Hungry for More: Crocs released its fifth collaboration with Post Malone on December 8.
David Brandon Geeting/CrocsWhen Crocs launched a collaboration with Kentucky Fried Chicken this summer, it set off a small social media frenzy among customers who wanted to hoover up a pair of chicken-patterned clogs topped with drumstick-scented charms to pin on them.
“Bad news is the KFC x @Crocs are officially sold out,” KFC’s Twitter account announced shortly after the clogs went live. “Good news is you can still buy a real bucket of chicken at KFC. Don’t wear them.” Quick-fingered customers who were able to buy a pair were soon selling them on eBay for $250, a $190 premium on the original price.
“Frankly, a little self-deprecation is baked into our DNA,” says Michelle Poole, Crocs’ president who has been at the company since 2014. The brand has also shrewdly leveraged its many celebrity fans. This year, Crocs produced collaborations with Justin Bieber and Bad Bunny, and on December 8, rapper Post Malone will release his fifth collaboration with Crocs—the Post Malone x Crocs Duet Max Clog II, a chunky-soled shoe in pink and black. And, of course, they can be embellished with a Post Malone charm. Ahead of the release, the singer also surprised several thousand fans with giveaways in New York, Los Angeles, Chicago, Dallas, Austin, Salt Lake City, Toronto, London, Sydney, Tokyo, Paris and Berlin. “Giving away 5,000 pairs of shoes is how I’m saying ‘thank you’ to my fans,” Malone said in a statement. “Drop 5 is going to be one my fans remember.”
And 2020 may prove to be a year that Crocs remembers for a long time. Though the brand was forced to close many of its retail locations earlier this year due to the pandemic, sales are slated to be higher than ever. Accordingly, Crocs’ stock price has more than quadrupled since March 18. The brand reported a record $362 million in third-quarter revenues and expects to report at least 20% growth in sales in its latest quarter ending December, according to Chief Financial Officer Anne Mehlman.
White Rabbit: Bad Bunny shows off his 2020 Crocs collaboration, complete with custom Jibbitz.
CrocsCrocs CEO Andrew Rees ascribes the company’s 2020 success to a defensive and an offensive approach. The defensive strategy, he says, involved canceling inbound production and diversifying the supply chain. The task was easier said than done. The brand’s supply chain was disrupted due to quarantine measures around the world, especially in Vietnam, where a significant portion of its clogs are manufactured. According to Mehlman, a second challenge was how a single component sometimes held up the entire supply chain for the whole shoe. She admits that the simple design of Crocs, which are heavily-molded, helped in not having to deal with a lot of components.
Crocs’ playbook was not completely focused on playing defense, especially when it comes to opportunities in China. By the end of April, all Crocs stores and its nearly 350 partner stores in China had reopened. That same month, Crocs livestreamed an event on Alibaba’s Tmall with Chinese actress Yang Mi where she shared tips and tricks on how to style Crocs with different outfits. In June, it unveiled a new store concept in Shanghai which allows customers to personalize their Crocs in store. Crocs told investors in October that “its reach and engagement [in China] increased 50% month-over-month in June.”
Cool for the Pool: Justin Bieber in his co-branded Crocs.
CrocsAnother important strategy was to market Crocs as the ideal shoes for frontline healthcare workers because they are easy to clean and inexpensive to replace. Crocs says it has also given away some 860,000 pairs of shoes to healthcare workers in the U.S. worth $40 million in retail value and $10 million in cost to the company. “How many companies do you buy from because you think they stand for the right thing?” says Sam Poser, footwear analyst at Susquehanna Financial Group. “People who weren't considering the brand a year and a half ago are now considering Crocs.”
“If you have a brand that has a lot of haters, that makes it even more interesting to collaborate with.”
The pandemic has also accelerated fashion brands’ foray into athleisure, causing labels to focus on consumers who are now more likely to value comfort over making a fashion statement. At a time when people are Zooming in sweatpants and slippers rather than suits and heels, Crocs bet on its function more than form. But the brand still found a way to make its easy-to-mock shoes fashionable and customizable, thanks to its arsenal of add-on charms, known as Jibbitz.
Bite-Size: A selection of Post Malone Jibbitz for customizing Crocs.
David Brandon Geeting/Crocs“You can go on the Nike website and order a custom pair of Air Force 1s but they charge you a pretty hefty premium for that and it arrives in six weeks,” Rees explains. “Our customization, you can stand in the store, pick your Jibbitz and walk out that day with a completely custom pair of shoes.” On the Crocs website, customers can find anything from avocado charms to Black Lives Matter pieces for $3.99.
The rise of Crocs has been underestimated from the beginning. In 2002, three friends—Scott Seamans, Lyndon Hanson, and George Boedecker Jr.—came across a new boating clog made by a Canadian company in 2002. They acquired the rights to the synthetic material called Croslite, and founded their own company—Crocs. The trio brought 200 pairs of shoes to the Fort Lauderdale Boat Show and they sold out in one day. (To date, some 600 million pairs of Crocs have been sold.) The company went public in 2006 and by 2007, it had become a hit. “For a while you couldn't find a pair of white Crocs. Every time it showed up, it would sell out,” says Poser who argues the sense of urgency made the brand even “hotter.”
Trying to accommodate the increasing demand, Crocs started having inventory problems in 2008 as well as an oversaturation of stores. While trying to overcome the challenges, Crocs diluted its product base by going into golf and more fashionable models. It wasn’t until around 2014 when the company spent $24.5 million in restructuring costs that it started a true turnaround by going back to its origins.
“Those moments where we really chose what we wouldn't do as well as what we would do were really important,” Poole says. “When we really focused on clogs and sandals, we said, ‘This is what we're going to double down on, this is what we're going to commit to.’”
Crocs also started having conversations about its marketing approach and a call from British designer Christopher Kane in 2015 became a milestone, according to Poole. Kane collaborated with Crocs and put colorful and bejeweled clogs on the runway in 2016. A year later, $895 Balenciaga-branded Crocs with four-inch platforms (“The higher the better, right?” Poole jokes) were shown at Paris Fashion Week. It evoked a mix of shock and awe by fashionistas.
A New Platform: When Balenciaga collaborated with Crocs in 2017, fashionistas were horrified—and ate them up.
Balenciaga“If you have a brand that has a lot of haters, that makes it even more interesting to collaborate with. When Balenciaga, one of the hottest high-profile fashion brands in the world, reaches out to you and wants to collaborate with you, they are doing that not because we're the greatest footwear manufacturer in the world. They are doing that because of the polarized nature of the brand, and the story that emerges from that,” says Rees. “It’s a true win-win.”
And Crocs has been on a winning streak for several years. On a positive growth trajectory since 2018, the brand's ascent has been about more than just people wanting to wear clogs as they work from home, says Jay Sole, an analyst at UBS.
With such a strong marketing strategy and a friendly push from celebrities (Ariana Grande has shown off her white pair on Instagram), Crocs may prove that it is more than just an ironic fad. “It’s all about how well you manage the brand,” says Poser of Susquehanna Financial Group. The Colorado-based company, which has 351 stores in 90-plus countries, appears to be determined to push more boundaries and be a global force. “We came out of a pretty serious restructuring and there was a lot of commentary on ‘Can they ever really be a brand that matters again?’” CFO Mehlman says. “I think we have shown that.”
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How Crocs Devoured 2020 - Forbes
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