Crocs-Embracing Its `Ugly` Image
| Case Code: MKTG451 Case Length: 12 Pages Period: 2022 Pub Date: 2023 Teaching Note: Available |
Price: Rs.300 Organization : Crocs, inc. Industry : Retailing Countries : Global Themes: Branding Strategy, Advertising & Promotion |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
A Roller Coaster Ride
In 2007, Crocs reached annual revenue of US$ 847 million. It increased its product offering from 25 models in 2006 to 250 models in 2007. The company began to produce large quantities of shoes. However, in 2008, the Great Recession hit and people cut back on their spending. Consequently, Crocs’ sales also declined. Crocs had surplus inventory in warehouses and suffered a net loss of US$ 185 million in 2008. Nearly 2000 employees were let go as the company dealt with the financial crisis and closed some underperforming stores..
The Good, The Bad, and The Ugly
Crocs’ designs had always been subjected to ridicule. Its success was described as ‘Croco-philia’ -- an assault on the fashion sense . Crocs clogs divided people into lovers and haters. Those who loved the shoes did so because they were comfortable and practical. But haters complained that the brand was ugly and unfashionable. There were even reports that some Croc haters had posted videos of their cutting up or burning the footwear..
Holding on To The Ugly Image
Cooley instructed her team to embrace the Crocs ridicule, as a result of which the marketing team was able to experiment widely with marketing ideas and collaborations . She believed that embracing the ridicule would make the brand bolder and more creative and innovative with its products. She said, “We made the decision to lean into that polarization. It’s amazing what our fans allow Crocs to do. I think that’s because of the polarization of the brand and the polarization of the shoe. We’re really confident in who we are and our fans resonate with that approach really well.” ..
The Impact of Marketing Initiatives
In Cooley’s opinion, Crocs’ marketing initiatives paid off, as its revenues increased steadily. In 2022, its revenues reached US$ 3555 million, an increase of 54% as compared to 2021. Its stocks also saw a rise, going up from US$ 7 in January 2017 to US$ 180 in November 2021, which was an all-time high stock closing price for the company. In December 2022, the closing stock price was US$ 108.43..
Looking Forward
Crocs committed itself to becoming a net zero company by 2030. In keeping with this commitment, it was to introduce products made of a new bio-based Crosilite material. According to the company, it intended to reduce its carbon footprint by 50% per pair of Crocs shoes by 2030. It was also exploring sustainable packaging alternatives. In order to become a sustainable company, Crocs hoped to develop ways to become part of a circular economy as well. It hoped to drive a consumer-led donation, recycling, and re-commerce program. Rees said, “Taking action to reduce our environmental footprint by implementing more sustainable practices across our entire business is the right thing to do for Crocs.”..
Exhibits
Exhibit I: Revenue and Net Income of Crocs
Exhibit II: Some Noteworthy Collaborations of Crocs
Exhibit III: Marketing Expenses of Crocs from 2016 to 2021
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