Introduction
Skechers is a high performance and lifestyle footwear company located in Manhattan Beach, California, which was founded in 1992 by current CEO Robert Greenberg and his son Michael. It was first incorporated in 1992 in California and then reincorporated in Delaware in 1999 while keeping its headquarters in California (Skechers, 2016b). As of fiscal year 2015, it owned and operated in the United States 119 concept stores, 155 factory outlet stores, and 117 warehouse outlet stores. Internationally, it also owned and operated 82 concept stores, 41 factory outlet stores, and five warehouse outlet stores. It has more than 1340 company-owned retail stores through an international network of subsidiaries, which are located in Canada, Brazil, Chile, Japan, and other 27 countries in Western and Central Eastern Europe. It also has joint ventures in Asia. This paper explores its marketing strategies, target customers, licensing agreements, apparel products, global sourcing strategies, production planning and strategies, and quality control procedures.
Marketing strategies
Skechers describes its footwear products as an amalgamation of style, value, quality, and comfort. It has two four sets of footwear brands: the Lifestyle Brands, the Performance Brands, the Skechers Kids, and the Skechers Work (Skechers, 2016b).
Under the Lifestyle Brands, it has five brands: Skechers USA; Skechers Sport; Skechers Active; Skechers Sport Active; BOBS from Skechers; and Mark Nason (Skechers, 2016b). The Performance Brands, Skechers Kids Brands, and Skechers Work brands have only one brand, the Skechers Performance or the Skechers GO brand, the Skechers Kids, and Skechers Work, respectively. Skechers USA are casual footwear products, primarily sandals and boots, designed for men and women (Skechers, 2016b). The category for men and women, for instance, has five lines: Relaxed Fit from Skechers; Dress Casuals/Modern Comfort; Casuals; Casual Fusion; and Seasonal sandals and boots (Skechers, 2016b).
Skechers Sport consists of sport footwear collection for men and women with styles enhanced with comfort features (e.g. foam insoles, lightweight, flexible outsoles, and soft uppers) and technically inspired performance looks. It is known for bright, multi-colored and solid basic-colored uppers. The Skechers Sports, also for men and women, consists of three lines: lightweight sport athletic lifestyle; classic athletic-inspired styles; and sport sandals and boots. Skechers Active and Skechers Sport Active are two sneakers and casual sneakers brands for active women of any age. The former contains lace-ups, Mary Janes, sandals, and open back styles in many colors. The latter consists primarily of low-profiles, lightweights, flexibles, and sporties. Skechers Active and Skechers Sport Active are currently equivalent to two complete lines of sneakers and casual sneakers for females of all ages.
Meanwhile, BOBS from Skechers are designed for women and girls and marketed as donation products wherein each sale donates funds to such causes as saving dogs and cats or providing new shoes for children. It includes Bobs Plush, Luxe Bobs, Bobs Pureflex, Bobs Flexy, Bobs Bliss, and Bobs World (Skechers, 2016c). This brand consists of three lines: the BOBS classic espadrille collection; the BOBS vulcanized designs; and the BOBS at Home collection for women (Skechers, 2016b).
Mark Nason is a collection of a wide-ranging trendy, casual, and active styles of sneakers and leather shoes for style-conscious men. This brand has three collection lines: the Mark Nason Skechers; the Mark Nason Los Angeles Collections; and the Mark Nason Dress Collection. The Skechers Performance brand also has four collections lines: the Skechers GOrun; the Skechers GOwalk; the Skechers GOtrain; the Skechers GOfit; and the Skechers GO GOLF. Moreover, the Skechers Work brand comprises only a single line of casuals for men and women.
Meanwhile, Skechers Kids consists of different lines and styles of boots, shoes, and sneakers for infants, toddlers, boys, and girls with 14 different product lines. It includes 14 lines: Skechers Kids; Skechers Light Sport; Skech-Air by Skechers; Twinkle Toes and Twinkle Wishes by Skechers; Skechers Cali for Girls; Airators by Skechers; Skechers Super Z-Strap; Elastika by Skechers; Skechers GOrun and Skechers GOwalk; S-Lights, Hot Lights by Skechers and Luminators by Skechers; Mega Flex; Air-Mazing by Skechers; Foamies by Skechers; and Game Kicks (Skechers, 2016b).
Skechers Performance contains a collection of technical footwear, specifically designed for an activity with an objective of maximizing performance while promoting natural motion (Skechers, 2016b). It utilizes the latest advancements in materials (e.g. the ultra-lightweight Resalyte compound used in its midsole) and design innovation (e.g. responsive feedback sensors, glow-in-the-dark technology, etc.). Conversely, Skechers Work consists of a complete array of field boots as well as hikers and athletic shoes with casual designs for men and women. It has strong safety features (e.g. slip resistance technology, lightweight aluminum toe, electric hazard resistant, etc.) and athletically inspired.
Target customers
Skechers identifies its markets as men, women, and children across product lines (Skechers, 2016a). However, its core and target consumers are style-conscious men and women, who have special attraction to a youthful brand image and fashion-forward designs, as well as athletes and fitness enthusiasts, who prefer performance footwear (Skechers, 2016b). The company also possesses best-selling and core styles for children with age-appropriate colors and materials that reflect playfulness. Moreover, it continued to expand its demographic reach through various sponsored events (e.g. marathons) (Skechers, n. d.).
Skechers has more than 3,000 styles for men (cf. Skechers, 2016e), women (cf. Skechers, 2016d), and children (cf. Skechers, 2016h) (Skechers, 2016a). Each Skechers brand has its own collections of specific product lines, designed for men, women, and children categories.
Promotions
Skechers espouses the triple-U marketing philosophy of “Unseen, Untold, Unsold” in its comprehensive and targeted marketing campaigns according to three objectives: (a) drive traffic; (b) build brand recognition; and (c) effectively position its diverse product lines within the marketplace (Skechers, 2016b). The senior managers are directly involved in shaping the brand image through their direct participation in the conception, development, and implementation of its advertising activities and marketing campaigns.
Moreover, to achieve its third marketing objective and reach out to its men and women markets, Skechers promotes its brands through print, television, digital, and outdoor campaigns (Skechers, 2016b). To attract kids, it promotes the brand through animated and live action television channels for kids, often featuring Skechers action heroes and characters. Its Skechers BOBS line promotes its charitable footwear program through donation events.
Print ads
Skechers’s print ads are target to high end markets and appear regularly in popular fashion, lifestyle and pop culture magazines, such as Runner’s World, Shape, Seventeen, Men’s Fitness, People, Us Weekly, and OK! They also appear in international magazines (Skechers, 2016b).
Broadcast commercials
Skechers’s television commercials are focused on key national and cable programs, particularly during high-selling seasons to be cost-effective (Skechers, 2016b). These commercials had been translated into various languages around the globe and aired in its important markets, such as Austria, Brazil, Canada, Chile, France, Germany, Italy, Japan, Mexico, the Philippines, Switzerland, and the Philippines and certain countries across the Middle East and other regions.
Outdoor ads
Public relations and trend-influenced marketing
Skechers’s public relations objectives is to achieve its third marketing objective, positioning its brands as leading footwear brands in business, general news and trade publications, including product placement in key fashion and lifestyle magazines and television shows, and as a desirable footwear option for trend-setting celebrities and their children (Skechers, 2016b).
Social media
Its social media objectives include consumer engagement, product showcasing in relevant settings, and latest news announcements (Skechers, 2016b). It has built communities on Facebook, Twitter, Instagram, Pinterest, and Snapchat in the United States and offshore countries where its products are sold (e.g. Weibo in China). The brands included Skechers, Skechers Performance, and BOBS by Skechers.
Promotions and events
These activities are aimed at achieving the first and second marketing objectives, e.g. driving traffic to Skechers retail stores, websites, and retail partners (Skechers, 2016b). These strategies include in-store specials, charity events (e.g. in walks and marathons in the cities of Boston, New York, London, Paris, Los Angeles, etc.; footwear donations to children), product tie-ins and giveaways, and collaborations with national retailers and radio stations.
Visual merchandising
Skechers also hold in-house visual merchandising to support wholesale customers, distributors, and retail stores in the form of point-of-purchase displays, such as signage, graphics, displays, counter cards, banners, and the like (Skechers, 2016b).
Trade shows
The objective of these activities is to showcase Skechers’s diverse products to footwear buyers in the United States and Europe and to global distributors (Skechers, 2016b). These activities include exhibits in the United States (e.g. the FFANY, Platform, The Licensing Show, and Outdoor Retailer) and in Europe (e.g. GDS, MICAM, and ISPO).
Internet
Skechers also promotes and sells its brands in its website [www.skechers.com] and in foreign e-commerce sites in such countries as Chile, Germany, and the United Kingdom (Skechers, 2016b). It also launched the Skechers shopping mobile app in 2015.
Licensing agreements
Skechers retail partners with licensing agreement can be categorized into three: the distributors, the joint ventures, and the franchisees, which can be located around the world (Skechers, n. d.). Other information, such as licensing fees, compensations, and terms are, however, not available or accessible online.
Skechers responsibilities
There are primary areas wherein Skechers provide support to its licensees: locally targeted product selections; provide information-based merchandizing data based on global or regional sales data, trends, and experience in inventory management and planning; marketing support globally to drive brand awareness and consequently drive sales; comprehensive on-site sales, product, and employee training programs; retail standards that maximize profitability, operating efficiency, and KPI engagements; and an EDI solution for information sharing and order placements, among others (Skechers, n. d.). Its marketing support is based on custom marketing principles wherein licensees may request locally targeted and translated artwork, allowing licensees greater flexibility in driving local sales.
Licensee responsibilities
All licensees have the legal authority to open retail stores globally, carrying the Skechers brand. They are expected to have the knowledge and merchandising experience that enable them to effectively pinpoint local preferences for certain categories of Skechers products (Skechers, n. d.). They must also have a purchasing and planning system, which enable them to place orders, whether initial, replenishment or seasonal. In marketing, licensees are obligated to contribute to the advertising and marketing efforts, which includes the submission of quarterly local marketing strategies and calendar and excellent understanding of local retail standards, while adhering to Skechers guidelines. Licensees are also expected to choose prime sites for store locations, regular financial reports, and maintenance of staff competence according to Skechers standards, among others.
Meanwhile, Skechers followed a selective licensing policy in relation to its brand name and product line with the objectives of broadening and enhancing individual brands with minimal capital investments or incremental operating expenditures (Skechers, 2016b). Through its licensing program, Skechers offers branded apparel, bags, eyewear, toys, and many more (Skechers, 2016a).
Apparel product lines and price ranges
In addition to the core footwear products (e.g. athletic shoes, boots, casual shoes, Performance shoes, sandals, and sneakers), Skechers has its own apparel product lines with various price ranges. Skechers.com categorized these lines into women’s tops, women’s bottoms, men’s tops, and men’s bottom (Skechers, 2016g). Tops for men, for instance, ranges from $20.00 for the High Velocity – Adventure Tee Shirt to the $27.00 Bolsa Chica V-Neck Tee Shirt, all available in 2 colors.
Meanwhile, Skechers online categorizes its complementary products under the “Bags, Socks” category (Skechers, 2016f). These products support the company’s income generation base by extending number of choices across categories. However, this link shows other non-footwear products, such as bags, backpacks with lunch boxes, belts, wallets and headwear, sleeves, socks, eyewear, fitness, yoga and running accessories, work accessories and watches, dolls, toys, do-it-yourself fashion kits, and fashion accessories (Skechers, 2016b). Men’s 1-per-pack Skechers Compression sleeve, for instance, is priced at $8.00 (available in 2 colors), while Men’s 3-per-pack Skechers Work Crew socks (size: large) is priced at $18.00. Both complementary products are available in 2 colors and have equivalents among kids.
This category came in such brands as Skechers, Skechers Sport, BOBS from Skechers, and Twinkle Toes (Skechers, 2016f). The selection varied also according to the market, such as socks, bags, backpacks, and luggage in Mexico or watches in the Philippines. These products are covered by domestic and licensing agreements.
Global sourcing strategies
Skechers products are primarily produced by independent manufacturers located in China and Vietnam (Skechers, 2016b). It was decided so to substantially increase its production capacity and flexibility and to reduce capital expenditures, resulting from the high costs of managing a large production work force. In this approach though, the company sought to enhance contract continuity and quality from the same quality producers in addition to better control of production costs. The source product for styles came from at least five manufacturers, which, in 2015, accounted for the 56.5 percent of its total purchases. The arrangement is usually secured by an interest-bearing open purchase agreement.
Production planning and strategies
After the initial styles production and to ensure the determination of profitable products, the product is introduced in Skechers’s concept stores to find out if a substantial demand exists for that style (Skechers, 2016b). If the style showed substantial demand, the style can either be highlighted in an upcoming collection or offered as a part of the periodic style offerings. Conversely, the less popular styles are discontinued after a limited production run. Thus, the company most likely followed a modular production system due to its highly successful quick response problem in the initial part of the style introduction in order to minimize on production cost (Sarkar, 2009). Only when the consumer demands have been established will Skechers may order in bulk. However, Skechers sources lacks clear disclosures whether in its annual reports, online postings, and press releases.
Moreover, the presence of Skechers offices in Asia allows the company to negotiate more effectively with suppliers and manufacturers to decrease product turnaround time (Skechers, 2016b), which increases profitability through more sales volume, and ensure timely delivery of finished footwear for distribution and order filling efficiency. It avoided costly litigations under American law by requiring its manufacturers to certify that neither of its labor had been convicted, forced, nor indentured and under the specific Asian country’s law by certifying of no child labor. Moreover, they also must certify that the compensation had been paid according to the local law and compliance with local safety regulations.
Quality control procedures
Product quality and consistency is crucial in successful retailing of Skechers products. Moreover, quality control plays an important and effective role in maintaining the quality and reputation of these products. The point of quality control is to ensure that the finished products not only meet company design specifications but all footwear bearing Skechers trademarks meet quality standards (Skechers, 2016b).
Conclusion
The net sales and net earnings that Skechers achieved in 2015 evidentially confirmed the effectiveness in its marketing and production strategies. Its net sales increased by 32.4 percent while its net earnings increased 67.1 percent, a superior performance considering that footwear and apparel industry tend to be short on profitability. Effectiveness in marketing, sourcing, and manufacturing inevitably points at the net sales, particularly marketing, and net earnings, particularly sourcing and manufacturing. Its future too promises to be even more exciting both for Skechers and its consumers (Skechers, 2016b).
References
Sarkar, P. (2011, September). Different types of garment production systems. Online
Clothing Study. Retrieved from: http://www.onlineclothingstudy.com/2011/09/garment-production-systems.html.
Skechers. (2016a). Skechers USA, Inc. Skx.com. Retrieved from: http://skx.com/.
Skechers. (2016b). Annual report FY 2015. Manhattan Beach, CA: Skechers USA.
Skechers. (2016c). Women’s styles. Skechers.com. Retrieved from:
https://www.skechers.com/en-us/women/all?brand=/skechers-bobs.
Skechers. (2016d). Women’s style. Skechers.com. Retrieved from:
https://www.skechers.com/en-us/women/all.
Skechers. (2016e). Men’s shoes. Skechers.com. Retrieved from:
https://www.skechers.com/en-us/mens_shoes.
Skechers. (2016f). Franchising opportunity. Skechers.com. Retrieved from:
https://www.skechers.com/en-us/franchising-opportunity.
Skechers. (2016g). Apparel. Skechers.com. Retrieved from: https://www.skechers.com/en-us.
Skechers. (2016h). Kids. Skechers.com. Retrieved from: https://www.skechers.com/en-
us/kids-shoes.
Skechers. (No date). Skechers: A global brand for the world. Manhattan Beach, CA:
Skechers USA.
