Can Vans Recapture Its Cool?

Vans is throwing its classic sneakers in a blender.

It reworked its staple Old Skool by outfitting it with rugged Vibram hiking soles, ultra-strong Dyneema fabric uppers and a rotary lacing system. Another version swapped the shoe’s canvas upper for a multi-coloured, mesh knit. It put metal rivets in the usually sedate Authentic 44, and has given over its treasured icons to partners like artist Sterling Ruby.

The shoes are some of the more adventurous experiments from the brand’s new premium label, OTW by Vans, which launched in February. While it’s just a fraction of Vans’ total business, selling only at select retailers and through limited-edition drops online, it has become the most forward-facing expression of Vans’ head-down focus on product innovation as the brand looks to recapture its cool with consumers and restart sales growth.

“We’re re-thinking what products from Vans are,” said OTW’s vice president and creative director Ian Ginoza. “Things that are unexpected from Vans, gives Vans a new perspective, and consumers a new perspective.”

Vans’ sales soared during the streetwear surge of the late 2010s as shoppers scooped up its heritage skateboarding styles. But in the 2020s, trends shifted, and Vans found itself afflicted by the problem that often faces brands reliant on a handful of archival items. As consumers moved towards other silhouettes from brands like Nike and rising upstarts such as On and Hoka, Vans had nothing new to offer, leading to two years of double-digit sales declines.

Now the company is fighting hard to change that with an emphasis on remixing its signature models and introducing new styles. In a high-profile move earlier this year, Vans hired Sun Choe, Lululemon’s long-time chief product officer, to be its new global brand president.

“She’s a creative mind who had a lot of success at Lululemon. She’s done things at scale and built franchises at scale,” said TD Cowen analyst John Kernan. “I think that’s what Vans has lacked: innovation at scale and relying far too much on legacy franchises.”

For parent company VF Corp., those are issues Vans urgently needs to fix. The conglomerate has been contending with a portfolio of struggling labels — a situation that its ill-fated purchase of Supreme, which it offloaded this year, failed to change. Until this year, Vans was its largest cash cow, but its sales have kept sliding. When VF Corp. hired Bracken Darrell as its chief executive in July 2023, he singled-out a Vans turnaround as a top priority in a transformation program unveiled that October that also sought to improve the company’s results in North America, reduce costs and strengthen its balance sheet.

While Kernan said he remains “cautious” on VF Corp.’s turnaround and believes more work needs to be done, he sees Choe’s hiring as a win. Her arrival comes as VF Corp. has paid down debt, freeing up capital and its ability to reinvest in its businesses. And though Vans’ sales are still falling, the pace of decline has slowed, suggesting momentum is now moving in the right direction.

“I would say the number one thing is the importance of product,” said Choe. “So that focus that I had then and before Lulu[lemon], and what I bring to Vans, is really that: the power of product and the power of creatives.”

A Knu Skool and ‘Off The Wall’ Mindset

OTW’s mission is to push the boundaries of product and brand experiences with an “off the wall” or progressive mindset that brings Vans to the edge of design, art, music and new cultural spaces, according to Ginoza. Vans has staged events for the line like a New York Fashion Week activation that reunited the band TV On The Radio inside a re-creation of the downtown New York hipster haven Max Fish.

“It’s defying old conventions in pursuit of new and better ways of working, learning and building products,” said Ginoza. Unlike Vans’ previous, now-defunct line for its pinnacle product, called Vault, OTW tries to look towards Vans’ future rather than its past.

Early indications are that the approach is working. A collaboration with buzzy emerging streetwear brand Satoshi Nakamoto that embellished Vans’ OTW Old Skool Reissue 36 with pearls sold out, with pairs reselling for $1,000-plus premiums on StockX.

“The things they’ve been doing within that silo have been selling well,” said Lois Sakany, a director of retail research at OTR Global and co-founder of the sneaker blog Snobette. “I look at OTW as advertising/marketing that’s building brand equity and credibility, and it seems like that’s happening there.”

Choe said she sees OTW as a creative playground, and believes Vans’ mainline team can also harness its ideas for products that could be more scalable. To that point, Vans isn’t just counting on unconventional shoes that appeal to a niche customer to get its sales going. It’s also seeing success bringing back under-utilised styles from its archive such as the Knu Skool, a model from the 1990s that was re-introduced in 2022, that can connect in the mass market.

Choe said it’s a “top five” sneaker for Vans and has particularly resonated with women and young customers. Foot Locker, a key retailer for Vans, flagged the Knu Skool during an earnings call in August as “encouraging trend” out of the Vans brand, and StockX said the model is what’s driving Vans’ growth on their platform.

“They’re trying to stick their head into this new age of culture and going back to their roots,” said StockX’s merchandising director of sneakers and collectibles, Drew Haines. “It hits all the things people want right now: Newness, value and retro-inspired designs.”

Another factor has also played into the Knu Skool’s success in Choe’s view: the return of wider-leg bottoms, which the shoe pairs well with. The brand obsesses over what’s happening in apparel, she said.

Buyers from the sneaker and streetwear-focused boutiques agree that Vans is currently addressing a more fashion-forward customer.

“Obviously it has always been one of the top contenders in skating. I think outside of that, you’re just going to see a lot of women interested in Vans right now and a lot of the real street, Downtown [New York] culture [customers],” said Concepts senior buyer Ross O’ Hanlon.

UK-based retailer End Clothing is building up its Vans business. The shoes are trending amongst its global customer base. Dean Walker, who oversees the bulk of buying for the retailer, said the brand is cycling back in again because of its affordable price points and tasteful products, pointing out how the pearl-embellished OTW Old Skool 36s spoke to contemporary clothing trends and sold out within 20 minutes on End.

“It’s easy to sell down, it’s really hard to sell up,” Walker said. “It does start at that pinnacle customer and then it filters down.”

A Long Ramp Up

While the Vans business is improving, it still has a long way to go to get back to the growth it enjoyed at the end of the 2010s. Even though Vans has cleaned up its wholesale channels and initiated other reset actions like reducing its SKU count, TD Cowen analyst Kernan believes the brand still needs to close more stores and focus on growing its digital channels while improving its pace of innovation.

And while Vans has benefited from the trend towards low-profile sneakers like the Adidas Samba, Sakany of OTR Global and Snobette questioned whether the brand has a follow up to the Knu Skool. She pointed out that on X (formerly Twitter), for instance, sneaker fans argue all day about brands like Adidas, Nike and Asics. Vans just isn’t part of the conversation.

“They got lucky with this Knu Skool that clicked and have to build off of that by continuing to reintroduce themselves to their target, which is a teen customer who shops at a premium place like Dick’s, JD or Foot Locker,” said Sakany. “The connection between Vans and that customer is quite tenuous right now.”

In the latest iteration of Piper Sandler’s semi-annual Taking Stock With Teens survey, Vans was knocked out of the top five footwear labels among US teens this season, ranking below Ugg, Converse, New Balance, Adidas and Nike.

Ginoza and Choe believe that Vans’ roots in skateboarding and action sports still give it an invaluable cultural cachet to work from.

“That cultural relevance is so important because then what you can do is really draft off of your roots in skating, that authenticity around ‘Off The Wall,’ youth culture and create more commercial and lifestyle propositions,” said Choe. “But it then keeps you true to who you are.”