Quiksilver's crucible of debate
By Phil Jarratt
Quiksilver CEO Andy Mooney fired a pretty good shot across the bows of the ZoSea ASP World Tour last week, but only time will tell whether it was a warning shot or a declaration of war.
Speaking at Shop-Eat-Surf.com’s “executive roundtable” in California, Mooney responded to a question from Shaun Tomson in the audience about Quiksilver’s ongoing commitment to the pro tour with the news that this was a subject in the “debating crucible”. He went on to say: “If you are going to contribute to the ASP, you have to figure out what you are getting for it…If you are not getting access to the content, not getting exposure for your brand and athletes, it’s not clear to me why we should be involved.”
Mooney claimed that the ASP had adopted the business model of the American NFL, except that, “Unlike the NFL, they don’t pay any of the athletes – that’s a big distinction in my mind. We (the brands) are all paying the athletes.” He concluded that, “Asking the industry to contribute without sharing any of the benefits back to the brands that contributed - I don’t understand the logic of that.”
There wasn’t a lot of logic in Mooney’s comments either - the clubs pay the players, not the NFL – but clearly Chainsaw Andy has an axe to grind with the rollout for 2014 devised in large part by former Quiksilver board member Paul Speaker, who was leaving the Huntington Beach campus by the boardroom door at about the same time Mooney was coming in the tradesmen’s entrance at the beginning of the year. And for anyone clinging to the belief that the Quiksilver brand is still core surf at its deeply-wounded-but-still-beating heart, Chainsaw’s challenge to the status quo is quite scary.
You see, in just ten months at the top Mooney has directed a startling turnaround for the ailing brand. Quik hasn’t turned a profit since 2006, but analysts and investors have bought into the Mooney charm offensive, and sensing that there is light at the end of the tunnel, they have sent the stock price soaring by 50 percent, from $6 to $9, already way beyond the analysts’ end-year prediction of $7.10 and heading north. Although still hemorrhaging debt – “Quiksilver rides a wave of red ink”, the LA Times trumpeted in June – Mooney has become the darling of Wall Street. What they’re saying about him around the Velcro villages of the OC might be rather different.
Mooney came to Quik after a more than 30-year career at Nike and Disney, where he was regarded as a shrewd operator who could get the books in shape, and was only ruthless when absolutely necessary. He knew about team sports and Mickey and Donald, and I don’t mean Dora and Takayama. He knew jackshit about surfing, but when it came to saving Quiksilver, that was besides the point.
Mooney’s mantra was cut costs, narrow focus, and in his first month on the job he traveled the Quiksilver world slashing, burning and lopping heads. He greeted the survivors with a bro’ shake, the dead wood with a deft stroke of the executioner’s sword, while brand guru Bob McKnight was a benign presence in the shadows, welcoming the fallen into the Quiksilver afterlife.
In mid-February, in the face of a growing undercurrent of hostility in the industry, Mooney belatedly explained the purge in a press release, which read in part: “Over the last few weeks, we reduced the number of athletes under contract. This was done to free up resources to tell the world about the many great athletes we work with…Our key athletes should be household names, known well beyond the universe of core fans.”
A few days later he told Shop-Eat-Surf.com: “It’s not that I am trying to save money and put it in my back pocket. I plan to reallocate the money and to spend more money on the athletes we have.” This is a variation on: It’s not that I love you any less, it’s just I love the new chick more.
Now we learn that although he wants Quiksilver surfers to be household names, he doesn’t see value in supporting the tour that can make them so. Of course the jury is still out on the ZoSea tour, but the ESPN deal seems certain to raise the profile of the top surfers and take the tour to many new markets. Knowing where Mooney has come from, it’s easy to imagine that this is just about the money. But Quiksilver’s 2014 tour events will cost about a third of what they cost in 2013 – in round figures, $1 million instead of $3 million – and they will be seen by many more people.
So, we can but wonder, what will they be discussing in the “debating crucible”? //PHIL JARRATT
Comments
Hey Phil,
I sat through a 2 hour long Q & A with Paul Speaker last May in Mexico at the SIMA Surf Summit. I think ideally he would like to be running the tour without much if any interaction with the major Surf Companies. His goal is a much bigger one to say the least. If he can make it happen they the surf companies will benefit as a byproduct of what ZoSea is trying to do with the ASP. Quik won't be able to make their surfers household names for sure but ZoSea and the deals that they put together might help raise the level of interest, especially in the USA where surfing is still the poorest of poor relations in a sports market dominated by billion dollar Industries.
From the people I know and talk to Andy Mooney is there to get Quik back into the black regardless of what it means for the brand. We will see a steady stream of head scratching initiatives come from the top. I am sure your contacts have told you many stories already.
Makes sense to me - business sense, that is.
Why pay top dollar for athletes AND to host surf contests? The more cost effective thing to do would be to fund succesful surfers, deck them in your clothes and have them parade around at someone elses contest which is being run at someone elses expense.
Hurley has been doing something similar for a while; they sponsor more pro surfers than the other brands, yet with just one comp they have the least invested in the pro tour infrastructure. So Hurley may not have much webcast control, but whoever does has to interview every heat winner and it's there - on a Rip Curl, Quik, or BIllabong webcast - you'll see the Hurley logo emblazoned on hats, shirts, hoodies, boards.
Maybe this type of legitimate guerilla marketing is part of the Quik debate?
But would Zosea really care if Quiksilver split?? Same with any of the other brands if they threatened to leave. Zosea appear to be playing a bigger game now and planning to take surfing into another stratosphere. If I were Paul Speaker I'd hope for a reciprocal arrangement, but just as easily unhitch Zosea from the surf industry handcart if things got rocky.
Doesn't exactly appear to be many other ships to jump onto if the surf industry one goes to Davey Jones locker.
Nov and no schedule for next yr. Thats cutting it mighty fine.
I'd say Speaker and Co would be quietly shitting bricks right now.
For who to jump onto? For ZoSea..? I've already got the feeling - and The Bower said as much - that ZoSea view themselves as independent of the surf industry. Let's face it, surf industry success is predicated on fashion and that's no foundation on which to build a sport.
So wheres the money coming from if not the surf industry?
I'm with Freeride, no schedule, no plans, no sponsor. Hope those cowboys can handle the pressure because as soon as Pipe is over everyone will want answers.
I don't know, fuck, Beaurepaires? IMB? Pepsi? Coke? Hard Rock Cafe? BHP?
All have sponsored surfing before, none of them are part of the surf industry.
... let's see SURFING, the competitive sport, stand on it's own 2 feet, without the Evil Big3 props.
Give the grizzlers what they want. (this will be good.)
Speaker has had all year and change to come up with a Tour next year.
So far, we've got five eighths of fuck all.
What other Pro Sport has no idea what it's schedule looks like for the next year?
It should be like pro golf.
Brands sponsor athletes and events.
The ruling body makes the rules and administers the sport.
Surfbrands as we know them should just be a part of a succsesfull effort to provide surfing and its athletes with the best sponsorship model to help the sport succeed into the future.
Contests don't need to be put on by surfbrands. They don't have the funds and its probably better to let new marketers get involved, like a car company sponsoring a golf tournament.
I don't think its wise to let surfbrands run the sport.
The surfing athletes usually have more than one sponsor anyway.
The surfbrands will all stand to do well if the contests are run and telecast to the highest level achievable.
same story when Graeme Cassidy was president of the ASP and his vision was to bring in major Global Sponsors,so that the Surf Brands could put their $;s into the athletes/surfers and there would be non- competing presenting sponsors such as car/computer/drinks etc....
The Industry at the time wanted control of the ASP which they had for 25 years,so they would get coverage thru their surfers and...thru branding the comp with their Logo/Brand.
Of course this was an unsustainable bubble along with their growing sales into places like the Midwest......the price for a comp went to $3m.....athletes wages kept growing......and then the Surf Industry bubble burst and now...we have a couple of the biggest Surf Co's fighting for their identity and survival...
So in one sense Mooneys right.......should the brand be sponsoring the comps?
...short term yes as they have a responsibility for the monopoly they created,and they have a great deal in paying only $250 K for the ist year as the naming right sponsors ......and have $500K year 2,$1m year 3......
hopefully Zosea can demonstrate to global sponsors that there is value in surfing and that the Surf Industry has been taken out of the equation,and that the $'s saved by not producing the WCT events...will go to the athletes.....
reality says that the public Co's like Quik and Bill will just try and save the money and improve their bottom line
Is that the structure Brutus.. $250K first year, $500K second and $1M third?
I thought it was $1M straight up next year if they want to be involved (still 1/3rd of what they currently pay).
With perspective it's obvious where the Dream Tour - despite all it's blessings - went wrong. It gave almost full control of the tour to the brands, which was great for locations but fatal for the development of the sport.
Luke Egan as WCT contest director? Ditto Jake Paterson and anyone else in authority and on the sponsor's payroll.
Rip Curl Pro commentators cant talk about Quiksilver Pro contest. Quiksilver Pro commentators cant talk about Billabong Pro contest. None of them can talk of the tour as a whole.
The brands were killing the sport they supposedly loved. Hopefully this hokey stage of administration has passed with Zosea in control.
Hi Craig...not sure if they have changed the deal...but it was those numbers 6 mths ago.......and easy transition supposedly.....
the biggest problem at present is Kelly,will he or won't surf next year....until he signs a contract with ASP for next year....no umbrella/global sponsor would touch the tour,as he's actually bigger than the sport itself.....so what sponsor would sign on to a WCT without Kelly..or not knowing..
Billaquikcurl tried to own surfing and, by any objective measure, failed - tough shit. I can still buy a hand-shaped board off a guy that's in business after 35 years and go surfing. All this hand-wringing about pro-surfing has little to no relevance to everyday surfers.
No one over 25 looks to Pro contests to see where surfing's at anymore, anyhow. They look online. The up & comer + corporate dollars = profile model is finished.
The anti-establishment push started more than a decade ago (Molloy brothers, etc) & contest surfing/big money interests will never catch up. However, Corona have had a crack at driving the conversation with their escapism-themed campaign with some success recently I would argue.
Surfing's gone back to the future - anti-heroes playing rock 'n roll, shaping boards, writing books, getting barrelled. Same as it ever was..
read any good books lately?
Didn't say I enjoyed soul surfer's scribblings, just appreciate them having a go & being out of the box.
However, there was one great pulp fiction - Billabong's financial reports in 2010/11
For old farts (me), McTavish's book is a rollicking great read
Wouldn't put too much faith in those 'anti-heroes" ....most of 'em are dancing to the same piper as the comp surfers.
Pro Soul is still Pro.
But yeah, you're right. Easy enough for anyone with half a brain to sidestep the circus, buy good boards and just go surfing.
think "ant shannon" is on the money . Let all brands in . they will be far more transparent in their dealings (and demands) with all the surfers and would dilute the unhealthy influence Kelly Slater is holding over the sport .
"There wasn’t a lot of logic in Mooney’s comments either - the clubs pay the players, not the NFL"
Phil, if anyone's comment lacks logic it is yours. NFL clubs are part of the NFL and the NFL has complete control over the club - from how much the club can pay its athletes to how much revenue the club can generate (at least as it relates to the shared revenue scheme with other clubs). The NFL and the ASP are run much differently and Quiksilver is not part of the ASP anymore than Gatorade is part of the NFL. Gatorade buys advertising and sponsors athletes; they don't produce events. Mooney is correct. Imagine that... a guy with 30 years of business experience knows more about business than some dude whose sole goal is to create a witty editorial. Which, I might add, is also a problem with surfing. Instead of creating good journalism, based on facts, surf "journalists" always seem to define the quality of their "work" by how witty they think their article is. News Break: It's not. Business is business and surfing is surfing. Andy Mooney isn't trying to tell you how to get shacked so stop trying to play armchair quarterback when it comes to business. Take notes on what Mooney is doing (and, btw, what real journalists do), you might learn something.
Phil should be telling us how to get shacked? You haven't seen Phil surf lately have you mate.
Mooney said this: "If you are not getting access to the content, not getting exposure for your brand and athletes, it’s not clear to me why we should be involved.”
Could any sane person really make an argument that their brand and athletes haven't had exposure from the Pro Tour? And would continue to do so?
Blokes with far more business experience than Mooney have royally screwed the pooch and run companies into the ground.
His comments deserve no more prima facie respect than anyone elses.
Not sure if all the grizzlers have yet realised that Pro-Surfing and Pro-Surfers have fared much, much from the surfie-fashion industry than its shareholders have over the past decade.
I don'k know anything about the ZoSea / ASP model.
I do know that the X-Games are big events in the USA and they are very profitable. In my view, the X-Games also seems to be comparable to surfing - not exactly, but many similarities. Hence, over time it would be reasonable to expect that ZoSea will try to move to an X-Games revenue model.
I don't know how the corporate sponsorship works in the X-Games model so this could have an impact on the large surfing companies.