Converse, a brand under Nike, is moving to improve results with a "selection and concentration" strategy. It plans to focus resources on its flagship products Chuck Taylor and Jack Purcell and expand investment centered on key cities to rebuild the brand.
Bloomberg reported on the 8th (local time) that Converse Chief Executive Officer (CEO) Aaron Cain said at a recent staff meeting that the company will "do more with fewer products" and focus on classic lines such as Chuck Taylor and Jack Purcell over the next few seasons. Cain said, "It will work, and the results will come faster than most expect."
At the same time, Converse plans to expand brand investment centered on key cities such as New York, Los Angeles, London, Paris, Shanghai and Seoul. CEO Cain emphasized, "We are a growth company, a sports company, and a challenger brand."
Converse moved to restructure because weak performance had reached a serious level. Founded in 1908, Converse grew into a global brand through Chuck Taylor, which began as a basketball shoe. It later became a symbol of casual fashion, but assessments say it lost growth momentum in recent years as brand identity and product competitiveness weakened.
In fact, Converse's third-quarter sales fell 35% from a year earlier to $264 million (386.496 billion won). Nike's third-quarter sales were $11.279 billion (16.5056886 trillion won), similar to $11.269 billion (16.4910546 trillion won) in the same period last year.
As Converse struggled, rumors of a sale surfaced recently. Bloomberg reported that Authentic Brands Group showed interest in an acquisition if Nike put Converse up for sale. Authentic Brands Group is a corporations that owns Reebok and Champion.
However, Nike maintains that it has no plans to sell Converse. Nike CEO Elliott Hill acknowledged receiving inquiries about Converse's future but drew a line, saying the brand will remain within the group.
In an earlier interview with Bloomberg, Hill said, "We are committed to the Converse brand," adding, "Converse has a distinct and well-defined consumer base, and it represents independent and differentiated growth opportunities."
CEO Cain cited "creativity" as the key to the brand's recovery at the meeting. Cain said, "Creators reminded us how easy this recovery can be if we simply accept that the answers already exist out there."