Crocs saw its shareholder value fall by close to 96% from its highs in 2007. Crocs stock has fallen to $1.45, a downfall that is twice as steep as the rest of the market. Crocs announced that Mr.John Duerden will become the new CEO of the Niwot, Colorado based company. Crocs footwear may have few takers these days, as evidenced by the fall in revenues (to $126.1 million, half of previous year number), but its brand still has some equity that quite possibly some "brand elasticity" that can be transferred to other related items.
The economy and its current product line does not bode well for Crox. Mr. Duerden's appointment signals a possible Crocs' plan to leverage this brand equity, possibly with line extensions. The new CEO used to run another big brand in footwear, Reebok. Most recently, Mr.Duerden was with the Chrysallis Group, a brand development and renewal consulting group that he founded in 2006. We should expect him to be more brand focused and rebuild shareholder value through products with higher premium rather than increasing sales with lower priced items. Crox cannot win by going after market share by competing purely on price, profit should be the number focus.
Of course for all those coming to this post from Yahoo Finance Crox message board, this is just my opinion. Mr. Duerden's resume is verifable and it is true. I am not making any recommendation here. You should not make your stock decisions based on this or any other opinions. Look at my previous post on Crox from last year here.
The economy and its current product line does not bode well for Crox. Mr. Duerden's appointment signals a possible Crocs' plan to leverage this brand equity, possibly with line extensions. The new CEO used to run another big brand in footwear, Reebok. Most recently, Mr.Duerden was with the Chrysallis Group, a brand development and renewal consulting group that he founded in 2006. We should expect him to be more brand focused and rebuild shareholder value through products with higher premium rather than increasing sales with lower priced items. Crox cannot win by going after market share by competing purely on price, profit should be the number focus.
Of course for all those coming to this post from Yahoo Finance Crox message board, this is just my opinion. Mr. Duerden's resume is verifable and it is true. I am not making any recommendation here. You should not make your stock decisions based on this or any other opinions. Look at my previous post on Crox from last year here.
Posts
No comments:
Post a Comment