American Accent

Tracy Smith, president of U.S. operations for Geox, is leading the Italian lifestyle brand’s re-launch with a decidedly stateside approach to operations, product and marketing.

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Tracy Smith - President of Geox U.S. Operations.

Tracy Smith – President of Geox U.S. Operations.

Until now, Geox, a $1 billion-plus public entity that has penetrated nearly all corners of the globe and dominates the European market on a Nike-like scale, has experienced limited success in the United States. So, what gives? Most experts would agree that it’s not the product, which is grounded in Geox’s renowned breathable technology that spans men’s, women’s and kids’ and is in step with a comfort-loving nation in search of versatile styling. Many would also concur that it has not been for lack of effort. A series of well-regarded footwear executives gave managing the U.S. subsidiary a whirl over the past decade or so, only to run into philosophical differences on key issues like product assortment, delivery schedules and distribution strategies. Basically, the industry sentiment was that the U.S. division operated with too much of a European accent and, as history indicates with many overseas brands trying to break into this market, that often leads to difficulties.

But that was then and this is now. New President of U.S. Operations Tracy Smith (who joined in February following, most notably, an 18-year stint at Cole Haan, where he rose through the ranks to become president) declares that Geox’s approach to building the brand in the States is now squarely focused on the wants, needs and terms specific to this market. For starters, the corporate office is now on the same page. Smith notes that Geox CEO Giorgio Presca, who came on board in 2012, has run an American company (he’s the former president of VF Jeanswear) and lived here. The same can be said of Commercial Director Enrico Morra. “They really understand the potential of this market, and that we have to create and build a more independent subsidiary in the U.S.,” Smith says, adding, “It’s a completely different ballgame now.”

Smith predicts the industry will begin to see this independent approach in full force with the launch of Geox’s Spring ’16 collections, which will be highlighted by a snazzy new booth at the FN Platform show in Las Vegas this month. “It’s not just the normal booth filled with shelves and salespeople,” he says. “We’ll be calling out our different technology stories, like Nebula and Amphibiox, with creative display fixtures and flat screen TVs running technology and branding videos. It’s going to be a nice surprise for everybody.”

While many of the other changes may not be as flashy, Smith says logistical matters (like ordering and delivery dates) reflect a clear change in philosophy that should alleviate previous headaches. “The dates just didn’t match cleanly with the way business is run here,” Smith notes. “Those types of issues are fixable if you approach them in the right way, and fortunately I have had support from our global supply chain and am planning to do so. That’s going to be an immediate difference that retailers will see.”

Retailers will also see noticeable changes in the product, something that began with the arrival of Presca who, Smith says, is a product guy at heart. “He really came in and challenged the product teams to build a global line of shoes and not just a European line that you try to sell to everybody,” he says. Smith, who gained extensive experience in product development at Florsheim and later at Cole Haan, will weigh in along with recent hire Doug Hogue, who heads product development in the U.S. (Hogue came over from Sperry Top-Sider and before that had been a longtime co-worker of Smith’s at Cole Haan.) “Our role is to take from the global Geox assortment and edit it down to what we want the brand to stand for in the U.S.,” Smith explains, noting the changes at the top make the exercise easier. “We will be far more focused and edited, particularly from a wholesale standpoint,” he adds.

That said, nothing about this business is easy or getting easier. Smith is well aware of the challenges of trying to build a lifestyle brand in this market. But his experience coupled with the financial muscle of Geox and, perhaps most important of all, its proprietary breathable technology, has him relishing the opportunity. To Smith, it all seemed to come together as the right job for the right person at the right time. “It just felt very natural,” he says. “It’s a well-designed product at affordable prices that is very familiar to me, and it’s a great brand to step in where I left off at Cole Haan and really appeal to many of the same consumers.”

Of course, no footwear job or brand is exactly the same. To this end, Smith is excited by Geox’s across-all-categories breadth and its wearable technology premise, which he believes is particularly relevant today, given the popularity of Fitbit and smartphone accessories. Specifically, Smith thinks Geox’s seamless integration of its technology into its shoes and apparel mirrors a growing consumer desire for smart products with simple, user-friendly designs. “It doesn’t have to scream comfort or technology,” he observes. “It’s more like you have that knowledge inside that you made the smart choice, but you don’t need to scream it to everybody that walks by.”

It’s a story that Smith can’t wait to start telling. For starters, he says the Geox story is authentic, compelling and already proven to have translated extremely well. It’s also a story that he says has remained consistent, and therefore is still pure. “Geox has stuck with the story. It wasn’t breathable for four years and then sustainable for three years and then edible for two years,” Smith quips. “That proprietary technology has always been at the center and is the DNA of the brand.” It also doesn’t hurt that the story is still largely a new one to most American consumers. “I feel as though the story hasn’t been told for a number of years—the communication kind of went dark after the recession,” he notes. “So this is really a re-launch where we can re-introduce people to the brand and show the product evolution as well as connect with consumers who don’t know Geox through a cool, fresh and interesting story.”

You’ve been telling the Geox story for about six months now. What sort of reaction have you been receiving?

The general reaction is: “Wow, it’s about time.” Geox has always been a great brand but they were waiting for us to come out with the story and the focus to say, ‘here’s what we are now.’ That was mostly the sentiment we received from conversations that we had during the fall market shows. I’m really excited to find out what people think when we unveil a new booth, a new assortment, a new technology [Nebula] and new marketing collateral this month.

What do you want people to think—is Geox comfort, lifestyle, wellness, fashion, all of the above?

It’s all those aspects. I look at Geox as a lifestyle brand founded on innovation and technology that provides comfort and wellness aspects packaged in a contemporary design. It’s too narrow to define Geox as just another European comfort brand. The opportunities across men’s, women’s and kids’ with a great innovative technology concept running through all the collections—that’s when you realize what a real unique and big proposition Geox presents relative to other brands in the market. For example, I think people, particularly younger consumers, are starting to pay attention more to the idea of wellness and smart products. Today you have to offer all the pieces. We know that comfort brands can range from all levels of design and attractiveness. That’s where our Italian design foundation comes into play along with quality contemporary designs. But we’ve also got the breathable technology throughout our collection. We’re not giving up one aspect in order to serve the other. That’s where I think our story stands out more than other comfort brands.

Comfort is a given, but that alone isn’t enough.

I don’t think comfort by itself is enough anymore. Comfort in a less-than-attractive style isn’t going to be enough for many consumers. The secret sauce is trying to bring all of these elements together, and yet there’s a certain subtlety to it all.

Does that make the design and marketing processes more challenging?

Well, it’s in how you communicate and position the technology. Who would have thought, for example, that one of the greatest personal technology products to come about in recent years would come in the simplest design? But that’s what Apple is famous for. You know it has all of the technology inside, but it comes in the cleanest, most simple packaging and product design. I think people get that. That has become cool, whereas the old Ironman watch had 63 buttons, five dials and could start your car. I think there’s an element of that design simplicity coming into accessories. For example, the logo aspect isn’t what it once was. Nor is the fashion at all costs, like the crazy It bag or uncomfortable must-have, what it once was. Look at the Birkenstock trend: I think it reflects that people’s attitudes have changed. They want something that works for them. I think if you can be viewed as a smart product and a smart choice, that’s a real strong positioning for accessories.

Is this fashion movement that includes basics like Birkenstocks and sneakers on the runway unprecedented in scale?

I don’t know if it’s anything other than the normal trend cycle. We’ve seen it many times before. For example, I caught a glimpse of Back to the Future on TV recently and Michael J. Fox was wearing a pair of Nike [Bruins] and they still look cool paired with blue jeans. That’s a look that’s come and gone three times since that movie came out. Although, I agree that this time the sneaker trend feels much bigger because now you can’t look at a designer line and not see a sneaker. They all have a CVO, a trainer and a running-inspired style, no matter what the label is. That just shows when something gets really big that everyone just can’t help but react to it. But trends cycle in and out. A lot of guys of late are wearing cool English style brogues with rolled up jeans—in the U.S. That would have just seemed crazy a few years ago. Every guy walking around the recent fashion shows in Italy had that exact outfit on: short pants or cuffed up, no socks and English brogues. It looks cool right now.

Is this bouillabaisse of current trends a good thing from a merchandising perspective?

There are two sides to the story, depending on who you are talking to. On the one hand, it’s great because it’s just a much broader opportunity to connect with consumers. But then I’ve heard retailers lament that there’s no lead story. There’s no one outstanding item to bank on. Everybody is doing everything, so now what do we do? I do think it makes their jobs a lot harder than it makes ours. And a lot of this has to do with social media and the globalization of everything. Back in the day, we used to travel to Milan, Paris, Stockholm and Amsterdam to look for trends nobody else might have seen. You don’t really need to do that now. You walk into a store in Abu Dhabi or Rome and, guess what, you are looking at the same assortment. It’s just really changed the business.

Do you have a gut reaction about whether a shoe is going to be a hit?

I do, and I’m wrong as much as I’m right. [Laughs.] When you’ve been around long enough you learn when to trust yourself and when to listen to another opinion and let somebody else make the decision. It’s a balancing act. But at the end of the day, we’re not making widgets. Our business has to be about product and, fortunately, that’s always been at the center of what gets me up in the morning. The other areas of experience I have gained have helped me put a frame around it, but I consider it to be a real asset.

Is it easier in this retail landscape to re-launch Geox?

Nothing about this business is easy. On the one hand, I would say it’s certainly easier to reach more consumers with the message about the brand and product. But it’s certainly more complex in terms of pricing and the delicate relationships between retailers that own brick-and-mortar stores and the pure-play online dealers. It’s got to be about finding that right balance. Whenever you place a bet on one and forego or ignore the other, you don’t win in the long run. I like to use the analogy of driving with a clutch: there’s got to be that perfect balance to make the car go smoothly. If you don’t give it enough gas, you stall. If you let out the clutch too quick, you stall. You have to find the right combination.

Can a shoe company run on automatic?

I don’t think so. [Laughs.]

Where do Geox’s direct-to-consumer efforts fit into this balance?

It’s a part of everybody’s plan now, because it’s about how and where the consumer wants to engage a brand. We have to make sure we are partnering with our retailers and with our own e-commerce to make sure we are giving the customer that opportunity to shop and connect with the brand how they want to. That said, I think there are always going to be brick-and-mortar stores that offer superior customer service and that touch-and-feel experience. And there’s always going to be the convenience of online shopping. Omnichannel is the model. The trend, over time, may swing a little bit from one to the other. There could be a little bit of a backlash with online where we’ve lost the ability to interact with people and to touch and feel product. I would say you are seeing some of that sentiment of late with pure-play online retailers opening up brick-and-mortar stores, be it Warby Parker, Bonobos or Zappos. But no way do I envision one format replacing the other entirely. And I don’t think one will ever be 90 percent share and the other 10 percent.

I’m surprised at how certain segments of our industry still ignore the online shopping component. I think consumers just expect that option today wherever they are shopping.

I’m absolutely sure that’s the expectation today, no matter what type of store you enter. Take Mitchells as an example, which I consider to be one of the finest clothing and accessories stores in the country, yet they only launched their website last year. But they took their time and did a great job. I’m fortunate to live within a mile of their store in Westport, CT, and I still love the in-store experience—to have a salesman that knows me personally and knows what I like. But now if I’m stuck someplace and need something, I can go online and make that purchase.

Is online retailing the ultimate game changer? 

The only other thing that may even come close, and I’m not sure it does, is when the big department stores went national. But online retailing changed how we were able to shop and not just where we were able to shop.

Speaking of shopping, what’s the plan regarding Geox brand stores? The plan at one time had been extensive.

I think that strategy was at a different time in the history of the company and, honestly, a different time in the market’s history, namely before the recession. I just don’t think that level of a store rollout is really applicable in today’s economy. To me, it’s always been about balancing the business between wholesale and retail. You have to find the great wholesale partners that can really present your brand in the right way to consumers. And by that I mean target consumers that are shared between the brand and the retailer. You have to have company stores to be able to market the brand and tell the complete story to the consumer. The two aspects should work together to the mutual advantage and benefit of both parties. It should never be an “us vs. them” scenario. We always tried to achieve that balance at Cole Haan and I believe, to a large extent, we did.

Just how big are you envisioning Geox’s potential in this market?

Well, there’s a lot of room from where we are now and where Cole Haan was when I left. Those are two significantly different numbers. But it’s a matter of building it the right way. The goal [in five years] is to be a well-balanced, focused, tightly distributed brand that is communicating with and connecting to the market and consumers in a fresh and cool way. That’s what could make Geox special in the market. A lot of that has to do with a brand’s fundamental positioning: price points, whether you are just men’s or just women’s, are you just dress shoes or just sneakers, etc. When I add it all up for Geox, even if we just get a nice slice of market share in many of those aforementioned categories that we play in, it can be a substantial business.

Which Geox is in Europe.

In Europe, Geox has 70 percent unaided brand awareness. You can’t go to a European city without encountering either a Geox store or a retail partner selling the brand. It’s as well known as any brand is in the U.S. Certainly, it has a bigger brand awareness than Cole Haan. If we could come anywhere near that in this market, think of the potential. It’s really powerful.

And the re-launch begins in earnest for Spring ’16?

Yes, this is a re-launch of Geox in the U.S., pure and simple. We’re going to start with marketing activity in November and December on NBC4.com’s weather and weather alert pages. We’ll own the banners and will advertise Geox Amphibiox, which is our waterproof and breathable collection. We want to connect the weather to Amphibiox in consumers’ minds. They say, conservatively, over those two months the pages receive between five and seven million impressions.

When most people in the U.S. think ‘waterproof,’ they think Gore-Tex. What’s the difference with Amphibiox?

Amphibiox is entirely breathable. Without calling out any other technologies, depending on how they are constructed, they can keep water from getting into your shoes but they don’t necessarily keep your feet dry because they are not breathable. Amphibiox keeps you dry from the elements and by not causing the foot to perspire. It’s available in men’s, women’s, kid’s, dress casual and sports-inspired styles. It really is a sub-collection. I also think it shows how the brand has evolved because a lot of people who may know Geox are apt to say, ‘they make the moccasins with the breathable soles.’ But we’ve expanded our technologies into waterproofing and now, with the introduction of Nebula for Spring ’16, we will offer all-over breathability. Nebula uses the lining material found in Geox apparel that channels the air up and out. It’s our hero product for Spring ’16. I don’t think people understand how much the company and the product offering has evolved, and that’s why the story is so compelling.

What do you love most about your job?

Well, it’s a long list but right now it’s about building and leading a team that’s really focused and tirelessly pursuing one common goal. It’s always about product and people, and about bringing those two aspects together. That’s what I love and I get to do both every day.

Is this your dream job?

It is, for me, at this stage of my career. As I’ve said, I’ve been fortunate to have been given the opportunity to have experiences in a lot of different areas of the business and what I wanted was the opportunity to be able to utilize all of those areas. To do that, along with the ability to build and forge a corporate culture, is a dream job for me, and I have only just started. I’ve not been one to jump around from company to company. I spent 13 years at Florsheim followed by 18 years at Cole Haan. I’m not a hopper. [Laughs.] Once I’m committed and passionate about something, it’s about seeing the goal to the end. And I’m very fortunate to have the power of this global brand and the support behind me to help reach that goal. •

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