After a tough 2010, many shoe retailers and manufacturers are looking forward to better times ahead. Luckily, a slow but steady increase in sales is pointing to a prosperous 2011. Footwear News caught up with top execs to talk trends, challenges and where they see the footwear business heading.
Ken Hicks, Chairman and CEO, Foot Locker Inc.
Biggest highlight: “The highlight of this year was getting three quarters of sales and profit growth back to back.”
Biggest challenge: “The biggest challenge is developing sales, getting sales on track in the challenging business environment that we’re in.
Best footwear trend: “Lightweight running. It’s a good category. Next year, everybody is going to be participating.”
Prediction for 2011: “Next year is going to be even better than this year. Every year it gets better.”
Sam Sato, President and Chief Merchandising Officer, Finish Line Inc.
Biggest highlight: The first Nike Track Club we opened represented an evolution of the experience in the mall, and a pretty exciting experience for us.
Biggest challenge: From a merchant-only point of view, [it is] continuing to deliver against our commitment to deliver the most relevant product assortment for our target consumer. We want to be great for them, and that is not only the most exciting part, but the most challenging.
Best footwear trend: [Without hesitation], lightweight running.
Predictions for 2011: Running will continue its trend. We have also started to see a turnaround in basketball. In fact, our basketball business, which is a significant business for us, comped positive in the mid-single digits last quarter for the first time in this year. Hopefully that will continue.
Sonny Shar, President, Pentland USA
Biggest highlight: “I would say the group has done well. We increased sales across all brands, [especially with] Hunter and Lacoste.”
Biggest challenge: “[The challenge is] to maintain cost to the best of our ability — taking into account what is going on in Asia — and to have an orderly growth in 2011.”
Best footwear trends: “For us, the boot business [was a popular trend] and will continue to do well, as well as casual boat shoes.”
Predictions for 2011: “Unless the government gets on to economic sound footing, I don’t think anyone can predict. We hope it will be a good 2011 — better than 2010 — and that sustained growth will continue. We do have exciting things in the works. We are going to open new Pentland brands in 2011. We have faith in the future.”
Jeff Phillips, President, Fleet Feet
Biggest highlight: “Another year of double-digit comp-store growth and surpassing $100 million in sales.”
Biggest challenge: “Product distribution and pricing clutter in the marketplace, and managing customer flow on busy Saturdays and the size of our training programs, specifically the explosive growth of our No Boundaries program.”
Best footwear trends: “We are completely performance driven when it comes to footwear, so ‘trendy’ is not part of our retail vocabulary. However, we have benefited from the publicity and consumer interest around the minimalist or ‘barefoot’ trend in running footwear. It has given us the opportunity to educate our customers on the appropriate use of the product and sell them additional units as training-specific equipment along with their regular footwear purchases.”
Predictions for 2011: “We’re bullish on running, healthy lifestyles, our people and business model. Look for more aggressive expansion of our retail footprint through acquisitions of independent running specialty stores in 2011.”
Stephen Encarnacao, CEO, Dayton Boots
Biggest highlight: “The biggest highlight is that in spite of a very challenged economy, consumers are spending — and spending on quality, which is a surprise. Our business is up. People are recognizing quality more [than before]. Our new advertising campaign worked well for us, as well as a Groupon event.”
Biggest challenge: “We have to work harder and fight harder for business. We have to be smarter; we have to offer more value and better service. People are really concerned about incomes, and you’ve got the growing disparity that’s going on in terms of distribution of wealth.
Best footwear trends: “The one boot that is fascinating to me is the service boot. It looks like something that my grandparents probably wore. That silhouette is very strong. The look is going retro, looking like it came out of the 1920s or ’30s.
The biggest trend is the flock to quality. People are buying fewer pairs of shoes, but they are much more discerning. The Internet allows people to be much more intelligent, to get information from a variety of sources. People are willing to spend on things that have intrinsic value. That’s a comforting thing. The nice thing in terms of trends is the continued enlightened consumer.”
Predictions for 2011: “My prediction is that there is going to be a continued flock to quality. I do think there is going to be fallout with some of the bigger brands that can’t continue to grow. In the U.S. market, you are going to see some downturn in terms of spending. Consumers are going to continue to adjust in overall spending, being very careful. Rather than buying three or four pairs of footwear, they are going to buy two or three. If you look across the American economy, it’s going to be difficult for big brands and you will see some fall into hard times. I’m not optimistic about next year for the industry. It’s a mixed bag.
Coye Nokes, CEO, Coye Nokes
Biggest highlight: “The highlight for me this year was the day I was walking down the street in New York and spotted a woman wearing our shoes. It was the first time I’d randomly seen a stranger wearing Coye Nokes. It was a great moment.”
Biggest challenge: “The biggest challenge for me this year has been managing the growing business. It’s impossible to be everywhere at once. I’ve spent many nights on planes this year, and video conferencing has been essential.”
Best footwear trends: “I love the ladylike trend: beautiful, feminine, sexy footwear.”
Predictions for 2011: “The footwear market will continue to recover, emerging from this difficult period.”
Eddie Cuevas, Owner, Shoegasm
Biggest highlight: “We felt good about retail again. We were able to sell some footwear. In the spring and summer, we had a great time with wedges and jewels, and winter was big for combat boots.”
Biggest challenge: “The biggest challenge is keeping the inventory level low. Women want trendy shoes and are willing to pay, so you can’t make a mistake. You have to have the right product.”
Best footwear trends: “The biggest trend was masculine looks for women, [like] oxfords and combat boots. We saw over-the-knee boots a lot last year, but that trend has totally died.”
Predictions for 2011: “We are excited about the new boots with shearing linings and wool details. Boots, especially all-weather boots, are going to be really important.”