last fall's launch of a national sales team with representatives at 17 sites throughout the United States;
expansion of the product line that now includes men's dress shoes, children's sandals, and synthetic-fabric shoes for "the nonleather wearer";
a concerted effort to stay on the fashion scene;
a push to improve retail-store relations;
a more structured marketing and advertising campaign.
"I don't think the competitors are that much tougher these days," says Black. "I just think that we need to make sure that the brand stays strong, and that Dillard's, Macy's, and places like them have people on the floor who are educated enough to sell the product properly."
The company's drive to differentiate its offerings from the noise of competing products has met with some success. "Birkenstock is smart: they're going to have the fashion colors; they've got a line builder; they're not just sitting over there being a bunch of yahoos thinking, 'Oh yeah, we'll be very basic and European and stuff," says Cynthia Mullaly, vice-president of the National Shoe Retailers Association. Recently, in fact, Birkenstocks have appeared in fashion shows for Armani, Donna Karan, and Joseph Abboud. "It helps sell our core merchandise," says Mark Lenox, the company's chief product-marketing manager.
All the same, Birkenstock is not forgetting its core customer -- the independent shoe store. The company continues its exemplary in-stock service, shipping even single pairs to its retailers. More common now, the service was almost unheard of when Fraser started to offer it, 25 years ago.
This year Birkenstock is applying more enthusiasm to its promotional efforts. Its new series of advertising pieces, for instance, offers a dozen variations of mock testimonials. Stores drop their names and addresses into the ads and run them locally, and they pay only half the costs. "The 50% copayment is higher than most other manufacturers offer. Many companies pay nothing," says Marlene Bishop, who owns Foot of the Rockies, a retailer in Cheyenne, Wyo.
But even as the competition intensifies, Birkenstock shrinks from national advertising. Black says Birkenstock won't run ads other than those in its co-op program any earlier than 1995. In large part the company will continue to depend on public relations and the work of PR manager Geil to keep the Birkenstock name in the press.
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Tension over the challenges it faces belies the serenity Birkenstock favors. The supply problems endured in 1992 and the abrupt halt to revenue growth last year have obscured the company's goals, and the new five-part campaign has engendered some internal upheaval. Last December sales-and-marketing chief Diane Rowe left under conditions that make everybody clam up when her name is mentioned. Fraser herself says that it was a "personality issue" and coolly declines further comment. A key saleswoman, Mary Rodriguez, left Birkenstock last summer to join Yaleet, maker of the Israeli Naot brand, as its West Coast sales manager.
Fraser won't disclose 1993 sales figures but asserts that there was some expansion. The only goal she will state for the record is a sales target of $100 million for 1995. Mary Jones says the company needs a good 1994. "It's real important to us right now that we just stay on track this year, with no major upsets. I wouldn't want to grow too fast beyond that."
But at a time when Birkenstock's dominance is being threatened, focusing on stability may be insufficient. For example, Teva's parent, Deckers, went public last October, netting $32 million destined, in part, for increased advertising and marketing. Birkenstock is one of the Goliaths Teva intends to conquer.
Among Teva's newest offerings is a brown-leather-strap version of its popular nylon-strap comfort sandal. The word on the street is that when a certain Teva sales rep calls on his customers, he unwraps the shoe and dangles it from his fingers. With the confident smirk and narrowed eyes of someone who knows he's on a roll, he leans forward, takes a deep breath, and quietly, in a smooth drawl, declares, "This here is our Birkenstock killer."
If Margot Fraser were there, could she still look away?
THE SINCEREST FORM OF FLATTERY
If you invent a product or service, you'll have one main goal when you come to the marketplace: getting people to be receptive to your unique offering. But if popular acclaim comes your way, it can be as much a liability as an asset. Competitors either imitate or one-up successful ideas, and defending your market against encroaching opponents is a different and complicated challenge.
It's easier for rivals. They simply respond to your winning strategy with alternatives. You're expensive? They're cheaper. You offer a dozen choices? They've got one -- styled after your best-selling selection. You're targeting part of the market? They'll take the rest.
Establishing your position as industry leader isn't enough. If you manage to do that, that's when it's time to reassess service, distribution channels, pricing, quality, and even inventory control.
