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Formal Business Report:

Caroline L. Stastny
Saint Johns River State College
GEB 2214-2: Business Communications
Ms. Kristy Mattice
April 24, 2020
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Table of Contents

Executive Summary ……………………………………………………………..….…………… 3

Introduction ……………………………………………………………………..….....…………. 4

SWOT Analysis ……………………………………………………………….……...……….… 5

Strengths ……………………………………………………………….……..…………. 5

Weaknesses ……………………………………………………………..…….…………. 6

Opportunities …………………………………………………………...……..…………. 7

Threats …………………………………………………………………...……………… 8

Strategies ……………………………………………………………………………..…………. 9

Strengths/Opportunities ………………………………………….……………..….……. 9

Strengths/Threats …………………………………………………………….….….…… 9

Weaknesses/Opportunities ……………...…………………………………….....……... 10

Weaknesses/Threats …………………………………………………………..…..……. 10

Conclusion……………………………………………………………………………....……… 11

References …………………………………………………………………………...………… 12
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Executive Summary
The purpose of this report is to analyze all factors that affect the company, Crocs, and

devise several strategies accordingly. These strategies are meant to help Crocs become one of the

top-rated companies in retail footwear. Because both internal strengths and external opportunities

will be compared in this report, the company will utilize all resources available. This is known as

a SWOT analysis, which stands for strengths, weaknesses, opportunities, and threats. The

internal strengths of the company include a strong CEO, partnerships with influencers, a niche

product range, and successful e-commerce. Internal weaknesses are fashion, safety, and

employee satisfaction. External opportunities are a recent increase in online shopping, social

media, globalization, and the fact that Crocs has an established brand name. External threats

include competitors, consumer preferences, and Generation-z tendencies. Strategies devised from

these factors are described below:

Internal
Strengths Weaknesses
Opportunitie - Increase social media marketing - Market Crocs promotions or
- Partner with several more partnerships with celebrities through
influencers social media
s - Offer frequent discounts and - Continue to get free publicity
Externa seasonal promotions - Increase employee diversity and
commitment with special programs
l
Threats - Continue to market unique - Promote a family work environment
variations of the original clog - Continue to invest in research and
- Offer employee benefits to lower development in order to stay ahead of
the employee turn-over rate competitors

The most important strategies from these components will be to increase social media presence,

partner with more large influencers, invest in the research and development team, and increase

employee satisfaction. This plan shall be presented to the lead product designers, marketing

managers, and top executives.

Formal Business Report: Crocs SWOT Analysis

In the early 2000s, the newly popular company Crocs was rapidly expanding. New stores

were built everywhere, and merchandise was overproduced. Because Crocs turned out to be

mainly bought in the summer, along with having a reputation for being a fad, the number of

shoes sold could not support the recent expansions. The company had over-extended themselves

into a disaster. Luckily, in 2017, new CEO Andrew Rees stepped in and used highly aggressive

measures to save the company. However, in the modern business world, the need to keep

growing never stops. Rees must continue to push sales and figure out how to keep Crocs from

being the funky, fad shoe that simply fades away. In taking into consideration COVID-19, the

next months could be detrimental to the company. An analytical, SWOT analysis (strengths,

weaknesses, opportunities, and threats analysis) presented to the lead product designers,

marketing managers, and lead executives of Crocs would be the most beneficial in determining

how they should proceed.

This analytical report will assess each of the aspects of SWOT and define four strategical

plans based on the assessment. Each one of the strategies will have multiple components and will

fall under the categories of strengths/opportunities, weaknesses/opportunities, strengths/threats,

weaknesses/threats. This will give the best call to action for the company to take, based on its

internal and external conditions. Major current events that will affect the company, like

globalization and e-commerce will be assessed. Internal factors that affect the business, like the

new CEO will also be considered. If Crocs devises a highly strategic plan in accordance to the

SWOT components, they are highly likely to continue the growth pattern have seen in the last

four years.

The SWOT Components

Strengths

Gross Income

597.95
536.22
490.92
482.21

473.02
Millions of Dollars

2015 2016 2017 2018 2019

Strong CEO. CEO Andrew Rees was employed at Crocs for several years before being

appointed CEO. He first started as the Principle Executive Officer in 2014 and was appointed in

2017. Since then, he has made some major changes to turn the company around. When asked

what the most important parts of this progress was, Rees said, “It’s coming from two sides: One

side is cleaning up excess distribution and being focused on the channels we think are effective

for us. The other is having the right product in the marketplace that reflects the brand values that

we’re proud of and product we’ve spent a lot of time and energy developing. Overall, the most

important thing is brand elevation.” (Young, 2019). This quote describes how Rees closed the

large amount of extra outlet stores, delegated manufacturing plants to third party groups, and

refocused the product line on the classic clog. The chart below shows the gross income of Crocs

through the years that Rees has spent developing it (“CROX”, 2020). The gross income has

tremendously increased. It is clear that Rees is very familiar with the company, and will continue

to be its best option for a leader.

Partnerships with Influencers. In the past, Crocs has partnered with two major music

artists: Luke Combs and Post Malone. The company produced clogs inspired by each of these
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celebrities, which were both very popular. The infamous Post Malone Crocs even sold out the

day of the release and were highly sought by shoe collectors. Crocs should continue partnerships

like these in the future, to bring attention to the company and spike the sales.

Niche Product Range. The clogs and sandals that are sold can be narrowed down into

specific demographics, since the range of products that Crocs carries is so narrow. This can be

helpful in fine-tuning marketing strategies towards specific consumers.

E-Commerce. One thing that Crocs has done very well with is expansion through e-

commerce. Crocs has a very accessible website that is easy and efficient to buy products through.

Additionally, as a result of COVID-19, online shopping is a great opportunity for Crocs to make

sales while the stores are closed. The company is doing their best to post updates on their website

to keep the public informed. CEO Rees wrote that the company was responding to the pandemic

by temporary closing stores, and following guidance from the CDC on cleaning (Rees, 2020).

The company is also giving away free clogs to healthcare workers in attempts to do their share to

help. These are both great actions for the company to take, and reassures customers that this

company is socially responsible.

Weaknesses

Fashion. Crocs continues to attempt to expand into sectors that are simply inappropriate

for the company. Attempting to create Crocs golf shoes and fashionable items has already been a

failure for the company and should not be tired again. Crocs should continue to market and stay

in the design sector they have established, or they risk wasting time and money.

Safety. Several Podiatrists have made reports questioning the safety of Crocs (Cave,

2016). Because a good portion of the people who wear Crocs to work have jobs with long hours
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(health care, food service), they stand up all day wearing Crocs. Podiatrists question if Crocs are

supportive enough for this, and if they are hazardous (because they are not secure).

Employee Relations. The company could improve on its social responsibilities towards

its employees. There are several reports of the company’s having low diversity, low job

satisfaction, and a high employee turn-over rate (Williamson, 2018). This could be an indicator

that human resources management needs to be improved.

Opportunities

E-Commerce. The number of people who now chose to shop online has been steadily

increasing. This is great news for Crocs, as their online website is very accessible. E-commerce

is both a strength and an opportunity for Crocs, because while Crocs has a great website, the

number of people who will be likely to use this website continues to rise (Williamson, 2020).

Social Media. With the rise of social media, Crocs has a great opportunity for free

advertisement on Instagram, Facebook, and Twitter. As they continue to focus in on their social

media involvement, they can lessen the cost of advertisement elsewhere. Other opportunities

surrounding the social media subject include tweets or posts by Crocs’ celebrity partners, such as

Post Malone. Any post made by these influencers is great publicity for Crocs. Last year, Post

Malone made this tweet, receiving upwards of 8,000 likes:

(Malone, 2019).
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Globalization. As the world population continually increases and access to online

shopping develops, an increase in the demand of shoes continues to grow.

Established Brand. Because Crocs already has an established brand name and has

proven to be successful in previous partnerships, other movies or celebrities will be more likely

to do collaborations with them.

Threats

Competitors. Crocs’ biggest competitors include Sketchers, Nike, and Adidas. These

larger brands are a serious threat, because they are much more diverse in their product lines and

target age groups. While Crocs can only change so much, companies like Nike can continue to

change and develop new products as seasons and fashion trends change. Crocs is currently not in

the top ten ranking of retail footwear, while Nike sits at number one (“Crocs’s Competitors…”).

Consumer Preferences. As previously stated, Crocs are not considered to be fashionable

by many, and it takes a certain goofy sort of style to wear the shoe. In the past, Crocs has been

known to sell multiple more “stylish” variations of the classic clog. However, these shoes looked

tacky to many, and did not sell well. It is very difficult to stay within the ever-changing

preferences of fashion, and even more difficult when a brand has already been established with a

reputation as only fun and practical.

Generation-Z Tendencies. Generation-Z is less likely to be committed to a singular job

than any other generation. This creates a high employee turn over rate in stores, and large

problem for Crocs, because hiring and training employees repetitively is expensive.
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Strategies

By comparing the strengths and weaknesses to the threats and opportunities, multiple

highly relevant strategies are formed.

Strengths/Opportunities

Because of the global increase in social media, Crocs should increase the amount they

market on social media. Posting more on social media platforms will not only be effective in

gaining viewers but cost efficient. The company should be driving sales on all social media

platforms because more people are constantly joining them and have the chance to see Crocs.

More partnerships with large influencers, like Post Malone, should also be done. These types of

partnerships have been very successful in the past and are an excellent way to increase sales and

exposure. Campaigns with large influencers help to keep Crocs a popular topic. Finally, Crocs

should offer frequent or seasonal discounts or promotions on the products in order to boost sales.

Because of the price of Crocs compared to the frequency people will actually wear them does not

seem to correlate, promotions will help to bring in many more sales. Today’s world is heavily

globalized, and information can spread very quickly. Crocs should use the ever-increasing

population and availability of information to its advantage. More and more people continue to

need shoes, so crocs should always be increasing in its sales numbers.

Strengths/Threats

Because Crocs has already found that trying to stray too far from the original clog is

unsuccessful, they should continue to mainly sell different variations of the same clog. This

classic clog can be recreated in many ways, and for many different uses. They should appeal to

consumer preferences by offering Crocs or Jibbitz with themes of popular topic. Additionally,
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personalized shoes or Jibbitz would be a creative way to allow consumers to purchase an

individualized product. Personalized items could be designed and purchased on the website.

Finally, programs and incentives should be offered to employees in order to increase employee

satisfaction and loyalty. For example, offering a one dollar raise for every four months a retail

employee works would be good motivation employees to stay with Crocs. This could also

increase employee satisfaction and create a higher-driven employee.

Weaknesses/Opportunities

Crocs should continue to get as much free publicity as possible. Posts made by celebrities

get thousands of views and are great advertising. Additionally, releasing pictures of products like

the “high-heeled Crocs” are a great way to get free advertising from people re-posting the image.

With that being said, the company should not focus on trying to be fashion forward, but instead

on the products that have already shown success. Crocs should be comfortable, useful, and fun to

wear. In reference to the doctor’s concerns with Crocs safety, the company should continue to

release information assuring the public of the safety and comfort of Crocs. The developers could

also consider making a more secure shoe, with a foam bottom and smaller circumference around

the ankle. Finally, Crocs should increase wages for committed employees, and increase worker

diversity. These are both large problems that HR and other departments should pay more

attention to.

Weaknesses/Threats

Crocs should promote employee loyalty and job commitment as much as possible. To do

this, managers should promote a family environment in stores, and motivate employees to want

to do their best at work. They could also offer programs for students who have worked with
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Crocs through college, like offering them corporate jobs or subsidies. The company should

additionally do its best to adapt to the changing preferences of consumers and stay ahead of other

businesses. This means they should be investing heavily into the research and development

departments of the company. As the business is not currently in the top ten for retail footwear,

their goal should be to get there.

Conclusion

Crocs has come very far as a company from where they were in in early 2000s. While

their gross income is now showing an increase each year, the company will need to continue in

its aggressive strategies in order to continue this. Making a profit is simply not enough; they

should be striving to be one of the top footwear companies.

Crocs is a highly unique company, because it is focused on one style of shoe for one

season, which is very dangerous. The brand is constantly at risk for suddenly completely going

out of style, because of the rapidly changing fashion industry. Today’s highly globalized world

presents both threats and opportunities, but all that the company can do is control their own

reactions to this. The most successful approach to this will be using the SWOT strategies to form

a plan of action. For the company, the most important components of said devised plan will be to

increase social media presence, partner with more large influencers, invest in the research and

development team, and increase employee satisfaction. Additionally, with the COVID-19 issue

at hand, the company will need to make important decisions regarding employee safety and

social responsibility. It will be harder than ever to continue selling shoes, which is why the

company needs a strong plan of action rights now. Rees has done a great job at reviving this

company, however he should take the SWOT analysis into consideration in his next moves,

because this could be critical to the company’s survival.

References

Account, C. S. V. (2020, March 25). Crocs Shoes (@Crocs). Retrieved April 16, 2020, from

https://twitter.com/Crocs

Andrew Rees. (2020, April 13). Retrieved April 13, 2020, from

https://www.bloomberg.com/profile/person/18735636

Butler-Young, S. (2019, June 24). Exclusive: How Crocs CEO Andrew Rees Breathed New Life Into the

Brand - One Classic Clog at a Time. Retrieved April 10, 2020, from

https://footwearnews.com/2019/business/retail/crocs-ceo-andrew-rees-interview-2019-classic-

clog-1202738360/

Cave, J. (2016, June 1). Here's What Podiatrists Think About Your Crocs. Retrieved April 10, 2020, from

https://www.huffpost.com/entry/are-crocs-bad-for-you_n_574de531e4b02912b241081f

Crocs’s Competitors, Revenue, Number of Employees and Acquisitions. (n.d.) Retrieved April 14, 2020,

from https://www.owler.com/company/crocs

CROX: Crocs Inc. Annual Income Statement. (n.d.). Retrieved April 15, 2020, from

https://www.marketwatch.com/investing/stock/crox/financials

Malone, P. (2019, November 21). Posty (@PostMalone). Retrieved April 24, 2020, from

https://twitter.com/PostMalone

Rees, A. (n.d.). A Message From our CEO. Retrieved April 16, 2020, from

https://www.crocs.com/COVID19-STATUS.html

Williamson, D. (n.d.). Crocs Inc SWOT Analysis / SWOT Matrix. Retrieved April 16, 2020, from

https://www.essay48.com/term-paper/2830-Crocs-Inc-Swot-Analysis