BRANDING

A Second Chance for a Failed Brand

The once-hot eco-friendly clothing brand Nau is reborn as part of apparel retailer Horny Toad.

Horny Toad

Advertisement

THE PROBLEM

In March 2007, the outdoor-apparel maker Nau launched to much fanfare with retail shops in four cities. Nau's high-end designs, $35 million in funding, and generous contributions to charitable initiatives quickly made it a brand with a lot of buzz. But, as we reported in November 2008, Nau soon ran out of cash and announced that it was closing its five stores and selling its assets. In the end, a core group of employees found a buyer in the casual-apparel company Horny Toad, which acquired Nau in June 2008.

WHAT THE EXPERTS SAID

Colette Brooks, founder of Big Imagination Group, thought the marriage could work as long as Horny Toad did not interfere with the Nau brand. Joel Makower, executive editor of Greener World Media, liked the new plan of slower growth and less philanthropy but wondered whether Nau could get a "second act as a phenomenon." Jane Park, CEO of Julep Nail Parlor, cautioned that even with Horny Toad's backing, Nau still needed to proceed cautiously.

WHAT'S HAPPENED SINCE

Nau relaunched under the Horny Toad umbrella last fall, selling a scaled-back product line of 80 styles in 12 retail outlets. Combining operations with Horny Toad resulted in a vastly smaller staff: 15 employees, down from a preacquisition high of 95. The brand has begun to show new signs of life: In fall 2008, stores sold more than 80 percent of the Nau products supplied to them. Building on that success, the brand now supplies 60 eco-friendly boutiques and outdoor-clothing stores and produces about 100 styles. "It's been exciting and unpredictable," says Mark Galbraith, Nau's general manager and a key member of the original team.

WHAT'S NEXT

Gordon Seabury, CEO of Horny Toad, says Nau will be profitable by July. Nau's revenue makes up less than a third of Horny Toad's total, but Seabury hopes it will reach 50 percent within five years as Nau increases Web sales and expands its distribution network. Nau-only retail locations, though, are not on the horizon.

Last updated: Dec 1, 2009




Register on Inc.com today to get full access to:
All articles  |  Magazine archives | Livestream events | Comments
EMAIL
PASSWORD
EMAIL
FIRST NAME
LAST NAME
EMAIL
PASSWORD

Or sign up using: