Why Vans Wants to Own Skating

Adidas, Nike, Puma – when talking about sports?

marketing, these are the brands that come to??

mind. But there is another footwear brand that?

built its success largely on its association??

with sport. And one sport in particular.

Vans is the #1 skateboarding shoe company in??

the world, having become the uniform of choice for?

skaters, bikers, surfers and snowboarders alike.??

Their brand took on even greater significance?

after the company became sponsor of the??

now-legendary Warped Tour, the longest-running?

music festival in North America. But how did a??

small, family-owned business achieve such success?

when facing competition from rivals like Converse,??

newcomers like Under Armour, and sneaker?

giants like Nike? The answer lies in??

how Vans shifted their focus from being a?

manufacturing company to a marketing company,??

and from a mere skate shoe to a lifestyle?

brand. This is the story of that transition.?

In 1964, California-based Paul Van Doren was an?

employee of the Randolph Rubber Company. Despite??

being the third largest shoe manufacturer in the?

US, Randolph’s profit margins were terrible, with??

only a few pennies made for every shoe sold. Van?

Doren knew that the real profits lay in retail,??

not manufacturing, so he came up with a business?

plan to sell shoes directly to the consumer.??

But when his idea was turned down by his?

boss, Paul would quit his job at Randolph??

to form the Van Doren Rubber Company with?

his brother and two other business partners.??

In 1966, the “House of Vans” store was?

established in Anaheim, California,??

and three months later they sold their first shoes

During its first decade, Vans struggled to turn a??

profit, but once the skaters from Santa Monica?

and Manhattan Beach showed up, sales took off.?

Although their shoes weren’t originally?

designed with skateboarding in mind,??

the key to Vans’ early success lay in supporting?

the rising skate culture of the 70s and 80s.??

The company hardly spent money on advertising at?

first, but it wasn’t long before Stacy Peralta??

became their first sponsored skateboarder.?

For $300 a week, he’d wear Vans gear at??

all his competitions, and it wouldn’t take?

long before all of Vans’ stores were paying??

seven skaters each to wear their shoes.

The first shoe model was the Authentic:??

It had a rubber sole that was twice as thick as?

that of other brands. Due to the waffle-shaped??

profile, the grip on the board was also better.?

As a result, the Authentic became intimately tied??

to the legendary Zephyr skateboarding team, aka?

the Z-Boys. Hailing from Dogtown in the mid-70s,??

they helped pioneer what would become modern-day?

skateboarding, and wore blue Authentics as part??

of their uniform at the Del Mar Nationals?

in 1975.

A year later, Z-Boys members Stacy Peralta and Tony Alva would help develop the?

company’s first skate shoe, known initially as??

“Off The Wall”, and later renamed “The Era”. It?

became the shoe of choice for a whole generation,??

and would set up Vans to become the de?

facto skate shoe brand for decades to come.?

By successfully appealing to?

the youth culture of its time,??

Vans was able to gain what every?

shoe brand now desperately wants:??

frequent endorsements by high-profile celebrities,?

first in sports, and later in Hollywood. A famous??

example is when Universal Studios called to?

say that 21 year-old Sean Penn wanted a pair??

of their checkerboard slip-ons to wear in his?

upcoming movie, “Fast Times at Ridgemont High”.??

The free screen-time given to their shoes would?

propel Vans to nationwide popularity in 1982.??

By 1987 the company was selling over 2 million?

shoes a year, earning them over $50 million,??

and their first signature skate shoe would?

soon debut (in 1988) as a collaboration??

with legendary vert skater, Steve Cabballero.

But the fast times would soon come to a halt.??

After a few years of great business in the 80s,?

Vans would start producing shoes for seemingly??

everything: basketball, running, break-dancing and?

even skydiving. But the production costs were too??

high and sales were disappointing, forcing?

the company to file for bankruptcy in 1984,??

with over $12 million in debt. Luckily, founder?

Paul Van Doren was able to negotiate well and??

saved the company. Three years after the impending?

bankruptcy, he resurrected the brand – now,??

free of debt. A year later, Paul would sell his?

company for $75 million to a banking firm. But??

the regime change ushered in new problems.?

By the 90s, Vans was facing competition from??

younger shoe brands like DC and Osiris. The?

owners wanted to prevail with a new strategy??

against the competition. Production was moved to?

China and the designs were changed. The customer??

base responded moderately and after 5 years of?

sustained growth from 88’ to 93’, Vans’ profits??

would begin to fall. Ten years later, sales had?

stagnated and Vans was losing $30 million a year.?

The one saving grace that kept the brand?

relevant throughout the 90s was that Vans??

no longer only made and sold shoes, but?

transitioned into a marketing company.??

Vans wanted to organize a huge skating event and?

linked up with the organizer of a punk rock tour.??

In 1995 they started the Skateboard Contest Warped?

Tour for the first time. A music and sports event??

that runs through the countries for several?

weeks. In 1998 the Warped Tour was so big and??

successful that it also took place outside the?

USA.“ It was a resounding success for the next??

25 years and offered international exposure to?

some of the biggest acts of the 90’ and 2000’.?

Not long thereafter, Vans set out to sponsor?

sports events like the Triple Crown for??

skateboarding. The first edition debuted in ‘95?

at the Hard Rock Café in Newport Beach, with??

11,000 people in attendance and Tony Hawk taking?

home first place. In 96 they added surfing to??

the contest, followed by snowboarding in ’97, and?

wakeboarding, motocross, and BMX in later years.??

The events received global television coverage?

and prompted Vans to add a pro-surf team to??

their operations in the late 90s. Years later,?

they’d be sponsoring the US Open of Surfing.?

Vans also came up with the first-ever Park?

Terrain world championship, which was chosen??

to serve as the blueprint for the upcoming skate?

competitions in the 2021 Olympic Games in Tokyo.?

Vans continued their strategy?

and hosted an array of??

events. (Other Vans events would come to include?

the Vans Pool Party, the Vans Downtown Showdown,??

Slam Jam City and the Vans/Hard Rock BMX Jam, to?

name a few.) It was this wave of event sponsorship??

and lifestyle branding that helped maintain?

the cool factor around an otherwise financially??

stagnant company, and as a result, Vans was?

acquired in 2004 for $400 million by the VF??

Corporation. With a number of other brands?

in its portfolio like Wrangler, Timberland??

and the North Face, VF was well-positioned?

to oversee Vans’ comeback, and their clever??

business strategy resulted in just that.

Alongside other skate brands like Thrasher??

and Palace, Vans has expanded its appeal?

beyond extreme sports into fashion at large.??

The turning point came in 2004 with the launch of?

Customs program, which allowed fashion designers??

to create their own slip on designs. The?

following year, Vans teamed up with Marc??

Jacobs and Karl Lagerfeld for high-end collections?

that secured their place in the fashion industry.??

They’ve also created shoes with everyone?

from Supreme to brands like Star Wars,??

Disney, Metallica and The Beatles, all of which?

has helped grow their fanbase. Skate shoes were??

then one of the few fast-growing categories?

in the otherwise-stagnant U.S. sneaker market.?

Rather than spending money on new shoe designs,?

VF refocused on retail by raising its store count??

to 200 by 2009. They also re-established the?

classic models like the Authentic and the Era as??

centerpieces of Vans’ product-line. VF would also?

leverage their distribution channels to push Vans??

into the apparel market. Thanks to the sale of?

T-shirts, sweatshirts, backpacks, jeans and more,??

Vans apparel became a $400-million?

dollar cash cow by the mid-2010s.??

As a result of this expansion, most people?

who now buy Vans are regular consumers,??

and have no interest in extreme sports. With the?

rise of the streetwear and athleisure wear market,??

people have opted for sportswear as a part?

of their daily wardrobe, providing companies??

like Vans with a new, sizeable market to profit?

from. Nowadays, there is a whole subculture that??

use Vans as their canvas and customize them.

According to recent surveys, Vans is now the??

second favorite footwear brand among?

teens, behind Nike, and has eclipsed??

“the North Face” as VF’s top-selling brand. Where?

other companies would have met their downfall,??

Vans has found ways to prosper through successful?

brand extension. They now boast over 700 stores??

worldwide, with total revenues rising from?

$2 billion in 2015 to $3 billion in 2018.?

Whilst Nike would have their customers?

believe it’s reasonable to pay $120 for a??

pair of Converse, it turns out that Vans’ $60?

skate shoe has become a game changer. By the??

estimation of their CEO, if Vans had the same?

global penetration that they currently have??

in Southern California, they’d be an $8?

billion company. So for all its success,??

the company still has a lot of room to grow.

With a fan-base ranging from pop culture,??

to skate legends like Tony Hawk to socialites?

like the Kardashians, Vans’ products are now??

omnipresent. Having grown from a single?

shoe store to a multinational giant that??

grosses 80% of its revenue from shoe sales alone,?

it’s a true case of “from rags to riches”. Vans??

didn’t just build its footwear empire on the?

unlikely strength of a waffle-shaped sole:??

The authenticity that made the brand so successful?

was rooted in the brilliant decision to associate??

with skateboarding and street culture and become?

an icon in the skating and extreme sports world.