WomenÆs designer shoesùthe top brands in the countryùhave found a highly profitable niche in the U.S. market. For the purposes of this paper, only non-athletic non-casual designer shoes will be considered: designer shoes of every heel height and style, plus boots. This particular market niche relies on cachet and word of mouth more than on traditional advertising. Designer shoes are not just footwear; they are status. Although top-notch shoe designers do advertise, they rely more heavily on the exposure their lines receive from being worn by Hollywood stars than on the catchy slogans and innovative ad campaigns that everyone else must rely on for business success. Once a designerÆs shoes are seen on the red carpet, they are hot whether they have ever been advertised or not.
The U.S. footwear market did not gain in bulk during the 1990Æs. It is a mature market, however, and does continue to grow at a moderate pace. Much of the growth can be attributed to higher unit prices. The Dow Jones U.S. Footwear Index indicates a healthy picture for the footwear market, which at its highest is estimated to be worth $38.8 billion. FOT daily numbers are seen rising from 228 in April to 248 in May (1, Fig. 1). Dow Jones also shows a 52-week range from 194.80 to 256.53 and a one-year percentage change of 17.90% (1, Fig. 2). In the top ten best-performing stocks, however, only one company deals in designer shoesùKenneth Cole; the others are athletic shoes or lower-end manufacturers. Although this may appear to be an indictment of the designer shoe market, such is not the case, as none of the ten worst-performing stocks are designer shoe makers; most of them are again athletic shoe manufacturers.
Kenneth Cole, the rising star of the Dow Jones footwear index, has charismatic appeal in the U.S. market (1, Fig. 3). Although he started out designing only for men, ColeÆs offerings now include womenÆs shoes and clothing as well as...