After the acquisition of Collective Brands Inc.’s Performance & Lifestyle Group, the new Wolverine has reorganized its portfolio of brands into three groups — Performance, Lifestyle and Heritage — each with its own detailed road map for success.
And analysts said it’s one that should pay off.
“They’ve got a very strong portfolio of marquee brands in their key categories,” noted R.W. Baird & Co. analyst Mitch Kummetz.
The Lifestyle Group, headed by Mark Neal, has seen some of the biggest changes through the reshuffling. As the home for the Hush Puppies and Soft Style brands, as well as three of the four PLG labels — Stride Rite, Sperry Top-Sider and Keds — the division is the fastest-growing group in the company. Its focus is therefore on accelerating the expansion plans each brand already has in place.
Neal, who now spends a large part of his time in the Boston headquarters for the newer brands, said harnessing the Wolverine sourcing and organizational power will help the PLG labels achieve their goals faster.
“When I got involved, each brand had a vision and a strategy in place,” he said. “We have great sourcing and tremendous financial resources, and I’m just making certain the teams have all the resources to be successful.”
To ensure growth, the company is also hiring senior positions in Asia-Pacific, Latin America, Europe, the Middle East and Africa. “We want people on the ground,” Neal said.
The opportunities also go beyond footwear. Efforts are underway to push the labels further with licensees for apparel and accessories. Keds launched apparel in April and Sperry will add the category for fall ’14, and Neal said there are additional opportunities to sign more partners.
Citigroup analyst Kate McShane said international expansion makes for a good long-term growth story.
And she noted that Stride Rite — which will take over the design and development duties for the Merrell, Sperry and Keds kids’ footwear lines — is a solid player in a burgeoning market. “The kids’ business is fantastic right now,” McShane said.
The Performance Group, headed by Jim Zwiers, also welcomed some new family members, notably running brand Saucony, as well as Cushe, which was formerly in the Lifestyle division. Zwiers noted the newcomers are energizing the entire portfolio.
“The Saucony leadership team has driven an outstanding brand with excellent consumer engagement, and to have a true athletic brand and a running brand [in the group] is an exceptional opportunity,” he noted. “We’re really excited to have that team and brand contributing overall.”
The longtime Wolverine executive is looking forward to leveraging sourcing synergies between Saucony and Merrell, the latter of which has made athletic outdoor pursuits a priority. In fact, he noted, continuing to “blur the lines” between casual and athletic, and between outdoor and athletic, should help Merrell recapture strong growth and become Wolverine’s first $1 billion brand.
Meanwhile, at Patagonia Footwear, a refocused line emphasizes trail running and surf styles, to better align the shoes with the overall brand message, said Zwiers. For Chaco, the priority is expanding the SKU and category count within the brand’s existing distribution, to expose the Chaco consumer to a broader product range.
As for his division, Heritage Group President Ted Gedra said that newly placed Sebago is a natural addition.
“It is authentic and has a great deal of heritage, and it revolves around well-made, handcrafted product that takes a lot of skill and shoemaking ability, and in that regard, it’s just a great fit,” he said.
And never mind that there are now two boat shoe brands in the family, Gedra added. Sebago will continue to emphasize handsewn and classic styles, along with its made-in-America collection, and will target an older consumer to help differentiate the line from Sperry. The brand’s shoes also will be sold at higher price points.
Above all, executives noted, Wolverine’s longtime relationships with overseas partners will ensure the newer labels’ strong debut on the global stage.
Still, achieving a bigger top line all boils down to continuing to serve each consumer with the right shoes.
“You win or lose with great product,” said Neal. “What we see consumers responding to is freshness, so we need to concentrate on how we keep it different and unique, and that will come through great design talent and a focus on innovation.”