CEO Asics: “We have yet to launch our true DNA”

Asics is looking to cement its position within the sports and running markets with its new store concept. Although, historically, the Japanese brand has always been known for its technical running shoes, it is increasingly committing to sports and running apparel, which is also becoming progressively more fashionable. FashionUnited spoke with Alistair Cameron, CEO of Asics EMEA, about the challenges within the sports and running market, the prospects and the brand’s ‘true’ DNA.

What is the Asics brand’s strength?

”It is one of the world’s oldest sports brands. Asics has a great understanding of the needs of athletes. Many people talk about how to do something, but we actually do it. We have a scientific institute in Japan, where more than 100 scientists work on molecular structures, which later become the newest spring tensions in shoes. During the past 25 years, over 25 innovations developed in Japan have been implemented in our products. The Japanese business now exports its expertise in all global markets. That is unique.”

How did you come to join Asics as CEO?

”I used to work for a competitor [New Balance] and we always had our eye on Asics. We were constantly waiting for the brand to slip up and make a mistake, but that never happened. At the time, it was quite a challenge working for the competition. Subsequently, I joined Clarks, and seven years ago I became CEO of Asics. I have a long history in the sporting goods industry.”

What were the biggest challenges when you started out?

”We were the number 1 running brand, but no one believed there was room for additional growth. In spite of that, we managed to grow sales from 420 million to 900 million dollars in the space of 6 years. We’re still the most important running brand, but our market share varies.

Cameron explains: “We recently analysed the European market, and found that we have a market share of around 30 percent there. That percentage varies per country though and also for instance in terms of age and type of runner. But the product works in all markets, whether for someone in their early twenties from Spain or an experienced forty year old from France.”

Sales have increased in the past year. What is the current situation?

”We grew 6 percent in the last year, but the last quarter of this year was tough. The market has become overheated. There simply is too much supply; there are too many retailers with too many collections. Some of them are already bankrupt or have filed for Chapter 11. We therefore decided to withdraw 350,000 pairs of shoes from the market. That’s the equivalent of 18 million euro, but it was necessary because we weren’t managing our business well. It wasn’t a great experience, but it was part of the strategy. That is not to say it wasn’t difficult, because you’re saying ‘no’ to business.”

How do you position and set the Asics brand apart from its competitors?

”It’s a competitive business. Nike, Adidas and Puma excel in sports lifestyle, and they are unsurpassed in this. Adidas in particular is on fire. They present a lifestyle that appeals to Millennials. Our strength, however, lies in the technical and performance aspects. Although now it’s up to us to also make our products more attractive. Everyone wants to look better, and there’s no reason why our products shouldn’t look good.”

How does Asics innovate?

Laughing: “I can’t reveal our secrets! But expect many new things for next year. They will, at the very least, look good. We are working on beautifully colourful collections.”

Tennis is also a major category for Asics.

”That’s right. Asics Tennis is very big in France, Spain and the UK. We work together with major tennis players. We also conducted research into innovations with various players. They wanted to be able to run to the net faster, so we developed a speed shoe. Tennis players want stability as well as speed. We were able to double the market by addressing this need. We are also adding more products to this category; we are launching a special technical collection next year.”

What are Asics’ objectives for the next five years in retail and wholesale?

Our own stores, where our entire collection is available, are doing particularly well; better than sales via department stores. In shop-in-shops your have to make choices; which items from the collection do you showcase? That’s a tough decision. Customers know that we’re the best brand for runners, but we also want them to buy other products besides running shoes. And therefore, we have to make choices in which products we present. We therefore focus on space management. We have many plans for major locations.”

What is your strategy to that end?Edit and amplify. You have to find out where consumers shop in ‘your world’ and know where to find them. That also means that we aren’t available everywhere. We focus on selling the right collections at the right locations. Fish where the fish are, so to speak.”

What are your expectations for the sports and running industry?

”Some players will only become bigger. Specialists will survive, as will major players with ‘different faces’. Our challenge is to remain relevant among the specialists and the major players in our sector, with our own stores.”

Which is the most challenging market in Europe?

Great Britain is tough; distribution in this market has been destroyed. It’s difficult to earn money, because the cost of doing business is so high. I will admit that we could be stronger in the British market. We are currently looking into how to improve our presence there. A new store on Regent Street in London is opening soon. There are over 8 million people living in London, so having more stores there makes sense. We will also be opening more stores in the south and the east of Great Britain.”

What are Asics’ greatest challenges?

”The biggest challenge for Asics is the ‘running’ aspect of the running industry. We are a market leader, but do not behave as such. And we must learn to act like a market leader. We know what a runner needs, and this is not just limited to shoes. Most runners know: when you’re starting out, you buy whatever appeals to you, but once you get serious about running, you switch to Asics. Other brands are doing enormously well in the runners market and we are keeping up with increasing demand for running items. However, if you want to become really big, your have to focus more on fitness runners and be able to communicate that. In fact, it’s all about communication. Asics should also be appealing to Millennials.” Thinking out loud, he says: “Are collaborations with celebrities really the only way to reach this demographic? And if so, who would be the right face for Asics? This is something we really have to think about.”

What do you look forward to most?

”The opening of new stores. The faces of our customers, the success and new sales. The clothing collection will be important, because there is great deal of opportunity there, when compared with competitors. If the consumer is the barometer by which we measure retail, we are delighted.” Adding: “But we still have to improve distribution.”

What can we expect in the future?

”We have a significant and very cool design team in Japan. They have designed a beautiful clothing line from high tech materials, which will launch in the fall. This team has an amazing Japanese signature, which shows in the designs. We didn’t have a clearly defined DNA before, but I think that’s what we’ll be launching now.”

Adding: “We have also just opened a design centre in Amsterdam, which we are currently furnishing. Furthermore, we also have design centres in New York, allowing us to locally address the needs of customers. The most important designs come from Japan, but the three continents collaborate on relevant collections.”

What exactly is Asics’ DNA?

”It’s high quality, Japanese, attention to detail, craftsmanship and high tech, and very reliable. That is what Japan stands for too.

What does Asics consider sustainable growth?

”We are aiming for revenues of 7 billion dollars by 2020, signifying a doubling of business. It certainly poses a challenge, but it is possible. We think in terms of sustainable growth and taking the right approach. We refuse to compromise; our strategy is long term. Asics is listed on the stock exchange in Tokyo, and the Japanese also prefer long term, sustainable growth.