Sports Executive Weekly sat down at the recent Outdoor Retailer Winter
Market show with Jim Zwiers, President
of Wolverine Worldwides new Performance Group.

On January 8, Wolverine announced
its decision to migrate from four to three brand Operating Groups – The
Heritage Group, The Lifestyle Group and The Performance Group. Performance –
comprised of the Merrell, Saucony, Chaco, Patagonia Footwear and Cushe– is
being led by Zwiers. Heritage-Wolverine, Caterpillar Footwear, Bates, Sebago,
Harley-Davidson Footwear and HyTest-is being overseen by Ted Gedra. Lifestyle
– comprised of the Sperry Top-Sider, Stride Rite Children’s Group, Hush
Puppies, Keds, and Soft Style– is being led by Mark Neal.

The restructuring follows
Wolverines October acquisition of the Performance & Lifestyle Group (PLG),
which included Saucony as well as Sperry Top-Sider, Stride Rite and Keds.

Here, Zwiers discusses the
reorganization and the prospects for the brands across the new Performance portfolio,
particularly Saucony.

What drove the decision to reorganize Wolverines
This is really only
important to us internally. We continue to be intensely focused on our brands.
We want the consumer to see our brands and love our brands. It’s also what we want
the retailer to see and our group’s structures are really for us internally to
make sure weve got the right sourcing, the right HR support, the right legal
support, the right finance support, the right sharing of best practices, etc.
Its also a way to have a ‘small within a big. Were pretty big now and for
career development, to know our teams, to understand what their hopes, dreams
and opportunities are, it takes an ability to have a little smaller subset
within the bigger company. We want the retailer and consumer to just see our
brands and we want the world class infrastructure to support incredible
excitement, product and innovation in the brands.

What attracted Wolverine to Saucony? Saucony is for the dedicated runner and that part
of the running sector is phenomenal right now. Saucony has positioned itself
well – theyre not just the running brand of the moment or on the trend of the
moment; they are for the dedicated runner. And when we look at participation in
that category – whether it be half-marathons, marathons, women’s events,
social-cause running events-there is terrific community around and emphasis
there, along with strong specialty run store connections with the consumer. One
of the big ‘X factors of the industry right now is how strong specialty
running is and I think that’s because they reflect great modern retailing.
Theyre close to the consumer, close to their local community, they create
events and excitement, and they provide excellent service when you come in the
door.  That’s pretty rare to find at retail
and is a real strength for this sector.

How will Wolverine support Sauconys growth? Saucony has tremendous momentum right now and a
tremendous team. So we dont think of it so much as how is Wolverine going to
help any of the acquired brands as much as how can the combination of the
brands and the people along with the strength of the legacy Wolverine brands
and people create opportunities together. What are the opportunities to make
these brands stronger? And so from a Saucony standpoint, one opportunity is
international. They already have one of the better international businesses
within the PLG brands, however, were able to add some infrastructure and some
expertise in international that we think can be incremental and help drive
growth. Second, from a sourcing standpoint, we now source over 100 million
footwear units or apparel units every year and that’s a big advantage thats
going to benefit not only Saucony but all of our brands. Third is the sharing
of best practices. When you take Merrell, Saucony or any other brand in the
group, there are areas of expertise either in channels of distribution, or
business structures or in people that we can benefit from and learn both ways.
One brand, for instance, can help another expand into a newer channel. So the
integration and discussion around best practices has been very positive.
Finally, the culture fit has been fantastic and gives us a strong platform to
build on.

Both Merrell and Saucony both sell into run
specialty. Any plans to share reps or realize any synergies in that channel?
We wont share reps. We really dont need the
consumer to know at all that Saucony and Merrell are connected in the back
room. We take a brand-focused approach and we drive our brand with intensity
from a product, marketing and sales standpoint. We want the consumer to see
that brands point of view represented in the product. We will definitely keep
them individualized from that standpoint. From a run specialty standpoint, we have
two brands that really come from a different point of view. For Saucony, you
have a history of serving the dedicated runner and that leads to a certain type
of product. We are servicing that runner-on the road, on the trail-in their
running endeavors. Its a run-based brand and that’s where Saucony is focused.
Merrell comes at it differently. Merrell comes at it to excite, drive and empower
the outside athlete. With Merrell we focus on hiking, trekking, trail running and
lots of activities in-between. Merrell also brings that outside
performance-minded person into train and a little bit into road but more from
an outdoor or outside athlete perspective whereas Saucony comes at it from a
point of view where, ‘Sometimes I run on a trail. Sometimes I run on pavement.
But I run. And that’s a very different focus. It doesnt mean the shoes may
not sit directly next to each other on a shelf in some instances, but I think
it will be easy for the consumer to see where the brands are coming from not
only in terms of a look, features and benefits but also from a brand aspirational
viewpoint that connects uniquely with them. We feel very confident in the
unique point of view of both brands.

And you also see each approach to minimalism
differentiating enough?
We do and
it comes from each brands point of view. Saucony is again focused on the
dedicated runner, and they have approached the category from that perspective. Saucony
runs from zero drop to 4m and they have the ‘Geometry of Strong approach at 8m
in select big franchise categories. Theyve been very smart in taking it from a
scientific consumer focused standpoint. For Merrell, the team has been very
focused on the consumer feedback and learnings from Barefoot. We have learned
that the feeling you get while running in minimal product heightens the
experience outside. With 4ms becoming popular, Merrells new M-Connect series expands
to differing stack heights in terms of drop but also in cushioning so were expanding
to appeal to the broader range of outside athletes.  Merrells also been dedicated to running form
and teaching Merrell Bareform running.
Saucony has been focused on providing a quiver
of alternatives to the dedicated runner to meet their personal goals – both
training and competing
. And so they
certainly work together but they just have different points of view.

Theres been some concern about minimalism slowing
with FiveFingers sales sliding. Whats your take?
We dont have any worries about it. What we see is
a natural expansion, not a contraction. Consumers are wanting a minimal
experience and brands are applying that in ways that the consumer wants to migrate
to. For example with our Merrell M-Connect weve added cushioning in certain
models where people wanted it. Weve also added a little bit of drop in areas,
so its broadening. It’s more difficult to identify exactly minimal product
now. But if you look at what products are influenced by minimal and influenced
by lightweight, youll see that it continues to expand even more broadly. The
market numbers look different because one dominant brand has fallen off, but
the other brands and products around it have grown nicely and it continues to
be an important influencer of the trend. So we see the category expanding and
also getting more intelligent and a little less, ‘Hey, just build it thinner
and build it lighter.  Its much more
intelligent than that, which has resulted in improved products and great
stories at retail.

Any plans to move some of Sauconys staff from
Absolutely not. First,
those teams are well established on the east coast. Second, as a company we
have wanted an east coast attractor – an area to retain and build talent on the
east coast. That corridor is excellent and rounds out Wolverines ability to
build the best teams.  Globally, we have offices
in London, Montreal, Portland, Hong Kong, as well as Michigan. So with the Boston
office we have a broad set of locations to attract the best in the industry,
which is critical to our future success.

How is Merrell performing? Were thrilled about many things from a market
perspective. We continue to gain market share and the data is really powerful
in that direction. Its been a bit of a tough outdoor market this year and
Merrell has been able to more than hold its own. What’s more exciting is the
development of the three lanes on the Merrell highway of opportunity-Performance
Outdoor, which is where the brand began; Outside Athletic; and Active Lifestyle.
Merrell addresses all the needs of the outside athlete and it’s where our
consumer is moving. More importantly, the retailer needs to strategically
expand their view in a similar way to drive growth in their categories. Weve
had terrific meetings this week at the OR Show with our retail partners around
strategy. With the size of Merrell, we dont need to ask, ‘Where do you think
the consumer is going? or ‘Where do you think the water is flowing? We can
much more work strategically with our partners to say, ‘Where do we need to
move the consumer? ‘Where do we need to move the business to?  That comes from trust but it also comes from
the opportunity that Merrell offers to hit a broad base of consumers visiting outdoor
stores. Thats been very exciting.

Can you highlight some key initiatives to drive
Merrells growth?
M-Connect is
huge and it will hit for spring. As we move into fall, well continue to move
on the
platform, which has reinvented the hike category. We continue with the
M-Connect series and for fall we have added an exciting M-Select Move casual collection
that has been one of the biggest attractions this year. Its a very tellable
story because its highly contoured on the top of the footbed, which is unusual
in a casual shoe. Fall 13 will see key launches in each of our three
categories, Performance Outdoor, Outside Athletic and Active Lifestyle.

Why did Cushe shift to the Performance Group? At the time we acquired Cushe in 2009, we talked
about where it would fit best within our portfolio, and at the time we wanted
to make sure we were getting it expanded internationally as fast as possible.
So linking it to the Lifestyle Group and Hush Puppies was the right decision at
that time. The brand has grown to be very global. But the brand’s action sports
and outdoor sports focus has become more and more relevant. So it’s a natural fit
with the Performance Group when you look at the types of constructions and the
types of sourcing we need to support it but also the types of retail formats
where it sells in.

Hows Cushes momentum? The brand’s going great and is achieving nice
exposure with clean distribution. All the way from Nordstrom to surf shops, we
have achieved strong brand presence and it’s checking though very well. It
seems to have hit a nerve with après activity, which is really powerful. So
whether its board sports, skate, surf-its a terrific alternative choice with
some sophistication and comfort that attracts a broad audience. Its not a typical
action sport brand but it plays in a pretty big category with a unique point of
view. Cushe is getting a lot of attention right now.

Whats the potential for Chaco? The opportunity for Chaco remains huge. It grew at
strong double digits last year and it will do so again in 2013. Whats great
about Chaco is that is has stayed very close to its heritage and the consumer
continues to respond to that. Were broadening out the excitement in terms of
patterns and in terms of webbing, and weve also gone to three different sandal
options – our fully-built original, a medium platform, and then a lighter-weight
option that’s lighter, easier to understand, and easier to adjust. So weve
been able to segment the line and add excitement at all levels. The Fall13 line
that we introduced at OR has been well received and the consumer and retailer
want Chaco to be a four-season brand. We feel great about Chaco. Its
absolutely red hot in certain parts of the country and starting to expand

Finally, hows Patagonia Footwear going? We are
privileged to partner with Patagonia to create amazing product linked to the
Patagonia ethos.  Patagonias authentic
and genuine approach to product and the environment is inspiring and provides a
strong platform for our footwear.  We are
excited about our Fall13 product and continue to link even more closely to the
stories and focus of the Patagonia brand.

How is the overall performance opportunity looking
for Wolverine?
One of the great opportunities in the
market today is around brands that connect with the consumer and meet their
needs for active and casual products that they love and cherish. And so whether
its Merrell, Saucony, Chaco, Cushe or Patagonia Footwear, our brands are in
sync with the consumer and current lifestyle trends. Consumers want to be active,
they want to be healthy, and they want a connected life. And frankly, they want
to tell better stories, they want more experiences, they want to be empowered
to do a little bit more every day. Our brands have that advantage, and I think
one of the hugest attractors for a lot of people is that ability to do more in
their life, to be empowered, and to be more of the person they want to be. The
brands in the Performance Group empower our consumers every day. So were
fortunate to have high-engagement, high-performance brands that really define
the individual who wears our product and were thrilled that they choose our