Converse Case Study

Topics: Nike, Inc., Basketball, Athletic shoe Pages: 5 (1817 words) Published: September 6, 2012
Converse: Shaping the Customer Experience

They dominated the basketball courts – both amateur and professional – for more than forty years. The first U.S. Olympic basketball team wore them, and Dr. J made them famous in the NBA. Punk rocker Joey Ramone made them standard issue for cult musicians; indeed, Kurt Cobain even donned a pair when he committed suicide. Today, a broad range of consumers, from the nerdiest of high school students to A-list celebrities, claim them as their own. What are they? Converse All Stars – more particularly, the famous Chuck Taylor All Stars known throughout the world as Cons, Connies, Convics, Verses, Chuckers, Chuckies, Chucks, and a host of other nicknames. The cool quotient of the iconic Converse brand is unquestionable. But you might wonder just how the brand has maintained its status decade after decade. The answer is this: by doing nothing. That may be an oversimplification, but the folks who run the Converse brand understand that in order to provide a meaningful customer experience, sometimes you just need to stand back and leave customers alone.

The Rise and Fall of a Legend
Converse has been around a long time, perhaps longer than you realize. Founded in 1908 in Massachusetts, Converse introduced the canvas high top All Star in 1917. In 1923, it renamed the shoe the Chuck Taylor, after a semiprofessional basketball player from Akron, Ohio. When his basketball career ended, Charles “Chuck” Taylor became an aggressive member of the Converse sales force. He drove throughout the Midwest, stopping at playgrounds to hawk the high tops to players. Some consider Taylor to be the original Phil Knight, Nike’s CEO, who also started out by selling his shoes at track meets from the back of his van. From the 1930s to the 1960s, Chuck Taylor All Stars were the shoes to wear, even though they only came basic black or white until 1969. But at that time, 70 to 80 percent of all basketball players still wore Converse. There’s no question that Converse invented basketball shoes. You might even say that Converse’s pioneering efforts paved the way for the success of athletic shoes of all kinds. And the popularity of All Stars on the court played an instrumental role in making athletic shoes everyday footwear. But as the sneaker market began to explode in the 1970s and 1980s, shoes became more specialized, more high tech, and more expensive. As Nike, Adidas, and Reebok took over the market, Converse experienced a financial roller coaster ride. The company ultimately declared bankruptcy in 2001 as its market share bottomed out at 2 percent of the athletic shoe market, a small fraction of its prior position. But as Converse fell from market dominance, something interesting happened in the marketplace. Emerging artists, designers, and musicians began wearing Chucks because of their affordability, simplicity, and classic look. Young people caught on and adopted them as an expression of individuality. In fact, Converse’s shrinking market share and ad budget made its shoes a favorite of the anti-establishment, anti-corporate crowd who were tired of trendy fashions. These people would take a cheap pair of comfy Converse All Stars and thrash them, scribble on them, and customize them as a canvas for personal expression. Perhaps the most intriguing aspect of consumers adopting Converse as a counter-culture icon is that Converse itself never promoted the brand as anything but basketball shoes. Despite its emergence as a niche counter-culture brand, Converse continued to struggle. In 2003, however, Nike came to the rescue by acquiring Converse and making it part of the Nike corporate family. Many analysts speculated that this acquisition by a big-brand corporation would ruin Converse’s cult caché as a “non-brand. However, although Nike buoyed Converse with an infusion or cash and access to its product-development labs, it left Converse management pretty much alone to implement its own strategy. It...
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