As the new year begins, we reached out to several brand leaders to ask them about the key lessons they learned over the past two tumultuous years and how they think 2023 will unfold.
We spoke with Derek O’Neill of Stokehouse Europe, Dylan Slater of Rip Curl, Todd Hymel of Liberated Brands, Mandy Fry of Z Supply, Pierre André Senizergues of Sole Technology, Martino Fumagalli of Union Binding Company, and Eric Carlson of The Leisure Collective.
Derek O’Neill, President of Stokehouse Europe, which is home to Vissla and Sisstrevolution brands. Derek was CEO of Billabong International when it was an independent, publicly traded company.
What are a few of the biggest lessons you have learned over the past two years?
Derek O’Neill: For me, the last two years have been unlike any others in my long industry career. Mostly because all the normal rules went out the window! You learn so much more when you are dealing with challenges compared to when everyone is patting you on the back.
And there were so many challenges. Raw material cost increased almost week to week. Shipping costs exploded and goods took twice as long to arrive. Zero demand followed by huge demand. Tourist movements. Stores closed by governments for months. The Euro dropped its buying value over 25% in two years. War. Inflation. Supply chains that were impossible to read – the days of ordering something and just expecting it to come as it did in the past were gone.
The lesson from all that was that sometimes, you need to reexamine why you are in business and you have to review all parts of what you need to do to keep your business strong. We are planning to be here for the long term, and therefore we worked out which suppliers and retailers are going to be our strongest partners going forward.
We also reviewed our brands, the look and feel of them, the design, the pricing, and the distribution points we had to go forward with. We looked at all of this from a European perspective and this is leading to some changes in how we will work going forward. Pricing may need to be more fluid even within the season. More products will be sourced closer to home. We will carry less inventory to help cashflow, and will aim to sell it out.
The important retailers will be the ones who realize while we are here to work closely with them – and that we work incredibly hard to produce the product they want for the delivery time they want – we can’t always take on every problem they have as well as our own.
Brands increasingly have to find other paths to the end customer if the traditional paths are blocked, and today there are more paths available. In the end we can only help our clients if we remain strong. And to do that, you have to say no a lot more than in the past.
How do you think 2023 will unfold from a business and consumer spending perspective?
Derek O’Neill: Europe is probably going to see a very soft six to nine months ahead, if not longer. The realities of inflation are hitting everywhere and, understandably, this will lead to some cautious and nervous consumers. Energy price increases through 2023 are serious enough to have major impacts on everyone in Europe.
On the positive side, we are likely to see a bigger influx of international tourists to France, Spain and Portugal in 2023, just as we saw in Italy and Greece this year. This should help summer tourist spots have a bumper mid-summer hopefully.
What is the most exciting thing happening with your company in 2023?
Derek O’Neill: While we expect it to be tough going, I think 2023 is going to be a fun year actually. I look forward to watching the impacts of some of the coming industry corporate ownership changes. That’s going to be fascinating, especially for Europe, which is a complicated market. That may open up some business for everyone here, but we’ll see.
Our industry historically has seen good brand energy arrive after tough years. When we started Vissla in late 2013, it was just after the global financial crisis. Everyone thought we were crazy to start a new brand, certainly in Europe anyway. But the market was open to new blood and we have seen that develop further with many fantastic brands emerging since then, and more and more of them are now available in Europe.
Our company has made great inroads with winter product for Vissla in Europe over the last four to five years, and now we are close to a 50-50 split between winter and summer sales. We have taken the same steps for Sisstrevolution in winter product for Europe in the last few months and we expect that we will become a much bigger part of the female market here in 2023.
We also think that the current flood of products we see in certain categories, especially hardgoods and wetsuits, may continue to have a negative impact through most of 2023. But by late in the year, some of those categories will potentially move back into a much lower inventory position just as demand increases and they will hold tremendous value again.
Dylan Slater, President, Rip Curl North America
What are a few of the biggest lessons you have learned over the past two years?
Rip Curl North America President Dylan Slater – File photo courtesy of Rip Curl
Dylan Slater: I think the last two years have underscored the absolute importance of agility. The speed of change in operating conditions has never been more rapid. Whether it be the state of the global supply chain, the ripple effects of the pandemic, or the impact of inflation on the consumer, remaining agile and adapting to rapid change to meet the consumer’s needs has been paramount for achieving success.
How do you think 2023 will unfold from a business and consumer spending perspective?
Dylan Slater: Despite the economic uncertainty looming for 2023, I believe the consumer is still in a relatively strong position. I also believe the strong state of surf participation, the broader interest in professional surfing, and the health of the core retailer all support a case for a positive 2023.
What is the most exciting thing happening with your company in 2023?
Dylan Slater: In one word, it’s innovation. Rip Curl’s vision is to be regarded as The Ultimate Surfing Company. In order to do that, we need to continually innovate products that improve the surfing experience.
We’re just now launching a new boardshort innovation known as Mirage Activate in collaboration with three-time world surfing champ Mick Fanning and Dr. Tim Brown that we believe will help people surf stronger for longer.
We also have a couple other product innovations in the pipeline for this year that we think will excite our customers and retail partners.
Todd Hymel, CEO, Liberated Brands, which holds the master license for the Volcom and owns the Captain Fin brand.
Liberated Brands CEO Todd Hymel – File photo courtesy of Volcom
What are a few of the biggest lessons you have learned over the past two years?
Todd Hymel: Always trust your gut while pushing yourself and your team to challenge the status quo.
How do you think 2023 will unfold from a business and consumer spending perspective?
Todd Hymel: Conservative but opportunistic towards the very end of 2023.
What is the most exciting thing happening with your company in 2023?
Todd Hymel: Launching Captain Fin apparel, building on our market share for Volcom and Spyder, and a few other big things that we can’t share yet.
Mandy Fry, President, Z Supply
What are a few of the biggest lessons you have learned over the past two years?
Mandy Fry: I’d say learning to practice patience has been the No. 1 lesson. In this business – and the landscape as a whole – things seem to be evolving faster than ever. The ability to remain patient and calm, and not get caught up in the whirlwind of change, makes for a less turbulent, more steadfast way to build our business.
I’ve realized that it takes a lot of patience to stick to our beliefs as a brand. Remaining true to who we are, without wavering, will always serve our retailers and employees best!
How do you think 2023 will unfold from a business and consumer spending perspective?
Mandy Fry: I believe Q1 will tell us – and the industry – a lot. At Z Supply, we plan to take a conservative approach, especially in Q1, and not waver from our beliefs and philosophy of how we run our business. There seems to be some strong headwinds coming towards our industry, but no matter what comes at us for 2023, our employees, our mission and our retailers remain the most important part of our company.
I am still optimistic that this next year will present opportunities for growth. Although we are planning conservatively, our 2023 strategy includes room for growth, as we strive to increase our market share by being more adept at adapting to the changing conditions. We will continue to support our retail partners, think outside the box, provide the best customer service for them, and watch our distribution carefully. We’ll also continue to look for great talent to add to our team so that we can flourish into 2023 and beyond.
What is the most exciting thing happening with your company in 2023?
Mandy Fry: I am very excited about continuing to develop our Z Supply Foundation. Giving back and being a positive force in our community is not only incredibly important to myself and my partners, but to our entire team. We are so thankful for our continued success, but with success comes great responsibility. We look forward to expanding Z Supply Foundation’s education fund, which supports students pursuing degrees in creative fields, by creating opportunities for mentorships, internships, and fostering a new generation of our creative workforce.
I’m also looking forward to creating and executing more exciting ways for us to support our retailers. Though we are still small (but mighty), our team has grown its ability to support more retailers with things like individual sections and shop-in-shops, similar to what we recently did at Tyler’s in Houston.
In addition, we are all excited to expand upon our new Z Supply Eyewear and Active divisions. We have great new product ideas launching next year. We are also going “live” these days and developing ways to speak to our customer in real time. In addition, we are adding one-to-one styling services and personal shopping.
And lastly, but arguably most importantly, I really look forward to continuing to cultivate our company culture, making this an even more creative, healthy, and supportive environment for our employees to thrive.
Pierre André Senizergues, Owner and CEO, Sole Technology, home to the etnies, éS, ThirtyTwo and Altamont brands.
What are a few of the biggest lessons you have learned over the past two years?
Pierre André Senizergues: I’ve learned to expect the unexpected and to adapt quickly with our team. This requires more commitment than ever. When I reflect on the past two years, I can’t help but be reminded of the reason why we’ve worked so hard for nearly four decades – our drive and passion for our community is what got us through. I’m very proud of what my team has accomplished together.
How do you think 2023 will unfold from a business and consumer spending perspective?
Pierre André Senizergues: The word that comes to mind is cautious. We’ve weathered a lot this past decade as a company and as an industry. When we look at consumer habits, we may currently see consumers still spending but every forecast says that it will start to slow down in 2023. We are preparing for this.
While there are many unknowns, we will continue to focus on our commitment to deliver quality products with value, deepen relationships, and create meaningful connections.
What is the most exciting thing happening with your company in 2023?
Pierre André Senizergues: We are continuing to put focus on our Michelin collaboration, which is delivering the most durable skate shoes on the market. This is a superior rubber technology and the quality is unmatched in our industry. We’re proud to deliver another strong year in partnership with such an incredible and respected brand.
We continue to invest in our pro riders who are excelling in events en route to the 2024 Paris Olympics. We’ll see a lot of energy from them as they prepare for the world stage.
Lastly, I’m super excited about the growth of ThirtyTwo – we continue to be rider-driven with quite a cast of personalities. I am specifically excited about our adventure snowboard collection of boots and outerwear. I think consumers who love to take things to the next level will really enjoy what we’re bringing to the market.
Martino Fumagalli, CEO, Union Binding Company
What are a few of the biggest lessons you have learned over the past two years?
Martino Fumagalli: I wouldn’t necessarily call it a lesson, but one thing we have had to learn over the past two years is to operate humbly and learn to easily adapt and adjust to this ever-changing world.
Union Binding Company CEO Martino Fumagalli
We’ve invested a lot of time, effort, and energy to build our supply chain and that’s allowing us to operate at a whole new level going forward. There was a lot of work in the beginning and we’re seeing the rewards now. Adjust, adapt, and execute are words we use each day at Union.
How do you think 2023 will unfold from a business and consumer spending perspective?
Martino Fumagalli: We expect a bit of a cool down on business and consumer spending. Our tag line for the Union sales team has always been “Sell out, don’t close out.” We plan to continue this strategy going forward and will adjust, adapt, and execute as needed. We are lucky because we work on what we are passionate about, so we always see the positive.
What is the most exciting thing happening with your brand/company in 2023?
Martino Fumagalli: We’re a product-driven company. There are always new materials, new processes, new functionality, and new levels of binding performance for us to bring to the market. Outside of product, we look forward to continuing to add new and highly motivated employees to our team.
We are happy to see the brand is in a strong position, but there’s no sleeping for us. We will continue to do our part to advance the sport and the industry.
Eric Carlson, President, Americas, The Leisure Collective
What are a few of the biggest lessons you have learned over the past two years?
Eric Carlson: How important it is to have very clear priorities. In periods that have great opportunity, the clear priorities should be driving the organization from the front foot. When challenges come up and you have to operate more defensively from the back foot, they quickly provide clarity to the team on what needs to happen. They create a clear difference between ‘nice to have’ and ‘must be.’
The other area that’s really been highlighted the last couple of years is a brand’s purpose. Sometimes purpose gets positioned as a marketing or corporate social responsibility box to check but I believe it should actually drive the priorities I referenced above.
Eric Carlson of The Leisure Collective – SES file photo
When you have a super clear answer to ‘why’ your company or brand exists, then you can really focus on bringing that very thing to life for the consumer to experience. It’s not a marketing slogan but more of an internal mantra that can drive everyone’s actions in a way that’s seen and felt and appreciated by the market.
And lastly, it’s all about communication. With the speed and complexity of business increasing and with the change to more remote work, having super effective communication across our organization, customer base, and supply chain is hyper critical. Being transparent, consistent, and frequent in whatever form of communication you choose is the best fuel for our teams.
How do you think 2023 will unfold from a business and consumer spending perspective?
Eric Carlson: In a challenging economic landscape with lots of uncertainty, I think it’s a great time for two types of businesses: market-leading brands and new brands or products. Market leaders can actually increase their share because consumers tend to buy brands that they trust the most and are seen as safer bets. We saw this during the last two recessions very clearly and I’m hearing similar comments these last few months.
For new brands, new products, and new stories, there is an opportunity because consumers see new products as a sign of hope and positivity which is always very commercial. Also, consumers will be much more thoughtful with their spending choices which puts more pressure on brands and products to really give a reason to be chosen.
What is the most exciting thing happening with your company in 2023?
Eric Carlson: Without a doubt the most exciting thing going on for The Leisure Collective is our certification as a B Corp company which just happened a few weeks ago. In many ways, this is the outward acknowledgement of how we operate as an independently owned, surf and outdoor lifestyle company that wants to do good by our employees, our customers, our partners, and for our company.
On a tactical level, our OTIS and sito eyewear brands are making incredible gains at retail, our Creatures of Leisure brand has the best team riders in the world with a major innovation on the way, and we are relaunching our Layday towel brand in Q1. All in all, we have a ton to be excited about and proud of.
