Shoes Stand Their Ground

American consumers are still buying footwear, despite the sluggish economy. "Footwear has been sheltered to some degree," says Michael Atmore, editorial director of Footwear News, New York. "When you look at apparel and handbags, shoes probably outperformed those categories, but I think they were hit."A New York Times article from November 2009 stated that shoe sales increased nearly 8% in September compared to the year before, and sales of shoes were $1.5 billion in October, the highest they have been in any October since at least 2006.Asics' vice president of footwear Jim Monahan says the Irvine, Calif.-based company was up roughly 8% to 10% for 2009 (90% of the manufacturer's sales were in footwear). However, Rick Ravel, president of Karavel Shoes Comfort Center, a 15,000-square-foot shoe superstore in Austin, Texas, says the new "up" is flat or down 5%, and some parts of the country are doing much better than others. But he adds that independent retailers are doing better, overall. "We were affected to some extent," confesses Amber Vanwy, marketing manager for the Western Boot division of Rocky Brands, Nelsonville, Ohio. "We do make work boots. Not as many people were working."Changing Shopping HabitsWhile the footwear shopper -- people of all ages searching for the right shoes for various occasions (work, sports, the beach, etc.) -- hasn't changed in recent years, consumers are making a dramatic shift in shopping habits, says Joe Wood, Brown Shoe's president -- retail, pointing to internal research. "Value, versatility and convenience are more important now than ever, and people are buying to satisfy needs over wants, though they're still interested in unique offerings."Aerosoles, Edison, N.J., has been providing comfort shoes for women since 1987 and sells through eponymous retail stores and outlets, in addition to catalogs, wholesale accounts and websites. It's a prime example of a manufacturer/retailer that strives to understand its shoppers, a broad range of women in their 20s to 70s. "We had gone more fashion-forward with some of our shoes in the past, and maybe went too far for some customers," says vice president of marketing Michele Rast. "In the past year, we've felt really good about our assortment." Atmore says, "It's no coincidence the wellness movement is taking off. It combines a couple of trends: It gives the customer an impression of value; it's perceived as a lifestyle or health enhancer; and it encourages a healthier lifestyle. I think it's very important in that category to display the benefits. A lot of them do have research that backs up their claims." As an example, he cites MBT, the originator of the "rocker" shoe. Shape-ups, which mimic the style, have become immensely popular for Skechers. "I don't know that the consumers really knew they wanted that footwear until it was offered to them," Atmore says.To find out what resonates with its customers, Aerosoles recently orchestrated in-store focus groups to analyze topics including branding and positioning. But Rast admits this procedure is "not a regular thing." The brand also introduced a loyalty program to keep its regulars enticed and relies on computer-aided marketing to keep a database of its retail customers, catalog buyers and those who buy from www.aerosoles.com. In the future, Rast anticipates more qualitative surveys and more research on a larger scale.Asics also does focus groups on key product initiatives. Ravel of Karavel says major manufacturers not only use focus groups, but they also send upper management to visit with retailers and watch customer interactions. Atmore doesn't hear much about luxury brands doing research on their shoppers, but says, "They probably should."Harris MacNeill, president of MacNeill Engineering Worldwide/Champ Spikes, Marlborough, Mass., which makes athletic spikes and cleats, adds that large athletic brands are doing a lot of testing on professional athletes and their merchandising crews are definitely out in the field, but more in-your-face marketing is needed. "Generally, you're not going to drive a consumer to the store to buy shoes, at least in our category. They're going for something else. They don't really know what brand they're going to buy and what model they want until they get there." Rocky, it seems, went where few companies have gone before: directly into consumers' homes. To discover the needs of the work boot consumer, they contracted various firms to conduct guerilla research. Vanwy says those companies' representatives literally became part of consumers' lives, getting to know everything about them and doing shop-alongs. In-Store StrategiesChanges are being made in Aerosoles' retail stores, as P-O-P is being pulled back. "We really want the shoes to be the heroes," Rast says. However, Vanwy says Rocky Brands invested in calling out features via signage, P-O-P and dedicated wall space. The company uses hangtags, innovative ads, and in-store materials like pegboards that command a lot of space with an 8-foot-long Rocky header for power accounts. Monahan says, "Retailers are not just looking for individual P-O-P elements, but company 'build-outs' in their stores, specific walls produced that showcase the best of the brand." Asics' P-O-P relays short and simple messages, explaining various technologies.The biggest issue for brands and retailers is finding new shoppers and keeping current customers coming back. MacNeill cites Under Armour as an incredibly successful new footwear line. Within one season, he says, "They got a 15% to 20% market share. They leveraged their compression apparel. In any of the major sporting goods chains, they had signage, P-O-P and a whole section where customers could pre-order shoes."He says perhaps large retail stores with a lot of product can get by without marketing backup, but for independent retailers and sporting goods/golf shops especially, advertising and promotions are of utmost importance. For a successful launch, in-store materials are obligatory."We greet and seat," adds Ravel, whose clientele depends on good customer service. They tend to be 55 years old and up, though he's trying to attract younger buyers, too, by carrying lines like Söfft. Karavel shoppers are mostly women and they're willing to spend an average of $125 for a pair of shoes. He has three on-site pedorthists in a set-aside wellness center for customers that come in with a prescription and special needs."We're the only industry where 99% of the inventory is hidden. We sell service," Ravel says. But Footwear News' Atmore says he believes, "Price is king. Service falls second."Outside the store, Rocky paired up its Durango brand with the Country Music Association at a music festival, Rocky with Kalitta Racing (a member of the National Hot Rod Association) and Georgia Boot with NASCAR's Ron Hornaday to establish relationships directly with consumers. The company is also using Twitter and Facebook to connect, especially with its Flirt With Durango brand demographic of teenage to 20-something girls. Vanwy is charged with "tweeting" on behalf of Durango, and the company hired a firm to handle its Facebook communications.Famous Footwear recently launched "Make Today Famous for Back to School," the company's largest and most integrated consumer communications campaign, and the brand's first effort to include social media and national cable television advertising. The company created a dedicated website, Facebook page, YouTube channel, Twitter handle, and viral video site to get the word out.Though the footwear industry is a little behind the curve, some brands are incorporating technology and digital signage more than they used to. Atmore says he sees the most from the outdoor market since their products tend to have more benefits to announce. Ravel says MBT, Earth, Ecco and Mephisto have DVDs playing messages at Karavel, while he has an 8-foot-by-16-foot digital sign outside showing video of new products and announcing trunk shows. "We must continue to push the envelope."Inventory and CollaborationInventory also seems to be a hot issue, as Ravel estimated about 80% of the manufacturers he works with cut back this year and vendors did not back up their products due to fewer initial orders. A new revelation, it seems, is that brands are now working with retailers to negotiate terms and turn inventory. Karavel hired an inventory consultant to make sure extra pairs of shoes don't stay around for more than 90 days. "He's saved us a ton of money," Ravel says. "The businesses that will survive are the ones that control inventories and offer something unique." MacNeill also reports that there's more collaboration: "The footwear companies had a little more power and were dictating more buy programs, then the retailers became stronger. But now they realized it's better to work together and have a balance instead of beating each other up." His company provides retailers with either shop-in-shops, P-O-P for slat walls, shoe holders, counter stands, signage or posters. He says that five years ago, it was relatively easy to get P-O-P in most stores, though retailers were using chintzy displays that were often mangled or mishandled. Today it is much more difficult to place displays in retail stores like Target, Walmart and Golf Town (Canada's largest golf store), but it's more important than ever. This is especially true when a brand has to teach customers a new concept, like telling golfers to change their spikes every few games for improved performance. Karavel has numerous shop-in-shop displays from brands like Mephisto, Ecco, Dansko, Clarks, MBT and Aetrex. "The majors are recognizing that independents are very important to them," he says. "How many department stores in the mid-range are left in the U.S.?"Clarks recently flew in its merchandisers to preview the fall 2010 line. "They're probably one of the few that do that," he says, but brands send him P-O-P and do trunk shows regularly.

Shoes Stand Their Ground

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