Business Insight Zone

When I signed on with Hoover’s back in 2000, one of the company veterans I talked to warned me about a common affliction of Hoover’s editors: you end up knowing waaaay more about companies and industries than you can ever safely trot out at a cocktail party. He said he knew he had reached this point when he was driving down the highway, saw an eighteen-wheeler owned by a big-but-not-huge trucking company, and immediately remarked to his passenger that the trucking company was owned by Parent Company A and competed primarily with Companies B, C, D, and E.

In other words, we’re geeks for this stuff.

A recent reminder of this came when I was talking to our editor Catherine Colbert, who has covered apparel makers for Hoover’s for several years. She was telling me about Crocs — they make the popular clog-style shoes of the same name — and said that the company was “doing really well and seems to have itself together.” Catherine covers her whole beat like a hawk, but she said that this company had really started to stand out from the crowd for her — a phenomenon I well remember from my days covering STMicroelectronics (the best huge microchip maker most people have never heard of).

As if I needed confirmation of Catherine’s opinion, I found it in this post about Crocs from the Trendsspotting blog. (Take a look at their logo and you’ll see why the double-s in the name is intentional.) The charts at the bottom of the post are particularly useful for showing how the Crocs brand has extended its reach over the past couple of years.

Two things ring sour for me in the Trendsspotting post:

1. The opening description of Crocs as “questionable shoes.” True enough, some people find them questionable in terms of fashion, but there’s no question that they’ve caught on in a big way. While I have no flag to carry for Crocs (and no financial interest in its success), I would note that my daughter’s third-grade class is populated wall-to-wall with Crocs wearers. She liked hers so much that she persuaded me to buy a pair, which I find great for gardening.

2. The post ends with this:

“My conclusion: yes, Crocs is behaving as a catching and spreading trend. Now, would you say it is a fad — soon to be eliminated?”

Catherine, at least, would say no. She points out that Crocs doubled its revenue last year, while also increasing its profit margins. The company has grown both in organic sales and through a series of small, complementary acquisitions, and seems to have an expanding reach in terms of its marketing. (Witness its big deal with Disney.) Yes, I’m biased, but my guess is that Catherine has read this one right.

Long live the merry Hoover’s band of business geeks!

Category: Consumer goods