Comparing the 1999 and 2000 Buyer’s Guides.

I hold in my hand TransWorld’s Skateboard Buyer’s Guides from 1999 and 2000. Everything you could possibly want to know about decks, trucks, wheels, and bearings are in these guides.

Well, okay, TransWorld exercises some discretion over which brands make it into the guide and which don’t. All the product from each brand isn’t necessarily included. And not everybody has actual suggested list prices, so the ones included may be a little suspect. Certainly, the prices don’t bear much relationship to what things really retail for, do they?

Still, there are a lot of data points, and when you have a lot of data points, something statisticians call “regression to the mean” takes over and then you may be able to glean some relevant information in spite of all the inaccuracies.

I’ve spent a lot of time figuring out average prices and price trends, comparing them from one year to the next, and listing and counting brands to see who’s there and how it’s changed from one year to the next. My fingertip is raw from punching the calculator button, and I’ve damn near gone blind staring at the guides (nobody warned me you could go blind from reading skateboard-buyer’s guides). So caveats aside, what can we learn from the two guides about how the industry is evolving?

After we’ve looked at the guide data, we’ll travel to a major skateboard Internet site and see how the data checks with retail reality.

Decks

The 1999 Buyer’s Guide featured 411 decks from 49 brands. The 2000 edition had 402 decks from 60 brands. The increase in the number of brands has more to do with who TransWorld put in the guide than with the number of brands there really are. The numbers exclude longboards.

The average suggested retail price for a deck declined from $54.79 to $53.35, or about 2.6 percent. The overall range of prices also moved down. In 1999, decks were priced from $39.95 to $76.95. In 2000, it was from 33 dollars to 67 dollars. In 2000, everybody pretty much dropped the cents from their prices, rounding them to the nearest dollar and, incidentally, making my calculations a lot easier. Keep in mind that blank decks aren’t included here.

The two charts show the distribution of decks by price for the two years. Check out how the distribution has tightened up. There are fewer decks at either the lower or the higher pricepoints. In 1999, there were 180 decks priced under 50 dollars. In 2000, the number is 22. Similarly, 1999 included 137 decks at $69.95 (I call them 70 dollars on the chart). There aren’t any in 2000.

The distribution of prices has gotten a lot tighter, and the average suggested retail price moved up because of the huge decline in the number of lower-priced decks. Basically, what you’re seeing is that consumers can’t afford to pay 70 dollars for a deck (or can’t be convinced that it’s any better than a 50-dollar deck), and nobody can make money on full-graphic, branded decks that retail for under 40 bucks.

This tightening of the price distribution is absolutely consistent with a market where there are few real differences among products. The consumer is price-resistant, and the brands all find themselves on the same cost curve. That is, it costs them all more or less the same for a deck. It’s inevitable that prices move closer to each other.

Wheels, Trucks, And Bearings

There were 208 wheels in the 1999 Buyer’s Guide from 48 brands with an average cost of $31.25 per set. The 2000 Buyer’s Guide featured 224 wheels from 58 brands with an average cost of $30.58, down two percent. Again, be cautious in concluding anything from the number of brands.

Sets of wheels were priced from 24 dlars to $43.95 in 1999, and from 20 dollars to 40 dollars in 2000. Prices moved down about four bucks per set, but the spread between the lowest and highest remained the same.

Now if I was really diligent (read: obsessive/compulsive), had nothing else to do with my life, and loved the feeling of calculator buttons moving under my fingers, I’d go back and create the same kind of chart for wheels that I did for decks. My guess is you’d see the same trend toward a tighter distribution of prices, and for the same reasons.

Twenty-eight trucks were available from 19 brands in the 1999 guide. The average price, excluding the product for 100 dollars a set, was $38.50 per set. They ranged from $19.60 to 100 dollars per set, but if you take out that 100-dollar set, the top price was $55.50 for a set.

In 2000, 21 brands offered 43 trucks. The average price was $40.56, up 5.3 percent, excluding the 100-dollar product. Prices ranged from 22 to 52 dollars.

Happily, there are fewer bearings to count and calculate. In 1999, sixteen brands offered 26 bearings. The average price was $20.79 a set, and they ranged from $9.60 a set to $36.50 a set.

The 2000 Buyer’s Guide featured 22 bearings from fifteen brands at an average price of $19.73 (five percent lower than the previous year), excluding the 120-dollar ceramics. Prices ranged from 10 to 37 dollars–basically the same as 1999.

Trends Across Products

The number of brands was up in all product categories except bearings, where it dropped by one. The number of product offerings was up everywhere except in decks, where it declined by two percent. Prices fell, except in trucks.

It’s hard to interpret the increase in the number of brands. I want to emphasize again that it’s probably more how TransWorld put the guides together than how the actual number of brands changed. I guess there are some new companies, and new brands also represent new offerings from existing companies trying to find a marketing advantage. It’s troubling for the industry as a whole that such a maneuver is part of the basis of competition. It just confirms the similarity of product from brand to brand.

Prices are tending down, at least slightly, even in what I believe is the hottest market that’s ever existed in skateboarding. In snowboarding’s go-go years, you could raise prices each year. The implications for what the market and industry may be like when (not if) growth slows aren’t very encouraging. Right now, if I were a brand that was having trouble meeting demand, I wouldn’t try to meet quite all of it.

Yup, you heard me right. When business isn’t so good, the companies that will get through it successfully will be the ones who have nurtured their brand’s market position, built their balance sheet, and controlled expenses. The skateboard industry’s consumers tend to lose interest in any product that everybody has. What better way to support your brand then to make it just the slightest bit harder to find? I think it may be better marketing than some of the things you spend advertising and promotional dollars on.

Another trend, obscured by the coming and going of brands in the industry, is the dominance of perhaps the five or seven largest players. As I watch deck prices move toward each other, with every player on basically the same cost curve, I’m certain, for better or worse, that these companies will end up with the lion’s share of the market. I’m not saying there isn’t some room for smaller players, but every industry has this trend towards consolidation.

Back In The Real World

Because of my healthy skepticism about the picture painted by the guides, my nimble fingers have taken me to a major Internet skateboard retailer. I didn’t check out every brand in every category, but I looked at a lot. Decks, including griptape, were either $44.99 or $49.99. Add some shipping costs, but maybe subtract sales tax–depending on where you’re ordering from, and the price isn’t too far from the average price of $53.35 in the 2000 guide. Then, of course, there are the shop-brand decks for $29.99.

Almost all the trucks were either $33.98 a set for plain metal, or $37.98 for painted. The average price in the 2000 Buyer’s Guide was $40.56. That number included both painted and plain metal trucks. Again, not too far off from this site’s prices if you account for shipping costs.

Wheels were $23.96 a set “unless otherwise noted.” I saw some at $31.96 a set, and there were the shop-brand wheels for $15.96 a set. That’s quite a bit different from our 2000 Buyer’s Guide average price of $30.58.

To nobody’s surprise, the 2000 Buyer’s Guide’s suggested retail prices are higher than street prices when compared to one very comprehensive Web retailer. We also confirm the tendency to move toward a simpler pricing structure, recognizing the lack of real product differentiation. But except for wheels, these retail prices are not that much higher than the guide’s average prices.

It looks like, at the end of the day, the lack of product differentiation is pushing product prices lower, but high demand is controlling, though not eliminating, that trend. At least for the time being.

Jeff Harbaugh helps companies manage issues of transition, and has worked in the action-sports industry for ten years. Reach him at (206) 232-3138. Or at: jharbaugh@email.msn.com.

y category, but I looked at a lot. Decks, including griptape, were either $44.99 or $49.99. Add some shipping costs, but maybe subtract sales tax–depending on where you’re ordering from, and the price isn’t too far from the average price of $53.35 in the 2000 guide. Then, of course, there are the shop-brand decks for $29.99.

Almost all the trucks were either $33.98 a set for plain metal, or $37.98 for painted. The average price in the 2000 Buyer’s Guide was $40.56. That number included both painted and plain metal trucks. Again, not too far off from this site’s prices if you account for shipping costs.

Wheels were $23.96 a set “unless otherwise noted.” I saw some at $31.96 a set, and there were the shop-brand wheels for $15.96 a set. That’s quite a bit different from our 2000 Buyer’s Guide average price of $30.58.

To nobody’s surprise, the 2000 Buyer’s Guide’s suggested retail prices are higher than street prices when compared to one very comprehensive Web retailer. We also confirm the tendency to move toward a simpler pricing structure, recognizing the lack of real product differentiation. But except for wheels, these retail prices are not that much higher than the guide’s average prices.

It looks like, at the end of the day, the lack of product differentiation is pushing product prices lower, but high demand is controlling, though not eliminating, that trend. At least for the time being.

Jeff Harbaugh helps companies manage issues of transition, and has worked in the action-sports industry for ten years. Reach him at (206) 232-3138. Or at: jharbaugh@email.msn.com.