The marketer and retailer of women's footwear has given the boot to many a competitor to become the undisputed leader in U.S. sales of women's shoes priced $30 to $150 and in the last couple of years has made some global moves.
Nine West's success comes amidst troubled times for the footwear business. While total shoe sales dropped 5% from 1991 to 1994, Nine West's revenues jumped an average of 17.3% a year during that time. Last year Nine West posted $652.2 million in sales, up 18.1% from 1993.
The key to its good fortune has been diversification and expansion. To fund its growth, the 18-year-old company went public two years ago raising $484 million. Last year it opened 100 retail stores, for a total of 406 at yearend.
In addition it acquired LJS Accessory Collections in January to branch into handbags and belts. Those products began appearing in stores in July.
The coup de grace came with the March acquisition of the shoe division of the U.S. Shoe Corp., makers of Easy Spirit. That company posted $706 million in sales in 1994 and could boost total Nine West sales near $1.4 billion. The more than $560 million acquisition made Nine West the kingpin of the shoe business and the focus of many industry analysts.
"It makes them the largest footwear company in the industry outside of sports footwear," said Jennifer Black Groves, exec VP at Black & Co., a Portland, Ore., investment company. "Probably the biggest challenge they have is integrating the footwear division of U.S. Shoe. I also think that it's their biggest opportunity."
Currently, Nine West is still mapping out the final structure of the combined companies. But analysts credit Nine West for its flexible, inexpensive Brazilian sourcing and quality management, expected to see Nine West through the integration.
In the match, U.S. Shoe will benefit from Nine West's knack for retailing and Nine West will gain another vehicle for expansion.
"We have a lot of exciting things going on with the integration," said Stacy Lastrina, VP-marketing for Nine West. "Getting into different areas-that's really the strategy behind what we're still about."
That's what Nine West has always been about. Each year the shoe giant offers more than 800 styles under its five major labels, Nine West, Spa, Calico, 9&Co. and Enzo Angiolini.
The company's ubiquity in the marketplace has allowed it to get by with minimal ad spending-totaling $9.3 million last year. While Nine West's advertising is handled in-house with assistance from an outside art director, Easy Spirit's advertising will continue to be handled by Lotas Minard Patton McIver, New York.
Traditionally Nine West has stuck to print ads in fashion magazines like Glamour and Vogue.
Starting this month, it is branching into other media with outdoor boards in Los Angeles and a four-page insert in The New York Times.
Although Nine West will keep the 2-year-old tagline "We all need shoes," the company plans to communicate its new identity in advertising by depicting belts and handbags in addition to shoes.
Yet Nine West has considerable room to grow in the $14.4 billion women's shoe retail market. Its overall share rose to 9.7% in 1994, up from 8.1% in 1993. But it's the so-called better shoes category, costing $30 and up, where Nine West really beats the competition.
Constant expansion has kept rivals at bay. Upscale shoe brands such as Kenneth Cole have a more narrowly focused customer base. And store brands have limited distribution because of their regional appeal.
"They are by far the dominant manufacturer of better shoes in the world and definitely in the United States," said Laurence Leeds Jr., managing director at Buckingham Research Group, New York. "They really don't have any competitors."
And Nine West wants to keep it that way. It has a joint venture with clothes company Toppy International to open four shops in Hong Kong and is pursuing joint ventures in Australia, Chile, the Pacific Rim and the U.K.
Meanwhile Nine West continues expansion nationwide with plans to open 100 new retail stores and 150 department store concept shops this year-knowing everybody needs shoes.
Headquarters: Stamford, Conn.
Leadership: Jerome Fisher, chairman of the board; Vincent Camuto, co-chairman of the board and president; Richard L. White, chief financial officer; Stacy Lastrina, VP-marketing.
Net income: $63.9 million in 1994 on revenues of $652.2 million
Ad spending: $9.3 million in 1994
Recent successes: Acquisitions of LJS Accessory Collections and U.S. Shoe Corp., makers of Easy Spirit; expansion into Hong Kong and potentially other global markets via joint ventures.
Challenges: Integrating U.S. Shoe into its management and distribution structure.
Source: Advertising Age and company reports