Crocs Case Study

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Globalization has changed the competitive landscape of all businesses and the footwear industry is no exception. Datamonitor’s profile of the industry estimates that in 2008 the global footwear market was valued at $196.6 billion and projects that figure to grow to 232.1 billion by 2013. How can firms such as CROCS or ECCO succeed in this global market?

Datamonitor points out that this industry is highly competitive and that rivalry between firms is strong. A key success factor for the footwear industry is the successful development and management of a profitable supply chain. Different firms take different approaches to this issue. Neilsen points out that several large players such as NIKE and Timberland act more like “branded marketers,” who do little manufacturing in house. They instead focus on design and marketing while outsourcing production to cut costs. CROCS and ECCO handle much more of the manufacturing in-house as both firms feel they have a competitive advantage by controlling this aspect of the business. The key is for a footwear company to find the right mix of integration that will enable them to focus on their core competencies and to maximize value creation(Chase 418).

Other critical success factors include brand recognition and repeat sales, reports Joe Ayling. Shoes are a necessity and a loyal customer base who continues to purchase your products is vital to the long-term success of a global shoe company. The key here is to balance the need for repeat sales with the customer still feeling they had a good value from the durability of their original purchase (Ayling). A brand that is perceived as consistently delivering value to the consumer will always succeed. The value a firm seeks to deliver can be identified in their corporate vision and mission.

CROCS rapid success is impressive considering a firm that first appeared in 2002 rose over $200 million dollars in its IPO, the biggest ever in the shoe industry (Ylan). However,...
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