The two years since Kontoor Brands broke off from VF Corp. have marked an era of expansion for its denim brands and online platforms.
The company has pushed to connect Wrangler and Lee to younger audiences through a combination of global expansion, investments in e-commerce and strategic marketing plays — executives have frequently touted Wrangler’s collaborations with alt-fare TV including “Stranger Things” and “Rick and Morty.”
During the pandemic, as the work-from-home class of consumers alternately shops online or latches onto outdoorsy pastimes as a respite from apartment life, Kontoor has strategized.
In March 2020, Kontoor brought on Christopher Reid as the company’s general manager of digital. And Wrangler, which is also being rolled out in China, has been issuing new collections including outdoor apparel under its All-Terrain Gear line. This week, the brand unveiled a line of fishing-oriented apparel under its “Wrangler Angler” collection.
Kontoor’s chief executive officer Scott Baxter spoke to WWD about the company’s strategy and investments to introduce its denim brands to new audiences.
WWD: At the time of the spin-off, what did you see as the path to growing the Wrangler and Lee brands after this independence from a larger parent, and what were some of the challenges you were anticipating at the time?
Scott Baxter: I think the biggest opportunity was investing behind the brands. The brands hadn’t had a large investment or a big marketing and advertising campaign behind them for quite a while. I think the opportunity that we saw was that we had a passionate consumer for both brands globally, which was the really interesting part.
We also saw the long-term vision that the brands could play in different channels, geographies and categories. What I mean by that is, at the time of the spin-off, the brands were almost landlocked into a couple of specific categories. But since the spin-off, we’ve gone ahead and invested behind the brands, we’ve brought the brands to new geographies, like Wrangler to China. We’ve introduced new categories, one being Wrangler All-Terrain Gear, which is our outdoor line.
And then you heard us announce at the investor day that we kicked off Wrangler Angler, and also a much larger emphasis on our workwear brands for Lee and Wrangler.
I think that’s really the vision we saw as a company: investment behind brands that have been around collectively for more than 200 years and that have a passionate following. And the consumer was ready to see those brands in different geographies, they were ready to see those brands in different channels. And they have responded really well to our demand creation around those brands.
WWD: The company has also highlighted its investments in its digital wholesale business as well as its direct-to-consumer online business. Could you talk about the kind of infrastructure updates Kontoor has made to strengthen that e-commerce platform?
S.B.: Another great example of why we saw there was a great opportunity to spin off — there was a lack of investment in the digital space for our denim brands when we were part of another company.
We saw an opportunity to invest in those. We saw an opportunity to take a leadership position. And we also saw an opportunity to create something special for those brands because they hadn’t really been focused on in that digital channel.
So what we did was we brought in an executive to run that business, we put investment dollars behind building the platform. We have this really good platform we didn’t have before, so we can interact and also work together within our company, with our supply chain and product folks. It makes a big difference for us.
At the same time, [we’ve been] hiring a staff that really specializes and really focuses on that. We’ve invested in people in a very significant way, and we’ve invested in marketing behind our brands. And we’re connecting very well with our consumers. Some of the big things we’re doing in collaboration and marketing are really driving consumers to our sites, and are paying off very well.
We’re going to continue to invest in the digital space. We think that we’re at the very early stages of the company, because of where we come from.
WWD: The company has also mentioned expanding with domestic partners including Amazon, Walmart.com and Kohls.com. These retailers’ online and delivery services are themselves evolving, especially as Walmart competes with Amazon. What does that competition mean in terms of the upside for Kontoor. What does the expanding scope of these retailers’ own online platforms mean for the Wrangler and Lee brands?
S.B.: The most important thing is that we’re a very important piece of their business. We drive consumers to not only their stores, but we drive consumers to their sites. They look at us and see the volume that we drive, they see the passion consumers bring for our products. We’ve become a very important partner of theirs. So we’re central to what they’re doing as far as how they’re trying to work with their consumer. We become a very important piece of that strategy for them.
WWD: The other strategy the company has outlined is expanding in the China market, where Wrangler, for one, is in the midst of a launch. I know the Lee Brand has a premium lifestyle offering. Is it going to be a similar packaging for Wrangler?
S.B.: They’re a little bit different. It’s going to be premium, like the Lee brand. We see a very action-oriented male and female consumer, younger consumer for the brand, but still at a premium.
WWD: The company is expecting that its overall digital business, which accounts for 5 percent of revenues, will grow to 10 percent by 2023. How has the pandemic changed how Kontoor thinks about its e-commerce growth and investments?
S.B.: The pandemic has done a couple of things for us: It accelerated our thinking, we moved very quickly from a digital standpoint, we accelerated our plans and everything we were doing on how we were investing in the digital business.
We compressed our timeline, and we moved faster in the people that we hired, leadership, our platforms, and that has been a really smart decision on our part. And it gives us great momentum coming out of the pandemic. The pandemic pushed us to do things quicker.
The interview has been edited and condensed for length and clarity.