Vince Gunn, European Managing Director, Crocs
Vince Gunn, European Managing Director, Crocs
 

15 Aug. 2014

Q&A: Vince Gunn, European Managing Director, Crocs


Following heavy income losses, comfort footwear brand Crocs has announced some extensive strategic changes including drastic cuttings in workforce, retail locations and direct investments last month. However, from a European perspective, things are not going so bad, says Vince Gunn, European Managing Director at Crocs. We spoke to him about saving measures and the difficulty of promoting a diverse product portfolio when perceived as a clog brand only. Interview by Maria Hunstig

Mr. Gunn, Crocs has registered some serious financial penalties recently. What has gone wrong?
I can only speak about the European business and this is actually developing well: In Europe, we now had eleven quarters of growth in a row and sold eleven million shoes last year. We registered a 13% growth in 2014 so far and therefore have actually increased our market share in a diminishing market.
It’s funny because if you ask anyone “Hey, have your heard of Crocs?”, the answer is usually “Are you guys still around?”. We have 409 million dollars in our bank, over 10.000 wholesale accounts and also we have around 350 other styles than just the well-known Clog in our portfolio, but many people don’t notice that. After 12 years in business and eight of those years in Europe we are now at a point where we have to think about what we can do to keep growing.

One part of Crocs’ new strategic measures is to cut its number of styles drastically. What does that include?
The global range shall be reduced by around 40%. But whilst the global portfolio includes 350 styles, in Europe we only have 170-200. We will focus on our core products and get rid of non-core lines like for instance our Elite Collection or Stefano Furiani Collection which is a very adventurous, glossy product that we would only place on the Russian market.  We are not a fashion forward brand.

So which ones are your core products?
In the European market, we still make 70% of sales with our clogs, whereas on a global scale this balance is 50/50. Next to that, we put a strong focus on our boots, especially in Europe, but also our flats, wedges and huarache sandals are core products as we are still committed to become a four-season brand.

Style of Crocs
Style of Crocs' Stretch Sole collection
So how do you want to make consumers aware of all your other products?
We recently ran this “Guess the brand” campaign where we showed people in different cities like Berlin, Amsterdam and London some of our more fashionable shoe models like sneakers or sandals and let them guess which brand they were from. People guessed names like Converse, Vans, H&M or Boxfresh and most of them were really surprised when we revealed they were Crocs. This encapsulates both our frustration and our success at the same time. So what we need to do is increase our marketing spending and improve the execution of it by better explaining that we do more. The consumer needs to get access to other products than clogs, too. Social media will play a big role in this field, but we will also increase our billboards and out of home media and invest in our trade show appearances.

Another point on the saving agenda is the closure of numerous Crocs retail stores. How does that translate in the European market?
In total, Crocs will close 75-100 own stores, in Europe we will close 25-35 of these. But at the same time, we have already opened 14 stores in Europe this year alone. It’s about finding out which sort of locations do best for us and at the end of the exercise we need to have a good balance of outlet und full-price stores.
Our own retail stores are still very important for us, together with the internet they are a good way of explaining our product. If we have new innovations like for instance our new Stretch Sole, we usually launch them in our own stores before they go to wholesale.

Do you sell any Europe-only products or are you selling of the global collection?
We have had some Europe-specific products in the past and we will look into that again because we notice that the European customers have a different approach to quality and style. 

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