Peddling Footwear

It must be January: Shoe makers are now putting their best foot forward with fall 1995 merchandising programs. And with good reason.According to the Athletic Footwear Association's 1994 industry report, the wholesale athletic shoe market in the United States amounted to a whopping $7.55 billion in 1993. And that category covers just sneakers. Cleated shoes, outdoor shoes and dress shoes are separate categories, which together account for another 62 percent of footwear sales. Traditionally, the athletic shoe market has been the most aggressive user of P-O-P. A 1991 AFA survey, for example, ranked store displays as consumers' second most important source of information on new sneakers. Display surpasses even television in influencing purchases.But some of those dynamics have changed. Outdoor (which was not even a category five years ago) surged to $325 million at wholesale, or 5 percent of all sales."In some respects, the outdoor industry has taught the athletic footwear industry how to be creative," says Helen Rockey, a former Nike executive and now president of Brooks Sports Inc., Bothell, Wash. The arrival of the outdoor category "took wall space from basic athletic," she explains. "Athletic is still fighting back with more creative P-O-P and product."Integrated ProgramsAcross the board, all categories of footwear makers are directing increased attention to integrated marketing -- the simultaneous release of product, displays and advertising."Lately we've begun seeing more complete programs that are more focused," notes footwear analyst Roger McGrath, a columnist at The Sporting Goods Dealer. "Some promotion has always been done, but until now, nobody's been this aggressive or said in-store is so important."Nike and Reebok were the first to realize that "individual promotions were most successful when the whole package was delivered at once," observes Rockey. "Now, that's the rule in the industry." The big boys "have more money," she concedes, "but every brand is aware of the challenge and has the desire to create that integrated effect."Brooks is now designing point-of-purchase materials at the same time as it designs product. "Internally we view the creation of P-O-P as equally important," Rockey says.At Avia Group International., Portland, Ore., similar attitudes prevail. Beginning in 1995, says Senior Merchandising Manager Tim Haney, "we're going to have an integrated marketing program. Our point-of-sale materials will re-emphasize our advertising. We're making interchangeable retail merchandising items, utilizing the same photography, typefaces and imagery of our advertising."Maureen Smith, director of marketing communications for Keds Corp., Cambridge, Mass., says the company is undergoing a "major change in the way we've been creating and providing display materials.""Our strategy has changed. Rather than supporting specific seasonal themes, we're supporting the brand," she says. The company's 1995 display budget has exploded, though she won't say by how much. Where in the past Keds experimented with miniatures to display its children's line, including a street scene and a shrunken washing machine, that kind of toying with P-O-P is over. "All of our fixtures, whether a slatwall shelf or a tower display, will be made from the same materials and feature similar logo placement," she says.Converse Inc., North Reading, Mass., is also "putting more emphasis on and committing more dollars to point-of-sale," says Donna Schiff, senior manager of marketing services and merchandising. The company divides its products into two categories: Performance and Athleisure. The coming year will see a series of "solid, quality" fixtures with a two-year lifespan. "For spring of '95, you'll still see some displays that tie into specialized TV commercials," Schiff says, "but by Back-to-School '95, those advertising messages will be integrated into our new program of diamond-shape slatwalls and towers."In November, Reebok International Ltd., Stoughton, Mass., released its Kamikaze commercial pitting Seattle Supersonic Shawn Kemp against a video monster. The commercial is "all computer graphics," explains Shane Estock, director of creative services. "So our point-of-sale pieces reiterate the same monster, and pieces of the shelf cover look like parts of the video game."Nike Inc., Beaverton, Ore., continues to work on integrated marketing launches. "We are trying to coordinate our major category initiatives so that the consumer gets a single, consistent message," says Helen Harwood, corporate program manager for footwear P-O-P. "It's tough to do with the different timelines involved [in television, print and collateral] but it's something we're trying to do." The company has 18 different P-O-P programs slated for fall release.Other manufacturers don't have a whole lot to coordinate. Adidas USA International, for one, doesn't believe in flashy ad campaigns. "We do very little advertising," says John Freud, director of public relations at the Spartanburg, S.C.-based shoe label. "We let our retailers do the selling."Adidas believes so completely in the effectiveness of P-O-P, that it's taken the radical step of discontinuing its coop program. Where the sneaker maker once supplied "$200 to $500 fixtures free of charge, only to have stores not use them," Freud explains, "we now give those dollars to our agencies to allocate, based on building a marketing plan for retailers." Dealers may purchase displays outright, but no more freebies. "It's that whole pride-of-ownership thing," continues Freud. "Properly integrated on the floor, P-O-P can be used wisely to increase sales."Industry observer McGrath says small manufacturers commonly tell him, "I can't compete with Nike and Reebok in the media, but I'll let them bring people into the store and then I'll get some attention with my in-store merchandising."The Challenge"A tremendous amount of final purchase decisions in athletics are made at the point-of-sale," says Brooks' Rockey. "People might come in because they saw the Nike ads, but they stand there at that wall and they pick a few things to try on."Rockey tells her designers that P-O-P must get the consumer to try on Brooks. "We have a challenge because we're small, and we need to make P-O-P small and easy and yet exciting. And it needs to enhance the product."At Brooks, display primarily is used to differentiate new products on the shoe wall. "It's darn big and there's a lot of stuff up there," says Rockey. But the company also expects P-O-P to contribute to the positioning of the brand. "Brooks is different from the big guys; it's a really accessible human brand focusing on individuals."Breaking through the homogeneity of the slatwall is the biggest hurdle for P-O-P."It's tough to reinvent point-of-sale materials," says Haney. "For the most part, you're dealing with a store that has slatwall and that's the only place you can put P-O-P. We face some pretty tight parameters as to what we can design."The shoe shelf works best for Avia, Haney says, "because we don't get the real estate" for more elaborate pieces. "We're designing wall units that hold multiple shoes in a small space, and a lot of things that go in and around the shoe [like buttons] to dress it up. He notes that Avia handles the majority of its design and printing in house."It's much more difficult to design P-O-P for footwear than other industries," asserts Ray Melioli, president of P-O-P company Medallion Associates Ltd., New York. "So many brands, so many seasonal changes. Everybody's vying for attention. The challenge is to be different and exciting and still stay within the parameters of the brand and of the retailer."Even Reebok finds the slatwall difficult. "It's getting harder and harder to get somebody over to the shoe wall and then to make them understand why your shoe is different than anything else they're looking at. That's our biggest challenge," says Estock.The shoe wall is "a big zone in the Americas," she continues. In Europe, where stores are smaller, windows are more important. Reebok keeps an eye on both worlds by creating "smaller window pieces that also work as countertop or department store pieces in this country."Push/PullIn the realm of athletic footwear, P-O-P can be generated from either a push or a pull mechanism. Powerful, strategic partners like Foot Locker can pull P-O-P from companies like Nike. With automatic orders for 700 to 1,000 pieces, footwear makers happily work with retail giants to develop exclusive programs.At K-Swiss Inc., Chatsworth, Calif., Jenifer Larson sees the "trend going toward more customized programs," she says, "although we've had a huge increase of stock P-O-P sales this year. Smaller stores that aren't as defined on what goes where in their stores are starting to do more vendor merchandising. But the larger chains are pretty specific per square inch what you can and can't display."For example, she continues, "Lady Foot Locker has certain merchandising tools that they allow you to 'decorate' during certain times of the year. You can lease line signs, posters, displays, but it all has to tie in to their existing merchandising.""The biggest challenge with footwear," she continues, "is you've got a very small product that, in general, is shown linearly. You want to make the shopping experience pleasurable. But to create an environment that becomes more interactive, you're asking for more square footage."Footwear makers are all over the field when it comes to display sophistication. While Avia's Haney notes that "mechanical things like motion-sensitive displays" are "coming," he says Avia's not ready for that. "We have to crawl before we run."The Interactive DebateAt K-Swiss, the approach to interactive point-of-purchase materials is not so much mechanical as "human-interactive. We're doing more 'touch-and-feel' type displays," Larson explains.At the other end of the spectrum, the No. 2 athletic shoe maker, Reebok, thinks of interactive in 21st Century terms. Estock says "we're way past" the traditional, sound-activated, interactive display. "It's time to get into multimedia in a true way -- CD Rom or computer disk." Although she won't reveal what multimedia projects Reebok has in the wings, she does say, "multimedia is hot. Anybody who's not on to that wave is missing it."Reebok's particular target, 12-to-17-year-olds, is not easily impressed. "The graphics that they're bombarded with are so dynamic, and always moving, never still," says Estock. "It's more and more difficult to capture their attention with a single, still picture. You have to get better and better on the wall, trying to incorporate, without being gimmicky, other things that catch their attention." On the reverse side of that, she says, those same teenagers are environmentally sensitive. "They want to look at real things, not fabricated things."Retail as Theater"Growing up in the video generation where everything is a thrill, today's consumer is incredibly demanding," agrees Rockey. "Stores that combine the thrill of sports with that purchase of sports apparel and equipment will be most successful."The concept of retail as theater is not new to footwear manufacturers. Some might even say it could only have been invented by the big budget of the No. 1 athletic footwear company in America.When Nike opened its first retail store in 1991, many retailers were alarmed at the competition. Today, with eight stores built or in the process, and seven more expected by the end of the decade, Nike is the trailblazer in shopping as entertainment.Granted, few stores have the space to commit to the elaborate merchandising style of a NikeTown, but the flavor translates well into more accessible P-O-P.Medallion's Ray Melioli says, "We all can't go out and be Warner Brothers, but in our own little section of the store we try to entertain." A recent Medallion project for Nike featured a rotating basketball; another due out soon has a shoe levitating above a basketball rim.Brooks' Rockey believes the future lies with "stores that are actually sporting-goods environments." Already in some stores, she notes, "you can shoot hoops, run a track, lift weights, or try out a bow and arrow."The growing Galyan's Trading Co., a sporting goods retailer in the Midwest, concentrates heavily on the retail theater. At its flagship, the store merchandises 1,000 SKUs of athletic and outdoor footwear scattered amid a 42-foot climbing wall, a driving range, putting green and a basketball court. A self-contained, 1,000-square-foot log cabin houses the store's rugged footwear department."I believe retail is theater," says Terry Atwood, director of footwear operations. "You have to affect people's senses, from what they hear, to what they smell, to what they feel. If you don't make things fun for the customer, they're going to blow you off."Concept ShopsThe idea of a store within a store is not new to footwear retailers either.New Balance, for one, is a major supporter of concept shops. Beginning in the fourth quarter 1994, the company made a commitment to creating focus areas within stores. "These are 2-foot-wide by 8-foot-high modular pieces that can be configured in many formats," explains John Donovan, marketing services manager at the Boston-based New Balance Athletic Shoe Inc.The units can "run along slatwall or stand free in the middle of an area, merchandising both footwear and apparel."The beauty of concept shops, he says, is their appropriateness to the "whole dealer network, from the corner shoe store to an 80,000-square-foot Sports Authority."New Balance uses canvas backdrops to facilitate easy, seasonal changes. "Six months down the road we can ship a whole new set of graphics and keep it fresh," he adds. Concept shops, or vendor shops, are a "win-win for everybody" because they "allow you to tell the story of the brand within its own world," adds Donovan. "It's like going to the full-blown cinema."Avia, on the other hand, is abandoning the concept shop approach. "It worked well for us, but we're not going forward with it," Haney comments. Because some Avia accounts operate as composites of vendor shops, he says, "our hand was kind of forced. We had to have something in there, too. But that's over."Larson says concept shops could well be the "wave of the future." She says K-Swiss will likely break out a concept shop in 1995.All Dressed UpThe dress shoe industry isn't as committed to P-O-P as other shoe segments, believes Bud Stein, president of New York-based Trimco. "Ninety percent of footwear P-O-P is done for the athletic market." The dress shoe business, he says, is not a major market in terms of producing displays. "That's really a table presentation world."The dress/casual segment may be catching up, however, with several manufacturers showing an increased interest in use of point-of-purchase materials. According to Mitchell Massey, vice president of marketing for G.H. Bass Co., South Portland, Maine, his company is steadily increasing its P-O-P efforts."In the last couple of years we have really moved a lot of our advertising funds into in-store merchandising and in-store promotion," says Massey. "We've developed a significant in-store program, from all the furniture items and lifestyle photography, up to sign holders and seasonal promotional kits." Funding has "virtually doubled" each year of late. "We've been very active," he explains, "because we think P-O-P helps secure real estate for our products and it gives us better assurance of being able to hit our target customer with the image we want them to see Bass in."Massey adds: "While we know our customers plan their purchase in terms of need, our research has shown that 60 to 70 percent of the time, the actual brand decision is made in the store, on the floor, at the time of purchase."Marketers at Red Wing Shoe Co., Red Wing, Minn., echo a similar valuation of P-O-P. "In-store presentation is growing each year," says Michael McMurchie, visual marketing and merchandising manager. "We're slowly growing our in-store promotions, and next year we'll be continuing with displays for all of our product segments."Like the company itself, Red Wing's display items tend toward the classic. "Something that works well, works well forever," says McMurchie. "Generally speaking, displays will stay available for a minimum of two years." Some of the company's products have been in production for more than 30 years and some of its display items are even older. A neon sign design dating to the 1920s is still available."We're pretty stable; we're not hype. We're trying to communicate our quality and that puts us in a different category than these tennis shoe guys who are always trying to show the brand new, bold thing with bells and whistles."The company is moving toward more permanent fixturing, rather than temporary displays. And while interactive "is fun, it's too expensive for us," he says. On the other hand, he adds, "we don't have big runs, (most are around 300), so that makes the smaller, more custom stuff more affordable."New products and women's shoes get the most display attention at Red Wing. "Being as old as we are, new products become something that we want to highlight," says McMurchie.Both athletic and dress segments tend to use "a lot of lifestyle graphics" and both play up technology, explains Trimco's Stein.Last year, Florsheim Shoe Co., Chicago, introduced the Centennial line of men's dress shoes featuring "patented comfort construction." The launch's P-O-P unit "graphically illustrated the unique features of the outsole and insole," says Gunter Alberts, general manager, visual merchandising.One of the company's most successful units, he notes, is the Bubbler. "It's like a little aquarium," says Alberts. "The shoe appears to be under water. Dealers like the idea because it's visually fascinating and draws attention to the product so that the consumer gets involved."Alberts explains how Florsheim decides on P-O-P. First, he says, the company projects the number of units it will be able to place; then it determines a feasible cost range per unit; finally, it decides whether a short term or permanent display is needed. "Big ideas get more emphasis; smaller ideas get less emphasis," he says simply. "Wherever we feel we have something unique to talk about, we put more energy and more money into it."In recent years, the majority of Florsheim P-O-P has "been of a semipermanent or permanent nature." Flexibility is built in whenever possible, he says, "with interchangeable graphics to tell a different story."Alberts says, all in all, the company is "relatively successful getting the P-O-P in place, on a co-op basis. Independent dealers know how important P-O-P can be and are very enthusiastic about it."ExecutionBut other footwear makers are concerned about placement. For Avia, "the execution part is harder than designing a nice piece," says Haney. "It does no good if it sits in our warehouse.""Making P-O-P is not the difficult part," agrees Stein. "Getting it accepted at the store level with all the other stuff that's being sent in, that's the problem."In contrast, Nike has trouble getting dealers to remove old P-O-P. "We'll send something out and it'll still be up two years later," complains Harwood. "Some stores can turn into museums. You don't want to be competing with yourself in the retail environment." The reason some stores may use temporary materials permanently, she says, is a "bigger demand for Nike P-O-P than we can deliver on. That is a big problem for us."

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