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GoPro to sack its retailers

GoPro has announced that it will eliminate retailers from its supply chain this year, instead selling direct from the GoPro website.

Nick Woodman in more celebratory times.

The move is part of a package of moves to stem losses encountered in the past few years, but with only 20 percent of sales currently made direct online, it could be seen as a ‘Courageous Decision’ (in the Yes Minister application of the term).

Other measures include a workforce reduction of more than 20 percent (around 200 people), and slashing the sales and marketing budget.

‘We have a clear opportunity to super-serve consumers’ demand for our products in a more direct and efficient manner which can have a positive impact on the profitability of our business,’ Nicholas Woodman, GoPro’s founder and CEO, said. 

GoPro will continue to sell to ‘select leading retailers’ in some regions. ‘However, the company will be shifting primarily to consumer-direct sales to drive growth in regions where GoPro.com already enjoys a strong share of the market.’

‘We believe our more direct-to-consumer-centric approach is better aligned with the current business climate, is accretive to ASP and gross margin, and positions us well for when consumer demand begins to normalize,’ said GoPro’s Chief Financial Officer/Chief Operating Officer.

CEO Nick Woodman will forego the remainder of his salary through the end of 2020 and the GoPro Board of Directors will also forego their cash compensation through the end of 2020.

GoPro’s share price has been depressed for several years.

This is GoPro’s second major downsizing. In  early 2016 it also slashed its workforce – which was around 1500 at the time. Even at that stage Nick Woodman was pinning his company’s poor performance on ‘poor retailer sell-through’, so it’s perhaps unsurprising that he has now identified retailers and retailing as an unnecessary evil. From highs of  over $60 prior to 2016, when a range of competitors moved into the action cam category, GoPro’s share price has been depressed for several years.

 

 

 

 

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