On Monday, April 30, IPATH, the skateboard-inspired footwear brand with an environmental ethic announced that its assets had been acquired by Timberland for an undisclosed amount. The acquisition marked a newly-formed subsidiary for Timberland, which is known as a hardcore workman’s boot which has morphed into a fashion symbol over the last 4 years for males and females in urban youth culture.
IPATH founders Brian Krauss and Matt Field will remain on board at the company’s headquarters in Torrance, CA. Jeffrey B. Swartz, Timberland's President and Chief Executive Officer stated, "We are very excited to welcome IPATH into our business enterprise. IPATH brings a unique and authentic brand, business and consumer relationship, rooted in a distinctive persona that extends far beyond skateboarding. We believe that a combination of highest quality product, a commitment to environmental sustainability, and a unique consumer "voice" make IPATH a powerful source of new growth and excitement."
Interestingly, both brands are committed to the environment and their merger may compound what they’re able to do with this direction. For IPath, the deal also means extended strength, reach, and support for an expanded number of retailers, while for Timberland, IPATH brings them into the expanding category of skateboarding lifestyle.
Volcom’s 1st quarter earnings call April 26th revealed an increase in revenue from $41.6 million from the 1st quarter ’06 to $50.8 million from the 1st quarter ’07, which is a 22.2% total revenue increase. Their revenue forecast for the year is $275 to $280 million. However Volcom expects a slight loss in the second quarter in Europe due to taking over its European operations in the second half of the year. According to Label Networks’ data, while the brand does quite well in North America, it has just started to register in Europe, particularly in the UK and Germany. However we’ll be tracking this brand and its changes in rankings among consumer preferences of 15-30-year-olds in the upcoming Label Networks’ European Youth Culture Study including the UK, France, Italy, Germany, Spain, and the Pan-European Report.
Hot Topic, the retailer chain known for attracting music-inspired fashion fans, particularly young girls ages 12-22 who are into punk, emo, and screamo, is making moves to revamp it’s stores, merchandise, and digital outreach by expanding on its music niche and hiring a Chief Music Officer, John Kirkpatrick, formerly the SVP of Music and Creative Affairs at Paramount Pictures.
Hot Topic’s plan specifically is to launch a new music strategy which includes changing up their merchandise and store formats, plus revamping its internet strategy which currently includes selling big-name band CD’s. Sales have been in a slump for the retailer chain, even though summer music concert season is winding up. If, like Urban Outfitters and their indie rock in-store initiatives can boost credibility and sales, Hot Topic should be able to do the same, but perhaps even more so given their foundation of music. Hot Topic has 696 stores, 131 Torrid stores, and an internet store. Label Networks will be tracking changes in the retailer with the release of their upcoming North American Youth Culture Study—The Spring Report ’07 due out this month.
