Laguna Beach, California
Industry: Consumer & Lifestyle
CEO David Lee's innovative snowboard subscription program solves his seasonal sales limitations while catalyzing community.
A pro snowboarder turned snowboard manufacturer, Lee started Signal Snowboards as a natural progression in his career, but soon found there were growth limitations. "I was a pro snowboarder in the '90s and I had my hands on the manufacturing side," he says. "It was an organic move, and in 2007, we had enough orders to build a factory in Huntington Beach, California."
While Signal began selling through retailers and operating on a seasonal basis, Lee realized over time that the company hit the wall with a traditional model. "We made everything ourselves and had a good customer base, but we couldn't grow any further," says Lee. "Our volume was too low for any discounts, so we decided to take the manufacturing overseas. This allowed us to gain better margins and the manufacturing there allowed us to build what we know we could sell."
Lee still had to overcome the limitations of seasonal snowboard sales. He came up with the idea of a subscription/membership service that gives customers greater access to their latest snowboards and allows them to advance in the sport. "Traditionally, snowboard sales operate on a seasonal basis," says Lee. "You need to predict how many will sell, spread out the products across your dealer network, and hope it snows everywhere. Our subscription service lowers their barrier to entry and eliminates the seasonal problems. With a monthly subscription, they can choose one board, get it within two to four days, and keep it. Then they have two weeks a season to try something else in the line as part of their membership subscription. This gives them an opportunity to ride different boards that get them out to participate in the sport."
Now operating from a Laguna Beach office, Signal designs new snowboards and manages the subscription service which continues to expand. "With our membership platform, we can ship that board wherever you're going and have it waiting for you: You give us to address, it shows up in a box with a return shipping label," says Lee. "With our program, you can upgrade to a new snowboard every year. Our service can also match the board with the type of snow conditions to where you're headed. It then becomes more exciting to go out and participate with the right gear."
Lee says that the three pillars of his company's success are accessibility, participation, and experience. To promote this, Signal employees are constantly on social media to continue to showcase customers' experiences with the subscription platform. "Social media for us is our direct link to our community," says Lee. "It's how we communicate and where we put all our time and money. We're pretty much a direct-to-consumer brand, not in traditional retail. We do some distribution globally, however, and we're working on a new version of our site, which will launch in June."
With a growing community of customers, Signal Snowboards' concept of making the sport more accessible and enjoyable are catching on. "This whole concept helps us," says Lee. "In the past, an individual had to buy the product and was left to learn it on their own. This way, it's about building the community and culture within an individual sport, and they can progress with the community. We want to go beyond the board."
Challenges: "We have to fine-tune what the subscription is," says Lee. "It's new, and we're two years into it. If anything, our challenge is reaching more people and getting them to understand what our membership is, and what works. Our site needs to be tuned for that and will be more clear on what we deliver."
Opportunities: "I think the destinations are our biggest opportunity for growth," says Lee. "The fact that we can ship a snowboard to wherever you're going, presents customers with more opportunities to go snowboarding. With that we find ourselves going beyond the product and finding more opportunities that our membership program begins to grow."
Needs: "We're always looking for investment, but not in real need of it," says Lee. "To grow in the scale, we need a bigger infrastructure here. We're building now with the resources we have and are growing within our own means."