Part 1: Rollerblade Interview

Part I: The Rollerblade Interview ...

In Which Nick Skally Talks About ...

How Things Are Going Since Tecnica Took Over
The Post-Fad 'Mature' Market for Inline Skates
The Next Wave of Inline Skaters

Robert: Rollerblade has been through some tumultuous times in recent years. First it was bought by Benetton, the clothing maker. Then it was hit by the slump in inline skating. And finally, it was bought by Tecnica, the Italian sporting goods company. How are things going now?

Nick: Things are good, actually. It's an improvement to be owned by a company that has been in the sporting goods industry for 40 years.

Benetton, though it did a lot of great research and development for us, wasn't as sensitive to our distribution needs as Tecnica. Benetton is such a vast empire. We were just such a small piece of its overall pie.

Robert: How is Rollerblade organized under Tecnica? What happens in the different offices?

Nick: The New Jersey office is mainly involved in sales, marketing and customer service. The New Hampshire office handles human resources, accounting and warehousing. And Italy is the headquarters. The research and development happens there.

But we are very much involved in the process. Before with Benetton, we might have gotten proposals about new products, and we would give feedback. But now we are involved from the ground up. We have product council meetings two or three times a year, and the product team here goes to Trevignano [Tecnica headquarters] and works with them to make sure our needs are being addressed.

We also have a video conferencing system. So we are communicating with Tecnica every day about the needs of the our market.

The United States is still the largest market in the world. There is no other country that even comes close.

Robert: What is happening in the market?

Nick: We now have a mature market. We had the fad years, which peaked in '95 or '96, when lots of people picked up inline skating because it was a hot new trend. And maybe they bought inline skates and used them one or two times but then put them away in their closets.

But today, we have a core group of people who are dedicated to inline skating, who travel to events, and who are spreading the word about inline skating. For these people, inline skating is part of a fitness lifestyle. And we are finding that they upgrade their products every few years.

Robert: So inline skating isn't dying?

Nick: No. It certainly isn't dying. There are fewer people doing it today then there were in the mid-90s. But according to the most recent numbers, there are still 19.6 million inline skaters. That makes it one of the top ten activities in America. And for children 6 to 17, we're number three, behind soccer and basketball.

Our focus at Rollerblade now is to rebuild the industry.

Robert: How do you intend to do that?

Nick: Through grassroot efforts like our Skates-in-School program. We have this program in 700 schools around the country now. And it's a great way to reach kids, teach them to skate and have them learn brand preference.

Robert: Do you donate skates to the schools?

Nick: We give them a price break on the skates. But then the cost is almost entirely subsidized by governement grants.

Robert: Does Rollerblade expect the market for inline skates to continue its decline or stabilize at this point?

Nick: We expect it to plateau. And we expect another period, like 1996, when there will be a resurgence.

We are actually young as a company. Next year we'll be 25. So inline skates have not been around that long. My parents didn't grow up with them at all. For them, it's very scary to think about getting on skates.

But my generation has grown up with them; we are comfortable with them. So when we starts to have families, we will be doing family skating.

And that will be the next big wave: people like me who are in their child-rearing years teaching their children to skate.

Robert: Are you seeing growth in inline skating in other countries, for instance in Asia?

Nick: Asia is getting big. Korea has grown a lot. But now they are starting to have some of the excess inventory issues we had here in '97. They had their big growth spurt last year and the year before. But now it is leveling off.

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