Suunto: Grow the core and expand

Amer Sports ©

“I am happy to confirm that we have continued to execute our turnaround strategy successfully,” says Mikko Moilanen, President of Sports Instruments at Amer Sports.

Both the company and the market are growing fast, and new opportunities are emerging. The strategy is to grow the core and then expand to new market segments.

”We have been able to grow the business 11% CAGR over the past four years, and at the same time improve profitability from negative to above Amer Sports group level.”


At the moment, market landscape is in turmoil. “What used to be a sports fanatics instrumentation market is rapidly changing,” says Moilanen. “The great news is that the addressable market for us is bigger than ever, and it is growing fast.”


There has been a lot of excitement around wearables. “Suunto’s roots are in the wearables – we are one of the most recognized brands in the field,” Moilanen reminds.


Suunto’s strategy to grow is twofold – first grow the core, then expand to a broader audience.


Expand Beyond the Core Audience


“We want to be a benchmark brand for the top practitioners of endurance sports and ‘Grand outdoors’.” Moilanen is referring to modern outdoor activities ranging from modern adventures to outdoor athletics and casual leisure hiking.


“We also want to keep our benchmark position in diving, including recreational and leisure diving.”

After building leading and sustainable position in core markets, Suunto is gradually expanding to broader outdoor, dive, and adventure inspired lifestyle market.


“We are very encouraged by the progress in this segment especially in some of the Asian countries,” says Moilanen.


The core users of Suunto are top doers who push the limits. However, even in that area the target audience is much wider.


“We have learned that there are a lot of people, who are not necessarily the hardest doers, but admire them and want to belong to the same ‘tribe’.”


Moilanen explains that this is the case in many lifestyle businesses. “Today’s watch business, in many of the price points, is totally driven by wanting to belong, not the function,” he says. 

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From Devices to Connected Solutions


What are the key building blocks in Suunto’s growth strategy? It all starts with the consumer and innovation.


“We are passionate about understanding our consumers’ needs and wants,” says Moilanen.

This has led to a significant change. Suunto is transforming itself from a devices company to a solutions brand.


“We understand that it is a long journey – it won’t happen overnight,” he says. “In practical terms it means increasing the role of mobile applications, connectedness, and cloud based services.”


A telling example is the new Suunto Connected family. It consists of the Suunto Movescount mobile application, the sleek new Bluetooth Smart enabled heart rate sensor and, of course, the Suunto Ambit3 Sport and Ambit3 Peak watches. They all connect with each other but can also be used individually. Movescount.com, the free online sports community, further extends the possibilities for the users.



For example, Suunto Movescount mobile application includes photo capturing and has a build in “movie maker”. It turns a logged Movescount route into a Suunto Movie including the photos taken along the road. Once created, it can be stored or shared with friends in social media.

Suunto Ambit3 family sports watches have also a hint of smartwatch. For example, incoming calls, messages, and other notifications of the smartphone can be shown directly on the sports watch.

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Expansion in the Channel


Important part of Suunto’s strategy is building the brand equity. “We want to build a Suunto world around the brand,” says Moilanen. Internet plays a key role here. Another important factor is in-store excellence.


“The number of shop-in-shops globally is approaching 200. Three years ago it was zero. And this can be seen in our good financial performance.”

Suunto is continuing to build strong distribution, in traditional channels and in e-commerce. This is even more important as the company expands to the larger lifestyle market.

“The active lifestyle market calls for appropriate channel expansion,” says Moilanen. The results have been promising especially in Asia and in some European markets.


Towards 200 million Euros


Operational excellence has an important role in Suunto’s performance. “We benefit greatly from the Amer Sports Group functions. We utilize fully the scale and synergy benefits of the Group in the fields of distribution, e-commerce platforms, and retail,” says Moilanen.


Suunto itself plays a key role in Amer Sports Connected Digital Ecosystem. It consists of growing portfolio of connected products. They interact with mobile applications and service platforms – the brand websites, Movescount.com, and Precor’s Preva fitness network. An integrated CRM database helps drive customer loyalty and increase sales throughout the different brands and their e-commerce shops.


“Looking back a few years, we have done what we said we would,” says Mikko Moilanen.

“We have grown the business according to targets, and made the business profitable. We crossed the 100 million euro line actually ahead of the schedule in 2012.”


“The next step is to further accelerate the growth, and to take Suunto towards 200 million euro line, and beyond."

www.suunto.com

Source Amer Sports ©


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