Vans shoots for $5 billion in revenue in 2023
Vans announced on Wednesday that it plans to reach $5 billion in revenue by fiscal 2023, a $2 billion increase that the VF-owned youth brand is hoping to drive with strong growth across all channels, product categories and geographies, but particularly through its direct-to-consumer (DTC) business.
The announcement came before an investor meeting in which Vans gave further details about its objectives, which assume growth of between 10% and 12% over the next five years.
By 2023, the brand expects DTC revenues to reach $3 billion, accounting for approximately 60% of all global sales. This would represent a five-year compounded annual growth rate (CAGR) of somewhere between 13% and 16%. DTC Digital revenues are expected to hit $1 billion, representing a stellar CAGR of between 30% and 35%.
Breaking down its objectives by product category, Vans is aiming to see a five-year CAGR from 10% to 12% in footwear revenues, with heritage shoes registering a CAGR of between 8% and 10%, and progression footwear growing at a rate of between 14% and 16%.
Revenues in the brand’s apparel and accessories category, on the other hand, are predicted to hit $1 billion by 2023, representing a five-year CAGR between 13% and 15%.
Geographically, Vans also has high hopes for the Americas, where it is expecting to see a CAGR of between 10% and 12% to achieve $3 billion in revenue in the next five years.
“Since VF’s acquisition in 2004, the Vans brand has grown at a 17 percent compounded annual rate and transformed into a $3 billion global lifestyle brand,” said VF Corporation CEO Steve Rendle in a release. “I am confident in the Vans team’s ability to deliver on a bold $5 billion revenue target which will be a key driver of VF’s plan to deliver superior total return to shareholders over the next five years.”
“Vans is moving into its rightful place as the number three global sport lifestyle brand by being clear about who we are and who we are not,” added Vans Global Brand President Doug Palladini. “By forsaking ubiquity and instead focusing on Vans’ brand pillars of art, music, action sports and street culture, we continue to generate deep and meaningful consumer connectivity that is growing the Vans Family worldwide.”
According to VF Corporation, Vans achieved net sales growth of 35% in the first quarter of 2018. The meeting in which the brand gave further details about its financial objectives for 2023 to investors was broadcast live and is available to listen to on the Vans corporate website.
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