When Danny Giovale, founder of Flagstaff, Arizona-based company Kahtoola, started his business more than 20 years ago it wasn’t, in his words, because he was an MBA student who wanted to make a bunch of money.
“I was an outdoor person who had an accident,” he said. “And I wanted to help fix problems when you’re approaching in high alpine environments, and you have a lightweight crampon that won’t work on your running shoes.”
He came to the business from a user’s perspective, and now the company has products in about 850 stores in North America. It makes crampons, gaiters, traction gear, and accessories for backpacking, hiking, expeditions, and road and trail running.
Kahtoola is best known for its microspikes, traction devices that can fit over boots and shoes for use on icy, mountainous terrain. Think of them as tire chains for your feet.
The Daily spoke with Giovale about how overall business is going, the evolution of the brand, and his company’s identity as an environmental steward.
Sluggish Sales Picture Post-COVID
Kahtoola, like much of the industry, is sitting on “a lot of inventory,” Giovale said. “It’s just sluggish compared to where we were in the past, (during) the growth of the COVID years.”
His business grew rapidly during the pandemic, and Kahtoola increased the size of its team by about 60% to build on that growth.
“Now we’re pretty heavy on the human resources side,” Giovale said. “We have an awesome team, and sluggish sales growth.”
Since Kahtoola is privately owned and not accountable to shareholders or a board, Giovale said he can hold a long-term view and retain those employees, even if it’s costing the business.
Same for the retailers he works with. They’re still holding on and not liquidating inventory at the moment. It works in the company’s favor that its products aren’t at the mercy of fashion trends like an apparel line, for instance.
“We’re grateful for that,” Giovale said. “We really want to keep trying to hold the value of our product for everybody in the chain. But it’s a painful time, for sure.”
Kahtoola’s brick-and-mortar dealers have been appreciative that the company isn’t opening its MAP policies and isn’t liquidating online, he added.
Direct-to-consumer makes up about 8-10% of Kahtoola’s business. The company has deliberately kept that percentage on the lower side to support retail partners, though DTC is growing, Giovale said.
Kahtoola’s Retail, Marketing Strategy
Kahtoola’s “dream customer” is an independent, sought-after outdoor specialty retailer, though Giovale says that big customers like REI do a great job at retail.
“We see them as equally important, but we try to do better with the specialty shops as far as positioning and affiliation and thought leaders,” he added.
Giovale has been in the business for about 25 years, and he admits that Kahtoola’s retail and marketing model is “pretty old school.”
In conversation with his younger marketing employees, he takes a cautious approach to dedicating too much time and effort to digital approaches.
“My philosophy has been ‘let’s do some experimentation,’” Giovale said. “But let’s not lose who we are in the mix. It’s not about trying to get people to click on something based on a discount.”
Kahtoola’s Product Evolution
The bulk of Kahtoola’s products are designed for winter use, and the company is eager to see how the cold season plays out. Right now, Giovale expects to end the year flat compared to last year.
For the past several years, Kahtoola has been enjoying a surge in interest from ultra-runners and thru-hikers.
Giovale said he feels like those segments are growing based on the increased engagement they have received from those two groups.
As for further product evolution, Giovale comes from a climbing and mountaineering background, and he said he tends to abuse his gear.
“When it comes to product design and development, I want a bomb-proof solution,” he added. “Let’s make a product that really works and stands up to people who are using it in a more intense way. We’re not so interested in the more easy-peasy users. We’re more interested in people who are really hammering it.”
The newest iteration for Kahtoola is the second version of its nanospikes, which are designed for road and trail runners on slick roads in freezing temperatures. That product hit retail in August.
Advocacy as Brand Identity
A big part of Kahtoola’s business identity is its work in the conservation and advocacy space in the industry.
“We’re lucky to live in a place surrounded by public lands, so these issues of public lands are not hypothetical,” Giovale said. “We have national parks, national monuments all around us. Wilderness areas. It’s natural for us to just play a role.”
The company also has been involved in indigenous culture preservation, for example, in Arizona. It participates in efforts to protect water sources in and around the Grand Canyon, particularly from the threat of uranium mining. Kahtoola has joined efforts by The Conservation Alliance, for one, to raise awareness that uranium mining is causing permanent harm to the water supply.
Those two issues converge around the Havasupai Indian Reservation, which is surrounded entirely by Grand Canyon National Park and has a single water source that’s susceptible to contamination.
When Giovale founded Kahtoola in 1999, he was motivated by the mindset of Yvon Chouinard, founder of Patagonia, and wanted his business to be a force for good.
“We kind of owe it to the planet for doing business,” Giovale said. “We have to double down on our efforts to make the world a better place and reduce our impacts.”
Bart Schaneman can be reached at email@example.com.