APP Adrian
A-List Customer
- Messages
- 364
- Location
- Toronto
I know =P. That's how businesses make money.
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I know =P. That's how businesses make money.
D
Deleted member 16736
Guest
AE was sold for $200 million, and based on that valuation, I'd say they had adapted to market conditions nicely under their previous owners, who were also venture capitalists. Maybe Goldner Hawn will buy it back for $100 million.
verdeo
New in Town
- Messages
- 25
- Location
- SE Wisconsin
As a somewhat new person here at TFL and somewhat new to AE, I am surprised to read these negative comments. I've been in Milwaukee for most of my career and have been aware of AE just a 20 minute drive north of us. I've had to wear tails, tuxes and dark suits nightly for my livelihood for over 50 years, so dress up is not new to me. Perhaps dressing up properly with attention to detail is new. Having a black pair of refined shoes was not a priority though, for a musician on stage, as the uniforms take a beating day after day.
In retirement, I am finally able to explore some of our treasures in SE Wisconsin, so ran across a timely sale at AE in Pt. Washington this past spring. I have always worn cap toe shoes in my profession, yet never had the time to cultivate an appreciation for well made shoes. I got by with whatever was available in stores and was cheap.
After seeing the quality and beauty of some examples of AE Park Ave. and Fifth Ave., I ended up with two pairs one black and one merlot. Perhaps I have missed the sweet spot in my lifetime with this company, but I am thrilled with the quality vs. price of these shoes that I purchased, to say nothing of the exact sizing for my 14 E feet.
There aren't many places I can go for such a great fit, in fact, I've been lucky my whole life ...finding a size 14 at all.
So, I am one very happy customer and a convert to quality in a shoe that I had never experienced.
The thought that AE is phasing out classic shoes is not what I've experienced at all. The plus is they are just a few minutes away!
In retirement, I am finally able to explore some of our treasures in SE Wisconsin, so ran across a timely sale at AE in Pt. Washington this past spring. I have always worn cap toe shoes in my profession, yet never had the time to cultivate an appreciation for well made shoes. I got by with whatever was available in stores and was cheap.
After seeing the quality and beauty of some examples of AE Park Ave. and Fifth Ave., I ended up with two pairs one black and one merlot. Perhaps I have missed the sweet spot in my lifetime with this company, but I am thrilled with the quality vs. price of these shoes that I purchased, to say nothing of the exact sizing for my 14 E feet.
There aren't many places I can go for such a great fit, in fact, I've been lucky my whole life ...finding a size 14 at all.
So, I am one very happy customer and a convert to quality in a shoe that I had never experienced.
The thought that AE is phasing out classic shoes is not what I've experienced at all. The plus is they are just a few minutes away!
Richard Warren
Practically Family
- Messages
- 682
- Location
- Bay City
And I still can't understand why you object to them adapting successfully. Would you rather they adapt unsuccessfully? Then they would be gone and you would have to complain about something else.
I looked at the website and saw a broad range of traditional shoes that seemed to be reasonably priced, as to quality I haven't bought any in the past few years and cannot speak. I did buy eight pairs of their competitor's shoes in the last couple of years and two pairs had to be returned and several others had issues that would not have passed ten years ago. American made merch requiring handwork has gone down across the board if you haven't noticed, for reasons certainly beyond any one firm's control.
They don't (can't for the money people want to pay) make em like they used to. I'm happy that some folks still try and come pretty close. I hope they make money at it so they can continue.
Guttersnipe
One Too Many
- Messages
- 1,942
- Location
- San Francisco, CA
To reiterate, AE's new owner are taking a far more radical (and risky) approach than the previous owner. There are a number of case studies, such as Johnston & Murphy, Florsheim, Burberry, Coach, Bulova, Brooks Brothers, in which similar, radical brand revamp strategies have had mixed success. However, the previous, more restrained approach did seem to work; I submit the 2006 purchase price of $100 million and 2013 sale price of $180 million as evidence of this fact. Alden has also grown significantly in recent years using a similar, incremental expansion of sales and distribution by expanding its customer base to a younger generation that prizes artisan items, and is willing to pay a premium for such items. So the questions becomes, under Brentwood's management, will AE crash and burn or sustain?
- Messages
- 16,870
- Location
- New York City
The challenge is growth - market share, revenues, units moved - versus sustaining the quality and particulars that made the brand a legacy brand in the first place.
It is very hard to grow a brand in a mature market with a traditional product at the rate that Private Equity or even most public companies want to grow without changing many things about the product. Is it possible that by better advertising, better marketing (direct, social, digital) etc., a company like Allen Edmonds could expand by selling more of its existing product and by thoughtfully expanding its offering in a manner consistent with its reputation and value offering - yes? But is that likely, easy or something that can go on for years - probably not.
So the choice is to remain a smaller niche traditional company that can have some growth spurts (like Alden) with modest product line expansion or to try something more radical for more aggressive growth. Unfortunately, the "more radical" is often wholesale change and going down market as the down market move allows the company to benefit from the good will - the reputation for quality it has built up over time - as customers get excited to buy a "great brand's" products at a lower entry point. Coach and Cole Haan have done this successfully if you define success as greater market share and growth for a time. But in the end, what they really did was cash in their old name for a period of growth, but now their names no longer have the value they once had and they are just another seller of a middling product.
I have nothing against Private Equity, public markets, growth, competition, etc., I'm just pointing out that it is hard for a niche, old-line company offering a quality product in a limited market space to grow fast enough to satisfy the demands of Private Equity or public markets. Those companies do better if the are privately owned by a family or a small group of investors who want to maintain the traditions of the company even if it means less growth. Are there exceptions - sure - sometimes a big company buys a smaller one and nurtures it, but that is always tenuous because as management at the parent company turns over, they will look at the small company and start thinking: hmm, I wonder if we could get more growth out of this little gem?
It is very hard to grow a brand in a mature market with a traditional product at the rate that Private Equity or even most public companies want to grow without changing many things about the product. Is it possible that by better advertising, better marketing (direct, social, digital) etc., a company like Allen Edmonds could expand by selling more of its existing product and by thoughtfully expanding its offering in a manner consistent with its reputation and value offering - yes? But is that likely, easy or something that can go on for years - probably not.
So the choice is to remain a smaller niche traditional company that can have some growth spurts (like Alden) with modest product line expansion or to try something more radical for more aggressive growth. Unfortunately, the "more radical" is often wholesale change and going down market as the down market move allows the company to benefit from the good will - the reputation for quality it has built up over time - as customers get excited to buy a "great brand's" products at a lower entry point. Coach and Cole Haan have done this successfully if you define success as greater market share and growth for a time. But in the end, what they really did was cash in their old name for a period of growth, but now their names no longer have the value they once had and they are just another seller of a middling product.
I have nothing against Private Equity, public markets, growth, competition, etc., I'm just pointing out that it is hard for a niche, old-line company offering a quality product in a limited market space to grow fast enough to satisfy the demands of Private Equity or public markets. Those companies do better if the are privately owned by a family or a small group of investors who want to maintain the traditions of the company even if it means less growth. Are there exceptions - sure - sometimes a big company buys a smaller one and nurtures it, but that is always tenuous because as management at the parent company turns over, they will look at the small company and start thinking: hmm, I wonder if we could get more growth out of this little gem?
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