Havaianas – the simple rubber sandal from Brazil – has become one of the country’s best loved exports. Created in Brazil in June 1962 as a vulcanised rubber sandal based on the Japanese Zori straw sandal, the company has emerged from a major re-branding drive which has moved the shoe as one strictly for poor people to a fashion item even worn by the queen of Sweden! Sitting down with Havaianas’ very international director Carla Schmitzberger – half Brazilian, half Austrian and educated in the United States – we went through the process which has taken the sandal from one wealthier people were embarrassed to be seen in, to one where several pairs now grace their wardrobes.
Havaianas were originally made in one style and in five colours – blue, yellow, brown, black and pink – with a sole the same colour as the strap. The top of the sole, where you placed your foot, was originally white, however. For the first 30 years, from 1962 to 1993, the sandals were sold through small `mom-and-pop’ shops. Packaging was a plastic bag. In-store display was nothing more than a line of Havaianas placed on the floor. “Not exactly the most attractive point of sale and distribution,” Carla points out. “But I must admit the company did quite well.”
At its peak in the late 1980s, Havaianas was selling between 80 to 85 million pairs each year. Brazil’s warm climate and long coast made the sandal a practical choice in footwear. It was also the only pair of shoes many poor people could afford. Sales started to fall as the company moved into the 90s, bottoming out at 65 million pairs in 1993. “The people managing the brand realised that if the rate of decline continued at the same pace, the business would have totally collapsed by 2006 and the brand would have died,” Carla says.
The main reason behind this dramatic fall in sales was that consumers had come to view the sandal as a simple commodity. “Every time you have a commoditised product, you don’t spend anything on communications,” Carla explains. “Advertising would focus on functionality and the business began to focus mainly on cost-saving solutions, potentially affecting quality. This process is then set into a vicious circle.”
From commodity to fashion item
Change was clearly needed. The company started by looking at how consumers were using the product. Carla: “We saw that consumers were taking off the sole and turning it around so that the upper part of the sole was the same colour as the straps”. In response, Havaianas launched a new product range – Havaianas Top – which was a monochrome sandal originally launched in eight solid colours and now available in 20.
The second move was to change the packaging. “It was taken out of the plastic bags and placed in cartons” Carla explains. “In this way, the product was not limited only to ‘mom-and-pop’ shops, but could also go to shoe stores and be exhibited in a better way.”
The third and most significant move was to shift the brand perception from one people were embarrassed to be associated with to a fun and aspiration brand. The company launched a new high-profile advertising campaign, including print and TV commercials, which always contains lots of colour, vibrancy, energy and joy. In addition, Havaianas started targeting opinion leaders such as magazine fashion editors and celebrities, sending them samples – particularly of a growing range of limited ‘special edition’ models – in a bid to encourage them to wear the new look Havaianas. The strategy worked and soon the fashion elite of Brazil were being seen getting about town in their new Havaianas, while the sandals were making regular appearances in the editorial pages of the country’s top fashion magazines.
The company also entered into a number partnerships to ensure a continuous line of new, creative and novel products. Examples include partnerships with jewellery designers, such as HStern, that resulted in jewel-encrusted versions of the sandals, as well as with famous cartoonists who decorated special editions. “These special projects helped create a strong emotional attachment with customers. They also resulted in the creation of a lot of buzz surrounding the brand. We also do a tremendous amount of brand activation through artnerships with international brands. The beauty about our brand is that it is a blank canvas, you can always come up with new ideas.”
Other innovative marketing campaigns saw the company join with environmental groups working to save endangered forest species. Havaianas came up with a special version of their sandals with the endangered species printed on them and donated part of the sales of these products to their partner organisations.
Back in business
Today, Havaianas has around 450 models of different style and colours. The company has also moved to launch its products globally, with Hawaii and Australia – both countries that have a strong beach culture and where consumers already wore sandals – becoming the first targeted markets in 1998. The same branding strategies were put to use and strong sales followed. Today more than 11 percent of sales are carried out overseas. With the set up of an office in New York in June 2007 and now an office in Madrid, they are taking serious steps forward and put feet on the US and European market, where the opportunities are huge.
Since Havaianas emerged from its re-branding strategy in 1994, sales have been growing by a steady 8 percent each year. Last year the company sold 171 million pairs of its now famous rubber sandal, 20 million of which were sold outside Brazil. Inside Brazil, the company has achieved the amazing brand penetration rate of 850 pairs sold per 1000 inhabitants. “The beauty of this is that 50 to 60 percent of these pairs go to poor people so despite all the changes, the brand is still true to its origin,” Carla said. “These days, however, it is a brand which permeates all social classes. Now it is a brand for everyone.”