Published on: October 30, 2015by Kevin Coupe
Sometimes, the best disruptions come because someone is able to catch and ride a wave.
In this case, literally.
Bloomberg has a piece about a company called Wavestorm, which makes the most popular surfboard in the US. The company has sold about a half-million of the mass-produced soft foam boards, which have been adopted by both novices and experts. Unlike most surfboards, which are developed by "revered" surfboard designers and surfers, Wavestorm was created by a former hockey player and a Taiwanese businessman.
But what really makes Wavestorm different is that it sells its flagship product for $99.99 - and it markets the board exclusively through Costco, and not through the traditional surf shops that tend to dot oceanside communities.
"We don’t want to mess around collecting money from little surf shops and sporting goods stores," says co-founder Matt Zilinskas. “Margins are slim at Costco, but we pump out volume and get paid on time.”
"While Costco stocks several Wavestorm products," Bloomberg writes, "with some paddleboards costing more than $500, the $100 8-foot board accounts for 90 percent of sales. That price, along with Costco’s policy of issuing refunds to customers whose boards break (a hazard of inexpensive foam models), has had a ripple effect on the industry. Huntington Surf & Sport, one of the largest surf shops in Huntington Beach, Calif., an epicenter of the global surf scene, no longer stocks soft-top boards. 'Why even bother when you can go to Costco for $100?' says assistant manager Cody Quarress.
The story notes that the mainstream surfing industry - a phrase that somehow seems like a non sequitur - has tended to scoff at Wavestorm's business model, believing that somehow it is not pure enough. But there seems to be some level of conversion taking place, as people begin to recognize that those $99.99 surfboards may be bringing new people into the sport, creating a market for more expensive, advanced boards.
It is a fascinating microcosm of how and where disruptions take place ... and an Eye-Opening example of how disruption can help to fuel greater growth.
- KC's View: