Merrell brand parent company Wolverine Worldwide (WWW) outlined progress and planning for some of its top brands when discussing fourth-quarter and full-year results, pointing to the outdoor footwear brand as a key contributor. 

On a conference call with analysts, Wolverine’s CEO Chris Hufnagel said the Merrell brand will have the opportunity to work more closely with the company’s Saucony brand in 2024 when it joins up later this year in Grand Rapids. MI.

WWW is in a transformation plan to cull brands, cut costs, reduce inventories, and empower brand teams to add “excitement and growth” to its product. Hufnagel called out Merrell as one of the top brands it’s focused on, along with Saucony, Sweaty Betty, and the Wolverine brand.

Hufnagel said that with firmer footing and a clear vision, WWW brands are accelerating efforts to reinvigorate growth, focusing on “designing awesome products and telling amazing stories.”

“While we expect our inflection to growth will follow the meaningful margin improvement we’ve outlined, our brands are moving with great pace to drive improved top-line performance,” he said, highlighting Merrell as “the outdoor footwear industry leader with a long history of product innovation.” Hufnagel also noted that the product pipeline is improving at the brand.

“Its MTL Skyfire 2 Matryx, developed in the Merrell Test Lab and Elite product innovation incubator with rigorous testing by trail running athletes, is a super lightweight plated trail runner that was named Outside Magazine‘s Best Trail Running Shoe of 2023 and received recognition in Runner’s World and ISPO, among others,” Hufnagel said.

“We are viewing the marketplace differently in how we manage the brands,” Hufnagel shared. “I do think the product we have is really good. And, regarding the product we introduced in 2023, I think, our innovation fell flat. The consumer responded to newness, and we were heavy in core styles that didn’t check, which put pressure on 2023 and continues to put pressure on us in the first quarter of this year.”

He said the company’s largest brand intends to continue to modernize the trail category through faster, more trend-right designs that consumers demand, including the durability and traction that trails require.

“The brand’s Agility Peak 5 is outperforming the leading trail-running shoes in the marketplace in consumer and expert gear reviews on comfort, quality and fit, and is up triple-digits at the start of the year. The product is exceptional,” he added. “And Merrell plans to scale its storytelling to drive greater momentum.”

Hufnagel said the brand’s new Moab Speed 2, a 2023 ISPO award winner and a key story this year, is also seeing strong early sell-through.

“We’re seeing good pickup on that, good reception, the Agility Peak 5, and then some of the lifestyle collections around Wrapt,” he said during the Q&A session on the call. “When Merrell can develop on-trend and on-brand product that looks different, consumers respond. At the same time, we also need to invest back in our brands.”

“Merrell’s collaboration with Jeep in the fourth quarter drove 17 million earned impressions, and the Hero Blue Color sold out to the piece. Again, the brand grew U.S. market share in hiking and trail in Q4, tapping a year of market share gains for our largest brand,” he boasted.

“As with Saucony, the broader life opportunity is significant for Merrell,” the CEO offered. “And when we develop on-brand and on-trend styles like the new wraps collection, a disruptive look on our barefoot platform, our consumers respond. This new collection almost sold out on in a matter of weeks. And, today, we are chasing replenishment for this franchise and plan to reduce new silhouettes later this year.”

When asked about reconciling the double-digit declines at Merrell with the statement about growing market share, Hufnagel provided his view on the landscape for the outdoor category as it relates to Merrell and key products.

“At the highest level, the outdoor category has been pressured, probably one of the worst-performing categories in the market for the past 12 months,” he noted. “We’re not going to sit behind that and say it’s just a category issue—the category leader, which Merrell is. Merrell has to innovate and help lead that category, which is why I’m encouraged by some of the new product introductions. 

“The Moab Speed 2, which I’ve referenced, is a lighter, faster and more athletic version of the world’s number one hiking boot, the Moab. I think the Agility Peak 5 is the evolution of the trail. The trail is certainly evolving. Specifically, in market share gains in the last quarter, Merrell gained 30 basis points and 60 basis points in the hike and trail run, respectively, and for the full year, up over 100 basis points and 70 basis points, respectively, in both of those categories. So that is share gains, albeit in a contracting category,” concluded Hufnagel.

He went on to say that he thought the future of the outdoor category was lighter and faster and more athletic and versatile. And it was not just predicated on function, but also style.

“And, I think, that’s where, in Merrell, we can work harder, is hitting that style piece and designing great looking shoes that are versatile that can not only be worn on the trail but also for everyday wear,” he continued. “So, I think the onus is on the category leader to help reinvent. I think the reinvention is lighter and faster. And I think the work we’ve done on the pipeline is important. Another reason why the Merrell Test Lab is so important to us—this elite trail running incubator for great product—the design awards we’ve won in Merrell for the past handful of years around that run the MTL product is critical and important and, honestly, some of the best products in the market. So, in this tough category, the leader has to lead, gaining share, and we have to be out in front of the evolving trends.”

While the overall Wolverine Worldwide ongoing business was down 18.4 percent year-over-year in the fourth quarter in constant-currency terms, Merrell declined 17.0 percent in the period to $161.8 million. Merrell was down 11.3 percent in constant currency for the full year to $675.8 million, compared to $764.2 million in the prior year.

Excluding extraordinary items, company CFO Mike Stornant felt the total company would see a 5.5 percent decline for 2024 at the mid-point of expectations.

Active Group revenues, which include Merrell, Saucony and Sweaty Betty, are expected to decline in the mid-teens for the year. Merrell is expected to decline in the low-double-digit range, with inflection to growth expected in the year’s second half.

The business is reportedly starting the year from a “challenging position,” which will weigh on full-year revenue results, most meaningfully for Saucony, followed by Merrell and Wolverine, according to Stornant. But he also said the company anticipates a sequential improvement in top-line performance as the year progresses.

Hufnagel added during the Q&A that when he thinks about the back half of the year, it’s largely driven by the innovation they are bringing, and added that is also why he is encouraged by what they have in the company’s line of sight to in 2025.

“We expect the positive impact of our corrective actions will accelerate and be bolstered further in the second half by reduced Rogue selling, cleaner inventories, better alignment with global partners and lapping easier year-over-year comparisons while contributing to an inflection in growth in the second half of the year and acceleration into 2025,” he added.

“I think part of the turnaround, and one of the things that I talked about on the last quarterly call, was just how close we were to the wholesale market, how close we were to the partners,” Hufnagel said. “I think the conversations are different today than just a handful of months ago. As we think about the outdoor category specifically and how they view Merrell within their assortment, we know that the pressures are well documented in the outdoor category.

“Merrell continues to be the leader, continues to gain share and we keep seeing retailers protecting Merrell,” he continued. I think the important thing for the Merrell brand is to evolve behind the classic Moab 3 silhouette and become lighter, faster, and more athletic, which is why we’re so excited about how the Moab Speed 2 has been received and then our entree into trail run. And, the fact that we’re gaining share in trail run is very encouraging. I think we’re paying very close attention to our direct-to-consumer business, too and what’s happening in our 46 Merrell outlet stores.

“Where is traffic? What are they buying? What are they responding to?” Hufnagel asked rhetorically. “We’re working to be less promotional at And we’re seeing great increases in product margin to be less promotional and create less disruption in the marketplace. And Merrell has new introductions coming for the balance of the year. And we’ve got continued health of the Moab franchise. We talked about the Jeep launch last year, 70 million impressions.”

The CEO noted that the new Moab offering sold out to the piece in 2023, and the brand saw a 12 percent lift across the rest of the Moab franchise just by bringing “new heat” to that category.

“Hopefully [the category] will bottom out, and it’ll begin to resuscitate. At the same time, we can’t sit back and say it is what it is. The leader has to innovate, and we’re bringing product to market that is very good,” he concluded.

“Discrete items in 2023 totaling $165 million in revenue will not recur in 2024,” Stornant added. “These include approximately $70 million of extraordinary end-of-life inventory liquidation, heavily weighted to the first half of 2023, approximately $55 million in business model changes, including the transition of our China JV to a distributor model for both Merrell and Saucony and approximately $40 million in a timing shift of international distributor shipments that benefited Q1 2023.”

Hufnagel said the company has a new protocol every Tuesday, featuring a full deep dive into the business. He stated they are starting to have different conversations.

“We’re talking about chasing new products. We’re talking about the perception that we have seen, feedback that we’re getting and about chasing products in our supply chain today, where we haven’t had those conversations for a while,” he shared. “I get on the plane next week with the presidents of Merrell and Saucony to go to Vietnam, to go to our biggest factories, both to accelerate products that are in development and talk about how we can continue to chase other items. So the fact that we’re talking about chasing new good styles and chasing products that we want to accelerate into the pipeline is a very encouraging place for us to be right now.”

Image courtesy Merrell


See below for more SGB Media coverage of the Wolverine Worldwide results for Q4 and full year 2023.

EXEC: Inside the Wolverine Worldwide C-Suite – Assessing the Year Ahead

EXEC: Saucony to See Big Decline in 2024 Before Recovery