Vans becomes VF Corp.'s top brand in 2016, ahead of The North Face, Timberland
Vans has edged past The North Face in 2016, becoming VF Corp.’s leading label. Van's sales last year grew by 7% compared to 2015, as the skateboarding-inspired label celebrated its 50th anniversary. They were worth just over $2.3 billion, edging past The North Face, which also generated $2.3 billion in sales in the course of the fiscal year.
In the year’s last quarter, Vans recorded a 17% sales increase in the Americas region, with a peak of over 20% in DTC sales and an increase in its wholesale business too, while online sales leaped up by 40%. "Our All Weather MTE collection turned Vans into an all-season brand, doubling its revenue compared to last year, said Steve Rendle, the group's new CEO, talking to analysts. Also, our improved customisation website for Vans shoes, allowing consumers to create unique models by choosing motifs and colours and even using their own designs, is ready to make a strong start." In Europe, the brand's sales recovered, posting a small increase in the fiscal year's last quarter, driven by a 20% rise in DTC sales, while the wholesale business slumped again by about 5%, due to high inventory levels. In Asia, Vans' business jumped up by 25%, with a runaway success for online purchases, especially in China: its DTC sales rose by 50% compared to the last quarter of 2015.
The North Face did not enjoy the same kind of success in 2016, losing 1% at the end of the fiscal year. The outdoor label suffered a 7% shortfall in the last quarter: despite a rise of about 15% in DTC sales, the wholesale business in fact lost 20%. The North Face performed well in Europe, where its sales grew by nearly 20%, but sales in Asia fell by 5%, and the brand also struggled in the America's region, its main market, where sales lost more than 10%, dragged down by a 30% plummet in the wholesale channel. The group pointed the finger to the late arrival of the winter season, the default of several sport retailers in the US and very high inventories, though it also accepted part of the blame.
"After an honest assessment, we agreed that we did not provide the most relevant product range for the American market, admitted Rendle. We have worked hard in the last six to eight months to redress this. The four brand landscapes we have identified provide more clarity, and help our design teams produce the right products for each of these landscapes. I think the way our business is performing in Europe confirms the soundness of this plan. We experienced a similar slow-down there, but in the course of two years we did a huge amount of work, initially on our management team and then on market segmentation and product quality. They also focused on the number of new products, using a more effective launch strategy."
As for Timberland, VF Corp.'s third major brand, it grew by 1% in 2016 over the previous year, reaching a revenue of $1.8 billion. In the last quarter, Timberland grew in double-figures, thanks to a small increase in its wholesale business and a double-digit increase in DTC sales. In the Americas region, the brand was hit by the same problems caused to The North Face by the US economic and weather situation, though sales for its professional models posted a healthy increase.
In Europe, sales instead rose by nearly 20% in the direct channel, and by about 5% in the wholesale one, with notably a 20% rise in apparel sales in the last quarter. Commenting on the increase, Steve Rendle noted how the group "has reviewed and relocated its apparel design organisation to Stabio, in Switzerland, increasing its potential and bringing it closer to Napapijri's. It is one of the reasons for Timberland's [fine] performance in Europe. The collection is now ready to go global, something we do need since our performance in the USA has not been as strong as we expected."
Copyright © 2022 FashionNetwork.com All rights reserved.