Killick Datta, CEO of International Brand Partners LLC, makers of Ccilu, on how the company is just getting started.
Expect more brands, plenty of killer styles and a whole lot of buzz in the very near future.
How the world has changed so much since I started in business. People will tell you it’s all heading in the wrong direction, but I don’t believe that’s the case. Just in the 35 years that I’ve been in business, Asia has completely changed from being a mass of hungry, poor people to now being the biggest market in the world. And probably, within our lifetime, we’ll see the same thing happen in Africa.
“Never take no for an answer.” I tell my kids that all the time. But they just laugh because when I tell them not to do something, they are quick to remind me.
Yes. When I launched Diesel everybody said that it was the silliest thing I could do with my own money because no one had ever succeeded in taking an apparel brand into footwear. People said I had a better chance of launching a brand called Killick. What’s more, it was my first time starting a business. But we grew it into a $500-million brand. So I’ve always believed that if you have sufficient ability and are willing to work hard, then you can succeed.
I always wanted to better my dad in business. He was on the board of directors of one of the biggest pharmaceutical companies in the world. But never in a million years did I think I would get into the shoe business.
I was recently on a farm outside Paris and it was nice to hear a few birds, a stream flowing and nothing else. It was the most peaceful moment I’ve had in years.
Someone with the gut financial instincts of Phil Knight, a shrewd operator like Robert Greenberg and, to be completely biased, my work ethic. I may not be the most talented or smartest, but I always felt no one could outwork me.
Bill Gates or Roger Federer.
Killick Datta loves every aspect of the footwear industry. It’s been his life’s work since his Oxford University days when he was hired before receiving his MBA to work for Nike’s international marketing division. Soon after, he was recruited by Brendan Foster, then the Managing Director of Nike Europe, to come to the company’s Beaverton, OR, headquarters to head up international business development. Career stops after that included executive positions at L.A. Gear, Wolverine Worldwide, Brooks Sports, Skechers and, perhaps most notably, branching out on his own with the launch of Global Brand Marketing Inc. (GBMI), which was led by the Diesel footwear license. The brand became a fashion-athletic hybrid juggernaut that peaked at $500 million in annual sales in just 10 years.
Throughout his career, Datta has been an astute student of the shoe business. A voracious reader, he’s always up to date on what’s hot, what’s not, who’s cool, who’s out and what’s next. What’s more, it’s a global perspective. If Datta is anything, he is a well-traveled footwear exec who puts George Clooney’s character in the movie Up in the Air to shame. (At last count, he’s visited 170 countries on business and, at the time of this interview, had just walked in the door to his Singapore home after a 14-hour flight from Berlin.) In addition to being an expert on sourcing and international trade issues, having served on numerous related boards and committees, Datta is a walking, talking industry scorecard. He possesses an encyclopedic knowledge of leading brands and retailers. He knows the key players, their stats, their hits and misses and their strengths and weaknesses. And he is quite complimentary of his colleagues who continually hit it out of the park. In that sense, Datta is as much a fan of this business as he is a key player himself.
“I’m passionate about this industry. I’ve never seen it as just a job,” Datta says. “It‘s something that I love doing.” He concedes that this might sound like what one is “supposed to say,” but stresses it’s the truth. “I absolutely enjoy what I do. Nearly everybody I know is in this industry, and I can go from country to country meeting friends I have done business with for years.” Datta continues, “I just love this industry. It changes every six months, and the good companies are able to change with it and do even better.”
Now Datta finds himself in the embryonic stages of launching another good footwear company. It consists of Ccilu, a street fashion-athletic hybrid brand steeped in injection-molded constructions. Soon to join the portfolio (the deal is expected to be finalized this month) will be the license of a $1.2 billion health and wellness brand for a line of related footwear and apparel. Datta has great expectations for this performance brand and what he sees as enormous untapped market potential. Also in the works is an upscale fashion license that should be finalized later this fall. Like GBMI, which involved multiple brands, Datta says there will be no product or market overlap. That philosophy hasn’t changed. What has changed is a portfolio that won’t solely consist of licensed brands. Datta learned his lesson—in the hardest and most financially painful way when his Diesel license wasn’t renewed. It’s easily his biggest business-related mistake. “It’s like I was building on a rental property where I added new bathrooms, plumbing and bedrooms. I even retiled the kitchen—all for a 10-year lease,” Datta laments. “It was taken away and I was left with nothing.” But Datta doesn’t regret the experience. He says his team had a tremendous amount of fun, learned a great deal and would do it all over again—under one condition: “Make sure we have much longer-term license deals.”
Ownership of brands, like the joint partnership with Ccilu, is part of the International Brand Partners LLC (IBPL) formula. But it’s a matter of finding the right brands. So far it’s been a case of quantity and not quality. “I’m getting offers of about two brands a month and 99 percent of them are trash,” Datta affirms. In fact, Ccilu didn’t even involve a formal offer. Rather, the deal came about during a chance meeting with a Chinese shoe factory owner (who provides a lot of components and molds for the likes of Skechers, Nike and Crocs) by way of an old colleague. “They are the single largest injection-molded manufacturer in the world,” Datta says, adding that the owner sought to launch his own brand. But Datta says his team (which includes GBMI’s former creative director Fiona Adams) had zero interest in launching another Crocs-like brand. Ccilu, Datta says, is nothing of the sort. It’s pure street fashion, like Diesel, only using today’s consumer touchstones. “The sexiest buzzwords in the industry today are lightweight, cushioned, durable, flexible and green (i.e. sustainable),” Datta explains, citing Nike’s Free and Flyknit collections and Skechers GoRun and Memory Foam lines as examples. “It’s the opposite of the days when you had to have a hulking outsole and a midsole that couldn’t collapse.” Datta adds that it’s also the opposite of Diesel, which primarily involved distressed, vintage-looking styles that weren’t particularly lightweight. “Those days are long gone,” he says.
Thanks to advancements in manufacturing capabilities, Datta says Ccilu is able to encapsulate all the of-the-moment product features in a shoe that is low-profile yet cushioned and super lightweight. Datta also believes there’s a street fashion niche that performance brands have not been addressing directly—at least not with the style of which he believes Ccilu is capable. What’s more, he believes the street fashion market is ripe for something new. “Street is pretty much Vans, Converse and Uggs,” he says. “I’m not knocking them, as they are huge brands, but there has been nothing new in street fashion for quite a while.” It’s one of the reasons he believes consumers have been flocking to Skechers, Nike, New Balance and Under Armour—brands that deliver on the aforementioned buzzwords. “People are wearing Nike Flyknits and LunarGlides all day long,” Datta says. “There has to be an opportunity here for us to specialize in street fashion.”
Perhaps the biggest takeaway from all this is the simple fact that Datta is about to get back into the footwear game full force. His team’s proven track record for creating fresh concepts, building powerful brands and selling boatloads of shoes should be welcome in a market that’s been drenched in heritage brands and style reissues for the past few years. Most retailers would surely sign on to be part of another Diesel-like run. Datta, of course, makes no such guarantees. But he’s confident that if the product is right, success will follow. “That’s why I’ve always invested heavily in product, designers and developers,” Datta says. “As long as our product is good, we will succeed.”
You didn’t have to launch another company from scratch, so why did you?
You’re right, I didn’t have to. But I love this industry. Robert Greenberg certainly didn’t have to start Skechers after L.A. Gear. He could have just relaxed. But he is so driven—as much today as when he started. It’s just something about this industry that drives us. Besides, I don’t play golf and I don’t like to fish, so I had time on my hands—and that’s despite still managing my celebrity branding company, Universify, [represents Jennifer Lopez, among others], serving on several industry boards, leading business lectures and consulting for a few athletic brands. I was also offered several jobs by headhunters where I could go back to being an employee with a salary, benefits, a 401K, etc. But that didn’t really interest me. That’s when [in early 2011] the Singapore government presented a tax-free opportunity for me to launch a company headquartered there. That’s how the whole process of launching IBPL really started.
Was there ever a time you thought you wouldn’t get back into the shoe business?
After GBMI closed, I was very down for about a year and I wasn’t quite sure what I wanted to do or whether I wanted to start another company again. It was the first time that I had ever failed at anything in business. It cost me a lot of money, many employees who had become friends lost their jobs and distributors who got rid of other brands to carry Diesel had to scramble to replace that business. We were in 150 countries and doing very well at the time. There wasn’t a single country where our shoes were being discounted. We had 11 shoes doing 1.5 to 2 million pairs each annually. So that hurt a lot of people. While the big retailers replaced Diesel—and I doubt they cried all that much—many independents got especially hurt. Unlike Nordstrom, whose strength is a clientele that comes to them because of who they are, in many cases Diesel was a driving factor as to why people were shopping those independent stores.
What are the advantages of being based in Singapore?
The corporate tax reasons aside, Singapore is an ideal operating base—I’m only an hour-and-a-half flight away from my sourcing base. I didn’t move here thinking about that, but it’s been a big, big help. I’m also in the middle of the fastest-growing market in the world, and it will continue to be for at least the next 15 to 20 years. Two-thirds of the world’s population lives within a four-hour flight of Singapore and nearly 70 percent of the global GDP will be in this region. Asia now represents the single largest market for any footwear brand. Even the luxury market is now heavily entwined with this region. The moment Indians or Chinese stop buying luxury goods, many of those companies start reporting bad quarters. It’s become that important of a market, and I’m in the middle of it all.
Is IBPL meant to be GBMI 2.0? Is that the goal?
First let me say, back when I started GBMI, I never once said we would one day grow to be $500 million in size. That said, I want IBPL to be successful and known as a player in the industry. I’ve had success being an employee of various companies, I’ve had success with GBMI and now I want to try to do it again. Now, whether that translates to a similar or bigger-size company than GBMI in terms of dollars, I cannot predict.
Is any aspect of this partly to prove your former Diesel licensor wrong?
No, not at all. I’ve actually come to the point where if I happened to run into [Diesel Founder Renzo Rosso], I would thank him for the opportunity. He awarded me the global license for Diesel footwear when I didn’t even have a company, basically. It was an incredible opportunity. So if I met him today, I would just say thanks. Shame it didn’t go forward, but it was incredibly fun while it lasted.
How many brands do you envision in the IBPL portfolio?
I never think along those lines, the same way I don’t think Proctor & Gamble or Unilever think in finite terms of how many brands they can handle. As long as a brand has potential and there is an opportunity in the market to exploit, that will determine the number of successful brands that we have in our portfolio. I expect that we will have at least three or four brands in our portfolio by this time next year. But I just don’t want to take on any brand. I can be a little more selective this time around. It has to fit a niche. It’s got to be unique and fill a market opportunity that’s not being adequately covered today in the upscale distribution channels. We first ask ourselves: what can we make of this brand? If all we can make of it is something that already exists in the market, then there’s no reason to do it. I don’t think the world needs just another brand in footwear.
Speaking of which, what makes Ccilu unique?
Ccilu is like an electric VW Beetle. We are bringing modern technology to street fashion via our lightweight and comfortable CciluCell technology. Our product is very technical, but we don’t sell that aspect because we are not selling performance athletic. I’m not seeking to go head-to-head with Nike, New Balance, Asics, etc. I’m quite happy saying we will be street fashion, but the product must look good and still perform.
Who is the Ccilu customer?
Basically, I want all the cool kids who are tiring of seeing all the uncool kids wearing [Converse] Chuck Taylors and Vans. They are now wearing the same shoes as the uncool kids and I believe there have always been leaders who want to wear different stuff.
Is the Ccilu customer similar to the Diesel customer?
Not exactly. This customer is healthier and stays away from drugs. Diesel was much more underground and involving a club scene. Ccilu is a much cleaner kid who wants to look different but doesn’t necessarily want to wear Lacoste paired with Nike Flyknits. They want something different, which is what we’ve always done. Our products have always been unique, but we make them commercial. The key to great product is to make unique shoes that are still commercial. Designers can sketch completely outlandish shoes that might win an award from ID magazine, but that doesn’t make them successful at retail. What Nike does day in and day out is push the envelope creating new designs, but it’s always hugely commercial.
Ccilu potentially represents a much bigger target audience than Diesel, correct?
Yes, Ccilu has a much broader appeal. We’re not strictly luxury. We can sell it to Finish Line. We’re also in Macy’s, Nordstrom, Sportie L.A., Bloomingdale’s, etc. But the orders are still miniscule. We’re just been tested in these doors. Our first delivery to the U.S. was only this July. [Sales and distribution in the U.S. are being handled by LJP Int.] I’m happy to report that we’re getting reorders. It’s OK. I’m not going to lie and say it’s flying out like Diesel eventually did. But it’s been good enough that some of our retailers are increasing the number of orders for next season.
How much might your past history play into this initial reception from retailers?
My past allows me to get a foot in the door. But then the product has been unique enough for them to pick it up, look at it and say, “You know what, this is interesting. This is different.” It’s different yet commercial. My point being that retailers aren’t buying Ccilu just because they might have bought Diesel from me in the past. Today, that buys me dinner or a coffee and “how’s the family?” The days of wining and dining to get an order are long gone. Fortunately, not a single retailer that has seen us has said they don’t know what the hell we are trying to do here. The product has caught their attention. And note that when we launched Ccilu in 2012 [in Japan] the brand was 90 percent strictly injection-molded styles. Today, maybe it’s only the outsole or a vamp that’s injection-molded and the rest consists of hybrid materials like leathers, nylons and knit fabrics. Along those lines, I’ve always felt that, at the end of the day, product makes the brand and it’s not the other way around. So even though Ccilu is still relatively unknown, it doesn’t bother me because I believe in our product. I’ve helped launch L.A. Gear and Skechers worldwide when both were unknown outside the U.S. I’ve been at the start of many new brands, and each time I’ve had to explain what the brand was going to be and let the product do most of the talking.
Can we expect a similar approach to the launch of the (yet to be announced) health and wellness brand?
I believe that brand will be the first premier fitness shoe company since Reebok and Ryka. That’s the pitch and what people will see in the product [launching for Fall ’16]. It will consist of men’s and women’s styles spanning their needs for cardio, yoga and Pilates workouts. This brand is going to be much more than an aerobics brand; it’ll be a health and fitness company, only with our element of fashion appeal. Health and fitness is a huge market. Today, everybody wants to be healthy and fit. And this brand is already huge; they sell a wide range of nutritional products and have instructors and training programs. And now it will have the footwear and apparel aspects to go with it all.
Where do you envision IBPL in five years?
I want us to be recognized for making great products. Like at GBMI, making lots of money isn’t the primary goal. What really gives me great enjoyment is being in an airport, for example, and seeing one of our products walk by. Or when people in the industry compliment me for a great design. That has always made me feel good, whereas when someone said, “Hey, you guys are making tons of money…” You know what, that didn’t matter as much to me. Besides, how could you possibly say that when you look at Nike’s numbers? It’s all relative, right? But when someone says they love our product, it means the world to me.
Product is king.
I agree. I believe whether it’s a brand or a retailer, you have to offer great products. If you do, you are going to get clientele. Think of it this way: If you own a restaurant and just serve omelets and burgers, it’s probably not enough today. You’ve got to have something special on the menu as well. That’s why I believe there’s still room to open stores, but they must be destination stores like Colette in Paris and Atmos in Tokyo, which stand out because of their unique offerings. Similarly, as long as you can create great product you should be able to launch new brands. Where were H&M and Zara 15 years ago? It can be done.
Speaking of menus, yours is pretty full with the launching of a handful of brands, managing your celebrity branding firm, lecturing university students… How do you find enough time in the day to do it all?
You find the time if you are enjoying what you are doing. It’s like when you find a great book and you can’t put it down. Whenever you hate the work, that’s when you are repeatedly looking at your watch hoping it will end soon. Along those lines, the lectures are one of my passions.
What are you telling your students these days?
A lot of my lectures aren’t about footwear and apparel, specifically. It’s more about international trade. Specifically, how much things have changed and how big the market has become compared to what it used to be. When I started in business we couldn’t ship shoes to China or India, for example. The only open market was Japan and they had quotas. Pretty much everywhere else we had to license the brand and there were restrictions to trade. You couldn’t move product around. By the time something became successful in the U.S. it would take about one year to get to Europe and there was more lag time for everywhere else. Today, thanks to the Internet and a loosening of trade restrictions, it’s nearly overnight. Everybody sees and hears about the latest trends. A cool kid in Japan looks the same as a cool kid in Paris and a cool kid in New York.
Is that necessarily a good thing?
It takes away some of the regional diversity. Local brands, retailers and uniqueness of products have suffered because of globalization. When I used to travel from country to country, I could always pick up some interesting shoes, clothing or books. Today, those differences are getting smaller and smaller. A store in Japan now looks identical to a store in New York. But I don’t think Nike or Skechers are crying about it because now they can truly globalize.
Are you still having fun?
I am, although there are days I have less fun than others. But as I said to you at the beginning of this conversation, this is what I do. I love the shoe and clothing businesses. They are the most dynamic and incredible industries. Where else does the whole product cycle have to change every six months? Not in pharmaceuticals and certainly not in anything my father wanted me to do. Candy bars, soda, cars…those industries feature plenty of great companies and brands, but they don’t have to come up with new items every six months. •