Known for its hands-free, slip-in style, the shoe company caught the attention of many and became the third largest shoe company in the world by sales. Although the brand will not achieve coolness status that can drive demand, it is on track to reach $10 billion in net revenue by 2026.
Skechers has done that by capturing a part of the market that its competitors have largely ignored. Nike has superstars. Hoka has taken advantage of hardcore runners. Tech people are willing to pay for On’s shoes. Skechers is popular with retirees looking for comfortable shoes and families looking for something more affordable for their kids.
“It’s almost the opposite of what the big brands are doing. We’re just a different player,” Skechers finance chief John Vandemoer said in an interview.
Skechers isn’t flashy. Executives say they are in the “foot cover” business and are working to make those covers comfortable and inexpensive. Its children’s styles cost about $50, and the brand doesn’t sell limited editions that cost hundreds of dollars. However, Goodyear rubber makes pickleball shoes for $115.
The company generates about two-thirds of its sales outside the United States. Skechers may use a franchise system instead of opening its own stores, meaning it would take years before investing in its own operations overseas. Skechers executives say Skechers is bigger than Nike in India.
“People try to fit us into the Nike model or the Addi model, but that doesn’t work. That doesn’t mean our model isn’t successful,” Vandemoer said.
Skechers also began making soccer cleats and basketball sneakers, and developed a superstar following. They added Bayern Munich striker Harry Kane to the roster in 2023 and signed Philadelphia 76ers star Joel Embiid last year. “We acquired them because the market wasn’t taking them,” said David Weinberg, Skechers’ chief operating officer.
The company reported sales of $8 billion in 2023, up from $1.8 billion about a decade ago. Investors are paying attention. Over the past five years, Skechers stock has nearly doubled, while Nike and Adidas stocks have fallen more than 25%.
take part in a race
Skechers has been run by founder Robert Greenberg for 30 years. The 84-year-old CEO runs the business from an office in Manhattan Beach, Calif., and his son, Michael Greenberg, serves as president.
The father-son team does not participate in quarterly earnings calls, and the CEO has not appeared on major media outlets in about a decade. In 1989, Robert Greenberg sued American Airlines for publishing a photo of himself in an in-flight magazine and then agreeing to an interview on the condition that the photo not be published.
Skechers did not make Greenberg available for this article.
The entrepreneur moved to California in the 1970s and got his start in the shoe industry by selling ET brand shoelaces. Greenberg and his son turned that business into LA Gear, which became a large-scale athletic shoe manufacturer endorsed by celebrities such as Michael Jackson in the 1980s.
LA Gear ran into trouble when it entered the performance market by sponsoring athletes like Wayne Gretzky and Joe Montana. Mr. Greenberg was eventually forced out of the company he founded. Analysts said the company expanded too quickly at the time.
Skechers started in 1992, but it took decades for sales to take off. Weinberg, Skechers’ operations director and former LA Gear executive, said Skechers needs time to invest and grow its global business.
Skechers found some success in the 2000s as a celebrity ambassador, including Britney Spears, and then in the early 2010s with its shape-up walking shoes. Weinberg said that as the company expanded, its results fluctuated a bit, leading people to think of it as a boom-or-bust business.
“Today, for us, there is no make-or-break shoe, category, customer, or geography,” Weinberg said.
fill the gap left by a rival
Skechers has shifted into performance in recent years to fill the void left by Nike and others.
The business was helped by Nike’s decision to exit many low-income retail stores and focus on direct-to-consumer sales during the pandemic. Nike has also reduced sales of styles that sell for less than $100.
Nike sued Skechers in late 2023, alleging that the rival company was infringing on Nike’s patents regarding its Flyknit technology in seamless shoes. Skechers countered that the suit is baseless and an example of Nike using its own funds to stifle competition. The lawsuit is pending.
Skechers executives said they are still more interested in making comfortable shoes than signing the most expensive athletes. The company has a section on its website dedicated to comfort technology.
Maria Afsharyan is a convert. A real estate agent in Montclair, New Jersey, only wears sandals and had given up on sneakers because he couldn’t find sneakers that didn’t hurt his heels. Last year, her chiropractor recommended Skechers.
“I don’t even think about my legs anymore,” Afsharian said. Afsharian, 59, said Skechers Go Walk shoes have helped her become more active and avoid blisters. I can’t stop,” she said.
Skechers works with designers, street artists, celebrities and more, but relies on limited release projects because executives don’t believe limited releases generate the same amount of hype or awareness as other brands. He said he had not.
“That’s not our real consumer. That’s not what anyone is asking us to do,” said Vandemoer, the finance director.
Inti Pacheco inti.pacheco@wsj.com
