Columbia Sportswear is turning to more technical features in its garments that can be easily understood by the end user, to help it increase its average sales prices, gain market share and create more value for the consumer. Technology is included in 80-85 percent of the brand’s 2010 product line, up from 40-50 percent this year and only 15 percent in 2008. The technology percentage, however, doesn’t correspond to the percentage of sales volume.
Tim Boyle, Columbia’s chief executive, spoke at Goldman Sachs’ 16th Global Retailing Conference, saying the current retail environment has the makings of a gradual improvement but later added that retailers remain “extremely cautious” with their inventory purchases. More than 40 percent of Columbia’s global turnover is generated outside the U.S. market where conditions have been “less catastrophic,” Boyle said.
He said that the company is working to escape the role it had established as a moderate brand and return to its place in the specialty channel, selling at higher-end retail and department stores for “the true user.” However, he insisted that Columbia would still continue to sell to volume retailers.
On the footwear side, Boyle admits Columbia has yet to fulfil its potential after more than 15 years in the segment, but feels the “right management team is in place” now to make that happen and allow Columbia to compete more effectively against the likes of Merrell, Wolverine and Keen. He also noted that on the technology side, the company was incorporating its “Techlite” into its components, and plans to make the high-tech aspects of footwear visible to the customer.
In outerwear, private labels remain a big competitor in all channels, but competition is heating up from brands focusing on technical features for outdoor enthusiasts. This helped spur the new emphasis on Columbia’s technology.
Meanwhile, Columbia intends to forge ahead with its fledgling e-commerce and own retail operations. A new flagship store recently opened in Frankfurt, Germany, and another will debut in Manchester, England, shortly. It also just opened a factory outlet store in the new Designer Outlet Center in Salzburg, Austria, for the Columbia and Sorel brands. The brand’s web business, which will offer about 60 percent of the brand’s overall offerings to online consumers, launched three weeks ago.