Columbia Sportswear CEO: On-line purchasing could also be larger than ‘initially thought’ after pandemic
Columbia Sportswear CEO Tim Boyle told CNBC on Thursday the coronavirus pandemic’s acceleration of online shopping trends will not lead to the ultimate demise of physical retail.
But the longtime apparel executive acknowledged the health crisis altered the company’s outlook on how large e-commerce will be going forward.
“I think the move to digital purchasing on all sorts of products, but especially apparel and footwear, is here to stay and will probably be bigger than we had originally thought,” Boyle said on “Closing Bell.”
In its July quarterly earnings report, Columbia reported a 40% decline in overall net revenues due in part to pandemic-related store closures. However, the outdoor apparel maker’s e-commerce sales spiked 72% compared with the year-ago period.
Underscoring the importance of a strong online shopping experience for customers, Boyle said the company’s “only surviving” capital expenditure project in 2020 was “a real complete redo on our own website.”
Boyle emphasized, however, that there is value offered by an in-store experience that cannot be matched digitally, especially for shoes and the other apparel offerings Columbia specializes in.
“Brick-and-mortar retail for these kind of products is not going to go away,” said Boyle, who has been CEO since 1988. He joined the Portland, Oregon-based company, which had been run by his father, in 1971.
“Our customers like to spend money on products that fit well and make them look good, and there’s no substitute for having something physically on and making that decision,” Boyle added.
Shares of Columbia closed higher by 1.5% Thursday to $88.29 apiece. The company, which has a market capitalization of about $5.8 billion, has seen its stock fall nearly 12% year to date.
The pandemic has had significant global economic consequences, but some industries and activities have benefitted from people’s growing interest in spending time outdoors. For example, bicycle sales have skyrocketed, leading to reported shortages. There also has been a run on recreational vehicles, such as motor homes.
Columbia has experienced the same shift and expects it to have staying power, Boyle said. “It always helps when [Dr.] Anthony Fauci tells people to go outside, at least for our company,” he said, referencing the White House coronavirus advisor and infectious disease expert.
“People are looking at the outdoors, it’s a safe way to spend time, reasonably inexpensively, with their families, and I think we’re in the right position,” Boyle added. “Frankly, if we were selling tailored apparel or formal apparel, it’d be a much different story.”