Spalding: An Idea with Bounce

When Dan Touhey, 29, became manager of basketball products for Spalding’s sporting-goods division in 1997, his group was doubtful about the prospects of creating a truly breakthrough product. Spalding was a respected brand name, but buyer indifference had been driving basketballs—which Spalding sold in greater numbers than any other company—toward the dreaded status of a commodity.

As soon as he arrived, however, Touhey began looking for new ways to inject excitement into his products. “Consumers are rarely able to verbalize what their real needs and problems are,” says Touhey, who had previously worked at Bayer as a product manager for Alka-Seltzer Plus Cold Medicine. “When a moderator in a focus group asked about problems people had with basketballs, the number one answer was probably grip. But once the conversation was steered toward inflation, every hand would shoot up. Everyone had a story.” Spalding managers had been aware of inflation frustration for years, but little had been done to address the problem.

The idea that changed how Spalding approached inflation hassles occurred on Thanksgiving Day, in 1998. As Touhey watched his father get ready to carve the family turkey, the bird’s plastic pop-up ther-mometer gave him the idea for a minia-turized pump that would reside inside the ball when not in use.

Touhey knew that getting the company to invest in his micropump idea was a long shot. “There was a cultural fear of taking a big leap—of becoming involved in a blue-sky project that didn’t have a well-defined endgame,” says Touhey. Creating a tiny mechanical device appeared to be well beyond the capabilities and resources of Spalding’s R&D staff, who had been focused on more routine adaptations such as changing the ball’s texture with dif-ferent “pebbling” patterns. Additionally, Touhey feared that middle management in the company would hesitate to get on board with a risky investment.

But Touhey got lucky. Eddie Binder, an aggressive new executive vice president of marketing who was in his first week on the job when Touhey pitched him the idea, gave it the okay. Binder suggested that Touhey find a contract design firm to develop a quick-and-dirty mockup that would make the consumer benefits of the new design—now called “Infusion”—more tangible for the executives, marketers, and engineers who would have to rally around it.

Then came the real work. The plan was to build a drinking straw–sized pump into the ball itself: insert a fingernail into a small slot in a rubberized disc on the ball’s surface, turn 90 degrees, and the pump would pop out. Users would be able to add air at about one pound per square inch of pressure per minute. Compared with creating a new pebbling pattern, the Infusion project was like rocket science. Literally: one resource Touhey’s team relied upon was a former NASA engineer in Spalding’s golf product division, which controlled brands such as Top-Flite golf balls and Ben Hogan clubs. While basketballs had remained technologically static for decades, the golf engineers were used to employing the latest in materials and computer-aided design and testing technologies to improve their products on a yearly basis. The NASA engineer used software common in aerospace design to solve the Infusion project’s most in-tractable problem: guaranteeing uniform bounces, even around the micropump.

Product quality was of paramount importance. Infusion couldn’t be viewed as a gimmick; if it didn’t stack up against the best offerings in the market, it couldn’t display the valuable “official ball of the NBA” tagline. Spalding also had to ensure that the new product’s weight, balance, bounce, and durability were identical to those of traditional balls. But after almost two years spent building the world’s first basketball with moving parts, Spalding hit all of its performance targets.

The samples, tooling, consulting fees, materials, testing, and trips to manufacturers in China that went into the project ended up costing Spalding approximately $1 million, easily twenty times what it typically spent on a new product for the sporting-goods division (such as a ball with a new material or pebbling pattern). But it was worth it; Spalding’s share of the $140 million basketball market in the United States bounced up from 32 percent just before the launch of Infusion in February 2001 to 64 percent one year later. Chris Burston, a buyer of team sports equipment for San Francisco’s Sports Basement superstores, admits he was initially “really leery of buying a ball with a tiny machine inside. But I don’t think we’ve had any returned—and we have a superlenient return policy. This is just a great product for the father and son who come into the store and want to start playing immediately.”

Infusion’s dramatic success convinced many managers that the golf side of the house wasn’t the only place where investment in innovation could pay dividends. “We had always thought our NBA relationship and official license would be the primary determinant of growth,” says Touhey, “but we began to focus on the mantra that we were going to make technology and new products the lifeblood of our company.” Touhey estimates that, before Infusion, marketing managers at Spalding devoted 10 to 15 percent of their time to new-product development. Post-Infusion, the marketing group spends around 40 percent of its time on new products, whether on incremental improvements or on more ambitious innovations.

Spalding wasn’t exactly the first firm in the industry to latch onto the idea of building a brand around innovation and cutting-edge performance. Indeed, high-tech materials are the norm in some sports. Carbon fibers once found mostly in exotic aerospace applications, for example, are now helping women’s tennis groups everywhere boost their serve speeds into the triple digits. But while other companies found that enthusiasts would gladly pay premiums for even slightly higher performance from their snowboards and sailboats, Spalding knew it would have to look at product functionality in very different ways.

“Purists really focus on the fact that the ball should remain mostly unchanged. But changes in other sports technologies are already altering the ways games are played,” says Touhey. “We looked at what we had done with the Infusion program as a model for the type of innovations that would be welcomed: those that, number one, eliminated some of the annoying aspects of playing the sport and, number two, would maintain or enhance the integrity of the game.”

Touhey points to recreational softball as an area where technology run amok has disrupted the game, providing his company an opportunity to set things right. The popularity of aluminum and even carbon fiber bats had dramatically changed the sport over the last several years, allowing even moderately skilled players to slug home runs. Teams were piling up scores to the tune of 30, 40, and sometimes even 50 runs a game. With all of the marathon games on their fields, league managers found it nearly impossible to adhere to their nightly schedules. Some tried to introduce complex workarounds such as limiting the number of home runs any one player could hit in a single game, but such measures proved unpopular.

Spalding experimented with different ball designs that could help return slugging power to a manageable level. Ron Laliberty, a veteran of the Infusion project, introduced techniques for developing multilayer golf balls that he had learned from the engineers at Top-Flite. He found that a soft “mantle” layer of thermoplastic elastomer would restrict the flight of poorly hit balls. Marginal players would no longer be rewarded with towering homers just because they bought expensive bats, but players who hit the ball squarely could still reach the fences. Spalding also found that the ball, marketed under the Dudley brand, was less damaging to bats and eliminated most of the stinging vibrations caused by mishits.

Spalding continues to seek out new insights—and not just by watching ballers on the playground or weekend warriors on the diamond. “A colleague clipped an ar-ticle about Pull-Ups diapers, of all things, that talked about how the diaper holds uncomfortable wetness against the toddler’s skin for five minutes so that the kid seeks out potty training,” says Touhey. “It got us thinking on new tangents. How could touch and feel become a part of learning good techniques for throwing a ball? Maybe new materials could show a thermal handprint on a football, so you could see if you’re throwing with the right grip.”

In May 2003, Spalding’s owners sold the sporting-goods division to Russell, the maker of Russell Athletic outerwear and Bike protective gear. Russell has integrated the basketball-related product lines from two of its other recent acquisitions, backboard makers Huffy Sports and American Athletic, into the Spalding business unit.

“Huffy was focused primarily on cost containment before, but it’s amazing what happens when the engineering and product development people are given the opportunity to develop premium, category-changing ‘statement products’ rather than try to save a few bucks on existing offerings,” says Touhey. “Whether you look at Spalding’s role within Russell as an ‘innovation engine’ or just a good example, we think we can spread the mentality and help people act on category-changing innovation ideas quickly.”