Havaianas Case Study

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Class 3:
Case Study Havaianas: A Brazilian Brand Goes Global

Question 1:
What factors could explain the success of Havaianas in becoming a global brand?

1.) Stable and well developed economic background through acquisitions and expansions lead to a huge sandal market share * Sao Paulo Alpargatas exists since 1939, specialization in four business units: (sandals, sporting goods, industrial textile and retail) * Controling Shareholder (67%): Camargo Correa Group with operation in 20 countries * Acquisition of Companhia Brasileira de Sandalias (Dupé brand) in 2006 leads to increased share in the Brazilian flip flop market * Acquisition of 60% of Alpargatas Argentina to expand in Latin America

2.) Long experience and know-how in manufacturing sandals and producing the special rubber * Own operational and logistic framework
* Extension of the manufacturing plant in 2007 ( capability to produce 212 million pairs of sandals annually) * Production in the northeast of Brazil, Santa Rita, in order to reduce costs, increase productivity and further streamline the logistic network * Headquters in Camargo Correas Centro Empresarial to optimize the administrative processes

3.) Product innovation
* From one style with five colors to 509 new models of sandals and sport footwear * Different designs and colors
* Special editions

4.) Product properties
* Low price: affordable
* Durability, robust
* Comfortable
* Trademark in 1962
* “shoes for the poor”, outside work (coffee bean pickers and blue collar workers), all day shoes * For hot and humid weather

5.) Repositioning of the brand (1994)
* Before: one style and five colors, poor point of sales execution and functional based advertisement, image of a cheap product that can be bought everywhere * “Havaianas Top”, matching sole and strap

* in 13 colors
* slight premium price
* advertising showing upper class consumers and celebrities wearing Havaianas * upgrade through better packaging
* new sales channels with more emotional context

* Continuous product innovation
* Launch of new designs (80 styles)
* Incorporation of world fashion trends

* Changing costumers
* Opinion leaders, celebrities and upper class costumer wear Havaianas not only at home, but in many places and occasions * Free publicity from fans (international fashion and movie stars) * International fashion magazines, catwalk, MTV Music Awards and the Hollywood Oscars 2003

* Communication
* 12% of the turnover was spent for marketing
* Buzz marketing and advertising with electronic media
* Local and international celebrities
* Online advertising, youtube videos, …
* Co-branding: Havaianas was linked to ecological causes due to IPE limited editions and limited editions by famous artists, that financed “favela” projects

Question 2:
How far goes the company in terms of expanding the brand?
1.) 1960 export to Latin America
2.) 1990 tourism to Brazil increased and Havaianas were brought home 3.) 1998 big export to France
* Europe (major markets are Italy, Portugal, France, Spain, Switzerland, Netherlands) * At the Soccer World Cup of 1998 Havaianas with the Brazilian flag on the strap became an instant hit 4.) Communication strategy change

* Europe, France
* Independently managed markets (local entrepreneurs)
* European subsidiary to harmonize the brand strategy, advertising, product and price positioning * In 2001 “Tudo Bem” was established as an official importer * Cooperation with leading designers from fashion to luxury * Sponsorships (events at trendy discotheques, fancy hotels, gyms) * Customize your own Havaianas

* US
* Havaianas became a “must wear”
* In 2004 “Style West”, exclusive distributor, equipped celebrities and designers each season with the hottest colors * In 2007, entry...
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