Speaking on Wednesday, October 8, at Telsey Advisory Group’s 2025 Global Consumer & Retail Conference, Jay Schmidt, Caleres’ president and CEO, stated that newness and “products with brand heat and highly demanded products” are driving growth across the footwear industry. The trend is exemplified by the Jordan brand quickly becoming a Top 10 seller at Famous Footwear after its launch this year.
“Jordan was the highlight of back-to-school (BTS), and we’re very proud of the whole team for getting that accomplished with us,” said Schmidt. “We do think it’s a differentiating moment for us.”
Schmidt said Jordan was launched at Famous on July 11 as an exclusive to the family footwear channel across all stores and online and has “exclusive opportunities as we look forward into next year.”
Said Schmidt, “Mostly people ask me, ‘Was I surprised that it jumped into the Top 10 brands? And my answer is, ‘Not at all.’ The reason is that our consumer has been demanding it for as many years as I’ve worked here. And, so, it was very exciting to see that demand that keeps coming off what we saw on our websites, on brands that we don’t carry, translated to back-to-school.”
He added that Jordan’s strong performance is part of a bigger trend, seeing consumers seeking “more elevated products from brands they love. And it is brands with heat, and Jordan is a perfect example.”
Schmidt said Caleres is seeing similar trends across its brand portfolio segment, led by its four “lead brands” — Sam Edelman, Allen Edmonds, Naturalizer, and Vionic.
Said Schmidt, “The brands that are more authentic and more differentiated are breaking through at a higher rate, and we’re seeing this in two ways. Our four lead brands continue to outperform and take share within our brand portfolio. At Famous, national and in-demand brands and elevated products are performing best. So that’s how we’re seeing it, and the consumers in charge here.”
Overall, Famous’ comps were flat for the back-to-school selling season that starts in July and extends through August. Schmidt said he was “pleased” with the performance, given that Famous was facing a strong mid-digit comp gain in the year-ago BTS season.
Among other brands, Nike saw healthy sell-throughs during the BTS season, with Famous seeing more elevated product from the brand to become “somewhat of a differentiator” for the family shoe chain. Schmidt said, “Those are some of the [Air Max] 270 models that we’ve seen. And they’ve sold extremely well, better than some value products. So, it’s a very interesting moment there.”
Famous also saw a “very good performance” from Adidas, New Balance, Brooks, and other athletic brands.” On the non-athletic side, Birkenstock “has been a solid performer straight through the season and continued through back-to-school. And that represents one of our highest retails.”
Similar to athletic footwear, the “bigger brands in that non-athletic space” are outperforming lesser-known brands at Famous. For fall, Famous will be introducing the Frye boot brand and expanding assortments of Timberland with the resurgence in popularity around the Yellow Boot. Schmidt said, “You’ll see more elevated assortments and demanded products from them. So, we’re very excited about it, and I think it offers us some different thinking and different opportunities at Famous.”
Total sales at Famous were down 4.9 percent during the second quarter, while comp sales declined 3.4 percent. During its second-quarter analyst call, Famous’ management indicated that the company gained share in shoe chains and with kids during the quarter, according to data from Circana. Kids’ penetration was 21 percent among shoe chains in the quarter, up 0.6 points, while total Famous market share was up 0.1 points.
During the second quarter, men’s performed best, kids was about in line with the overall trend, and women’s underperformed. By category, athletics was nearly flat on a comp basis.
At the Telsey Advisory conference, Schmidt said he sees a bigger opportunity for kids as the chain increasingly offers kids’ sizes that match the popular adult sizes.
Looking to the third quarter, strength in major athletic brands during back-to-school selling helped drive Famous’ August comps ahead 1 percent, on top of a high-single-digit comp in August 2024. Comps at Famous are expected to decline in the low single-digits over September and October as the chain continues to see spending pull back in largely non-promotional months.
Famous will end the year with approximately 830 stores, closing a net of 15 or 16 stores year-over-year, which includes just under 60 under the Flair concept, featuring elevated presentation and continuing to outperform. Said Schmidt, “Those stores continue to show a nice top spread versus the base. As you know, we’ve been fairly disciplined about our investment in Flair because we’ve been learning as we’ve been going along. And now we feel like we’ve got the right model and the right criteria for the Flair store. And now what we’re seeing is even as that latest cohort of Flair stores now comps in the second year, they’re still showing that nice difference in terms of a comp spread versus the stores that haven’t been remodeled that way. So, we feel good about it, and obviously we’ll continue down that path.”
Asked about tariff mitigation efforts, Jack Calandra, SVP and CFO, said Caleres expects tariff increases in the range of 20 percent to 30 percent from the countries the company primarily sources from, including tariff changes scheduled for February and August. To mitigate, Caleres will reduce its sourcing from China to less than 15 percent of dollar receipts in the back half. Calandra also said Caleres has had “very productive and fruitful conversations with our factory partners in getting them to provide concessions to help with that cost increase.”
A third step is looking to reduce the dutiable value of goods by separating out “freight from the factory to the port” to exclude processes that may be excluded from the increased tariff rate. Finally, a fourth step is “very selective and surgical” price increases. Said Calandra, “Those four things, I think, really depending on how the consumers react to the price increases may or may not be able to offset the full gross margin impact from those higher tariffs, which is why we’re also looking at these SG&A opportunities so that we can make sure that, from an EBIT perspective, we fully have offset the impact of the tariffs.”
Image courtesy Famous Footwear
