Crocs Inc. could be making a comeback.
Birkenstock sandals have had their moment and Adidas’ classic Stan Smith has been a fashion diva favorite, but fashion is all about the next new thing and it could be ugly-shoe favorite Crocs.
The fashion blog Man Repeller suggested early in September that Crocs could replace the Adidas chunky white sneaker as the latest antifashion comfort shoe. Days later, by coincidence, they hit the high fashion runway. Designer Christopher Kane showed custom created marble-printed Crocs for his runway show complete with raw gem stone jibbets.
You As men’s wear designer Tony Liu paired his men’s wear styles with white Crocs for his spring collection. Add to that the film “Deadpool,” in which actor Ryan Reynolds as the lead character slips on a pair of Crocs, throws back his head and exclaims, “Oh, so comfy.” The “X-Men” spinoff was the most successful R-rated movie ever released, eclipsing “The Matrix” with more than $700 million in ticket sales.
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Crocs needs a fashion hit. It has taken the company years to return to and best its sales of $847 million from 2007. Last year, Crocs delivered $1.2 billion in sales. The footwear brand has been trying to branch out into new styles and chief executive officer Gregg Ribatt said retailers had responded well to new styles for holiday 2016.
“The highlight in the U.S. wholesale business [in the second quarter] was women’s in the sandal category and clog category,” said Andrew Rees, president of Crocs. The Sarah clog collection looks like a typical clog, but comes with the famous Crocs comfort and the Leigh suede wedge bootie looks nothing like the classic plastic shoe with holes.
The clog continues to reign supreme, accounting for more than 45 percent of sales. But the stock has fallen 23 percent for the past year and 63 percent over the past five years. In fiscal year 2015, the company reported a $98 million loss even though it sold 57.8 million pairs of shoes, an increase of 3.7 percent over 2014.
The company is still recovering from wiping its slate clean of dodgy Chinese distributors. It also had production issues to address. It seems both of these problems are behind it, but next quarter’s results are still expected to be lower than before.
“They did lower their third quarter,” said Mitchel Kummetz of B. Riley & Co. “They are going through challenges in China and cleaning up the market place. My general takeaway was less about China and more about their overall opportunity.”
It may be early stages, but if the fashion crowd adopts Crocs as the new go-to comfort shoe, the clog may be on the comeback trail.