A New Breed

Led by the successful relaunch of the iconic Pillow Boot, Steve Sedlbauer, president of Cougar Footwear, discusses how the classic cold-weather boot company’s rebirth into a stylish, upscale lifestyle brand is heating up. By Greg Dutter

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THE REBRANDING, REPOSITIONING and rebirth of Cougar Footwear is a story of survival, perseverance and risk-taking, not to mention a little soul-searching mixed in for inspirational icing. The main character, Steven Sedlbauer, is a second-generation shoe executive who, early on in our tale, comes to terms with what he truly loves doing more than anything else: designing and selling shoes under the company name his family founded in 1948 in Burlington, Ontario. He is committed to keeping that dream alive, and the story that follows—of how he is doing just that— is both a lesson in business acumen and personal salvation.

We pick up the tale in 1996 when Sedlbauer and his brother Ron, a former NHL star and 40-goal scorer one season with the Vancouver Canucks, take the plunge and buy the Cougar trademark out of bankruptcy. Their father, Walter, had passed away two years prior, around the same time as the Canadian-based manufacturing model was struggling with rising labor costs. At first the brothers decided to stick with the game plan they knew, finding a new Canadian manufacturing partner, which enabled the duo to keep the brand in the market—never missing a season, in fact. But they soon came to realize that it was a losing battle. “It just wasn’t meant to be,” Sedlbauer says. “There were just too many limitations and we were running into the same labor cost issues as before.”

It was during those difficult days that Sedlbauer did plenty of soulsearching. “I can remember sitting in my basement one night thinking about what I would do if I wasn’t in the shoe business. Nothing else really came up,” he confesses. “This is what I really wanted to do, and I couldn’t imagine doing anything else.”

Sedlbauer set upon a course to make that career affirmation a reality. He and his brother had already made the first step by acquiring the Cougar brand name, which owned decades of name recognition. Cougar also had a fashion ace in its catalog—the Pillow Boot, a winter style introduced in the ’70s that became all the rage when its trademark red tongue was worn flipped out. The brand, overall, had good bones, so Sedlbauer decided to go with the flow and move production to Asia and, at the same time, launch a private label business. “It required very little additional investment and allowed us to get at a whole other market with products that we designed and sourced,” he says of the latter decision.

Business for Cougar soon became sustainable. Along the way, the company also developed a niche: “We were growing based on new designs we introduced each season,” says Sedlbauer, who doubles his duties as Cougar’s lead designer. “Our new products were bringing buyers into our showrooms—a case of, ‘Let’s go see Cougar because they’ve always got something new.’” It was an item-driven growth stream that eventually reached a saturation point. Along the way, the brand became less disciplined in terms of what styles would sell, which resulted in Cougar lacking a clear identity. To get to the next level, Sedlbauer knew Cougar had to become a brand first and foremost. “We needed to develop a retail distribution where stores represent the brand as opposed to a specific style,” he says. “It’s more about their overall assortment of Cougar and creating a brand presentation in the store.”

That’s when our story—in 2009, to be exact—takes a dramatic turn as Sedlbauer opts for a full-on overhaul of Cougar into a lifestyle brand. “It started by creating a fresh new voice for Cougar,” Sedlbauer offers. To get that voice heard, Sedlbauer contacted the Blammo ad agency, which it had worked with 25 years earlier on its Pillow Boot campaign, for recommendations of smaller agencies, but the owner jumped at the chance to re-introduce the new Cougar. “They understood our situation in terms of driving the business by new styles and getting a new brand identity introduced,” Sedlbauer says. “They developed a new logo and messaging. They were quick to point us in the right direction and get us on that road to reconnecting with consumers.”

A key component of this reconnection has involved the use of the web. It’s a process that Sedlbauer notes has been quick, focused, quantifiable and affordable (especially compared to the national TV campaigns it ran in years past). “If you go back two years ago, we didn’t even have a website,” he says. “Our web traffic is up tenfold over last year.” Blammo created the Cougar site so consumers could learn about what products it made and then, through innovative contests, drove traffic to it. The first contest asked, “What would you do to win a free pair of Pillow Boots?” People from all over North America wrote back with a range of zany suggestions. Cougar then sent out a video crew to film the best ones and posted the results on its website and Facebook page. It was a tremendous success—Sedlbauer reports an estimated 30,000 visits to view the first video.

“It involved a woman who said she was afraid of heights but said she would go ziplining,” he says. “She was scared to death but was a great sport, and she got a free pair of Pillow Boots.” Sedlbauer adds that the contests were produced in partnership with LiveDress.com, an online fashion magazine, which posted the videos on its site for added exposure. “Overall, it’s been a great tool and it has allowed us to be very focused,” Sedlbauer says. “The contests, in particular, exposed another group of consumers to Cougar—people who may never have heard of us before.”

This brings us to the current chapter in the Cougar story about a company that is driving steadily toward a more upscale, brand-driven lifestyle image. But unlike most stories, Sedlbauer has no ending planned anytime soon: “We are still evolving to where we want to be,” he says. “In two years we expect to complete this transition to one that is also more of a year-round representation.” Sedlbauer adds, “We are heading in the right direction and I’m confident we will get there.”

What is the biggest difference between the new and old Cougar? The new Cougar is much more focused and thought-through in terms of our target consumer and what the brand represents at retail. But it’s not a one-season changeover, because we can’t just walk away from our current customers, who make up a great deal of our volume. Also, we are still pioneering new distribution, with many retailers testing us out, and that business doesn’t come overnight either. It’s a big undertaking and that’s why we believe it’s going to take another two years to really get the brand where we want it to be.

What’s been the biggest challenge the company has faced during this whole process? The hardest aspect has been that we are not going to grow our business a great deal until we fully make this transition. You don’t come out with $200 boots and everybody just buys as many as they did of the less expensive boots we used to make. We’ve got to prove to our retailers that it’s going to work. We’ve got to have some success, which leads to more success and our business grows. So sticking to our guns and getting through this patch has been the toughest part. The challenge has been internal as well: getting everybody to remember that it’s not about selling the most shoes as quickly as possible anymore; it’s about being true to the new strategy and making sure we don’t put our old thinking caps on and get overly concerned with units and volume. We’ve got to get to a new place and then the growth will come.

Was there really an alternative?
The alternative would have been to pare the product down and focus on a price-point business. Personally, that’s not a fun business to be in and it’s also very volatile, especially with the uncertainty of sourcing in China today. Actually, the whole issue of selling at higher price points gives us latitude on where we manufacture. It may not just be out of Italy, where we produced the relaunch of our Pillow Boot collection, and it may not be China going forward either.

What has been the biggest reaffirmation that repositioning was the right course of action? Despite the tough [warm and dry] fall we experienced in much of the U.S., we are still having respectable sell-through at retail. The Pillow Boot, in particular, has been very successful. There’s been a lot of excitement around the relaunch. I think almost every one of our retailers has re-upped for next fall. And we will be expanding the line for Fall ’12, including the launch of a men’s version, as well as a new construction in women’s that’s a little younger and edgier. The collection will also feature some new colors and materials.

What is it about the new Pillow Boot that has clicked at retail? The last is elongated and sleek, which is very fashion-forward for a winter boot. The old model was a wedge, whereas this is a cup sole so the profile is lower to the ground. The gist is it’s a vintage boot relaunched in a modern twist. I use the analogy of the Austin Mini Cooper, where the new version is very cool in that the design heritage is present but it’s not like they just made the old car again.

Similarly, the iconic aspects of the Pillow boot—the red lining and tan leather uppers—are there. I also believe the consumer loves the quality and the fact that it’s made in Italy. Along those lines, we made the packaging special. It includes a gold leaf embossed on the box along with the Pillow Boot logo, which is separate from Cougar. And, unlike our regular packaging that comes in green plaid tissue, this comes in gold. The box also includes a Pillow Boot look book and, in the limitededition boxes, a certificate of authenticity.

Any special make-ups in the works with regard to the Pillow Boot?
Yes. When you get involved in the social media aspects of marketing, you find people are really into special make-ups. They want something that nobody else has. It’s like a game for them to try and find it, be the first to have it and then tell all of their friends about it.

Could this repositioning process be as effective without the power of social media? That’s hard to imagine. Every day the segment of the population not into social media gets smaller. And younger people, in particular, are coming online at an increasingly earlier age. It’s been a great tool, and it has allowed us to be very focused. The contests, in particular, were pretty innovative and successful. We are definitely looking at some more innovative ways to keep that conversation going and growing through social media.

For example?
Well, the second contest we ran asked people to show us their tongue because, back in the day, the Pillow Boot was worn with the red tongue hanging out. People sent in pictures that they also were instructed to post on their Facebook pages, and every time you do that a message automatically goes out notifying all of your friends that you have changed your photo. That multiplies nicely. Friends were encouraged to then vote for the best picture, and the person who received the most votes each week won a pair of boots.

Any more contests in the works?
Not necessarily contests. We’re doing some brainstorming right now and haven’t nailed it down just yet, but we are certainly thinking outside of the box.

In what ways has social media been more effective than, say, a TV campaign?
I believe you get a much more focused audience. They are on your site or Facebook page because there’s an interest, as opposed to running a TV ad, where millions might see it but only a small segment may have a genuine interest and will follow up on the message. Social media is more targeted and measurable. Our objective was to drive traffic to our website to create awareness of our products, and we can measure that every week. Geographically, we know where they are coming from as well as if they are repeat visitors and how much time they are spending on our site. For example, there are a number of visitors that spend 30 seconds, and then there are plenty that are on for five minutes. I believe those people are actually looking closely at the product. We can also see how people are coming to us, whether it’s from LiveDress.com, from general searches or via Facebook. You get a lot of great information about where you are having market penetration and then can decide where to go nationally.

Are you selling direct to consumers off your site?
No. One of our main objectives has been to drive traffic to our retailers. We have a dealer locator on our website and visitors can also write to us with any requests; we have a department dedicated to tracking down the particular style and size and finding a retailer near them that has it in stock. We have two people that essentially drop everything whenever one of these calls come in. Back in the fall we were getting five to 10 emails a day and as many calls. We inform the particular retailer that someone may be coming in, to please hold the boots and, if they don’t come in, to let us know so we can follow up with the consumer. We checked recently to see how well we were converting the requests into actual sales and are quite pleased with the results. And this is as much about creating brand awareness among retailers as it is with consumers. We want to show the demand for Cougar.

In general, how receptive have retailers been to the new Cougar?
The new retailers are more open to the fresh approach because they don’t have as many preconceived notions about the brand. Either they didn’t carry it or haven’t in a long time. And for those few retailers that had a certain perception, once they see our new products, I think their perception changes pretty quickly. We’ve also got a group of retailers where, of their mid-priced offerings, we were toward their lower end before the re-positioning and now are moving toward the higher end. Most of those retailers are pretty happy to be making that shift. They are trying to get away from that lower end of the price spectrum because they simply can’t afford it. They don’t want to compete with the mass merchants.

What is the new price range at retail?
We used to be more in the $80 to $120 and now it’s $140 to $200. This is more in line with the resurgence of independent retailers we have seen cropping up around the country. Consumers are looking for a point of difference as well as added service. And these retailers need to have a quality assortment that is different from everybody else’s. They are looking for new brands, specifically ones with a quality of distribution so they are not butting heads with some of the bigger chains. Along those lines, we are introducing a lot more leather boot styles. Specifically, we have a whole package of deer-tan leather boots, which is also a throwback to the ’70s when a similar version was made by a lot of Canadian manufacturers. It’s cow leather that feels soft and supple like deerskin. It’s a whole collection of boots that sits just below the Pillow Boot in terms of price. But they are waterproof, too. When you touch these boots, you just want to buy them. They have sold well this fall.

Who exactly is Cougar’s target customer?
Primarily, it’s women. Specifically, it’s mothers buying shoes for their children or husbands, as well as shoes for themselves. Our customer is fashionable in that she doesn’t want her winter boot to be a commodity look. She’s looking for fashion, but she’s also looking for value—that it will service her needs by offering warmth and water resistance. But it’s not just a winter boot that sits in a closet until they need to wear it.

We are not selling to teens whose parents provide the purchasing dollars. It’s another reason why value is important. In addition, we tend to keep our customer until a ripe age, mainly because a 50to 60-year-old woman is much more fashionable today than 20 years ago.

In addition to changing fashion tastes, how else has this customer changed since your manufacturing-based days?
The fashion component is definitely the most important. In addition, there are a lot of traditional design aspects to winter boots that have changed. We used to always sell a 9-inch boot better than a 6-inch one, which was considered too short for the snow. Now all of those weather-dictated rules are pretty much out the window, which has a lot to do with the changes in the weather. In addition, everybody now wants boots that are easy on and off. They don’t want to bend over to tie laces. Any lace-up option often now includes a zipper running up the side and the laces are just an ornament.

How have the changes in climate affected your business?
It has led to increased success with more fashionable product that is not as chunky in appearance as a traditional winter boot. Consumers will buy those more fashionable silhouettes because they can wear it regardless of whether it’s cold and snowy. But they have the comfort of knowing that if the weather turns, they will be prepared. Having said that, when you are in a seasonal business you have to run it in a way you can thrive with or without the weather. We don’t necessarily need to have a long, cold winter in order to have success as much as we need an early snow. That drives regular-priced sales in the early season and then retailers fill-in. But you’ve got to look at that as the bonus and be able to run your business purely on placing orders in the preseason. Fortunately, we have had some good repeats on our lighter styles, so it hasn’t been all doom and gloom this past fall.

Is this one of the factors behind Cougar’s new spring collection?
First, it’s just good to have a year-round business—it’s better for the cash flow and keeping the brand more visible in the marketplace. This is our first spring line we’ve done in four years. With the re-introduction of our deer-tan leather boots collection, we believe this material will carry well in select styles, which includes a sneaker, a sandal, a moccasin and a rain shoe. The collection retails between $100 to $140. We are going to deliver about a dozen styles, and we’ve just got to let the product speak for itself.

What is your No. 1 priority for this year?
I don’t have sales projections that involve a great deal of growth just yet. Rather, there are specific retailers that we want to get onboard and others we want to add to their current assortment of Cougar. We are measuring our success more in terms of quality of accounts as well as making sure the ones we do have are fully serviced and satisfied. Along those lines, I’m confident that most of the retailers who added us to their mix this year will grow their Cougar business next season.

What do you love most about your job?
I love working with the product. I’m really drawn to that aspect, where every day is a new day. I see an idea and get inspired, and then I’m off trying to design the next big shoe. The influences and inspirations come from all over. Right now, there’s such a strong mix of vintage and retro stylings going on. It’s basically coming out of the library in the form of old magazines and catalogs. In fact, I’ve got a stack of mail order catalogs from the ’70s that I often go to for inspiration of late. Our deertan leather collection is a perfect example of this vintage trend. It’s a throwback to our Canadian heritage, and the product just has a great hand-feel and transcends tremendous value. Who knows? It just might be the next big shoe.

What’s the most exciting aspect about going to work at the new Cougar?
There’s just a newness about the company that’s fun. Specifically, from a product development standpoint, it’s more enjoyable and a little easier because we can do more. As we move into higher price points and work more with leathers, there’s more latitude in terms of getting creative. And we can afford to put more into the product. It’s just more enjoyable all around. I guess you could say that I love the smell of leather (laughs).

 

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