State Of The Shoe

If the shoe market were a living, breathing human, what sort of physical shape would it be in right now? Would it be the macho bodybuilder of the mid 90s that took over floor space like the Roman Empire? Or would it be a chilled-out dotcomer, sitting back, collecting venture capital and sipping a caramel latte? For answers, the first thing that any sensible writer would do is to place a call in to Miss Cleo’s psychic hotline, which she now runs from Atascadero State Prison. We spent a few-hundred dollars on a six-hour conversation with the Jamaican fortune-teller and we’re happy to report the market should be expecting lots of pink polka dots, silk laces, and leopard-print tongues. After that, we figured we’d call up some people who weren’t in jail and who might actually know what’s going on: the manufacturers and retailers. So, after sticking our thermometers in a wide variety of shops and companies, we got a pretty good idea of what’s checking and what’s wrecking. Wanna know? Read on.

The View From Space
One thing’s for sure, last year was undoubtedly the year of the retro-shoe, with stripped-down, sleek designs moving the most units. Consumers went after retro like Starr Jones goes after a club sandwich. While the tech shoes had another year of correction, the upside was that most manufacturers have been ahead of the curve on the retro-styled models.

“Adio’s been tremendously successful in the last fourteen to eighteen months, says Chris Miller, president of Atlas Distribution. “And one of the things that did that for us is when the trend started shifting toward more basic, simple shoes that are moderately priced, we already had a lot of that stuff in our line. So we started to see a lot of sell through, because we were already there, whereas some companies struggled because they had lines that were still very detailed and pricey.

The view from retailers was pretty far ranging. Some said that shoes were “dead, others felt they were stable, and still others claimed they would be increasing their footwear floor space. A definite industry positive, though, was the fact that endemic companies seemed to have an edge on what the stores wanted, which kept the majority of the revenue within the action-sports industry.

“What I’ve seen happen is that the skate-shoe companies addressed that {style change} themselves right away, says Dave Settgast of Groove Tube, referring to the retro trend. “So as a buyer I didn’t really have to go outside my regular skate brands to represent that category. But overall, hardcore skaters make up the majority of my sales anyway.

Buff And Trim
Settgast brings up another interesting point about the retro revival. Surrounded by a wall of apparently wimpier toned-down shoes, the hardcore skate customer found themselves wondering how long a bare-bones shoe would hold up compared to the techy models that had the footwear equivalent to rail savers, copers, and tailguards. It looks as though the designers answered back, putting a big emphasis on shoes that look stripped down, but are very durable as well.

“Function is a priority, says Kelly Kikuta, design director at DVS. “And maybe all the laces aren’t hidden, but there’s some lace protection in the ollie area, or more durable materials and good tread designs. Along with the inside of the shoe, we like to keep our midsole thicknesses thin enough to where you get good board feel but thick enough not to compromise cushioning.

And while everyone knows that not every skate shoe they sell will actually be skated in, increasing the durability and life span of a shoe is a selling point to any customer–whether they’re skating in them or running from the cops. Indeed, it seems consumers are getting increasingly savvy with their shoe-buying decisions. Not only do they want a durable, sleek shoe, but they want it at a lower pricepoint.

For the retailers, the general trend is also pointing toward a more prudent approach to tir buying. “The customer is so much more discerning, so it’s {our shoe department} been narrowed down to a lot fewer vendors than we once had, says Mark Richards, co-owner of Val Surf. “We might still have all those vendors represented, but we’re weening down on quite a few of them. There are a handful who have come to the surface and are really strong. DVS is the strongest. They’re a local company, promoted heavily. After that it’s Emerica, Globe, then Nike with the Dunk program is through the roof. Circa and DC are holding their own, but after that it definitely falls off.

Dave Bourbon, shoe buyer at Moondoggies Beach Club in San Luis Obispo, echoes the same sentiment. “Caution is the key word in my buying the past couple of years. Before, I thought that kids wanted to see the newest thing, and that’s how it was for a while. Everyone had a shoe company and you wanted to put all the new stuff out on the wall to be out there with the rest of the pack. Nowadays, I’m super cautious. If a new shoe line comes out, I’ll let it prove itself for a season or two before I take a stab at it. I’m sticking with all the old reliables.

Can I Get A Little Volume?
However, while they may be getting more selective, many retailers are reporting that their overall volume isn’t down. Part of this is due to the fact that instead of scaling back their shoe program, many retailers are going deeper into the models that are performing best.

“We are doing that in some cases–like for the {Vans} Geoff Rowley, says Emma White-Pryor, shoe buyer for Ron Jon. “It’s done so well that we’ll do four colors in it and maybe skip on some of their other styles that they’d want us to do. Just like the Milan and the Mojo.

It seems like an obvious buying strategy: stick with what’s selling. But compared to the madness in buying that characterized the shoe market a few years ago, it’s actually a significant shift. Instead of bringing in every new line that pops up, buyers seem far less willing to take chances on “the next big thing. Perhaps with the recent memories of the tech slowdown in the back of their minds, buyers are comfortable with the success of the retro shoe. Many are hoping to keep sales strong on a trend they have a good hold on, rather than jumping into the next trend, whatever it might be.

The recoil, from a manufacturing and design point of view, is that this narrowing isn’t the best atmosphere for creating new, cutting-edge product. And that’s really been where the shoe companies have thrived in the past: being on top of trends rather, than blindly following them.

Brett Ritter, Reef’s director of product creation, however, believes that after the retro shoe’s domination of the market over the last few years, buyers may be ready for something a little more adventurous: “The market is satisfied. It’s happy with the exposure to the very casual, toned-down shoe products that it’s had a run with over the last three or four seasons, and it’s hungry for new colors, new styles. The markets around the world are converging on the U.S. and they’re spelling out much more cutting-edge, fashion-forward influences in both color and styling selections. It’s coming. I mean you can see it. It’s on shelves here already. Under this light, it may actually be the perfect time to unleash some new, edgier products. It’s also a provocative answer to the often-asked question, “Is tech dead?

Distribution Solutions
Whether shoes are trending toward being more conservative or not, manufacturers are moving forward with new and bigger lines and even new brands and extensions of core brands. There’s no doubt consumers are always open to new stylings. The question is, can the market sustain this lateral growth? With some retailers trimming down their shoe volume and manufacturers beefing up their offerings, something has to give.

And if retailers are cherry-picking from a bunch of big lines, it means the manufacturing sector may be left with some backstock, which usually points toward looser distribution strategies.

“Everyone seems to be opening up their distribution a little bit, admits Groove Tube’s Settgast. “It’s a bit of a concern. Skate overall has taken a small dip, but I think surf is on the rise. The proliferation of some of these key brands out in the mall is not good for me, but I tend to have better pricing. I have a loyal customer base, so my business has been steady.

As important as the relationship is with ‘core customers, retailers are also emphasizing that their relationships with key brands are equally important to long-term success. This is nothing new, except that manufacturers are generally widening distribution, which tends to polarize retailers.

“We need to stay with the ones {manufacturers} who are really showing us their support, says Richards. “The DVSes of the world, {the companies} that are performing really well. We’ll stay with them and not make room for a brand that we feel is gonna go south on us some day. Some of these stronger brands might do that someday, {but} at least right now we feel really good about them.

Is Casual Connecting Or Correcting?
Depending on who you talk to, the casual market is both hot and cold. For Richards at Val Surf, casual hasn’t lived up to the hype–especially in an environment where skate is taking a dip. “It doesn’t perform for us, he says. “The casual footwear is even a tougher market than skate. It’s really tough to focus in on what’s going to sell there. Still, he’s committed to finding a way to stick with it and keep his floor space diverse. “We’re staying with it, but skate is driving our department. Whatever we can make work in the casual footwear division, we’ll do it.

Compared to the way tech and retro exploded when they came out, casual isn’t seeing the same type of immediate boom. Whether or not these expectations were unrealistic, in the interest of having a well-rounded stock, retailers are finding ways to work casual into their program. “Some models have done okay, says Settgast. “But in general it hasn’t really turned into this great category. It’s another category you want to represent, but it’s nothing that really blew up.

Meanwhile over at Moondoggies, Bourbon says his casual program is faring pretty well with the mix of college crowd and local boarders: “When we opened this store a few years ago, skate footwear was driving the market. The way skate’s kind of gone, footwear has taken a little downturn. Now it’s kind of made a left turn with the casual footwear. We carry the Milan from DVS, the new Dresden does well for us, the old Gavin, the revival style. Casual footwear is a big part of our market. We’ve got a lot of college guys.

Another aspect of the casual market that specialty retailers are coming to terms with is that it puts them in direct competition with massive chains that sell more mainstreamed casual brands. But if the specialty stores can snag some of those consumers who shop for their casual shoes at a department store, it could mean a widened customer base for them.

Chris Todd, shoebuyer for Seventeenth Street Surf Shop in Virginia Beach, sees the casual movement as a diversifying strategy for their shoe wall—and potentially for their customer draw. “It’s definitely a good business and something we’re going to continue to do, he says. “We look forward to that as just another classification that we can grow our footwear business with. To get that mens’ casual is definitely a nice little niche for us.

However, at Adio, Miller says they saw the casual trend as an influence to skateable shoes, rather than a viable movement on its own. “Everything that we’re doing is skateable, he explains. “The first category that we’ve gotten into that’s not a skate shoe has been sandals. There are definitely some more casual looks, but given what’s happened with Gravis, Clae, Stüssy, and other brands that tried to do a pure casual styling in the ska some backstock, which usually points toward looser distribution strategies.

“Everyone seems to be opening up their distribution a little bit, admits Groove Tube’s Settgast. “It’s a bit of a concern. Skate overall has taken a small dip, but I think surf is on the rise. The proliferation of some of these key brands out in the mall is not good for me, but I tend to have better pricing. I have a loyal customer base, so my business has been steady.

As important as the relationship is with ‘core customers, retailers are also emphasizing that their relationships with key brands are equally important to long-term success. This is nothing new, except that manufacturers are generally widening distribution, which tends to polarize retailers.

“We need to stay with the ones {manufacturers} who are really showing us their support, says Richards. “The DVSes of the world, {the companies} that are performing really well. We’ll stay with them and not make room for a brand that we feel is gonna go south on us some day. Some of these stronger brands might do that someday, {but} at least right now we feel really good about them.

Is Casual Connecting Or Correcting?
Depending on who you talk to, the casual market is both hot and cold. For Richards at Val Surf, casual hasn’t lived up to the hype–especially in an environment where skate is taking a dip. “It doesn’t perform for us, he says. “The casual footwear is even a tougher market than skate. It’s really tough to focus in on what’s going to sell there. Still, he’s committed to finding a way to stick with it and keep his floor space diverse. “We’re staying with it, but skate is driving our department. Whatever we can make work in the casual footwear division, we’ll do it.

Compared to the way tech and retro exploded when they came out, casual isn’t seeing the same type of immediate boom. Whether or not these expectations were unrealistic, in the interest of having a well-rounded stock, retailers are finding ways to work casual into their program. “Some models have done okay, says Settgast. “But in general it hasn’t really turned into this great category. It’s another category you want to represent, but it’s nothing that really blew up.

Meanwhile over at Moondoggies, Bourbon says his casual program is faring pretty well with the mix of college crowd and local boarders: “When we opened this store a few years ago, skate footwear was driving the market. The way skate’s kind of gone, footwear has taken a little downturn. Now it’s kind of made a left turn with the casual footwear. We carry the Milan from DVS, the new Dresden does well for us, the old Gavin, the revival style. Casual footwear is a big part of our market. We’ve got a lot of college guys.

Another aspect of the casual market that specialty retailers are coming to terms with is that it puts them in direct competition with massive chains that sell more mainstreamed casual brands. But if the specialty stores can snag some of those consumers who shop for their casual shoes at a department store, it could mean a widened customer base for them.

Chris Todd, shoebuyer for Seventeenth Street Surf Shop in Virginia Beach, sees the casual movement as a diversifying strategy for their shoe wall—and potentially for their customer draw. “It’s definitely a good business and something we’re going to continue to do, he says. “We look forward to that as just another classification that we can grow our footwear business with. To get that mens’ casual is definitely a nice little niche for us.

However, at Adio, Miller says they saw the casual trend as an influence to skateable shoes, rather than a viable movement on its own. “Everything that we’re doing is skateable, he explains. “The first category that we’ve gotten into that’s not a skate shoe has been sandals. There are definitely some more casual looks, but given what’s happened with Gravis, Clae, Stüssy, and other brands that tried to do a pure casual styling in the skate market, it just seems like that’s not what our customer wants.

It’s true that casual models occupy much less shop space than skate footwear, but this has its own advantages. Some stores’ skate-shoe offerings have grown so large that sometimes all those choices can be overwhelming for the consumer.

Todd at Seventeenth Street has seen success with clearly separated merchandising of the styles, although he thinks it’ll be a year or two before the casual companies get their merchandising completely dialed in. “It’s {casual} separated from our skate wall and its own freestanding grid area, he says. “But I don’t think some of those guys have the P.O.P. right yet, like some of the skate guys do. When skate jumped a few years ago, everyone started making money and they were able to do it, so I think some of the younger casual guys are just now able to do some nice P.O.P. and really make it merchandised right.

The clearly positive side to the casual footwear equation is that, in general, it’s bringing a higher pricepoint back to shop’s shoe walls, which means retailers can squeeze more capital out of the same relative floor space, but only if the product is moving, of course.

“It would be ideal for us if it were happening and we were able to sell shoes for 100 bucks, says Richards, “but the magic price for us is 60 dollars. However, given recent economic indicators that are reporting a significant uptrend in consumer spending, the coming year may create the most favorable climate for higher pricepoint shoes than the industry has seen in years.

In With The New
Another way to get a read on the near future of the shoe market is by finding out if retailers are adding lines or not. Despite their claims to be more prudent, retailers seem to be adding lines, although not in the frenzied way they were three years ago. Still, shops are always looking to capitalize on what they think is going to be new and hot, which inevitably means keeping an open eye to new lines and brands.

“We actually did pick up IPath this year, and that’s done really well for us, says Emma White-Pryor from Ron Jon. “I think IPath had that ‘something different’ that nobody else had. We put that in our New Jersey store. It’s a real beachy, resorty town, and it’s a bunch of the New Yorkers and people from Philly. They actually responded well to that line.

Targeting and catering to a wider variety of consumers seems to be one way retailers are deciphering the wide range of styles in the marketplace. With the array of styles available from the shoe manufacturers, shops are able to cater to a broader base of consumer, from an older conservative tourist, down to the most hardcore skate rat.

For Jim Ruonala of Pacific Drive in Pacific Beach, California, the emphasis is keeping the hardcore skate clients coming back. But with so many more retro styles coming out, is he going to be adding on lots of new shoes? “No, not really, he says, “other than Fallen, Jamie’s {Thomas} new company. That’s kind of a no-brainer. They’ve got some classic styles in there and I’m sure they’ll do well. He’s got a good overall package.

DC, parent company of Fallen couldn’t agree more. “When the idea fell in our lap, says PR manager Sally Murdoch, “we looked at it from all angles and felt it was a smart move for us to team up. While Jamie Thomas seems poised to make it fly, in general the pro-model shoe has been scaled way back.

Meanwhile, Quiksilver has thrown its hat into the closed-toed market. It released seven styles for the holiday season and is planning to bump it up to twelve styles for spring. There’s no doubt Quiksilver has the brand strength and design savvy to make it work, but the question is whether retailers are willing to put yet another name on the wall.

Richards at Val Surf seems to sum up the general attitude of many retailers. “We are touching on Quiksilver because we’re such a strong Quiksilver shop—even though their distribution is pretty