Glen Barad is a dyed-in-the-wool product person. He’s an industry lifer who made his bones working on the private label side of the business for decades before crossing over to the branded world with the launch of Taos 12 years ago. His product-first principles (i.e. no detail is too small) have served as a guiding light, leading to the brand’s steady growth that, of late, appears to have reached a tipping point with double-digit sales gains the past few years and 2016 going down as the best in its history despite a difficult retail climate. Taos’s recent run of success will require a move this summer—its second in the past three years—to nearby Carson, CA, to accommodate the increasing need for office and warehouse space.
“Our customer has been coming back to us, and she’s bringing her family and friends,” Barad says when asked what fueled the recent growth. “She really likes what we are doing, and that’s the main reason for our success. We’re capturing a great fan base.”
Indeed, Taos has arrived. No longer a hot item or seasonal business, the brand has become a year-round cornerstone for many of its retail partners. Perhaps the most impressive facet of Taos’s growth is that it’s being achieved through a distribution platform of primarily better independent and specialty chain brick-and-mortar retailers. In the age of Amazon and the recent death spiral of physical stores across all tiers and formats, the brand’s recipe for growth runs counter to conventional industry wisdom. In fact, many industry pundits would argue it’s statistically a long shot or even a fool’s errand.
But Barad is nobody’s fool when it comes to the shoe business, and Taos is living proof. He’s confident the brand can continue to grow by adhering largely to its current distribution strategy. For starters, he says there are still plenty of retailers in existence, an opportunity that is magnified as other vendors shift their attention to larger volume, online retailers and direct-to-consumer (DTC) efforts. Their neglect is Taos’s gain. “When other key brands choose to move out of the better independent and specialty retail distribution channel, there are openings for us,” he says, adding, “We’re just grabbing market share.” And while the numbers might not be big on a business-by-business basis, they add up. More importantly, for a brand like Taos, he says those channels are the preferred choice. “If you are looking solely for big numbers, then you are going to have to move elsewhere,” he suggests. “But if you are looking to build a full-price, full-service brand, then I believe we are in the right channels.”
Barad has been determined since founding Taos to build a meaningful and long-lasting consumer brand. It’s doesn’t happen overnight, and there are no real shortcuts. Barad says it has required years of hard work, dedication, talent, (lots of) reinvestment, perseverance, controlled growth and developing and maintaining trusted partnerships with its retailers. But none of it would be possible if the product wasn’t right in the first place. Barad believes Taos has built a loyal following by delivering comfort, quality and style—difference makers at the point of sale. “You have to give the consumer a real reason to buy your shoes,” he says. “It can be a fresh last, color, material or little detail—those are the things that add up. If you are vanilla, then there’s not going to be that much interest in what you do.”
Barad describes Taos’s overall design as “understandably fresh.” Think trend right but not over-the-top. It’s versatile, casual, lifestyle fashion. And while that might sound vanilla, Barad and his product team know the subtle details that can turn an ordinary shoe into an extraordinary one. “We’re just so product-focused, and all those small details are what we constantly re-invest in,” he explains. “We’re always searching for new ideas that we think that our consumer will like and our distribution channel will embrace.” Barad adds that Taos is relentless about improving and updating its collections each season. It’s a team effort that involves a lot of role playing. “It’s very important to the core of who we are, and sometimes it might not make sense when a buyer sees it for the first time, but we’ve probably been working on that style for at least six months and, in some cases, more than a year,” he says, noting that timing is key. “You can be too late or too early. Is your customer ready for it? What else is in the market? There’s just so much to it, and we are fortunate to have a pretty good track record,” he says.
It helps that Barad is extremely hands-on and a skilled product person. Unlike a lot of top level executives, the shoes must pass through his hands before ever making it into the line. It’s also another example of how Taos operates: No one is too big or important to involve themselves in the tiniest details. “We are very entrepreneurial in spirit and not driven by accountants,” he says. “We consider ourselves product people, and having the right, great, understandably fresh product is more important than ever before.”
Much of what Barad says about running Taos involves common sense. There’s no bombast when it comes to branding strategy or market analysis. For example, he says, “If the consumer is happy and the retailer is happy, then we’re happy.” Another gem: “I don’t really care about an order. But I love a reorder, because then I know it’s really working.” Of course, it’s not that simple or easy. But sometimes overthinking matters can result in losing sight of that basic formula for success for any full-price, full-service brand. Taos, in that regard, is refreshing proof that it can still be done the uncomplicated way. Barad is proud yet humble about Taos’s rise to an important brand for its retail partners. “We’re just a bunch of street kids really, just doing what we do,” he says. “It’s a different way to approach this business perhaps, but we’ve put together a good team and we’re in a nice growth mode. Maybe it’s just our time.”
Barad is excited by the prospects for future brand extensions and continued (controlled) growth. Just don’t expect a lot of fanfare or big brand mandates. “We’re trying to build a brand as best we can by being as transparent as possible and without messing around,” he says. “We want to do well, but not just because we show up. We want to do well because our product is right and the consumer wants to buy it and continue to buy it. We have to make sure what we do brings them back.”
The brand I hear cited of late as performing well in the face of strong retail headwinds is Taos. Is it, as you modestly suggested, just Taos’s time?
The brand is hot overall and perhaps most encouraging is that the customer is now going into stores and asking for it by name. When you hear that as a brand builder, you feel pretty good.
Has it been a particular style or category?
While there are certain categories that are stronger than others, she has been buying from every category. In general, our shoes are comfortable, supportive and they look good. They don’t look frumpy. Maybe we just have some pretty good eyes in our building that really understand what they are doing.
Exactly who is the Taos woman?
I don’t see her as being overly specific as we have a pretty wide demographic that ranges from fashionable boomers to young soccer moms. On the one hand, I wish we had something for everybody. But I also see how being more focused with our collections and target customer is beneficial, too. We are learning that sometimes less is more. Specifically, if we can be more focused it will benefit us in the mid and long term. That way we will gain more of a brand identity. Iconic brands, for example, are known for certain looks just by sight. I would love for Taos to get the point where someone walking down a street sees a shoe and immediately says, “That’s a Taos.”
It takes time, not to mention talent, skill, dedication…
It does. But it’s not like we just showed up and this happened. It’s been 12 years of a lot of hard work. We have a very good team. In this business, you are either growing or shrinking. Companies rarely stay the same size. It’s the same thing if you are playing a game, your lead is either decreasing or increasing. I always believed that if we could just maintain our business through the recession, we’d be able to grab a lot of market share. Fortunately, that’s been happening of late.
Primarily through brick-and-mortar retailers, no less.
We are finding a good amount of growth in those channels. The current retail climate has not been affecting us as negatively.
Yet many vendors are turning their focus away from those channels. Why?
I think you have to ask: Is the company run by entrepreneurs or accountants? Are you building a brand for the long term or chasing the money? We all have opportunities and options, and it’s hard to be everything to everybody today. At Taos, we’ve made a distinct choice: focused distribution in better independent and specialty brick-and-mortar stores, a strong MAP policy, truly partnering with our retailers and product, product, product. If we are going to build a strong brand, I believe it has to be done through those channels. Now I don’t know what tomorrow may bring and we could change our distribution if retailers no longer supported us. But right now, they need and want vendors like us, and it’s a conviction of ours to support them in return.
Some say those channels are no longer able to support meaningful growth.
I don’t believe that at all, and there will still be shoe stores going forward. But the ones that survive are going to have to be fabulous at service, build relationships with their customers, integrate into their communities and work with brands that are true partners who will protect them. I believe it’s going to be the only way for them to survive.
So, essentially, acting in the opposite manner as many retailers that have gone by the wayside recently.
There’s no service in those stores, so you might as well shop online. But if there is service from someone who is knowledgeable, courteous and you may even happen to know…We’re all human and I believe those types of relationships are important. Some will argue that it all comes down to price, but I believe good service and selection and the ability to shop local can be important factors in where consumers ultimately decide to shop.
Otherwise, you might as well buy it online, especially if you can find it for less and the shipping in free.
I was speaking recently with a friend who is a movie producer and I asked him how his business is doing, realizing that you can just as easily stream a movie at home today. He said business is down a bit but still healthy overall—people are still going to the movies. But he noted that they are going to the best movies. They are going to something that they really want to see and not just because it’s a weekend. So it’s product, product, product. It’s the same with regards to making a shoe. I constantly ask my team: Who is this for? What are we doing this for? Who are we trying to hit? Why will they want to buy it? We have to make the best product that we possibly can. And those stores where it can be found have to be places that consumers want to shop—the service, setting and selection must make the trip worthwhile. Now those channels will probably shrink overall, but that’s OK because, again, I don’t think you can be everything to everybody. If consumers like what you’re doing, then I believe you can survive and even grow. We believe there’s a very big opportunity for Taos in a very tumultuous time.
It wouldn’t be nearly as tumultuous if MAP policies were adhered to and policed better.
Left unchecked, it hurts our retailers and it erodes our brand. The ability to find a lower price online than at a brick-and-mortar store instantly presents a dilemma for consumers, and most choose the option to save whatever amount they can. But they wouldn’t if they couldn’t. That’s one of the reasons why we’re so committed to trying to make sure everybody is on the same playing field when it comes to price. Today you must invest in policing your MAP policy, particularly the anonymous online sellers. It’s a shame that we have to, but we have no choice as a brand. And we won’t quit. We will find you. We will take whatever actions we need. If it means cutting that account off entirely, we will.
Is it true that Taos has hired a private investigator to root out MAP policy violators?
We did, in fact. And while I would much rather direct the money we are spending on protecting our MAP policy to charity or in further support of our retailers, that’s just one of the costs of doing business today.
Another area of growing tension between vendors and retailers involves DTC efforts. What’s Taos’s position on that channel?
We offer the ability to shop direct on our site but we encourage customers to shop locally via our dealer locator link. We are also investing in new software for our site that we plan to relaunch this summer to better assist the customer in finding a retailer that’s close to them with the particular style, size and color that they want. At the end of the day, the most important component in this equation is the consumer and our goal is to support our retailers to take care of them.
There’s a middle ground where both sides can coexist?
I believe so. Because, for example, there are some consumers who prefer the DTC option and we don’t want them to leave our site disappointed. We also don’t want to direct them to a retailer that may not have that particular item in stock and is then, possibly, presented three options from other brands that are in stock. That can annoy the consumer who wants to buy our brand. (We’re not overly thrilled about it, either.) The big picture being, no matter what, we can’t disappoint our consumer and we have to do whatever we can to ensure that they are able to buy what they want. Having said that, we believe that’s best achieved with the help of our retail partners.
In response to those brands pursuing DTC programs aggressively, some retailers are looking at private label and brand exclusives as alternatives. As a former private label exec, is that an effective strategy?
First off, if a brand isn’t allowing a retailer to compete fairly on MSRP then they can’t continue to buy from that brand. Maybe another brand that doesn’t is an alternative? As for a retailer succeeding at private label, that depends on who, how big they are and how scalable that segment is. It’s not easy. No one goes from nothing to a huge private label business overnight. There are quality control issues and, for example, if something sells well, how quickly can you get it back in stock? I would recommend to start with a little test and see if it works. If it does, then try a little more. It’s the same approach for Taos. If it works, then we try a little more. At the end of the day, it can’t be just about price. If it is, then you are probably not going to succeed. It has to be about the product, first and foremost. If you happen to be a great eye, then maybe it’ll work. And while I believe the majority of consumers prefer to buy name brands, I encourage retailers who are curious to give private label a shot. Sometimes it’s just fun—going to Micam, picking up 100 pairs and seeing what they might mean. It’s not going to drive your business, but how cool is it to have your store name on the label?
Nothing in this business is easy, but you have to at least try new things.
That’s why an entrepreneurial spirit is nice. But, I agree, none of this is easy. If you are doing a start-up, for example, are retailers as likely to give you a shot today? And if they do and the shoes don’t sell well, will they be able to pay for them? That’s why start-ups tend to go away. Personally, I would hate to start a business in this climate. It’s just a tough environment and a lot of retailers are scared. But I would also argue that if you don’t try new things, you are going to get hurt in the long run. You can’t be afraid to fail. Vendors also need to try new things, and retailers should be willing to give tests and not just send it back if it doesn’t work right away. That’s a disincentive for vendors to test new concepts. If we think a new item makes sense and we explain why, then why not test three colors and 18 pairs and see what happens? If this test doesn’t work, just mark those down, move them out and we’ll move on to the next thing. Because, as often has been the case with Taos, you’ve tried three other tests that worked and you went on to sell a ton of pairs. Unfortunately, the overall mentality isn’t like that today if a test doesn’t do well. We need work together more in this regard.
Is there more confrontation between vendors and retailers these days than usual?
Perhaps. But this is a blip in time. The industry continually evolves and you just try and find a way to adapt and survive. Whatever the outside factors may be, we must always keep focus on trying to make our retail customers and consumers happy. The rest usually sorts itself out. That’s why we don’t obsess over dollars, pairs, etc. We just want consumers to come back to our brand. We also want retailers to not only love our shoes but also love working with the people in our office. To know that they are there to truly help them. In return, maybe they will feel more indebted to do the same by us?
Common courtesy and sense, really.
Yes. But we are living in a unique time and you really have to think long and hard about the business. You can’t just dial it in anymore. It’s not just about numbers. It’s passion about your store and, as a vendor, passion about your product. It’s passion about making the consumer want to come back.
Where do you envision Taos in five years?
While we take it one day at a time, we envision a nice growth trajectory because, for starters, we’re sill relatively unknown. This has all been grassroots, to date. As we continue to develop and grow our fan base and retailers continue to see our shoes turn well, I think we are going to grow nicely over the short and midterm just because of those factors. We also have several additional opportunities for growth, like expanding into men’s and kid’s categories as well as accessories. Overall, we see a huge amount of opportunity going forward and hopefully we’ll get there when we get there. We’re in no rush.
What do you love most about your job?
The relationships. If I’d been an accountant, sitting in some office in Century City, I’d probably only know my coworkers and those in my neighborhood. Because of this industry and our company, I have relationships with people all over the world. To be able to visit our retail partners in any state or meet with our agents and factory owners in Spain, Portugal, Italy, China or wherever and maybe have dinner…How great is that? That’s the beauty of this business.