The new Skechers NSM sounds off on the run specialty business and his role in it.
By Brian Metzler
After 23 years of working in various product and sales management roles for Saucony (1996-2002), New Balance (2002-2010) and Saucony again (2010-2018) – and earning an MBA along the way – Dan Sullivan got an offer he couldn’t refuse. He resigned his position of VP–sales with Saucony in November joined Skechers in December as its new national sales manager-performance. He is managing the men’s side of the other performance categories – walking, hiking and cross-training – but he’s overseeing the performance running category for men and women. Running Insight sat down with Sullivan recently to talk about his new role and the opportunities and challenges facing the brand as it continues its quest to grow in the performance running category. He says he will remain rooted in Boston but will spend a week or two every month at the brand’s Manhattan Beach, CA, headquarters and additional time on the road visiting specialty run shops and key accounts.
What did you find so compelling about Skechers?
I had dinner with (Skechers chairman and CEO) Robert Greenberg and he said, ‘Dan, there’s Nike at number one, Adidas at number two, Skechers at number three. What’s the difference? Those brands are rooted in performance, we’re not. I want to get to this performance thing right.’ And I told Robert that is music to my ears, because I’m a performance guy, that’s what I know. And honestly, performance is where it all starts and that’s where it all stays. Fashion trends go up and down, but performance is what remains. That’s just the beauty of performance and building products for their intended use and that’s what we want to keep growing at Skechers.
What is Skechers’ new Hyperburst foam and how will it spur growth?
For years everyone was talking about new foam, new foam, new foam, and that’s why all of a sudden you’re seeing a shift to TPUs and different types of foams. But Hyperburst is an EVA, and it’s pretty amazing. It’s created by saturating a solid piece of EVA with carbon dioxide that has been heated and pressurized into a super critical fluid state. After saturation, the CO2 returns to its normal gas state, creating thousands of bubble-like cell structures trapped within the midsole, making it lighter and more resilient. The bottom line is that it’s super light and resilient. I’m excited about these shoes and the new technology and that’s what sold me.”
Is it your goal to grow Skechers’ specialty running business?
“We’re probably in 60 run specialty shops, but we’re probably doing well in about 10. Rush Running in Arkansas is probably our best shop because Mike Rush really believes in us. There are certain places where we’re niche and people like our product.
“You can’t find our product everywhere, so it’s pretty clean. We want to grow those opportunities. Right now, Running Warehouse is our nnumber one, if you consider them run specialty. If we can get in with those guys and they love our product – and again it comes down to having good or great product – then we can increase that considerably. If we can do that, we’ll have some runway.”
What’s your strategy about growing Skechers’ specialty run business?
“It takes time to grow in the running specialty business. But if we can get a couple of key doors and go big, that will be a start. We’ll do some fun stuff, get some exposure and get the brand humming in a few locations and take it from there. My first task is creating the right sales team. I’m building a sales force and figuring out how we’re going to cover the country.
“We’ll probably have six reps to start off and we have some key people already on the team, but we might realign the territories a bit. Then we’ll have another person handling the key accounts and non-running accounts like Kohl’s, Dick’s Sporting Goods and Famous Footwear.
“That’s all going to happen by April so we can have our team in place by our Spring sales meeting. And then it will be calling key retailers and asking what we can do. I know we’re not going to be number one tomorrow, but give us a chance and let’s make something happen.”
What’s the key to helping a running shoe brand rise in 2019?
“Things have changed. It’s not the core four brands that owned it. You can come out of nowhere if you have innovation. You can’t be a me-too brand. You have to have a unique point of view. You can’t be meek and just follow. You can’t just say ‘hey, let’s take the Ghost and copy that and call it our own.’
“If you’re trying to compare your shoes to another brand’s great shoe and you come up with a good shoe, well, good doesn’t beat great. That’s why I like that Skechers has these great new shoes and we have a point of view. We’re going after the faster runners with these shoes, the tip of the spear. We’re going to be carving out some new niches.”
What are your thoughts about the mid-range shoe business?
“I need to develop two businesses. I need our performance/technical run specialty business to keep growing in innovative ways, but to keep the bosses happy, I also need to make sure the business at Kohl’s and Famous Footwear is going great, too.
“We’re going to keep those things separate, but we need that to be humming. But it all starts with performance. The $50-$60 shoes we produce have to be beautiful and have the right colors, but I want what we’re doing with our performance line – the design, the wear-testing, the validation – to be the same throughout.
“I want that consumer putting on a $50-$60 shoe to know that Skechers has the best fit and feel. That will extend the brand’s reputation and it might mean that new runner will eventually evolve to our high-end performance shoes.”
What is the future of performance running?
“It’s innovate or die. You either grow or you’re shrinking. I think the running space is always going to grow because there are always new ideas and one idea brings out other new ideas. Hyperburst is new for us, but it might lead to something else. We all thought EVA was maxed out. Industry experts said that EVA was maxed out because it has 70 percent energy return and you’ll never get 80 percent, but Hyperburst changes the game because the energy return is significantly more than that and no one was thinking about EVA that way a few years ago. I think there are endless possibilities, and that’s why this industry is always so exciting.”
What do you like most about the running shoe industry?
“It’s full of good energy and good people. You’re not going to make crazy money like you might in the tech world or the banking industry, but you’re going to have a lot of fun and have a healthy outlook about life because you’re helping people improve their lives. I played college football and then was coaching football at Harvard, but I found that wasn’t for me because it was quite a grind. I wound up getting a job working for an investment bank and lasted three weeks.
“My mother had called me one day and said, ‘Saucony called about that application you submitted a year ago and I guess they’re ready to hire you.’ So I walked into my boss’ office at the investment firm and said, ‘today is my last day.’ Katie, my girlfriend at the time, who is now my wife, thought I was nuts.
“But knew I was never going to be successful in that world because I wasn’t passionate about it. I wanted to be in a position where I was improving my own mental well-being and hopefully others’, too, and being involved with health and wellness. But, also, I have always loved shoes and have always been a shoe geek.”