Could these seven strategies help turn the fortunes of embattled surfwear brand Billabong?
Billabong CEO Neil Fiske has outlined a seven point turnaround strategy for the company at its annual general meeting.
Here, he details the strategy in his own words.
Brand
Our fundamental (re)orientation is toward building strong global brands. We put the brand view first in everything we do. That means fo cusing on the core action sports customer, holding ourselves to the highest standards of brand integrity, authenticity and uniqueness. It also means treating our brands differently depending on their growth profile and role in the portfolio. We have put significant focus and investment on growing our big three brands of Billabong, RVCA and Element, while creating an environment that allows smaller brands more ope rating autonomy and access to growth investment as they accelerate.
Product
We have always had great design. What we have lacked is strong merchandising. As a result, our product lines traditionally have been too wide and shallow in their depth of b uy, which means we are quickly out of our best sellers and have a long tail of leftovers at season end. With our “merchant front end” and “concept to customer” initiatives, we are narrowing our focus to fewer, bigger, better styles and focusing our design efforts more strategically on the areas where we can win. We have invested substantially in our merchandising and design talent around the world, allowing us to build strong global brands that are still regionally responsive and close to their customers.
Marketing
The mantra of fewer, bigger, better applies to marketing as well. We are installing new brand marketing disciplines into the business to create more impact, tighter alignment to our product strategies, and better story telling. We are also shifting our mix into digital media and customer relationship management in order to reach our young target consumers more directly, as well as putting more investment behind our faster growing brands. Our athletes and ambassadors keep us connected to the authentic core, while extending our major brand followers globally to now over 14.5 million consumers .
Omni - Channel
Our consumers shop in a rapidly evolving multi - channel world. We see the potential to dramatically accelerate our direct to consumer om ni - channel business, knowing that these customers are looking for a seamless brand experience across our stores and digital commerce sites. We will roll out this strategy in a manner that expands the brands overall and is complementary to our core wholesa le channel. Our stated priority is toward mono - brand formats and websites. We remain committed to quality distribution through better For personal use only 7 channels and core specialty accounts. With the sale of our interests in SurfStitch and Swell, we now have control of ou r mono - brand ecommerce sites and are in a position to invest behind their tremendous potential.
Supply Chain
We are undertaking a dramatic transformation of our supply chain, from a fragmented and inefficient regional structure to a global operation co nfigured for speed to market, faster inventory turn, and substantially lower costs. We have identified over $20 million in profit improvement opportunity in the supply chain over the coming years and have invested in a global leadership team to go after i t.
Organisation
The Group has put in place a new organisational structure aligned to the strategy, whilecompletely revamping the global executive management team. Since January, we have made over 65 new appointments globally and have also promoted hig h calibre talent inter nally. We continue to pay for the increases in capability with headcount reduction and productivity gains in other areas.
Financial discipline
We have balanced necessary investment in the business by ensuring it is funded through improving efficiency and taking out costs across the Group. We see the potential for further cost reductions to fund our marketing war chest, and will maintain a strict pay - as - you - go discipline.