When it comes to endurance, XTERRA is undoubtedly one of the most well-known brands in the business. Beginning in 1996 on the island of Maui, Aquaterra (later named XTERRA) started with an open-ocean swim, a mountain bike race, and a trail run. With the stunning scenery, impressive lineup of athletes, and the additional component of TV, XTERRA struck a chord with its participants and has now grown to over 300 events in 26 countries, a multitude of branded products, and over 350 shows. Mike Reilly, industry veteran and Executive Vice President of Global Sales at Events.com, sat down to interview Tom Kiely, Chief Executive Officer of XTERRA, about their success.
MR: Did you have any idea at the beginning that you would be at over 300 events in 26 countries in such a relatively short period of time? TK: No, we had no idea. Before we started this we were doing ocean events and we did the Tour of Hawaii for a couple of years. Then, we got into mountain biking and through it all we did TV shows for ESPN. So, when we first did Aquaterra in 1996, we just thought this would be another one of our local Hawaii events, we weren’t looking any further than that and really did see this as a one-time event. But, I think we happened to come along at just the right speck of time. If we were five years earlier, we’d have probably been too soon, and if we were five years later, someone else would have caught the wave already. It was all very serendipitous.
MR: Tom, you’ve built events that people love being a part of. You had to see the magic and passion in the faces of your participants and think, “man, we might really have something here!” TK: I think that’s what fuels us. I think when we were doing the pro cycling tour or the ocean sports, those were really for professionals and elites, but there were always a lot of people around that wanted to do this stuff as well. And also, as you know, in this endurance sports world the pros and elites are so accessible and happy to help people get involved. That helped fuel it a lot in those early days.
MR: Now, let’s talk a little about the brand itself. Do you think television had a lot to do with the brand taking off globally? Or, what do you think really catapulted your brand to where it is today – besides the events themselves? TK: I think a couple of things did that for us. One is that our world championship is in Hawaii. Now, I’m from New Jersey and I say that if we had our world championship in New Jersey, no one would have come back for a second one. Hawaii has star power, obviously with Ironman and all of the other things that happen out here that have really helped us.
The second thing is that we were different and unique, no one was really doing off-road triathlons at the time. And lastly, we were one of the few that had television. When I get done with the 10 shows this year we will have done 350 shows in our history. The fact that we were on and a lot of people saw us was pretty cool. Surely for the pros having television was great; we were one of the few endurance events outside of Ironman that got TV. You know, Ironman charted a big path for all of us to follow 35/40 years ago. And, had Ironman not done that, our road would have been a lot tougher. So, there are a lot of things that just came together.
MR: You are in a position that not many event companies are in anymore, because people just hone in on what they have – but you have so many licenses out there throughout the world. Do you fear that sometimes the brand is being diminished a little bit because some people aren’t living the XTERRA passion and creed that you are? TK: You always run the risk of that, surely, and our license agreement programs are pretty short term, a year or two, because you don’t know if some guy or lady who runs a good event might hand it off to their cousin in a couple of years. So, we have some protections in place that we can pull a license back if we have to. And every now and again that happens; but, fortunately for us, the spirit is really great. We always have somebody at those events from our office here, another event director that is established with us, or an ambassador to check out the event and do a report. We also do post-event surveys with the competitors. We protect the brand as much as we can. Every now and again we have to make a change, but it doesn’t happen very often.
MR: So, I’m sure you’ve seen social media’s effect on the endurance business take an interesting shape in the last several years. How has it changed the way you look at marketing and advertising for XTERRA in the traditional sense? TK: Well, you still have to do the blocking and the tackling, the basic stuff. You can’t completely abandon wholly one thing for another. But, relative to social media, we just did our year-end marketing impact analysis and I went to Janet Clark, the president of the company. I said, “I’m looking at these figures here and I think we may have a typo. It says 3 billion with a B for publicity, internet, and digital; but, the year before it was 300 million.
How could that happen?” She says, “The year before we were counting ourselves ‘ham and eggs’ as best we could, but last year we hired an outside company to measure and monitor this stuff.” They monitor everything in the world. For instance, one guy puts that he raced XTERRA on Facebook and 300 people see it, and you start to do the geometric progressions. So, that’s nice to see that number, you know, it doesn’t make me feel good or bad. But, then you get a call from a guy in Malta and he says “we want to be on the XTERRA World Tour”…in Malta. Malta, where is Malta?! I say, “How did you even hear about us in Malta” and he says, “Everyone knows about you guys in Malta!” So, that kind of resonates in your brain that people around the world in both big and little places have heard, and not just about us, we are still a smaller player in this whole big scheme of things. Two weeks ago we just wrapped up an agreement with Tahiti to join the world tour. Social media is just a dynamic thing – you have to get into it, you have to feed it. Let’s face it, we can’t afford to buy traditional media in the numbers we’d like; but, digital media puts us in a whole different communication realm.
MR: Whether you’re building one race, a series, or a company – it’s all about building a team. It’s about finding those A+ people that share your vision and passion, yet are able to combine it with good business sense; because, at the end of the day, it’s still a business and we still have to open up the doors and turn on the lights. How do you go about finding great people to help you run what you have? TK: It all goes back to trust. Fortunately Dave, Janet, and I all knew each other and worked with each other before we got into this crazy business. Lois and I worked together in the hotel business and, God bless her, she is still here. So, the element of trust is here. Now,
that is for your core team because there are going to be bad days and the ones you trust will get you through those bad days. The good days – anyone can get through those. Then, what has worked for us when it comes to building the rest of the team is having people intern or volunteer, essentially trying out for the team. We get to really know them and then some become full-time and some become specialists. Whoever is doing the hiring has to feel inherently that the trust is there. Also, it comes down to design of your organization and who is good at what. If you are a basketball team with 5 centers, you aren’t going anywhere. You have to blend the talents together and that’s not easy to do.
MR: What advice would you have for somebody that wants to launch an event series? TK: I was on the phone with a guy who was starting something new, and he was asking me for advice. I said to him that there are three legs to the stool. First is content, in this case a race or an event. Second is distribution – people have to know about it and you need to promote it. Third is funding – you have to have somebody pay for it! And a lot of people get started and think “I’ll put on an event and make millions!” First thing is – if you do anything good, it is going to take 3 to 5 years to even break even because you have to keep putting money where you should; keep reinvesting in it. As far as a series of events, start with one
and get it solid, then move on to another. People say “I want to do a whole series” from the start; I think that is crazy unless you have the backing of a ton of money. This is a slow growth business. Look at Ironman: almost 40 years, us: almost 20 years. This is not a “get rich quick” thing, it is a time consuming thing. I think those that are successful have emotional and psychological compensation first and foremost, and the financial comes many years down the line. You have to do this for the love of the sport to start; the money hopefully comes later, but it’s a process. For more information about the story behind XTERRA or to register for an event, visit xterraplanet.com.