Last week, we talked about the importance of brand revitalization during challenging times and how companies must address obstacles head-on and manage their brand on a proactive basis in order to maintain their desired perception in the marketplace.
Brand Iron recently helped Newton Running, the innovative, Colorado-born running shoe company, do just that. Working as a team, with some tactical planning and preparation, we set out to show what Newton has done to reorganize and restructure themselves as a company. As part of that effort, we helped develop the brand and public relations strategy and messaging for several different publications, including an article in Runner’s World Magazine that announces the Newton brand revitalization to the world. The message is simple: “we’re thriving, and we are are going to get back to our entrepreneurial roots disrupting the running shoe space.”
Here is the article in full:
Newton Running Reorganizes Without its Original Visionary
The company promises to return to its focus on serious runners who want to run more efficiently.
Newton Running, the innovative shoe company that made a big splash when it launched 10 years ago, has undergone a major reorganization in recent weeks. As a result, visionary cofounder Danny Abshire is no longer with the company and the brand has closed its flagship retail store in Boulder, Colorado.
Jerry Lee, the company’s cofounder and original investor, has come back to lead the brand, which made its name with brightly colored shoes, unique forefoot propulsion lugs, the promotion of more efficient running form, and online-only sales.
Lee returned as CEO and the company’s primary shareholder on April 6. Newton was under the management of private equity firm Fireman Capital Partners, which is no longer involved with the brand.
Lee said Newton will return to its roots and offer a narrower product line while focusing on being a strong but small company. At its peak, Newton Running employed 47 people—and Lee credited the brand’s current viability to the work those individuals had done—but it is now operating with a staff of 15, he said.
The retail store that Newton operated on Pearl Street in Boulder closed in late March. Independent running stores that carried Newton shoes once numbered about 600, but that total has dropped to about 100 in recent months.
Lee is confident the brand will achieve profitability soon by selling direct to consumers online and also through those specialty running retailers that have served the brand well through the years.
“I have always believed in the technology and the impact it has had on so many thousands of runners,” Lee said. “The outpouring of letters and emails from our key retailers and some of our best customers is really what brought me back. When we started the company, I never dreamed of having people tell us their life experiences, and we have had thousands of those kinds of testimonials.
“Financially, I didn’t have to do this. But I looked at all of those people that we created these passions with and it would be unfair if that brand just went away. The people who are invested with me believe strongly in Newton and in me, and so it’s here to stay, without a doubt.”
Newton will primarily focus on its performance shoes and its slightly more accommodating models going forward. Lee said the company will market mainly to discriminating customers concerned with running better and more efficiently.
The company will also go forward without Abshire, and his wife, Jennifer, who was part of the original start-up team. Both were assigned to handle operations at the store and taken out of the core management team a few years ago. They were let go when the previous management team decided to close the Pearl Street store.
Jennifer Abshire posted an item on Facebook on April 2 about their departure. That post garnered a lot of support, but it also raised questions about the fate of the brand.
“I am honored to have worked side by side with my husband, business partner and running buddy,” Jennifer wrote next to a photo showing the company’s launch 10 years earlier at the Ironman 70.3 race in Oceanside, California. “We worked with a great family of co-workers, met a lot of amazing people, travelled the country and helped runners and triathletes of all levels. Our journey with Newton Running has come to an end but we are excited to see what new adventures lie ahead.”
Lee initially backed Abshire’s innovative running shoe designs in the late 1990s. Abshire, a self-taught footwear guru, took the insights he learned from improving the fit of ski boots and later from building custom footbeds for elite triathletes like Paula Newby-Fraser and Michele Jones to developing his first running shoe prototypes in the late 1990s.
Abshire had a vision to build shoes that promoted more efficient running form via a mid-foot running gait and better running posture. His shoes came at a time when most brands were putting new technology and materials into thickly cushioned heel crash pads.
The brand was one of the first to trend toward a zero-drop or level platform and also helped spur the development of lightweight shoes and premium pricing of $155 to $175 per pair. It also offered running form clinics and coaching certification to further its message about efficient running form.
Lee and Abshire first brought the brand to market in 2007 at triathlon race expos and through direct-to-consumer online sales, selling 5,000 pre-orders before its first bulk shipment of shoes reached its warehouse.
“I won’t be part of Newton going forward, but I’m still very proud of what we did with the brand,” Abshire said. “When we started it was Jerry’s money, but it was Jennifer and I who created the grassroots movement. I really enjoyed all of the things that we created. We really stirred the pot and contemplated how to be different.”
The Fireman equity group originally backed Newton in 2011 with a reported $20 million investment, hoping to take it from a fledgling start-up to a major player in the running footwear industry. The brand grew by leaps and bounds from its inception through about 2013 and sponsored elite pro athletes like three-time Hawaii Ironman World Champion Craig Alexander. That group also tried to help it grow among recreational runners
But slower growth, some distribution and manufacturing challenges, and increased competition led Newton to a plateau, Lee said.
Newton achieved double-digit to triple-digital growth for several years, Lee said, before competition from other innovative brands—including Vibram, Hoka, and Altra—slowed its progress a bit. A major industry shift from more minimally designed shoes to well-cushioned models also affected the brand, Lee and Abshire said.
“A lot of things happened after we launched that were out of our control,” Lee said. “When we started, it was just us and the bigger boys like Nike, Brooks, ASICS and New Balance. We kind of opened the door for a whole bunch of other brands to come in.”
Fireman Capital Partners tried to sell the brand, but a deal never materialized, opening the door for Lee to step in with new investors to assume control of the company.
Kris Hartner, owner of three Naperville Running Company stores in suburban Chicago, was the second retailer in the U.S. and the third in the world to sell Newton shoes. He said the innovative technology, the brand’s messaging about running better, its bright fluorescent color palette, and overall quality helped it get off to a flying start in 2007.
But Hartner’s stores backed away from the brand in 2015 after the first reorganization resulted in the layoff of 14 people from its Boulder office and the elimination of most of its outside sales rep staff.
“They kicked ass right off the bat,” Hartner said. “To be honest, I don’t know if any new company has come to the table with as good as the shoes they had. They were impressive. We would have stuck with it, but they eventually kind of went in the opposite direction of how they originally presented themselves.”
Although Abshire says he was disappointed and a bit confused about how it all came down, he insists he’s not bitter. He says he and Jennifer will maintain their Active Imprints custom orthotics business in Boulder and that they already have a few new projects they’ve been working on.
“It’s not the end of the world,” he said. “It’s the end of a business or a relationship and whether it was a great one or a bad one, it doesn’t even matter. Things are constantly changing and as we accept that, the better we are able to move on and do the next best thing. If Jerry is taking over the company again, good for him. I wish him the best of luck.”
The article addressed some growing concerns in the marketplace about Newton Running and dispelled any negative rumors about their ability to stay in business and ship their products. Due to this coverage, we were able to help Newton ease potential fear and hesitation regarding their retailers and incite a spike in sales and excitement in the marketplace. This is only the start in helping to revitalize the Newton Running Brand.
If you and your company have gone through challenging times, don’t just sit there, take action and develop a strategy for getting back to achieving your company’s goals and objectives. Learn how Brand Iron can help.