History of Skechers

Founded in 1992, Skechers U.S.A. Inc. is one of the fastest growing footwear companies in the United States, focusing on trendy, casual styles aimed primarily at men and women from the ages of 19 to 40. With 1998 sales at almost $400 million, the company designs and markets more than 900 different styles of shoes, which are sold in major department stores such as Macy's and Nordstrom as well as in 38 of the company's own freestanding boutiques. Skechers's shoes are produced overseas at factories in China, Mexico, Brazil, and Romania, which allows the company to keep the prices of its designs below those of its competitors, and are designed to appeal to younger, active, fashion-conscious consumers. Skechers devotes much of its creative energy and revenue to flashy, highly visible ad campaigns a strategy that has helped the company grow within a matter of years to a multimillion dollar business.In 1990 the hottest selling shoe brand among young American women was called L.A. Gear, a label created and owned by a veteran of the retail industry named Robert Greenberg. Founded in 1983, L.A. Gear by 1990 was grossing more than $900 million in sales and, with its neon tennis shoes and overtly feminine image, seemed to be an unstoppable and unique presence within the industry. After a series of missteps, however, L.A. Gear took a sudden turn for the worse, and by 1992 Robert Greenberg, along with his son Michael, found himself without a job, forced out of the company he helped to create. Greenberg was no stranger to the unpredictable vicissitudes of the retail trade, however: The executive began his career in the 1960s selling wigs to beauty shops in Boston and by the next decade he had moved on to importing designer jeans to sell at the department stores Filene's and Jordan Marsh. At the end of the 1970s Greenberg moved to Los Angeles, where he founded a chain of roller skate stores, his first entré into the footwear industry. His first big break came in 1982, when Greenberg licensed the image of the film character E.T. to appear on shoelaces--a move that netted him $3 million in less than two months. This success gave him lasting clout and recognition within the retail trade, and it was with that revenue that Greenberg founded L.A. Gear. After Greenberg's departure from L.A. Gear in 1992, he immediately founded Skechers. Originally intended to be a distributor of Dr. Martens shoes, a British label made by R. Griggs Ltd., Greenberg within a year began to focus on designing and marketing his own brand. Utilizing the experience he gained through L.A. Gear, Greenberg began marketing Skechers primarily to young, hip consumers, although unlike L.A. Gear the focus was this time not on women's athletic wear but on casual, stylish street shoes for men. In addition, although Nike had a firm hold on men's athletic wear, there was no large, well established company against which Skechers had to compete in the market for men's street shoes, and this provided Greenberg the opportunity to help create and support a new and burgeoning niche market. Aside from being the largest distributor for Dr. Martens shoes, Skechers in 1992 also owned and marketed the labels Cross Colours, a brand that helped put urbanwear on the retail map, as well as Karl Kani and So. L.A. Although all three of these labels were successful, by 1993 Greenberg saw more financial opportunity in the development of his own label, and so he began consolidating his fiscal and creative resources to focus on Skechers. As a result, the labels Karl Kani and So. L.A. were discontinued by 1995 Cross Colours was discontinued not long after that and was sold a few years later. Within a year of Skechers's signing of a licensing agreement with R. Griggs Ltd., the makers of Dr. Martens shoes, the two companies had a falling out, with Skechers accusing R. Griggs of failing to deliver on orders for its increasingly popular merchandise. Skechers filed a complaint against R. Griggs for breach of contract, and a complicated array of countersuits ensued. By 1993, only one year after the two companies had formed a partnership, Skechers no longer served as a distributor for the Dr. Martens brand and had to rely on its own label for survival. Skechers U.S.A. had its first big break under its own label in 1993, with the introduction of a design known as the 'Chrome Dome.' Appealing to both sexes, this shoe was an urban street boot that reflected the increasing popularity of the 'grunge' look among younger consumers: the 'Chrome Dome' shoe was made to look well-worn and scuffed at the heel--much like the stone-washed, pre-torn jeans that were so popular at the time--and presented an image of tough androgyny. The 'Chrome Dome' design proved Skechers to be a company well aware of the quickly changing trends among young consumers, and the label soon was picked up by such stores as Foleys and Nordstrom.