underselling

Just open anyone’s closet Millennial to find them, whether worn, scribbled or with the sole on the verge of collapse. The Converse Chuck Taylor All Star have been much more than a shoe: they were our—this editor includes—unconditional companion that survived all our aesthetic phasesfrom the fever skater in the style of Avril Lavigne until it becomes the essential everyday basic for going to the office. However, in recent years we have observed that this situation is no longer the case. Although fashion magazines try to convince us that they are back, we know that both the street and, now, the income statement tell a completely different story. The symbol of our “rebellious” youth is sinking. The financial free fall. The numbers don’t lie, and the market verdict is being relentless. According to a report by Bloombergthe Converse brand is currently in free fall, with its revenue heading dramatically toward its lowest level in 15 years. The magnitude of the disaster breaks down a financial drain: the brand has had three disastrous quarterswith consecutive drops in income of 27% in the first quarter, 30% in the second and a brutal collapse of 35% in the third quarter, remaining at a meager 264 million dollars due to the general weakness in all global territories. A huge contrast with its matrix. In October 2024, Elliott Hill took over as CEO of Nike and, from that moment on, the sports giant has shown signs of improvement, especially in the United States and in the wholesale market. However, Converse’s problems have intensified. In the November quarter, the Boston-based brand accounted for less than 3% of Nike’s $12.4 billion in total revenue, becoming the biggest drag on the company’s resurgence. But how could it happen? That is, how has such an iconic sneaker lost public favor in this way? (It is also true that the Millennials We are a bit egocentric. The answer lies in a mixture of immobility and lack of technical vision. Laurent Vasilescu, analyst at BNP Paribas cited by Bloombergis blunt about this: “Converse has lost ground over the years because it has not provided innovations. There was an excessive dependence on the Chuck Taylor model.” The brand rested on the laurels of its classic design. When they tried to modernize it—with the launch of the line chuck IIwhich incorporated Nike foam technology to make them more comfortable—the experiment turned out to be a resounding commercial failure. The market has changed drastically. As pointed out Seeking Alpha, Converse has come face to face with a consumer that now demands technical innovation, losing the battle to newer, performance-oriented brands such as On and Hoka. To this we must add the historical irony that Converse was not always a street shoe; In the 50s and 60s, it dominated more than 60% of the basketball market, shoeing legends and starring in the 80s. the iconic rivalry between Magic Johnson and Larry Bird with his Weapon model. Paradoxically, it was Nike itself that ended its hegemony on the fields by signing Michael Jordan. After losing its sporting throne, Converse was relegated to casual fashion, a terrain that is now also crumbling. Are we facing the end of an era? Faced with this crisis, Nike’s initial response in Oregon has been to take out the scissors. According to Bloombergthe company reduced Converse’s workforce, restructured its organization and took a severe 44% cut in marketing expenses during the fiscal second quarter. Despite this, Elliott Hill declared to Bloomberg TV in Milan: “I have heard the rumors (…) But we are committed to the Converse brand.” The rescue plan involves a desperate attempt to recover the lost glory on the trading floor. In fact, Converse has once again opted for professional basketballlaunching $130 sneakers in collaboration with Shai Gilgeous-Alexander, the reigning NBA MVP, in September. A little hope. So if the resuscitation attempt fails, it already exists a pretty clear option: Authentic Brands Group (ABG). This brand management giant, led by Jamie Salter, has a long history of buying struggling historic companies to squeeze sales through licensing and operating agreements. They already did it with Reebok (purchased from Adidas in 2022 for 2.5 billion, managing to increase their retail sales by 50%), and they also control Champion, Guess and Forever 21. According to BloombergABG has expressed a long-standing interest in acquiring Converse if Nike finally decides to hang up the “For Sale” sign. The reality of the street. There is a fascinating fracture between what the fashion industry dictates and what consumers actually buy. On the one hand, fashion headlines have been since last year announcing a “quiet return” of Converse, applauding like celebrities like Alexa Chung or Charli XCX wear the classics again high-tops in campaigns or fashion weeks. They speak of an abandonment of quiet luxury in favor of nostalgia. However, the overwhelming financial data of Bloomberg show that this supposed rebirth It’s an Instagram mirage. The generation millennialwhich massively adopted this shoe in 2008, has changed its priorities to an ergonomic model, support and comfort. The Converse look very good in the photos of street stylebut they are no longer profitable on a day-to-day basis. We have gotten older. Nike bought Converse in 2003 for $305 million, rescuing it from a painful bankruptcy filing. Today, more than two decades later, history threatens to repeat itself. Whether it achieves a sales miracle thanks to the NBA MVP or ends up being devoured by Authentic Brands Group’s mass licensing model, one thing is clear: Converse’s golden era is over. For the millennial generation, seeing their iconic sneaker fight for its survival is a relentless reminder of the passage of time. Converse will continue to exist, probably in the back of our closet or as a product of licensed nostalgia, but the incontestable symbol of our cultural dominance is fading forever. Image | PickPik Xataka | We went out for a 20-kilometer run with a bag of liquid cream in our backpack: now we have our own butter