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