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Variety
Crocs sells more than 250 designs for men, women, and
children, and it is this vast product offering that seems to
have bolstered the brand. Mr McCarvel recently said that
one strategy in stores during 2011 was to offer more visual
merchandising and more gifting opportunities with
accessories, hats, gloves and socks. Clogs are less than half
of the company’s business globally, he added.
The tale o f Crocs begins with a Quebec company called
Foam Creations, which developed and launched a spa shoe
named the Beach in 2002. The 200 pairs that were
produced sold out at the Ft. Lauderdale Boat Shoe in
Florida. In June 2004, the three friends who founded the
Crocs company – Scott Seamans, Lyndon “Duke” Hanson
and George Boedecker – purchased Foam Creations and its
manufacturing operations to secure exclu sive rights to the
proprietary foam resin called Croslite. The foam forms itself
to a wearer’s feet and is said to offer medical benefits.
In 2006, Crocs purchased Jibbitz, a manufacturer of
accessories that snap into the holes in Crocs shoes, for $10
million, or $20 million if Jibbitz met earnings goals. The
following year, Crocs acquired assets of footwear maker
Ocean Minded, and agreed to buy shoe fi rm Bite Footwear.
By 2007, the company had applied to register ‘Crocs’ and
the Crocs logo as trademarks in over 40 countries, including
the US. Crocs also extended the scope of its trademark
registrations and applications for both the Crocs mark and
logo to cover non-footwear products including sunglasses,
goggles, knee pads, watches and luggage.
Out of favour
However financially successful Crocs may have become in
the few years since they were launched, there was a different
picture in the fashion world. The plastic shoes polarised
opinions and many style journalists described them as a
‘fashion disaster’. A
Washington Post
article in 2006 summed
up the mood: “Nor is the fashion world enamoured of Crocs.
Though their maker touts their ‘ultra-hip Italian styling,’ lots of
folks find them hideous”. Fashion consultant Tim Gunn told
Time
that the shoe “looks like a plastic hoof,” while a number
of websites and social media groups were set up to try and
eliminate the shoes.
Then came the financial crash of 2008, and shares in the
sandals plunged. While the economic situation in the US
and Europe was largely to blame for the slump, so was the
shoes’ fading popularity, and it was suggested by the media
and analysts that the shoes were little more than a fad. “The
brand is over,” said Robert Samuels, an analyst at JPMorgan
in New York. In April 2008, Crocs closed its Quebec factory,
making 670 people redundant. Things were looking bad for
the brand, but Ron Snyder, then CEO, insisted he was
“confident about long-term prospects”. “We believe many of
our markets are under-penetrated and should provide
meaningful growth opportunities for our products well into
the future,” he said.
When John Duerden took over as CEO in 2009, he
admitted that Crocs represented “one of the toughest
turnarounds” of his career. The company concentrated on its
core offerings and shelved certain lines, including its
clothing brand and You, the upmarket brand of women’s
shoes. Mr Duerden said he had no immediate plans to bring
the lines back and instead would focus on keeping existing
customers. He admitted the shoes were unlikely to impress
fashionistas but said: “We want to drive the brand at people
who choose to be happy, rather than right.” He told
Women’s Wear Daily
: “The biggest problem for us is
reconnecting with our customers, retailers, in particular. We
need to rebuild our reputation with them, which has
suffered as a result of such rapid growth, and we need to
improve the level of service.” He said that although he saw
the company as “like a shooting star” and had previously
dismissed it as a fad, he still believed there was a
“passionate group of consumers out there”.
Billion dollar brand
To get the brand out of danger and back on track, Crocs
expanded its retail presence and introduced a wider range
of shoe styles. This year, it began a licensing spree to spread
the brand name and attain more revenue. “Licensing
presents an opportunity to leverage one of our most
valuable assets – the global power of the Crocs brand – by
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AGAINST THE ODDS
MARCH/APRIL 2012 | www.footwearbiz.com
Crocs footwear has polarised the fashion industry but the brand
is determined to cultivate a fanbase of young women.
PHOTO CREDIT: RENE TILLMANN / MESSE DUESSELDORF