Converse CEO promises staff his plan will work as sales tumble

[NEW YORK] After layoffs and its worst quarterly sales in more than decade, Converse’s top executive attempted to reassure his staff that the brand’s strategy will succeed.

“I promise this will work and it will work faster than most of us expect it to,” CEO Aaron Cain told Converse employees at a meeting on Thursday (May 7), according to a recording reviewed by Bloomberg News.

Sales at Converse, which is owned by Nike, have been in free fall and are expected their lowest level since 2011. The company’s signature Chuck Taylor shoe has fallen out of favour and newer styles have not caught on with shoppers, making it a persistent pain point for Nike CEO Elliott Hill.

As Converse’s challenges deepen, questions have swirled about whether Nike will keep it in the fold. Authentic Brands Group has expressed interest in Converse if it’s put up for sale, Bloomberg News previously reported, though Nike has reiterated its commitment to the brand.

On Thursday’s call, Cain said that Converse plans to “do more with fewer products”, and that he will focus on its classic Chuck Taylor and Jack Purcell products over the next couple of seasons. Cain also spoke about investing in key cities, with a focus on New York, Los Angeles, London, Paris, Shanghai and Seoul.

“We are a growth company, we are a sport company and we are a challenger brand,” Cain said.

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Nike did not immediately respond to a request for comment.

In its most recent quarter, Nike cut spending on demand creation, a category that includes marketing spend, by almost 60 per cent. Internally, employee perks like free snacks have been pulled back as sales have weakened.

Cain talked about the importance of creatives, who he said reminded him of “how dead easy this comeback will be when we embrace the fact that the answers are already out there”. BLOOMBERG