation called ‘Modular Performance,’ which allows the athlete to choose what type of cushioning they need based on their type of game,” observed Edwards. “Should it be quicker? Should it be more explosive? The positive response that we have received from consumers has shown us that performance customization is something that players have been waiting for.” Overall, Edwards said Brand Jordan “had a very solid fiscal year, driven by consistent growth in North America, but we believe our renewed focus on performance innovation will accelerate this brand and grow it into the future.” New launches include the Fly 23, constructed on top of the same midsole as the Jordan Fly Wade and sharing a similar silhouette as D-Wade’s signature shoe but with patent leather and carbon fiber accents. The Air Jordan 2011 Q Flight features the Zoom Air cushioning system. The brand’s three star endorsers - Dwayne Wade, Carmelo Anthony and Chris Paul - undertook a 13-country tour together this summer as part of a Jordan Flight promotion. In May, Maya Moore, the first overall pick in the 2011 WNBA draft, became the first female basketball player to sign with the Jordan brand.

AIR JORDAN 2011 Q Flight retains some of the best aspects of the AIR JORDAN 2011 “Quick” midsole, featuring Phylon midsole, elephant-crackle outsole, and integrated lacing system around a full inner-sleeve, low-cut collar to reduce weight and increased responsiveness. MSRP $120

Pro Leather 2K11 is engineered with high-tech benefits in a simple package and retains the clean, simple design of the original Converse Pro Leather shoe. Predominantly features the “Dr. J” logo. MSRP $100 (Launches November 2011) ​

DEFCON is the ultimate in lightweight support for performance on the court. Crafted with innovative materials in a high-tech streamlined package. MSRP $90 (Launches October 2011)

The performance side received a blow when its top endorser Dwyane Wade left Converse to join sister brand, Jordan, in 2009. Its endorsers still include Elton Brand, Glen Davis, Lou Williams and Kirk Hinrich. But of the three brands, Converse appears to be taking the most aggressive grassroots approach to reaching players with its “Open Gym” initiative, first launched in 2007. Held in major metropolitan markets including Atlanta, Chicago, Philadelphia, Miami and Boston, the national program has reached more than 56,000 kids and provides an opportunity for kids to play basketball in a free, safe and unrestricted environment. In July, Team Converse athletes and Puerto Rican natives Carlos Arroyo and JJ Barea helped launch the program in San Juan, Puerto Rico. Beside pick-up games and Converse basketball shoe giveaways, the WEEK 1135 | SGBweekly.com

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DEFCON is the ultimate in lightweight support for performance on the court. Crafted with innovative materials in a high-tech streamlined package. MSRP $90 (Launches October 2011)

event featured a house DJ, a green screen-technology photo area for kids to take pictures with their friends, a temporary tattoo parlor, and a Converse barbershop where attendees received free haircuts. On the design side, Wyett said Converse is “realigning a strategy collaborating with Nike and creating a very gritty, street smart performance range that sits alongside Nike Basketball and Jordan.” Fall launches include the DEFCON lightweight shoe as well as the Pro Leather 2K11, an update of the original Converse Pro Leather shoe which debuted in 1976 with Julius “Dr. J” Erving.

REEBOK Reebok’s basketball business has grown steadily over the past two seasons. “The introduction of the ZigSlash was a catalyst to this success,” said Froio. “The performance benefits provided by ZigTech’s light weight and energy return attributes were key to initial consumer purchase. In addition, ZigTech’s iconic visual appeal, and endorsements from marquee NBA athletes including John Wall have brought Reebok basketball into the top three brands at retail. There’s no question that John Wall’s affiliation with Reebok and ZigTech has helped boost Reebok’s status in the basketball category.”

Reebok ZigEncore is John Wall's signature shoe. The shoe is the first to be emblazoned with his logo. The ZigEncore was designed to provide a balance between energy efficiency and cushioning. MSRP $115

In the 2011-2012 season, Reebok will launch the Zig Encore, Wall’s first signature shoe which will include his logo on the tongue, design elements which complement his speed and energy on the court as well as ZigTech technology on the bottom of the shoe. In addition, the Zig ProFuture, also featuring ZigTech bottoms, will launch and be worn on court by Reebok athletes including Jason Terry, Jameer Nelson and Danilo Gallinari. “The recent success of Reebok’s basketball business can be credited to two things; lightweight, visible technology paired with a marquee athlete like John Wall,” said Froio. “This combination is driving the team athletes to wear our product.” 12

SGB WEEKLY AUGUST 29, 2011

Micro G Supersonic incorporates Under Armour's exclusive HeatGear material to create the ultimate anatomical fit,  breathability and  moisture management. Synthetic patented forefoot and medial heel, asymmetric collar design, full-length Micro G foam midsole, fulllength molded Micro G sockliner, midfoot TPU shank plate, and onepiece rubber outsole. MSRP $100   Micro G Juke has an external injected TPU heel counter, external fulllength Micro G foam and midfoot TPU shank, and one-piece rubber outsole with multi-directional traction patterns  for lateral and linear movement. MSRP $100

UNDER ARMOUR Under Armour entered the basketball category last fall and continues to use a heavy grassroots-approach. Of the 30 plus high school programs it sponsored last year, 17 of them played for state championships. Events, like the Best of the Best in Atlanta, the Brandon Jennings Invitational in Milwaukee, and the NY2LA Summer Jam AAU event, introduce top talent from around the country to the brand. Likewise, partnerships with the NBA Players Association Top 100 Camp, and the Hoop Group Events are exposing the brand to thousands of ballplayers. Under Armour earlier this year made a bigger investment in the sport with the signing of Derrick Williams and Kemba Walker, both top-ten picks in the recent NBA draft, to endorsement deals. The rookies will complement Brandon Jennings, who will see his second signature shoe, Micro G Bloodline, launch in seven colorways in November. “Kids are looking for someone new to enter this category,” said Drew. “Success in basketball isn’t something that is going to happen overnight. We’ve gotten great feedback on our product and direction. Even though we’re new to the category, I think consumers can see that we’re creating performance product that lives up to our brand mission to make all athletes better.” For the fall, its biggest launch is the lightweight Micro G Supersonic, the first shoe in Under Armour’s line to prominently feature its HeatGear material on the medial side of the shoe. Said Drew, “The HeatGear textile that we’ve developed for footwear is lightweight, breathable, and will manage moisture similar to what consumers have experienced in our apparel. In a sport like basketball, heat means sweat, and sweat means weight. Keeping the shoe cool, dry, and light was a priority in the development of the Supersonic.” The Micro G Juke, at 5/8” height, incorporates a technology called Compfit, a compressive ankle sleeve that is integrated into the lacing system of the shoe. Said Drew, “It supports your ankle, but gives you the range of motion of a lower cut shoe. The rest of the shoe is a lightweight, one-piece upper construction with a laser-etched perforated pattern for breathability.”


AND 1 And 1 has been in a rebuilding phase since 2008 under a new team led by former Reebok Executive Director Rob Purvy, who believes both the product and brand structure had slowly eroded over the years as the brand moved from Paoli, PA, then to Portland OR, and finally to Aliso Viejo, CA. A product segmentation strategy has been set up with more value-oriented product targeting the mid-tier channel while its L2G (Low-To-The-Ground) product aims at athletic specialty. “We call it our ‘L2G Philosophy,’” said Purvy. “We build our performance product to be low while providing superior support and cushioning. We continually push the envelope looking to use strong, lightweight, durable compounds and materials for footwear applications.” And 1 has also created the Lo-Qi (pronounced Low Key) segment that harkens back to the Tochillin, the best selling footwear model in And 1 history.

ME8 Empire signature shoe for Golden State Warriors Guard, Monta Ellis. Built around the L2G philosophy which keeps players low to the ground, improving reaction by reducing the distance between foot and the floor. MSRP $80 ​ Sabatoge double lasted performance shoe built around the L2G Philosophy,was engineered to heighten reflexes and accelerate movement. MSRP $70

Another promising development for the brand is new ownership this year under Brown Shoe Co. that has already enabled the brand “to expand beyond a lot of the budget restrictions that existed previously,” said Purvy. Monta Ellis, the Golden State Warriors star, remains its key endorser and his shoe, ME8 Empire, drops in October. And 1’s Mixtape Tour, once a regular feature on ESPN, returned last September with an online initiative. Purvey believes that the brand will be helped by fashion trends, particularly around color, returning in And 1’s favor. “And 1 can and will be a benefactor here as the non-traditional colors were brand hallmarks back in the day,” said Purvy. “As far as players, I have never heard anyone ask for a heavy shoe. Add in the creativity and expertise that our design and development team brings, makes us very excited.”

FILA Fila, which at one point counted Grant Hill, Jamal Mashburn and Jerry Stackhouse among its endorsers in the 1990s, is looking to regain a foothold in basketball with the launch last season of its “Back To Grassroots”

Performance DLS has Fila’s DLS foam midsole and double-lasted construction for enhanced performance with a herringbone, multidirectional tread pattern on the outsole. The Upper features embossed synthetic panels for lightweight support and a faux carbon heel counter with welded detailing. MSRP $60

initiative targeting top high school, club and collegiate players through a partnership with basketball marketing agency, Michael T. White, Inc. (MTW). In April, for example, Fila hosted the annual All-American Prep basketball game as part of the Deep South Classic held at Carmichael Auditorium at the University of North Carolina. Twenty-two of the nation’s top ranked prep female players wore Fila’s new Performance DLS Slam basketball shoe and Fila uniforms. “Fila is thrilled to have the opportunity to develop a grassroots business venture with one of the top marketing experts in the basketball category,” said Fila USA’s President Jon Epstein. “We look forward to re-entering the performance basketball marketplace, where we enjoyed much success in the 1990s.” Providing financial support for Fila’s turnaround has been its acquisition by Fila Korea, which recently acquired the Titleist golf businesses. A marketing blitz celebrating Fila’s 100th anniversary is also being planned in 2011. In basketball, the DLS Slam will be updated for 2012 and the Michael T. White partnership will be continued with product placement and sponsorships at signature high school and AAU events across the country.

NFINITY Nfinity Athletic, the women’s team footwear company, launched its first basketball shoe, BioniQ Lite, in 2009. The shoe addresses the typically more pronounced Q-Angle in females, said Torre Clauss, Nfinity’s director of marketing and sponsorships. In addition, scientific research on jumping, cutting and change of direction movements has shown that female athletes tend to land with greater knee valgus (knock kneed) and a more upright posture possibly subjecting undue stress on the knees. Combined, the larger Q-angle and knee valgus are said to predispose female athletes to ACL injuries at a much higher rate than male athletes competing in the same sports. BioniQ Lite targets elite athletes. “Our market is not the beginning 12-year-old basketball player,” said Clauss. “Our focus is on the serious athlete that demands so much in their footwear that they’re going to pay a higher price.” For Fall/Winter 2012, the BionQ Lite is being updated in response to feedback, with improvements including shortening the tongue and adding more traction. The recent hiring of Rushia Brown, a former WNBA player, as basketball brand manager is expected to pave the way for more introductions in coming years. Nfinity, which also offers cheerleading, volleyball and softball shoes for women, has partnered with the WBCBL and sponsored some WNBA athletes, including Edwina Brown. But it’s also largely taking a grassroots approach by focusing on getting its footwear WEEK 1135 | SGBweekly.com

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Nfinity BioniQ Lite

Nfinity BioniQ Lite features an anatomical last that offers centering of weight in the middle of the shoe. BIONIQ Outsole Technology addresses the pronounced Q Angle in female athletes to protect knees during pivots and quick direction changes. QChannel technology centers the foot and weight. True 5/4 upper provides ankle support. NfiniFit forefoot gives a natural fit around the toes and jumping area. Interchangeable color cards add team or style customization. Packaged in a signature Nfinity shoe case with the five-year anniversary N logo. MSRP $130  

on collegiate, club and high school athletes to encourage schools to turn to Nfinity for their uniforms as well as their shoe needs. Said Clauss, “We are working with those coaches that are wondering why their athletes are getting shin splints and ACL injuries and are willing to take a chance for that athlete that wants the best footwear. An injury might take them out of a chance of getting scholarships.”

EKTIO Pioneered by orthopedic radiologist Dr. Barry Katz, Ektio was launched in 2009 as an antidote to sprained ankles. Built-in straps within the wall of the shoe anchor the ankle to prevent rollover injuries while “anti rollover bumpers” support the outside of the sole. Katz argues that tapes and braces have not adequately protected people. Tape only lasts fifteen minutes before it starts loosening while braces are attached to the ankle so the shoe can still roll, he asserted. “Our shoe is the first shoe that will prevent and cure ankle sprains,” said Katz. “So even if you jump and land on someone’s foot when you play, your ankle won’t roll and you won’t sprain your ankle.” The brand last year gained distribution at Dick’s Sporting Goods 14

SGB WEEKLY AUGUST 29, 2011

Ektio Wraptor is a physician-designed and clinically tested high-top  shoe with a patent leather toe designed to eliminate ankle sprains.The patented strap technology acts as an internal brace mechanism, bringing the foot and shoe together as a unit so the ankle and foot land flat. Included in the anti-sprain technology are lateral side bumpers to keep the shoe from rolling over. MSRP $150

and recently reduced its price from $200 to a more budget-friendly, $150. While former New York Knick star John Starks has signed on as a spokesman for the brand and advertisements have run on ESPN radio, the brand focuses primarily on continuing to seed product with players and coaches to break into the team channel. That effort includes sending a van this summer across the country to encourage inner-city players to try the shoes. While admitting that Ektio cannot compete with the budgets of the major footwear brands, Katz added, “Their shoes have no safety value. We find that about 95 percent of people that put on our shoes are amazed by the feel and they don’t want to take them off.” ■


The Nike Zoom Hyperfuse 2011 was built with Fuse technology, a process that blends three different layers of material to create a nearly seamless one-piece upper for improved ventilation, durability and stability. Phylon midsole for cushioning as well as plush-foam cushioning at the collar for protection and comfort. Pivot point at the outsole for stability during multidirectional movements. MSRP $100 Boston Celtics Point Guard Rajon Rondo Photograph courtesy of Nike


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By Thomas J. Ryan

ADIDAS BRINGS BAREFOOT TO THE GYM By Thomas J. Ryan 18

SGB WEEKLY AUGUST 29, 2011


U.S. women’s national soccer team midfielder Heather O’Reilly and New York Giants rookie wide receiver Jerrel Jernigan demonstrating training skills with the adiPure Trainer

A

didas last week unveiled what it believes is the first barefoot shoe designed for use in the gym. The glove-like adiPure Trainer, available in stores this November, is designed to mimic exercising in barefoot, but with the protection, traction and durability of wearing shoes. Although Adidas has come out with ultra-lightweight running shoes such as the adiZero Feather (6.7oz in men’s size 9) featuring its SPRINTFRAME and SPRINTWEB technologies, adiPure marks its entry into true minimalist shoes.

At the launch event held at The Gym in The Continental Hotel in midtown Manhattan, David Baxter, Adidas America's vice president of sport performance, said the company realized there was "a lot of buzz in the marketplace" around the concept of natural running, inspired by Christopher McDougall's book “Born to Run." But the benefits of harnessing the body’s natural mechanics weren't being brought to training and conditioning. Activating a wider range of muscles, the adiPure Trainer promises to build strength, balance and tactile sensitivity, which can aid in minimizing injuries. Baxter likened the adiPure Trainer's impact on the foot to how kids generally start wearing mittens for the snow and cold only to eventually develop the dexterity to use fingered gloves. "That’s very much like what the barefoot training concept is all about," said Baxter. "You are training your foot and all the muscles in your foot to activate and also activate more of the lower leg muscles." At the event, Mark Verstegen, famed trainer and president of Athletes' Performance, demonstrated training skills with the shoe along with U.S. women’s national soccer team midfielder Heather O’Reilly and New York Giants rookie wide receiver Jerrel Jernigan. "A lot of engineering went into making your foot a high performance machine," said Verstegen. "To achieve your full potential during a workout, focus on how your foot interacts with the ground in the same way you think about how your hand interacts with a ball or a bat. Using your foot’s natural power and movement will help you strengthen muscles you never knew you had in your feet, lower legs and throughout your core." WEEK 1135 | SGBweekly.com

19


adiPure Trainer MSRP $90

"THIS PIECE OF EQUIPMENT IS DESIGNED TO HELP ATHLETES STRENGTHEN THEIR FEET AND LOWER LEGS WHILE STILL PROVIDING COMFORT AND PROTECTION DURING THEIR STRENGTH TRAINING AND CONDITIONING WORKOUTS." DAVID BAXTER, ADIDAS AMERICA'S VICE PRESIDENT OF SPORT PERFORMANCE

"My feet are able to move naturally in all directions and I can work muscles from my toes all the way to my calves," agreed O’Reilly, discussing her tests with the adiPure Trainer. "The adiPure helps improve my balance and increase my foot and leg strength to help me play a full 90 minutes at my highest level." Featuring an independent toe separation design and a quarter-inch​ minimalistic profile, the adiPure Trainer allows the foot to be as close to the ​ground as possible and eliminates the heel lift to align spine and legs and improve posture. A flexible outsole and flex groves in the toes mimics the foot's natural movement while providing traction and durability. For comfort, the adiPure Trainer features a sock-like stretch while EVA midsole cushioning prevents foot bruising and allows for less rubber outsole material. Wrapped up side walls provide stability during ground-based positions and postures for pillar strength, movement preparation, yoga and Pilates exercises. Finally, an Ortholite sock liner offers antimicrobial protection and moisture management. "In almost every sport, your foot is the first part of your body to absorb impact or get you moving, so it’s crucial for your feet to provide balance, flexibility and strength," said Baxter. "This piece of equipment is designed to help athletes strengthen their feet and lower legs while still providing comfort and protection during their strength training and conditioning workouts." 20

SGB WEEKLY AUGUST 29, 2011

Baxter told SGB Weekly that the main difference between Vibram's FiveFingers is that that adiPure Trainer features an EVA outsole but it was also made and will be marketed specifically for gym use. "It was not made to run in," said Baxter. "It's made for the gym and made to do a lot of training movements and that's key." He added that the adiPure collection will eventually expand into running. Said Baxter, "Our category's called adiPure and there are other launches coming down the road – some for running as well as other enhancements in the training category. You will see more product from us in this space." Asked if Adidas had explored potential patent infringement issues with Vibram's FiveFinger's model, Baxter said, "We're not aware of anything like that. We're not trying to trample on anyone's intellectual property. It's not our business." As reported, Vibram in July filed a patent infringement lawsuit against Fila over its Skele-Toes collection. Fila has refuted the charges. ■


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CALENDAR

For full year calendar go to sportsonesource.com/events

SEPTEMBER

DECEMBER

7

Surf Expo SUP Demo Orlando, FL

5-7

8-10

Surf Expo Orlando, FL

JANUARY

9-11

NBS Fall Semi-Annual Market Ft. Worth, TX

10-12 ATA Show Columbus, OH

12-13

Interbike Outdoor Demo West Boulder City, NV

12-14 Surf Expo Orlando, FL

12-14

EORA Lake Placid Expo Show Lake Placid, NY

17-20 SHOT Show Las Vegas, NV

13-16

WDI Worldwide Fall Show Portland, OR

18

14-15

MRA Paddle & SUP Demo Gull Lake, MI

Outdoor Retailer Winter Market Salt Lake City, UT

14-16

Interbike Int. Trade Expo Las Vegas, NV

19-22 25-28

14-16

Health & Fitness Business Show Las Vegas, NV

26-29

SIA Snow Show Denver, CO

4-6

6-7

OIA Rendezvous Portland, OR The Retailing Summit Dallas, TX

NOVEMBER 1-4

NASGW Annual Meeting & Expo Reno, NV

2-4

TAG Fall/Winter Show Kansas City, MO

3-4

NBS Fall Market Mobile, AL

12-14

ADA Fall Buying Show Kansas City, MO

20-22

Sports, Inc. Athletic Show Las Vegas, NV

MRA December Market Lansing, MI

Outdoor Retailer Demo Solitude, UT

PGA Merchandise Show Orlando, FL

29-2/1 ISPO Munich 2012 Munich, Germany 30-31 SIA On-Snow Demo/Free Ride Fest Winter Park Resort, CO FEBRUARY 1-2

NBS Spring Semi-Annual Market Fort Worth, Texas

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