The Digital Skeptic: Outdoors Industry Wins Where Web Can't Follow

BOYNE CITY, Mich ( TheStreet) -- John and Shari Thompson wonder what the mountain of Web hoopla is all about.

"We have a website. We're active on Facebook ( FB). We do sell online," Thompson said as he showed me around his pride and joy, Shaggy's Copper Country Skis. He built this four-room factory in the old Knights of Columbus hall here on state Route 75, right down the road from the Boyne Mountain Resort, with its 500-foot vertical drop.

"But it has been no help to us. It's just not an obvious thing."

Thing is, this former framing contractor, who describes himself as a "bit of a pit bull," has got the story that, by rights, should make him be a digital, maker-age superstar: After the economy shut down and his home construction business went south, he and his wife essentially taught themselves how to mass-produce world-beating skis from local materials such as white ash hardwood and fabbed metal meant for the car industry.

He didn't need a magic 3-D desktop printing miracle. Rather, the couple straight up worked night and day and sometimes into the next night using good old-fashioned trial and error. Starting with designs, making some skis, seeing what worked, making more changes and then making more skis. In fact, all the duds are stacked in the corner by an old stage.

"I would go to chat rooms and look for ideas," Thompson told me. "But I realized that if I gave away too much there, I would not get anything for my knowledge."

But somehow, this normal dad who made houses for 15 years now custom fabs the most badass, superhero skis I've seen in some time. A solid pair of skis runs about $600, putting him out in front of major makers such as Europe's Rossignol and Atomic and Salt Lake City's Black Diamond Equipment ( BDE).

Business is growing. Shari told me they sold twice as many skis this year as last, which is remarkable considering that Shaggy's core customer is the limited experienced-skier market.

"These skis are not for sissies. You need to know how to drive 'em," Shari told me.Wanna know the remarkable, digital age punchline? Despite being straight out of information age central casting and thus primed to hack the Web to marketing greatness, guess what Shaggy's really relies on to sell skis?

"I'm looking to connect to the better retail ski shops that can communicate my brand to customers," he explained.

That's right, friends. When it comes to selling the big outdoors, the Web is nothing more than a random snowdrift that needs to be plowed through.

The mystery of the high margin snow monster
What investors need to know here is that the high-end outdoor industry Thompson works in is a rare bright spot in today's Dark Age 2.0. According to the Outdoor Industry Association, the Boulder, Colo.-based industry trade group, last year Americans spent $646 billion on outdoor recreation, roughly double what they spent on pharmaceuticals.

And while investors publicly may roll their eyes at President Barack Obama nominating Seattle-based specialty outdoor retailer REI Chief Executive Sally Jewell to be the next secretary of the interior, she runs what amounts to a commonly owned $1.8 billion kibbutz. (And privately, they are scheming to find a way to invest.) Despite max effort competition from monsters including Wal-Mart ( WMT), Sears ( SHLD) and Amazon ( AMZN), Jewell crushes them flat in essentially every measure of profit margin and expense management, even while employees get sabbaticals and millions are donated to outdoor charities.

What's even more remarkable is just how little a role the digital age plays in this sector at all.

Despite being a natural fit for the near-socialist Web and social media, REI and other outdoor industry powerhouses such as L.L. Bean and Cabela's ( CAB) have followed an almost deny-the-Web strategy of aggressive bricks-and-mortar retail store expansion. REI has bulked up to more than 125 stores over the past 10 years with two new outlets opening in Oxnard, Calif., and Jacksonville, Fla., this year. And L.L. Bean has grown to some 30 outlets in the same decade, with a new store opening in Danbury, Conn., last year.

Ski industry veterans backed up Thompson's dubiousness over the selling power of the Web.

"For me it's a lot of face-to-face interaction to create legitimacy," is what Mike Kilchenstein emailed me when I asked him about Shaggy's. He's the CEO of Ramp Sports, a similar Park City, Utah-based start-up ski maker, who also has 32 years of outdoor industry experience at companies such a Rossignol. For him, social media is an extension of what his company does face-to-face, not a replacement.

"Things like consumer shows, demo days, concerts where we get to speak with people so they hear our story from us," he wrote.

Which all means to Thompson, and Shaggy's Skis, that there is no magic Web bullet there to make Shaggy's grow. Rather, he faces just another round of trial and error, slowly and steadily gaining credibility inside his newfound industry.

"I don't want to go begging to any of the big chains," he said. "At the end of the day I want to put out a good product. The rest will take care of itself."

Right on, Shaggy. Right on!
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.