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BOARD TEENS

Growing action-sports chain Zumiez keeps cool to stay hot

BY KIMBERLY PFAFF

Where can you find cutting-edge equipment and apparel for snowboarding, surfing and skateboarding? Any self-respecting aficionado of these action sports will tell you: The place to shop is Zumiez, dude.

Ever since its debut in Seattle’s Northgate Mall in 1978, Everett, Wash.-based Zumiez (pronounced Zoo-meez) has been making waves with its passionate, innovative approach to the action-sports lifestyle.

Zumiez wants to be the shop for not just the skate, snow or wakeboarder, but also for the devotee of motocross, BMX racing and more. This chain has the boards, the clothes, the accessories and the extras — from pocket tools to board wax, videos and music.

“If you can think of it, we’ve got it — first-, second- and third-layer product,” said Rick Brooks, Zumiez president and CEO.

It’s that breadth of product that sets the retailer apart. As for their competition, Brooks doesn’t believe that Zumiez really has any.

“I don’t think there’s anyone who’s doing what we’re doing,” he said. “There are some regional chains doing it, but no one is doing it in a large-scale way like we are.”

Mall developers echo that sentitment.

“They’re a retailer that doesn’t fit the mold,” said Robert A. Michaels, president of Chicago-based General Growth Properties, which currently has about 30 Zumiez stores, and is working with the company on additional units. “They’re pretty out-of-the-box. They cut across some areas where it’s a real crowded field, such as juniors. But their skateboards, their snowboard business, their outdoorsy business — that really distinguishes them, and makes them a destination within a center.”

Zumiez added 27 stores in 2004, finishing out the year with 140 stores in 18 states. It has a heavy presence in California and New York and several states in between. This year the company plans to add 35 more units, with the ultimate goal of operating several hundred stores.

As a privately held firm, Zumiez will not disclose overall sales figures. But Brooks says the company typically posts $450 to $500 in sales per square foot and that comp-store sales have risen for 24 of the company’s 26 years.

According to the Sporting Goods Manufacturers Association, U.S. sales for skateboarding equipment totaled $130 million (wholesale and excluding apparel and shoes) in 2003, while snowboarding equipment sales totaled $141 million in 2003. That is down from $135 million and $168 million, respectively, the year before.

Zumiez is primarily mall-based, though the company also operates stores in several lifestyle and outlet centers. So far, the retailer has only one neighborhood center store and no plans to open any downtown units. The stores span about 2,600 square feet, though newer units measure about 3,100 square feet.

Zumiez carries more brands than retailers on either the apparel or hard-goods side, and it also specializes in showcasing newer brands very early in their development cycle. “We’re the first place that small brands come to to expand their distribution after they’ve had some success in independent stores,” said Brooks.

The store is also organized differently. Many retailers are category merchants, grouping together similar products regardless of brand. Not Zumiez. “When people walk in the store, they have to know a few things,” said Brooks. “Our stores are organized by lifestyle, then by brand within that lifestyle.”

Hang-ten hangout
But Brooks doesn’t just want teens to buy things at his store; he wants them to feel at home there. “We want kids to come in and hang out with us,” he said. To encourage that, every Zumiez has a living-room section, complete with red couches, where kids can play Xbox and other electronic games or watch board-sports videos.

The unconventional Zumiez culture, too, sets the retailer apart. And that starts with how the company trains, manages and rewards its employees — many of whom are themselves involved in action sports. “We spend a lot of time and money helping to develop our kids,” said Brooks.

In contrast to what Brooks calls a “check-the-box” environment, in which staff members simply do what they’re told by a headquarters, “we encourage our managers to make the decisions to drive their business,” he said.

In one example of this kind of initiative — and of the store’s hip, laid-back style — Brooks recalls an incident at a Zumiez in Chicago. “The CD player broke at noon,” said Brooks. “So what does the team do? First of all, they come up with a plan to purchase a new CD player, but in the meantime they get together and start singing TV theme songs with the customers. They made the experience fun for themselves and the customers too.”

In return, Zumiez rewards its staff in creative ways. Throughout the year, the company holds several employee-training and recognition events — each with an action-sports twist. In January, for example, salespeople who have sold more than $100,000 during the previous year are treated to a company snowboarding trip in the Rocky Mountains.

Some retailers may think twice about investing that kind of money in young salespeople who will probably only be around for a short time anyway, but Brooks sees it differently. It simply makes good business sense, he says.

“It’s a way of thanking them for all their hard work,” he said. “And it ultimately makes them better salespeople, because they relate the experience back to the customer. That’s the crux of our retail approach right there: Give them a chance to experience the lifestyle, but also say thanks.”

On the customer side, Zumiez keeps things interesting through partnerships with vendors on a variety of cool, fun promotions, from design-your-own-skateboard contests to free snowboarding trip offers.

That flying couch
But the firm’s most popular attempt to bring the action-sports lifestyle directly to the customer is the Zumiez Couch Tour, a festival-style event held each summer at select malls, typically in the parking lot.

Each one-day stop on the tour features exhibitions and autograph signings by professional skateboarders and motocross racers, live music, merchandise booths, giveaways and the like.

The end result for both Zumiez and the mall: thousands of kids in attendance. In June the tour drew more than 12,000 to Mall of America, making it the center’s third-largest event for 2004 and one of its top 10. That’s pretty impressive, considering that Mall of America sponsors 400 special events each year.

Mall owners, who might normally be expected to frown on skateboarders using their parking lots, welcome the event.

“We would definitely do [the Couch Tour] again,” said Jennifer Renstrom, Mall of America’s manager of events and marketing operations. “The number of people it brought in, and the amount of money it generated for Zumiez, was just tremendous.”

General Growth is a believer in the power of the couch, too.

“We thought [the Couch Tour] had merit, and it’s proven to be true,” said Michaels of General Growth, which has sponsored the tour at several of its centers. “It brings in additional people, and really gives them an opportunity to come to the mall for some entertainment.”

After all, landlords and co-tenants note, it can’t hurt if Zumiez customers leave thinking the store is cool — and the mall too, dude.