The Billabong saga which seemed as though it would go down in surfing history as one of the great fails of our time has announced that they plan to rebuild more stores.
According to CEO Neil Fiske, Billabong is ready “right now.”
“Stores are key to a brand’s health over time,” Fiske said in an interview in Sydney. “The thing you can do in a store that you can’t really do on the Web is connect directly to that customer. You can make it come to life.”
In the past 3 years, Billabong had sold 34% of its locations and eliminated debt of $333 million.
According to Bloomberg, Billabong shares rose 0.8 percent to close at 65.5 Australian cents in Sydney trading, hitting their highest level since Nov. 25.
“What you pay in rent in retail but you don’t have to pay in e-commerce is largely offset by what you have to pay for customer acquisition in e-commerce that you don’t have to pay in retail,” Fiske said. “You don’t have people just rocking by your site, you have to pull them to your site, which means you have to spend on paid search or display ads or other things.”
Billabong’s number of stores was at an all-time high in 2011 at 639 store locations. Now there are 424 outlets. In 2013, Billabong, including its other brands RVCA, Kustom, and Element, was worth A$49 million compared with A$614 million in 2011. One of the boosts for expanding stores again is the new store opening in Sydney which is doing well.
“We’re much more on the front foot now, working toward great store opportunities in the great surf locations around the world,” Fiske said. “Where we see those opportunities, we will invest.”
