Three friends started Crocs after one brought a pair of shoes made of Croslite material on a sailing trip. Crocs broke into the niche market of professionals who spend all day on their feet due to its comfortable and functional design. Crocs launched in bright colors and became a fashion phenomenon. While competitors focused on fashion or function, Crocs succeeded with a dual positioning of extreme comfort and revolutionary style. However, diversifying into many product categories diluted Crocs' brand and exposed it to more competition. To stay ahead, Crocs should refocus on comfort, expand internationally, and strengthen integrated marketing.
Three friends started Crocs after one brought a pair of shoes made of Croslite material on a sailing trip. Crocs broke into the niche market of professionals who spend all day on their feet due to its comfortable and functional design. Crocs launched in bright colors and became a fashion phenomenon. While competitors focused on fashion or function, Crocs succeeded with a dual positioning of extreme comfort and revolutionary style. However, diversifying into many product categories diluted Crocs' brand and exposed it to more competition. To stay ahead, Crocs should refocus on comfort, expand internationally, and strengthen integrated marketing.
Original Description:
Discussion around the rise of Crocs Inc and the marketing plan
Three friends started Crocs after one brought a pair of shoes made of Croslite material on a sailing trip. Crocs broke into the niche market of professionals who spend all day on their feet due to its comfortable and functional design. Crocs launched in bright colors and became a fashion phenomenon. While competitors focused on fashion or function, Crocs succeeded with a dual positioning of extreme comfort and revolutionary style. However, diversifying into many product categories diluted Crocs' brand and exposed it to more competition. To stay ahead, Crocs should refocus on comfort, expand internationally, and strengthen integrated marketing.
Three friends started Crocs after one brought a pair of shoes made of Croslite material on a sailing trip. Crocs broke into the niche market of professionals who spend all day on their feet due to its comfortable and functional design. Crocs launched in bright colors and became a fashion phenomenon. While competitors focused on fashion or function, Crocs succeeded with a dual positioning of extreme comfort and revolutionary style. However, diversifying into many product categories diluted Crocs' brand and exposed it to more competition. To stay ahead, Crocs should refocus on comfort, expand internationally, and strengthen integrated marketing.
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1.
Background & Introduction:
Three friends, Lyndon Duk Hanson, Scott Seamans and George Boedecker decided to start selling a new shoe design called Crocs, after one of the friends brought a pair along on a sailing trip. The design was made of a material called Cros-lite which was responsible for the peculiar design features that Crocs was known for - did not slip on boat, easy to wash, prevented odor and proved extremely comfortable. The simplicity and functionality of Crocs allowed the Company to break into a niche market that consisted of not only boaters, but also hospital workers and other professionals who spend most of their day on their feet. Heel straps to hold feet in or fold in front for easy slip-on Small nubs on the inside help prevent slipping and increase blood circulation Material cushiony for long-wearing comfort Croslite is odor and bacteria resistant
One
of
Soles are slipresistant and nonmarking
the boldest moves Crocs Holes increase air flow made was to launch its product in a wide range of vibrant solid colours, to grab attention and capture shoppers imagination. By breaking the traditional color boundaries, Crocs created its own fashion phenomenon. Adding to the fun, Crocs created a crocodile face logo to build a lighthearted brand image. With regards to production efficiency, Crocs material was inexpensive (compared to traditional materials used by the industry such as leather), less variable in terms of quality, longer lasting, and required minimal manual labor for production. All these factors made the company hugely popular and profitable. The company became a publicly listed entity in 2006 and recorded revenues of $142 million during the 1st quarter of 2007.
2. Key Initiatives by Crocs Analysis using the 4Ps
The success of Crocs can also be attributed to some key initiatives by the company. I have provided an analysis using the 4Ps of Marketing below: Promotion: Crocs used creative merchandising (out-of-box vertical displays) and word of mouth marketing to build buzz and momentum without having to spend as much as traditional manufacturers on advertising or paying celebrities for endorsements
Another key initiative, based on some of the
research I did is the promotion of Croslite in animated form as a lovable, kind-hearted foamy friend of the feet Company entered into a host of licensing agreement with NHL, Disney, NHL etc, in order to have control over the youth market
Product: The distinctive features that Crocs was known for satisfied a need that none of the traditional brands have been able to meet. While competitors were stressing on fashion or functionality, Crocs was able to adopt a dual positioning as an extremely comfortable option on account of its unique properties, as well as a revolutionary fashion statement.
Place: For retail customers, Crocs changed the game by allowing them order as few as 24 pairs and stock them in a matter of weeks, not months For consumer consumers, Crocs designed a broad and extensive distribution system so its shoes were available in a variety of retail outlets from specialty stores to department stores and large shoe store chains
Price: Crocs positioned its products in terms of quality and price
Consumers were willing to pay a premium for the product because it
was fulfilling a genuine need that is not currently being met The ability of customers to order products in small quantities, discouraged overstocking and allowed a consistent pricing in the long run These initiatives discouraged overstocking and the subsequent clearance sales allowing consistent pricing in long run.
3. Despite all the positives, why is Crocs facing extinction
threats? Having witnessed significant growth of its vintage products, the company shareholders became worried about the future growth of these products and pressured the company into diversifying into other product areas like apparel, umbrellas, bag knee pads, beach towels and sunglasses.
This action resulted in:
Increased competition: The company now operates across all market categories, exposing it to intense competition from other established brands like Nike.
Line Extensions: The Company stretched itself too wide, thereby
diverting from its core positioning of comfort and functionality. Product line swelled to hundreds of styles catering for almost all market categories Oversupply: Flooding the market with a product may result in significant short term sales but in the long run, it is likely to adversely impact on the brand appeal
4. How can Crocs stay ahead of Competition?
Rejuvenate the brand by going back to the basics of comfort and functionality and reminding the customers of where the company started from Reinforce the Croslite heritage Expand into new markets go international! Put in place a strong integrated marketing effort, spanning across TV, print, social networking and digital media
