Dr. Martens is certainly enjoying the benefits of the current ’90s fashion craze, but according to CEO Kenny Wilson, the firm has not been idle, letting trends propel it forward. Instead, the iconic label has spent the past year implementing an aggressive strategy focused on operational efficiencies, stronger direct-to-consumer channels and product innovation.
And they just might be on to something. The Northamptonshire, England-based shoe brand reported its fiscal 2019 sales results this week, noting a 30% climb in revenues to 454.4 million pounds (or $547.9 million at current exchange) and a 70% leap in profits to 85 million pounds ($102.5 million) for the 12 months ended March 31.
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“I believe the results demonstrate that what we’re doing is working,” said Wilson, who joined the company in July 2018 after stints at Levi’s and Cath Kidson.
Most importantly, he noted, the company saw strong double-digit growth across all retail channels and all key regions. “I’ve gone on record before saying I think in the next few years we can make Dr. Martens a 1 billion-pound brand, and we believe that. We believe that our [current] strategy is the right one to take us above a billion,” said Wilson.
During its fiscal year, the company was particularly focused on enhancing its direct-sales channels. It opened 20 brick-and-mortar stores globally (including eight in Europe, four in the U.S., six in Japan and two in Hong Kong), ending the year with a total of 109 doors.
“We believe that stores play an important role in allowing our customers to interact with the full range of the product and try the product on, which is important with footwear,” said Wilson. He added that this year the brand will aim to open a similar number of locations: “The markets we’ll look at will be the Americas, Germany, France and Japan.”
Dr. Martens’ biggest focus, though, has been its e-commerce division, which saw revenues jump 67% last year to 72.7 million pounds ($87.7 million). Wilson said that after re-platforming its sites for Europe, North America and Korea last year, the firm is now in the process of doing the same in South Korea, and it also has been staffing up with more digital talent at the HQ and regional levels.
Online sales represented 16% of total revenue at the end of the fiscal year, but Wilson predicted it could reach 30% within the next five years. To move that needle, he said his team will continue to invest heavily in people and platforms.
Another bright spot for the company last year was its product selection. Not surprisingly, its most iconic styles from the Originals collection continued to fly off shelves, with 28% sales growth. But more unexpectedly, its Fusion category logged a whopping 84% increase. Wilson explained, “The growth [for Fusion] was a combination of strong sandal sales for spring/summer, plus our quad-sole products which were really successful in every region throughout the year.”
The CEO noted that Dr. Martens’ ongoing challenge is to both cater to its existing customers and attract new ones, by keeping its heritage styles fresh and introducing different designs. “Next year is a very important year for the company,” said Wilson. “It’s 60 years of the 1460 boot, so every month we’re going to be releasing a limited-edition 1460 collaboration to celebrate. Ultimately, the goal is to celebrate our icon product and at the same time continue to build our sales beyond the icons.”
And after a year of aggressive action, Wilson said he has no plans to slow the brand’s pace. “We’ve got a [strong] brand name, we trade in 57 countries, people know Dr. Martens and what it stands for, but we’re only doing 450 million pounds in sales,” he said. “This has got the potential to be a much, much bigger brand than that. I feel confident that we can continue to accelerate the performance.”
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