Ecco Invested Aggressively As the Pandemic Slammed Its Business — Here’s Why It Paid Off
Even while the global health pandemic put extreme pressure on its business in 2020, Denmark-based footwear company Ecco made aggressive investments to strengthen its distribution — and it saw that pay off in its direct-to-consumer division.
For the full year, net sales for the company totaled 1,092 million euro (or $1.3 billion at current exchange), down from its 2019 revenue of 1,360 million euro (or $1.62 billion).
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CEO Steen Borgholm said in a statement, “Ecco’s 2020 results reflect the unprecedented impact of the pandemic, which led to a temporary closure of most of our shops and an unparalleled decline in profit. However, our business model and organization have once again proven robust, allowing us to act swiftly in times of changes.”
While many other firms pulled back on spending amid the deep challenges posed by COVID-19, Ecco took an aggressive approach, investing a record 195 million euro (or $232 million) to improve its digital platforms and marketing capabilities, and put in place the infrastructure for more product innovation.
It also acquired its business in Russia, as well as a large, unspecified number of Ecco stores in the Middle East and the Netherlands.
The latter move gave a boost to the brand’s direct-to-consumer division. According to Ecco, net sales from its owned retail and e-commerce grew a combined 2%, supported by the addition of the new stores and growth in online. Like other players in footwear and fashion, the brand saw a significant spike in traffic to its dot-com sites last year, posting 34% growth in digital sales for 2020.
Meanwhile, the footwear company, which in November was honored with the Green Imprint Award at the 2020 Elle Style Awards, continued to set ambitious sustainability goals. By 2030, Ecco said it aims to run on renewable energy and for its tanneries to use only bio-based chemicals and closed-loop water systems.
“Even as we operate our business in the new reality, we’re determined to make sure we don’t lose sight of the sustainability agenda which ranks high among Ecco’s priorities,” said Borgholm in a statement. “We don’t have all the answers and are not perfect, but we have a unique opportunity to be frontrunners and secure progress in our industry by raising the bar for responsible shoemaking.”
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