Legacy footwear giant ASICS is gaining ground on its tech-savvy competitors thanks to a smart digital acquisition.
Earlier this month, the Custora Team attended Etail East — one of e-commerce retail’s biggest annual conferences — in Boston. For three days, we were able to schmooze and attend sessions with marketing leaders from a number of major e-commerce retailers, all while enjoying wicked awesome views of Boston Harbor.
One of our favorite presentations during the conference was delivered by Dan Smith, President of ASICS Digital, who talked about being a “champion of change” and disrupting legacy systems. Smith is no stranger to shaking up the status quo — soon after he joined Runkeeper, a Boston-based fitness application, the startup tech company was acquired by ASICS in 2016. ASICS made Runkeeper its digital arm, renaming it “ASICS Digital.”
As a 70-year-old brand, ASICS has established a reputation for producing high-quality footwear, but the company had been slow to adapt to the demands of the digital world. It was up to Smith to help ASICS stay relevant in the digital age — which meant disrupting legacy values and shaking up the entire organization along the way.
Making What’s Old, New
In many ways, legacy brands have a leg up on the competition; they have the benefit of established customer bases, years of experience, and solid reputations within their industries. But in the digital age, brands must continuously adapt to address customers’ evolving needs in order to maintain their footholds within the retail industry. Simply continuing with “business as usual” isn’t enough to keep up with the needs and desires of the modern shopper, and may result in plunging sales for legacy brands.
We’ve now entered the Age of the Customer, the recognition of which has allowed ASICS to remain highly competitive in today’s retail market. Prior to acquiring Runkeeper, ASICS functioned more as a wholesaler than a direct-to-consumer retailer; its products often reached customers through a third-party retailer like Zappos or Footlocker.
ASICS’ acquisition of Runkeeper offered the perfect opportunity for the company to begin communicating with consumers on a more personal level. Since 2015, Runkeeper has had a built-in shoe tracking feature, which allows users to track the mileage on their current pair of shoes. The app then alerts them when they’ve reached their prescribed mileage limit and are in need of a new pair.
This app conveniently collects information about consumers’ fitness habits, shoe sizes, preferred shoe models and locations — in other words, all the data ASICS needs to market to each customer in a highly personalized manner. However, in order to take full advantage of the opportunities for personalization that a partnership with Runkeeper offered, ASICS first needed to modernize.
The Challenges Facing Legacy Brands
According to a recent survey conducted by the Harvard Business Review, 36% of marketing professionals believe legacy systems are one of the biggest roadblocks preventing them from implementing real-time analytics, with data silos and organizational silos close behind (at 33% and 29% respectively).
When ASICS created ASICS Digital, it had 70 years of tech debt to pay down and 70 years of organizational structure to rethink. Tasked with revitalizing ASICS’ digital arm, Smith came face to face with the problem of silos: marketing and tech were often in different departments or even regions. To address this, Smith brought in a scrum team to reorganize the company’s fragmented structure.
The next steps for ASICS included overhauling storefronts and upgrading e-commerce platforms, making direct interactions with consumers more meaningful, and moving into a cloud environment, thus shifting the focus from policing system vendors to improving the customer experience. The ultimate goal of this structural overhaul is to establish real-time connected systems without having to be loyal to one specific vendor, Smith said at Etail. Connecting all vendors with application programming interfaces (APIs) has been the most critical factor to ASICS’ success.
Currently, ASICS is operating in five-year increments, with the goal of completing its digital transformation by 2020. By that time, Smith said ASICS aims to create a single view of the customer and close the gap that separates the company from its tech-savvy competitors. If they do their job well, ASICS Digital will become obsolete — because ”digital” will be written into ASICS’ very DNA.