Growing Online

Companies find their place in Cyberspace.

It’s cheaper and faster than ever. If you aren’t connected at work or at school (or even if you are), hooking up to the Internet at home now costs less than you pay for cable TV, and it offers more “channels” than you can count. Ten, twenty, or even 40 bucks per month, depending on the type of connection, is a small price to pay to virtually put the world at your fingertips.

The World Wide Web, the part of the Internet that combines everything from text to streaming video on one screen, has managed to affect our lives in ways that were unimaginable just eight years ago when it was invented. By the end of last year, half of all Americans had access to the Internet, up from 40 percent in 1998. And more people are reporting that they use the Internet as their primary source of news and information–eleven percent in October, compared to six percent in January*.

It seems that everybody’s going online, and many of them are not only browsing, but building their own Web sites–from companies and retailers to the average Joe who just wants a home page of his own. Thanks to user-friendly site-building software, these days Joe doesn’t even have to be a programmer to build one.

When the World Wide Web was launched in 1992, its new Hyper Text Transfer Protocol language had to be learned, and the code that forms Web sites typed by hand. HTTP-editing software–and e-commerce–was years off, and the Web was the realm of curious users and brilliant programmers. It was slow and limited, and adequately powered personal computers were still out of range for the average consumer. But all of that would quickly change.

Businesses, particularly those in the high-tech industry, were quick to embrace and exploit the Web. And while it took a few years for the majority of skateboard companies to “go live,” a few built Web sites long before “dotcom” was a household word.

The first major skateboard company to establish a presence on the Web was Tum Yeto. By 1995, owner Tod Swank had launched sites for each of his brands, and linked them to tumyeto.com. But his vision of what the Web could do for skateboarding and youth culture went far beyond putting his products in front of potentially millions of viewers. He also launched Skateboard.com in 1995, a true online skateboard media, and followed that up with the Tum Yeto Digiverse, a community of sites for related sports and activities. “We wanted to get the industry involved,” says Swank. “At one trade show we had all the computers set up, and everyone just walked up and said, ‘Neat. What’s this?'”

While the rest of the skateboard industry was initially lukewarm to the revolutionary attributes of the Web, Swank was all fired up. He hired a staff of editors and programmers to keep the sites updated and glitch-free, and offered to build pages for companies who, at that point, didn’t know HTML from HTTP. “I was blown away by it–the idea that you could instantly be in touch with anybody in the world,” he says, though it took some time before others came to share his view.

While the benefits of Web-based promotion are obvious today, to those who hadn’t been online, the Internet then seemed more science fiction than business fact. Like ads and catalogs, Web sites can include information and images about companies and their products. But unlike a catalog, that information can be updated constantly, it can include animation, sound, and video, and it doesn’t have to be printed or mailed. Swank points out how even the Internet’s most elementary function, e-mail, can be a powerful promotional tool: “When Kris Markovich got on Foundation Skateboards, I sent a little JPEG of his ad around the world at the push of a button, and I got instant feedback. People were totally stoked, and I started seeing that JPEG of his ad on kids’ Web sites.”

The Web is a little more sophisticated than e-mail, and it’s based on a code that allows programmers to link elements on one Web page to another element or page anywhere on the Web. Swank’s found that most kids who have their own skate sites have exploited this useful tool to connect to related sites. “I went to one kid’s Web site, and there’s a list of links,” he says. “So I went to all the other ones, and they have lists of links. It’s just endless. I think skateboarders are ahead of so many other groups as far as taking advantage of the Internet for what it’s worth. There’s something inbred in skateboarders that drives them to network and be creative.”

Today, most skateboard companies have Web sites, and many utilize the latest animation and streaming audio and video technologies to present their teams, products, and graphics. The World Industries Web site (worldindustries.com) was launched in 1995, and in 1997 it was redesigned with animated sequences of its Wet Willy and Flame Boy characters. While users with average Internet connections initially had to wait several minutes for it to download, the World site was a thorough and carefully constructed excursion into purgatory. “It became a pretty instant hit,” says Dwindle CEO Frank Messman, who was then CEO of World Industries. “We got millions of page views per month, and hundreds of thousands of unique users. To this day it’s still very popular, and it’s been updated a lot since then.”

Building a Web site is one feat, but updating it so that visitors are inclined to return is an ongoing and labor-intensive process. To that end, some companies are hiring or training staff members to build and maintain their sites, while others outsource the work to freelance Web studios; one company is rumored to have paid as much as 10,000 dollars for its site. “This year is the first that we’ve more aggressively gone after making Web sites for all of our brands,” says Messman, whose staff now includes full-time Web programmers. “We went live with the actionfootwear.com site a few months ago, Decaskateboards.com went live, we have Darkstarwheels.com and Rodneyvsdaewon.com up, and Blindreaper.com will go live later this summer.”

The trick, of course, is to generate traffic, and directing consumers to Web sites relies, primarily and at least for now, on traditional print advertising. “You could do more on print advertising than just listing ‘www’ at the bottom of the page,” says Messman. “You could make it clear that there’s something more on the Web site. Not too many people do that.”

Expanding a company’s promotional efforts onto the Web, of course, requires a budget. And while it remains difficult to translate site traffic into sales, the costs of maintaining a presence on the Web will have to be figured into a company’s promotional budget. “Let’s just say, as an example, that we want to spend ten percent of revenues on promotion and marketing,” says Messman. “In the past, six of the ten was print advertising. It could very likely be that only four of the ten is print advertising, and you move two over to online advertising. So there will be a certain shift. Hopefully, for the successful ones, it’ll come together with increased sales.”

“We put an ad in the magazine, but we really don’t know how many people actually see that ad,” says Chris Carter of DNA Distribution, which now maintains sites for its Alien Workshop (alienworkshop.com), Reflex (reflexbearings.com), and Habitat (habitatskateboards.com) brands. Carter points out that, unlike print ads, traffic on his companies’ Web sites can be measured: “We don’t know how many people received the magazine. When I have a log on the Web site, I know how many people went to that Web site. I know that somebody looked at something. The Web, to me, is the real measure of number of viewers. Whereas in print media, you can only hope that someone filters out your ad from this 300-page book.”

The Alien Workshop, Reflex, and Habitat sites are designed to reflect each brand’s style with unique layouts and color schemes, and in addition to te
am and product information, they allow users to request catalogs and to e-mail the companies. “I just think it’s a great medium for kids to get information,” says Carter. “And it’s always changing, always being updated. I love it, I use it all the time. I’m really excited about trying to develop our Web sites into something much more interactive, interesting, and compelling than what we’ve done so far.”

Other companies are also using their Web sites to assume time-consuming and costly chores previously handled by employees. Online survey forms, which are automatically processed, are invaluable marketing tools that provide immediate and ongoing feedback from consumers. Two years ago Consolidated produced The Plan, its step-by-step guide to realizing a public skatepark, and Steve “Birdo” Guisinger says that he and his staff physically mailed about 10,000 copies in the first year. When the company put a downloadable version of The Plan on its Web site (consolidatedskateboard.com), the requests for physical booklets fell sharply. “We still send it out,” says Guisinger. “But now that everyone’s Internet savvy, we ask if they could download it.”

While its benefits are obvious to most, some are still skeptical about the Web’s effectiveness as a promotional tool. One prominent organization that has yet to hop on the World Wide Bandwagon is Giant, manufacturer and distributor of several top-selling brands: Black Label, Destructo, Destroyer, Element, and New Deal. “Right now, it’s a flat one-dimensional thing that isn’t substantial enough for me to be interested in,” says Giant Vice President Johnny Schillereff. “When I think of skateboarding, I don’t think of computers; I think of kids out there bleeding, skating, and sweating–three-dimensional skateboarding experiences.”

Schillereff concedes that Web sites could be useful additions to his brands’ promotional programs, but isn’t in a hurry to jump online. Carter was also hesitant about diverting staff and capital resources to building his companies’ sites. “We were very slow to move into it, due to lack of manpower, lack of knowledge–really knowing how to execute it effectively,” he says. “Fortunately, I’ve made some good contacts who are helping us. That’s the difference–someone who’s been dong it for a while, on a large scale, who can sort of guide you and help you. I just like it because we can change it as we get better at doing it. With print media, you have a 45- to 60-day delay from the time you develop to the time it actually gets to the readers’ hands. On the Web, you could literally get it the same day, if you were that together.”

While businesses and institutions are wired for speed, fast connections like DSL and cable modems are still cost-prohibitive for most households. This makes accessing some of the more sophisticated sites slow and painful. “Especially when you’re dealing with a lot of images,” says Eastern Skateboard Supply’s Ray Underhill, who’s also built Web sites for several brands. “You still have people out there with slow 28.8 connections, and you have to take those people into consideration, as much as you can. But certainly it’s moving in the other direction.”

If they can’t load an exciting site at home, about twenty percent of the 170-million people in the U.S. who use the Internet have access to faster connections at school or workÝ. And as Cyber culture further infiltrates our daily lives, standards will quickly change, forcing sites to utilize even more bells, whistles, and bandwidth-heavy features to attract and retain visitors. “As a person who puts these things together, I grow frustrated having to assume that there’s going to be a user who doesn’t keep up, who doesn’t understand anything more than opening and clicking, and who gets bottlenecked at the first glitch,” says Underhill. “But I think the users are becoming a little more sophisticated. For the most part, at least in our industry, they want to keep up because a lot of the sites have video clips, and they have to educate themselves to a certain extent.”

While some of his clients have doubted the ability of their Web sites to stimulate sales, Underhill says that all realize some sort of Web presence is necessary to maintain a progressive image in the eyes of their consumers: “I don’t know if it was the objective for many people in our industry to really boost sales, so much as to complement their already broad advertising schedule. It’s such an inexpensive form of advertisement to reach as many people as it potentially can reach.”

News, Info, And Antix

With Madison Avenue marketeers so eager to tap into the spending power of the Generation Y teen demographic, unheard-of amounts of capital are being invested into youth-oriented Web sites, including several action-sports and skateboarding sites. Elaborate magazine-style sites are being launched to draw users in and feed them into e-commerce (online retail) components stocked with relevant goods. But before the current wave of action-sports Web sites hit the beach, skateboarding had several indigenous sites that delivered news and information. Tod Swank’s Skateboard.com was the first, and TransWorld SKATEboarding’s Skateboarding.com came along later as an extension of the popular print magazine. Both were recently overhauled and re-staffed, and aim to serve slightly different purposes.

Earlier this year Swank sold his interest in Skateboard.com, but remains involved as the vice president of industry relations. He says that the new staff will allow the site to fulfill his original vision of a skateboarding-information source, rather than a news-and-features site like Skateboarding.com.

One reason Swank says he sold the domain name is that he wanted to separate his brands from the site, both physically and fiscally. Skateboard.com has moved out of Tum Yeto headquarters, and Swank is eager to point out that his role is advisory, and not managerial: “It seems like manufacturers always turn into the media controllers, and that’s the last thing I want it to be.”

Skateboard.com and Skateboarding.com were recently joined by Antix.com, an industry collaboration that was launched this summer by a coalition of prominent companies: Alien Workshop, Axion Shoes, Big Brother, Birdhouse, Darkstar, DC Shoe Co., Foundation Skateboards, Globe, Pig, Santa Cruz, Strength, Toy Machine, Tum Yeto, and World Industries. “It’s not so much a coalition of brands, it’s a coalition of people who have sort of grown up together in this industry,” says Messman. “We initially got together with the idea of not having it Internet only be outside people with lots of money coming in trying to capture the youth audience. We know what skateboarding’s about, we have the resources, and potentially our brands can provide traffic to this site by providing links and other things.”

Antix combines the clean iconic style of 411VM with the humor and candor of Big Brother to deliver stories, video clips, and reviews relevant to the skate-influenced Generation Y. “I think, obviously, by having the consortium of key people in this industry involved, that you have the advantages of what they bring to the site, and the resources to have good content all the time,” says Carter. “I don’t know if it was aiming to compete with other sites. At the time it was conceived there wasn’t much going on. It just seemed like a good idea.”

The Antix site may generate traffic to the sponsoring brands’ sites, all of which are linked from Antix’s home page, but Messman concedes that it will eventually have to be self-sufficient and include an e-commerce component. “It’ll certainly be some sort of partnership with an existing group of skate-related retailers or a single entity,” he says. “And there are other product categories that’ll interest the same buyer, including video games, music, and so on.”

Bricks And Mortar Versus E-Commerce

The Internet allows businesses t
o create a virtual presence on the screen of any computer in the world that’s connected to it. It’s a powerful tool, a power not lost on retail leaders in the book, stock, computer, and other trades. Skateboards are available online, too, and the implications for brick-and-mortar retailers (those of you with physical shops and overhead) are all-too clear. At least they would seem to be, on the surface.

E-commerce is a phenomenon that has yet to put brick-and-mortar stores out of business. While more people are buying and trading things like stocks online, physical goods like skateboards are more likely to be sold through physical retailers. And most Internet skateboard retailers fail to offer the same drastic discounts that successful online book and computer outlets do. “If I know exactly what I want, I don’t need to shop in a store,” says Guisinger. “But with skateboards, you want to look at them, you want to stand on them, you want to see the concave and the shape. You could go to the store, check out which one you want, then go back online. But how much are you really gonna save? And you want it right then–it was just in your hand. So I don’t think the Internet’s gonna take over retail.”

“I’ve talked to several retailers about the Internet, and how they feel about it,” says Swank. “It’s very diverse. Some people are worried, some don’t think it’s gonna be effective for this culture or industry, and some are totally amped on it and can see it helping their businesses grow. I think it’s all premature right now. We don’t know how it’ll affect retailers or manufacturers. It’s growing, but Internet sales are still only about five-percent of sales for any one industry.”

Like Guisinger, Schillereff sees buying a skateboard as a sort of tactile ritual that won’t soon be replaced by a point-and-click flick of the wrist: “It’s not like you go to the Gap, hang out and watch Gap videos, mingle with your friends and wrestle the Gap manager. That’s never gonna happen. The life and the world of a skateboard shop is unlike any other business that exists.”

Many shops have used the Internet to their advantage. Some operate their own e-commerce sites, while others just use it to advertise their shops online. “A lot of kids go online to check out an area they might be visiting,” says Pluto Sports Owner Brian Beauchene, who has two locations in the Knoxville, Tennessee area. “We have photos of the shop on the site plutosports.com, and I’ve seen people come in who’ve driven two hours to buy something on sale here.”

So long as he doesn’t have to update it too often, Beauchene thinks the Web site is a great promotional device for his shop, even though he’s not selling anything online. The idea of companies selling direct through their Web sites does concern him, and he says he’d be reluctant to deal with companies that offer consumers drastic discounts online: “Markups are already pretty small. That’d make it tough.”

The dilemma facing companies is that, while they want to be loyal to their dealers, they’re eager to make their full catalogs available to consumers–particularly those who don’t live near a shop. Some companies that do sell direct to consumers have taken measures to minimize competition with brick-and-mortar retailers. Their online prices are generally equal to or higher than prices at brick-and-mortar stores, many sites have database-driven dealer locators, and others–like Deluxe Distribution’s dlxsf.com online store–even directly state that it should be used only as a last resort. “We encourage people to go to their local shop,” says Deluxe’s Jeff Klindt, whose Anti-Hero, Forties, Real, Spitfire, Stereo, and Thunder Web sites are linked to dlxsf.com. “The online shop is more for kids who really can’t get it anyplace else.”

Indigenous skateboarding Web sites like Skateboard.com, Skateboarding.com, and Antix.com all plan to or already do link to e-commerce sites. Skateboarding.com is partnered with shops like Bigdeal.com and Brothersboards.com, while Antix.com and Skateboard.com have yet to designate retail partners. “Right now we have dotcoms coming left and right into skateboarding,” says Swank. “And a lot of them are backed by huge megacorporations that are in to make a play for skateboarding culture and e-commerce–bottom line. While the possibilities for e-commerce are there for Skateboard.com, we have a major concern about how it could impact both retailers and manufacturers. That’s the big underlying difference.”

To Be, Or Not To B2B

One of the latest Internet crazes is the business-to-business, or “B2B,” initiative. A form of e-commerce, B2B sites allow authorized users (other companies, for example) to access and use a Web site for browsing classified information, conducting transactions, placing orders, and the like. B2B Web sites generally require users to enter passwords before entering, and are more straightforward and task-oriented in design than public e-commerce sites.

Perhaps the first skateboard-industry company to offer dealers Internet B2B service is South Shore Distributing, whose Web site (skatenet.com) featured modern shopping-cart ordering when it launched in 1996. Co-owner Damian Hebert says that his own interest in the Internet drove him to create the site and convince a programmer friend to write the necessary code. “This was before e-bay and Amazon.com,” he says. “Nowadays you’re spending 30- to 60-thousand dollars just to get a program like this written. I started it when it was cheaper.”

The current South Shore site features a password-protected shopping area for authorized dealers, and Hebert says that about ten percent of his customers place orders through it. The primary benefit of the site, he says, is the freedom and flexibility it offers his customers. They can log on and browse or order at their convenience–anytime, day or night. And while the online database isn’t directly linked to his inventory software, his staff updates the online inventory several times a day so that the information there reflects actual stock. “More than anything, it’s just a huge managing job,” says Hebert. “The objective is to show customers what we have in stock. I’ve got three people for whom a large percentage of their jobs is managing the Web site.”

Other distributors have launched sites for their customers to use. The AWH Sales site (awhsales.com) features their catalog, a printable dealer application, and a section highlighting new items.

The Eastern Skateboard Supply site (easternskatesupply.com) is more of a supplement to the printed catalog, and Underhill says it allows them to update information between editions: “It’s not, at this point, going to replace picking up the phone and calling. We haven’t had people demanding that. To a certain extent, people still like that personal touch.”

Dwindle Distribution’s B2B site is currently under construction, and Messman says it’s designed to make everyone’s life easier–from his field reps to his international distributors. Logos and ads will be available in electronic form for promotional purposes, and reps will be able to log in to the central database from the road. “They’ll have access to view the orders,” he says. “So when the sales rep for Florida logs in, he’ll see his accounts. We can even open it up to customers, and certainly distributors. That’ll be our big project for 2001.”

Traditionally, companies have utilized three primary methods of reaching their customers, through magazine ads, tours, and videos. A Web site combines all three into an interactive portal and offers all the advantages of a designed presentation with the ability to generate and gauge direct feedback in real time.

If companies can direct enough traffic to their Web sites, their potential for marketing and promotion are virtually endless. But in the skateboard industry, where decisions are so often based on instinct rather than hard data, the virtues of the Intern
et may be less relevant to some. “I like to keep our focus on the actual product, the teamriders, the videos, and what has made and kept skateboarding such a great thing in our lives,” says Schillereff. “I’m not trying to be resistant and fight the Internet. I’m not one of those guys who’s living in the Stone Age, but I also know where to draw the line. I just figure, ‘Why not focus on what skateboarding is for most people?’ And that’s just blood, sweat, and tears. To me that doesn’t mean get online and get a potbelly spending your whole day looking at the ‘Net.”

* Columbia Journalism Review, January/February 2000

Ý Nielsen-NetRatings, Inc.