Vans: Chairman of the Board
Skateboarding has come a long way since roller skates were first nailed to a slab of wood. The sport has spread beyond a few maverick teens practicing their flips and spins on city streets and in empty swimming pools. But reaching them has proved tough. More than one athletic shoe giant has stubbed its toe trying to play to skateboarding's rogue image.
These days, the brand of choice is tiny Vans Inc. (VANS ) The Santa Fe Springs (Calif.) company, which pioneered thick-soled, slip-on sneakers able to absorb the shock of a five-foot leap on wheels, maintains its cool image with an offbeat marketing mix. Instead of relying heavily on mass media ads, it goes in for events, sponsorships, and even a documentary film to celebrate the outlaw nature of skateboarding culture. Its sales centerpiece: the elaborate skateboard parks Vans is building at malls around the country, venues that usually ban skateboarders. "Our vision is not to hit our target audience over the head with ads, but to integrate ourselves into the places they are most likely to be," says Vans CEO Gary H. Schoenfeld.
With the skateboarding craze still hot, that's translating into heady growth for Vans, which sells through its own chain of 140 stores as well as independents. Earnings will climb 38%, to $15.5 million, on sales of $336.4 million--up 23% for the year ending in May, estimates analyst John J. Shanley of Wells Fargo Van Kasper. True, that gives Vans just a point or two of share in an overall athletic shoe market half-owned by Nike Inc. and swarming with up-and-comers. Still, by staying true to its base of alternative-sports fanatics, the company has built an intensely loyal customer base. As apparel sales struggled during last year's difficult holiday quarter, Vans's same-store sales rose 16.3%. Orders for this fall's back-to-school season are up 25%.
The company's skateboard parks are helping it branch out beyond hardcore street-skaters to kids willing to pay $14 for two hours of skateboarding. Eight of its parks have already opened at upscale malls around the country, and a ninth, with 50,000 square feet of wood ramps and concrete bowls, opens in June in Denver. The brand-building potential is obvious. "I wouldn't wear anything else. I like just about anything Vans sells," says Tom Ward, 15, of Cherry Hill, N.J., who has visited the new park in nearby Moorestown five times since it opened a few weeks ago.
Now Vans is about to get some big-time media exposure. The company's 21-event Vans Triple Crown, a showcase for sports ranging from skateboarding to BMX biking, is moving from ESPN to NBC Sports, where coverage begins on May 19. And Dog Town and Z-Boys, a Vans-financed documentary narrated by Sean Penn that chronicles skateboarding's early days, has been picked up for distribution by Sony Pictures Classics.
WIMP WATCH. But if Vans wants to keep its momentum, it will have to offer new products without offending the loyalists who love its maverick roots. The company has moved into snowboard boots but steered clear of inline skates. Why? To keep the faith of skateboarders who consider inline skating a wimpy offshoot. It's also experimenting with hiking boots, an expanded women's collection, and a clothing line with partner Pacific Sunwear of California Inc.
Still, there's always the risk that the fad will fade or that someone could invade Vans's territory, as Nike tried to do in 1995. Schoenfeld doesn't believe the major brands have the right stuff to reach his rebellious market. "I have a tough time picturing Tiger Woods on a skateboard," he quips. "These kids know who's authentic." Still, he'll have to be nimble to make sure Vans doesn't get chased out of the market like a skateboarder on a busy street.
By Arlene Weintraub in Los Angeles, with Gerry Khermouch in New York