Deckers CEO Doug Otto provided quite a bit of detail on the Teva brand at the Piper Jaffray Consumer Conference in New York City last week and highlighted the strong performance of Deckers’ Ugg product.

Finalizing the purchase of the Teva brand from Mark Thatcher, according to Otto, has been the biggest contribution to growth. Now that the company has complete control of the name, patents, and licensing rights, they are free to use expand the brands reach into apparel, socks, and even watches. DECK is also able to produce sandals under the Simple brand, which was restricted under the former licensing agreement.

The licensing rights are a corner of the business that Decker’s had not been able to explore previously. Otto said that he expects the licensing revenue to make an impact on Deckers bottom line by the end of 2005.

The main domestic growth driver across all brands for Deckers will be the introduction of new categories & styles. Teva has already been developing a more casual line, as well as more closed-toe footwear. Otto is banking on the expansion of these lines to fuel growth. DECK sees the amphibious shoe category as its best opportunity moving forward, a category which Teva has the heritage, and “birthright” to be the market leader.

International expansion was described as Deckers’ “biggest opportunity.” Otto said that International sales are “only 18.5% of our business, and I can easily see them getting as big as our domestic sales.” To spur this growth, the company has hired a new European sales team that is “actively pursuing new business.” Soon Deckers will also have a new Asian sales manager to boost sales in that region.

Changing the color pattern and tweaking some of the existing Teva styles to fit the EU market has reportedly improved Deckers performance. Otto said that simply by covering the footbed of a sandal with a piece of leather, one customer boosted his order from 5,000 to 50,000 pairs.
Otto described the Ugg phenomenon as an “orchestrated plan,” with a PR firm to seed Hollywood, and a PR firm to seed New York. He applauded his marketing team for building a brand that “Potentially has the panache of something like Coach.”