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Shopping Centers Today -> December 2002
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SHOE WHOLESALER KEDS EXPERIMENTS WITH RETAIL
By Jon Springer
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| The venerable shoe manufacturer opened six stores in shopping centers this year. Whether it opens more depends on how well they do. |
It’s a brand almost as old as the rubber-soled shoe itself, and as basic as the white canvas sneaker that bears its name. Only the stores are new.
Keds has opened six specialty mall stores in the past year, in an effort to parlay the brand into a lifestyle concept that reflects the product’s spirit and expands its reach and growth. The stores break new ground for a company that has been wholesaling sneakers to department stores and independent retailers for more than 85 years.
“We’re much more than the white sneaker today,” said Gerrald Silverman, president of Keds, a division of Lexington, Mass.-based Stride Rite Corp.
Whether Keds opens any additional stores depends in part upon how this first wave does. The company’s current stores are in the Pembroke Lakes Mall, Broward Mall and Coral Square in Florida; the North Point Mall and Town Center at Cobb in Georgia; and Polaris Fashion Place, Columbus, Ohio.
“The consumer and trade reaction has been really encouraging so far, but I feel we’re really just beginning our first full year now,” said Silverman, referring to the full complement of stores that have now been open for one year. “I think we’ll know a lot more after spring of 2003.”
Keds stores offer more than 50 styles of women’s casual shoes, from the company’s well-known canvas Oxford sneaker to sandals, sports styles, boots and seasonal selections, with prices generally ranging between $20 and $50. The stores also carry children’s shoes as well as socks, handbags and branded accessories. Until its stores opened, Keds vendors would generally not offer its entire line of styles and sizes.
“For Keds, I think it’s a good thing, because it shows customers they have so much more to offer than the white canvas shoe,” said Brooke Smith, marketing director of Glimcher Realty Trust’s Polaris Fashion Place.
Keds sees its stores as a physical brand statement, using design, colors and layout to reinforce its message — “fresh, simple, clean and comfortable,” explained Terri Rawson, Keds’ vice president of marketing. The 1,200-square-foot stores were designed by Columbus-based Chute Gerdeman Design.
Visual elements include the familiar blue rubber logo from the backs of Keds sneakers featured prominently at the entrance (low to the ground, as if on the heel of a shoe) and throughout the store. The store layout encourages what Rawson described as “a circular flow,” with shoes displayed on small tables and racks leading to a circular seating area at the center of the store.
“We didn’t want to replicate other shoe stores. It’s not just a sea of shoes and people sitting back-to-back trying them on,” Rawson said. “The seating area at the center of the store encourages a real community feel. We’ve gotten very positive feedback about that.”
These elements have appeal for Keds’ targeted customers: women between 25 and 54, with the majority being 30 to 45 years old.
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“She’s on the go,” Silverman said of the target customer. “She’s probably a mom. She’s time-impoverished, but at a very good place in her life; the store works for her, because it’s casual, fun and vibrant.”
Or as Rawson, puts it, “For our customer, the brand is synonymous with pleasure and comfort. It may evoke a memory of a summer vacation or good times they have had.”
Lisa Shepherd, marketing director at General Growth Properties’ North Point Mall in Alpharetta, Ga., said the Keds store at that mall is positioned to succeed in part because the customer it seeks is aligned with the mall’s typical patron.
“They’re a good merchandise fit for the North Point customer,” she said. “We’re dominated by young families and soccer moms leading that suburban casual lifestyle. And it’s a great-looking store — very crisp, clean and appealing.”
Though she declined to state specific figures, Shepherd said mall research indicates that the store at North Point, which opened in July 2001, is outperforming its first-year sales on a monthly basis. “I can see why they would be encouraged,” she said.
For now the rollout isn’t so much about store sales as it is about expanding a long-standing name in footwear, Silverman said. The Keds heritage can be traced to the birth of vulcanized rubber in 1840. When several U.S. Rubber Co. footwear companies were consolidated into one in 1916, the resulting company was given the Keds name. Stride Rite purchased Keds in 1979.
Keds was flying high in the early 1990s, Silverman said, but has more recently struggled along with much of the women’s footwear business. According to Stride Rite’s third-quarter results released in late September, sales in the Keds division fell 13 percent versus the same period in 2002.
Silverman said he believes that the stores can help turn that around. They can be used to test new products (a new line of Lycra/leather shoes will debut in Keds stores next spring, for example), identify trends and track how customers shop, all while reinforcing the brand name.
The footwear business in 2002 “has definitely been challenging,” Silverman acknowledged. “It’s basically been a no-growth industry.” But, he explained, the stores will enable the company to learn more about its customers and their changing tastes.
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