At Reeboks Media Day event at FFANY, SEW sat down with three of the key members of the Rbk team. Paul Harrington, president and CEO, Bob Munroe, president of U.S., and Uli Becker, CMO, talked about their vision for the brand
SEW: Why meet with the press now?
PB: Its the right time now. We havent been spending a lot of time talking to the press, but rather spending the time to do the things that set us up to grow. Weve spent time looking at our brand positioning. Weve clearly looked at narrowing down what we do; to do less, better.
SEW: How will you spend the $50 million Euros in extra marketing dollars?
PH: A combination of things. Part of it will be against our marketing budget. Some of it is in the Product Development area. Weve identified that we need to beef up our product development process. In addition, some regional initiatives such as buying back our distribution rights in emerging markets such as China and Russia.
UB: Its an investment of support from adidas Group to make sure we can bring the brand to fruition in a way that might not have been done before. We are looking to spend money more wisely. We also want to have fewer messages coming out. Well do less things, better. Well have two major campaigns instead of the many campaigns weve had in the past.
We will focus on running in the spring, with a campaign called “Run Easy”, inviting new runners into the sport. For fall, the concept is on the edge of everything we do. Its kind of a “greatest hits” concept we call “Best On, Best Off,” best on field and the best off, the best of sport and the best of lifestyle. We want to become the brand that makes the borderline between sport and lifestyle. [In “Best On, Best Off”] we will focus on running and cleated product and then will broaden to other sports over time.
BM: “Best On, Best Off” celebrates that Reebok has a unique opportunity to play between sport and lifestyle. Most of the brands that we compete with have a very heavy sport or lifestyle position. We can play right in the middle.
SEW: Will Classics be a part of the campaign?
UB: Yes. The brand that connects sport and lifestyle is going to be a cool brand. Nobody has done that yet. adidas has been very extreme with regards to performance and very extreme with regards to lifestyle. Were going right in the middle. There is no brand that is there right now.
SEW: Will there be a music component to this campaign as well?
UB: Sure. There were statements made that we are too much of that. We need to find the right balance between sport and lifestyle and within lifestyle. We wont be one dimensional. Skate will be a part of this as well. Skate is a good example of both Sport and Lifestyle together.
SEW: How does Iverson fit into the “Best On, Best Off” campaign?
UB: We will try to get Iverson into “Best On, Best Off” for the fourth quarter next year.
SEW: We are seeing in the SportScanINFO data that the fashion consumer is moving away from sport-specific footwear. Reebok has always been more focused on lifestyle. How do you see that shifting?
BM: I agree with you on basketball. Not so much in regards to running. You need sports performance authenticity and creditability; you need iconic personalities on both the sport and lifestyle pillars. At the same time it would be dangerous for a brand to play heavily into the sport position given the trends you described. We think the trends play perfectly into what we are doing.
SEW: Branded apparel has been a very difficult category for Reebok. How does that fit into these campaigns?
BM: Apparel is probably our single biggest growth opportunity. You need great product creation and demand creation. As we build cache around our brand, apparel naturally becomes more attractive to the consumer…
SEW: What technologies will be the focus of “Run Easy”?
BM: It will focus on our Premier line of products. Weve won 14 awards on Premier over the last 4 years. There is no issue with features and benefits on the product. There is no issue with customer satisfaction. What weve concluded is that the issues are education and trials. Well feature the campaign on the Pump Paris Trainer and on the Kinetic Fit System. The campaign is much more about brand and category communication.
SEW: Classics have been a very difficult category for the industry. Beyond your lifestyle campaign, what other things are you doing to try to revive that category?
BM: On our core silhouettes, weve introduced a much more aggressive and disciplined allocation and segmentation strategy, with fewer points of distribution and fewer pairs per rooftop, to create more cache around the core items. Weve introduced derivatives and extensions of the core items. Weve been very careful about where weve decided to place those in the trade to create excitement, with new interest and higher price-points. Reaction from retailers has been strong. Our opinion is that the category has pretty much bottomed out. We are expecting that category to grow for us again.
SEW: To our eye, Reebok was still being promoted very aggressively on Black Friday, how do you move that to a more rational scenario?
PH: Retailers went into the season very promotionally. In the U.S., we are still working down on our inventory levels at retail. The plan weve put together for 2007, particularly on classics, recognizing we were over distributed in the U.S. market, weve adjusted that in plans for 2007, to more of a pull through strategy. In addition to the two campaigns we outlined, it will bring us to a point where we wont be as promotional in the marketplace.
BM: By putting the right product in the right places, and communicating to the consumer in the right way that builds overall respect for the brand, thats whats going to fix it. Im not sure I would agree that our brand stood out with regard to promotional activity. Weve taken quite a few steps to minimize that. Weve significantly reduced our offerings at entry price points… We are much less visible promotionally. That should continue.
PH: You can see that the 3 of us feel very confident about the brand going forward. Weve spent a lot of time working on it. Between the campaigns we are launching in 2007 and the team weve put together, we definitely feel good about Reebok going forward.