The Beginning

Sometime in 1908, Marquis Mills Converse decided to start a rubber shoe company,
bypassing a rubber trust that prevented most companies from doing business
directly with their retailers. Early catalogs bragged about how many trucks left the
Converse factory in Malden, Massachusetts, delivering product directly to stores in
Boston. Mr. Converse’s idea worked. But more importantly, it survived.

1908-1918

In 1913, Converse produced a catalog with the following words: “Our company was
organized in 1908 fully believing that there was an earnest demand from the retail
shoe dealer for a rubber shoe company that would be independent enough not to
follow every other company in every thing they do.” Those words would prove
prophetic. Always a brand for those independent enough not to follow, the young
company would take up with a young sport: Basketball. Also, Converse made tires.
But the basketball shoes gained more traction.

1918-1928

Chuck Taylor joins the Converse Rubber Company. How it happened remains lost to
history, but the reason isn’t: Chuck Taylor loved basketball and desired nothing so
much as to spread of the word of the new game and sell the sneakers it required.

1928-1938

By the time he lent his name to his signature badminton shoe in 1935, Jack Purcell
had won five consecutive Canadian championships and been declared the world
badminton champion. The Jack Purcell sneaker retains the legacy of its namesake
and the feel of his sport.

1938-1948

World War II provided Converse with a singular opportunity. Many products destined
for servicemen overseas now became a focus of Converse manufacturing. The
product range included footwear, apparel, boots for pilots and army servicemen,
parkas, and rubber protective suits and ponchos.

1948-1958

The invention of Rock & Roll. It was loud, lewd, filthy and everything everyone who
feared it said it was. It was also a movement in search of a uniform: It found the
leather jacket, the blue jean and the high-top sneaker. Interestingly enough, right
about this time, the high-top sneaker was around for the birth of something else:
The National Basketball Association.

1958-1968
A decade of change — for everybody. Rock & Roll and pro basketball grew up (in
Chucks), and All Stars finally came in colors. In tumultuous times, legends are born
— and from a green and white basketball team to a British invasion, from rooftops
to alfalfa fields, Converse was along for the ride.

1968-1978

Somewhere right around 1974, the All Star sneaker got a little bit of a makeover.
Remade in colorful suede with a big, bold star on the side, it was built for basketball
—but there was something about its brashness and brightness that would make it
irresistible to a generation of rockers, skaters and rebellious souls. Then around ’76
came the Pro Leather, an instant favorite in a time when the game needed a vibe.

1978-1988

An immediate on-court favorite, the Weapon sneaker became almost universally

favored by professional, college and high school teams throughout the 1980s and
’90s. In 1986, Converse launched the “Choose Your Weapon” ad campaign,
featuring two of the game’s biggest rivals wearing one of the game’s biggest shoes.
Over 20 years later, the legacy of Weapon — and its place in sport and culture —
continues to challenge the competition.

1988-1998

First came Grandmama. That was a big deal. Then, in 1996, Converse had a hit on
its hands with a basketball shoe called the All Star 2000. It was the first attempt at
replicating the Chuck Taylor All Star sneaker for contemporary competition, and
there was something about its ankle patch, red midsole stripe and no-nonsense
approach to the game that at least 1 million people couldn’t resist.

1998-2008

The brand enters its second century by honoring its heritage of seeing things a little
differently, loving people who want to change the world for the better, and basically
celebrating the spirit of rebellion and originality in basketball, Rock & Roll and
anywhere else you find it.

And there you have it — for now… The best stories are the ones that don’t end —
the ones you just keep adding to and adding to — all the while marveling at the
creative, disruptive, optimistic, courageous ways things evolve from being what
they were, to what they are, to what they will become.

Converse (shoe company)

From Wikipedia, the free encyclopedia

Converse, Inc.

Type Subsidiary of Nike

Industry sporting goods

Founded 1908 in Malden, Massachusetts

Headquarters North Andover, Massachusetts

Products shoes, aparell

Owner(s) Nike

Website converse.com

Converse is an American shoe company that has been making shoes since the early 20th century.
Miscellaneous Converse shoes

Contents

[hide]

• 1 History

○ 1.1 1908–1941: Early days and Chuck Taylor

○ 1.2 1941–Present: War, bankruptcy, and new

management

○ 1.3 Chuck Taylor All Star basketball shoe

○ 1.4 The Weapon

○ 1.5 Special editions

• 2 Converse college teams

• 3 See also

• 4 References

• 5 External links

[edit]History

[edit]1908–1941: Early days and Chuck Taylor

In his late 30s, Marquis Mill Converse, who was previously a respected manager at a footwear manufacturing firm, opened the

Converse Rubber Shoe Company (completely unrelated to the Boston Rubber Shoe Company, founded by fourth cousin Elisha

Converse) in Malden, Massachusetts in 1908. The company was a rubber shoe manufacturer, providing winterized rubber soled
footwear for men, women, and children. By 1910, Converse was producing 4,000 shoes daily, but it wasn't until 1915 that the

company began manufacturing athletic shoes for tennis. The company's main turning point came in 1917 when the Converse All-

Star basketball shoe was introduced. Then in 1921, a basketball player named Charles H. "Chuck" Taylor walked into Converse

complaining of sore feet. Converse gave him a job. He worked as a salesman and ambassador, promoting the shoes around

the United States, and in 1923 his signature was added to the All Star patch. He tirelessly continued this work until shortly before his

death in 1969. Converse also customized shoes for the New York Renaissance(the "Rens"), basketball's first all black pro

basketball team.

[edit]1941–Present: War, bankruptcy, and new management

When the United States entered World War II in 1941, Converse shifted production to manufacturing footwear, apparel, boots,

parkas, rubber protective suits, and ponchos for pilots and troops. Widely popular during the 1950s and 1960s, Converse promoted

a distinctly American image with its Converse Yearbook. Artist Charles Kerins created cover art that celebrated Converse's role in

the lives of High School and College athletes, as the essential sports shoe. In the 1970's, Converse purchased the trademark

rights to Jack Purcell sneakers from B.F. Goodrich.[1]

Converse Jack Purcells.

Red Chuck Taylor All Star basketball shoe.

Converse lost much of its apparent near-monopoly from the 1970s onward, with the surge of new competitors,

includingPuma and Adidas, then Nike, then a decade later Reebok, who introduced radical new designs to the market. Converse

found themselves no longer the official shoe of the National Basketball Association, a title they had relished for many years.

The loss of market share, combined with poor business decisions, forced Converse to file forbankruptcy on January 22, 2001. When

the company subsequently changed hands that year, the last factory in the United States was closed. Thereafter, manufacturing for

the American market was no longer performed in the United States, but instead in a number of Asian and European countries,

including China, Indonesia, Italy, Lithuania and Vietnam.

On July 9, 2003, the company accepted a $US305 million purchase offer from rival Nike.[2]

Current NBA players wearing Converse include Kirk Hinrich, Kyle Korver, Alando Tucker, Maurice Evans, Acie Law, Udonis

Haslem, and Elton Brand.

Converse fashion in Paris

Joshua Mueller, Guinness Book of World Records holder for largest collection of "Chucks"

[edit]Chuck Taylor All Star basketball shoe

For more details on this topic, see Chuck Taylor All Star.

The Chuck Taylor All Star shoe has developed a number of nicknames over the years, such as: "Cons", "Connies", "Convics",

"Convos", "Verses", "Chuckers", "Chucks", "Converse", "Chuckies", "Chuckie Ts", or "Chucker Boots" or "Chuck Taylors" for the
 higher styles.[citation needed] For decades the Chuck Taylor All Star basketball shoe only came in black, with a white variant released in

1947. Under pressure from basketball teams Converse decided in 1966 to manufacture other colors. Different materials also began

to be used, starting in the 1970s, including leather, suede and vinyl, and even hemp, rather than just canvas. Besides high-tops,

low-cuts and later knee-high versions were produced. After Converse was bought by Nike, operations were moved from the United

States to overseas, although the design has had few alterations. The fabric is no longer 2-ply cotton canvas but 1-ply "textile" and

many wearers have noticed different patterns of wear. Types include neon, clear plastic, words, etc. and remains popular for

children and adults all over. Today, even in countries in the East like in India, they are a common choice for all children from above

Std. VII. Several colours don the market and even Chinese companies manufacture such shoes.[citation needed]

[edit]The Weapon

The Weapon, manufactured in many different color schemes

In 1985, Converse released "The Weapon" basketball shoe. Manufactured in many color schemes to match the kit colors of

basketball teams, it has been available in both high-top and low cut varieties. The unique aspect of this shoe is the leather

construction throughout, including the inside heel which is also heavily padded for comfort. Converse re-released "The Weapon" in

2002, 2008, and 2009, and "The Loaded Weapon" in 2003.

ey Statistics about Converse

Top Locations
• Greater Boston Area (303)
• Greater New York City Area (106)
Headquarters Greater Boston Area

Industry Apparel & Fashion

Type Public Company

Status Operating

Company Size 500 employees

Founded 1908

Website http://www.converse.com
 Common Job Designer 5%
Titles
Director 3%

Manager 3%

Account Manager 2%

Footwear Designer 2%

Top Schools Fashion Inst. of Tech. 3%

Median Age 32 years

Median Tenure 2 years

Gender Male 51%

Female 49%

Estimated based on Link

Company Perspectives:

The Company's marketing strategy is centered on the Converse All Star brand,
which is positioned as the American performance brand with authentic sports
heritage. The company believes that there are significant opportunities to build the
brand, which commands high consumer awareness generated by reason of its 91-
year history. The company's consumer research has become an integral part of its
product development, advertising campaigns and in-store point of purchase
materials.

Key Dates:
1908: The company is founded as Converse Rubber Co.

1917: Converse introduces the All Star, one of the world's first basketball shoes.

1929: Converse Rubber Co. falls into bankruptcy.

1972: Converse is purchased by the Eltra Corporation and acquires the footwear
division of B.F. Goodrich Co.

1979: Allied Corporation purchases Converse.

1982: Allied Corporation sells Converse to a group of its senior managers.

1983: Converse stock becomes available on the NASDAQ national market.

1984: The company signs agreements with Moon-Star Chemical Corp., Mizuno
Corp., and Zett Corp. to handle the manufacture, distribution, and sale of Converse
footwear in Japan.

1985: The company is named the official shoe of the National Basketball
Association.

1986: Converse is acquired by Interco Incorporated.

1994: Converse is spun off from Interco in November.

1999: Converse introduces the He:01 shoe.

Company History:

Converse Inc. is the largest manufacturer of athletic footwear in the United States,
producing approximately 8.4 million pairs of shoes domestically in 1998. It owns
and operates a manufacturing facility in Lumberton, North Carolina, where it
produces the majority of its athletic originals, and leases manufacturing plants in
Mission, Texas and Reynosa, Mexico. The Converse All-Star basketball shoe was the
first in the athletic footwear industry, and by the early 1990s, more than 500 million
pairs, in more than 56 colors and styles, had been sold in more than 90 countries
worldwide. In addition, the company has diversified into varied rubber products,
sports apparel, and full lines of athletic shoes for tennis, cross-training, team sports,
running, walking, and children's recreation.

From Basketball Shoe Innovator to Market Leader in the Early 20th Century

The origins of Converse Inc. date back to 1908, when Marquis M. Converse founded
the Converse Rubber Company in Malden, Massachusetts with a capital investment
of $250,000. Converse had gained extensive retail experience as a general
manager of one of Boston's largest department stores and at Beacon Falls Rubber
Shoe Co. He started his own firm after Beacon was absorbed by U.S. Rubber, and,
within a year of its founding, the Converse Rubber Company had integrated 350
employees into a full-production team in a new plant. By 1910, the company had
expanded its plant to produce 4,000 pairs of boots and rubbers daily.

The young company experienced a dramatic increase in sales after its 1917
introduction of the Converse canvas All Star, one of the world's first basketball
shoes. The game of basketball was then in its infancy, having been invented by
James Naismith in 1891 at the International Young Men's Christian Association
Training School. All Star's rapid success was spurred by the reputation and
marketing savvy of basketball star Charles 'Chuck' H. Taylor, who joined the
Converse sales force in 1921 to become the brand's first player endorser. In a town
outside of Columbus, Indiana, Taylor had graduated from high school to a career in
basketball. After playing for barnstorming basketball teams, including the Buffalo
Germans and the Akron Firestones, Taylor joined Converse's Chicago sales office in
1921. He traveled around the country selling the shoe and promoting basketball in
clinics. In 1968, a year before his death, Taylor was inducted into the Naismith
Memorial Hall of Fame.

The original Converse Rubber Company soared beyond the scope of its 1908
designs until 1929 when it fell into bankruptcy. Control of the company then passed
on to Mitchell B. Kaufman, who had been president of Hodgman Rubber Company
since 1925. After Kaufman's untimely death a year later, his successor, Albert
Wechsler, operated the company for the Kaufman estate until 1933, when a
depressed economy and reduced profits prompted yet another change in command.

The 1933 purchase of the company by the Stone family began a 39-year period of
family ownership during which time Converse became a market leader. After
providing protective footwear, special-purpose boots, parkas, and other equipment
for the American Armed Services during World War II, the Stones concentrated on
rapid growth in a civilian market. In 1946 the company's Granite State Division in
New Hampshire began operating two large plants. In 1953 Converse established the
Coastal Footwear Corporation in Canovanas, Puerto Rico. Converse brand lines were
further expanded with the 1961 acquisition of the Tyer Rubber Company and the
1964 acquisition of the Hodgman brand of sporting goods equipment. The company
also opened a new factory in Presque Isle, Maine in 1967 and purchased the Bristol
manufacturing company in Rhode Island in 1969.

Expansion and Increased Competition in the 1970s

By the early 1970s, Converse had diversified beyond footwear to provide numerous
industries--textile, plastic, automotive, paper, paper converting, photocopying, and
leather processing--with products ranging from hockey pucks to teethguards, sports
and industrial boots, and rubber compounds for specific applications. Sales were
delegated to three separate divisions: Sporting Goods, Footwear, and Industrial.

The Stone family dynasty ended its reign in 1972, when Converse was purchased by
the Eltra Corporation. That same year, the footwear division of B.F. Goodrich Co.
was acquired, adding a modern manufacturing plant in Lumberton, North Carolina
and a large distribution center in Charlotte, North Carolina, which remained the hub
for Converse distribution as the company continued to expand.

By the late 1970s, factors, including increased foreign competition, soaring labor
and overhead costs, and a weak domestic economy, forced the company to pare
down operations, consolidate, and increase efficiency. The Hodgman line was sold,
and the Malden and Andover plants were closed, followed by the Granite State
Division. Sales divisions, which had traditionally been divided between sporting
goods and footwear, were consolidated into one team.

Converse changed hands once again in 1979. Under the ownership of Allied
Corporation, the brand would achieve unprecedented sales and profits. In 1982,
however, the giant chemical conglomerate underwent a restructuring and moved
out of the consumer products business. Although Converse produced 12 million
pairs of sports shoes a year and had become the leader in basketball footwear,
Allied put the company up for sale.

Through the combined efforts of a group of senior managers, Converse spun off
from its parent to become a privately owned and operated entity. The group, led by
Richard B. Loynd, president of Allied's Eltra Corporation, of which Converse was
part, and John P. O'Neil, Converse president, negotiated the purchase of the
Converse division from Allied for approximately $100 million. By 1983, Converse
stock was available on the NASDAQ national market.

Facing the growing pressure of foreign imports, Converse moved to develop its
export business to international markets. In 1984 the company signed separate
agreements with Moon-Star Chemical Corp., Mizuno Corp., and Zett Corp. to handle
the manufacture, distribution, and sale of Converse footwear in Japan. With the
opening of an office and warehouse in Osaka in 1984 and plans to develop new
shoes specifically for the Japanese market, Converse anticipated that 'within three
years, it [would] be a leader in the distribution of athletic footwear in Japan,'
according to company president John P. O'Neil. Between 1987 and 1988, Converse's
international business increased by more than 60 percent. One driving force behind
such growth was the building of direct company operations in key European, Asian,
and North American locations, in addition to licensed distributors in more than 90
countries worldwide.

The Beginnings of a Full-Line Athletic Shoe Operation in the 1980s

Converse also faced competition from other domestic shoe companies. Since the
early 1970s, the introduction of high-performance, leather athletic shoes strained
Converse's leading position with its simple, canvas classic. By January 1986, the
New York Times reported that 'Nike of Beaverton, Ore., maker of Air Jordan
basketball shoes, appears to be outrunning such competitors as Reebok
International Ltd., Converse Inc. and Hyde Athletic Industries.'

Consequently, Converse diversified to become a full-line athletic shoe operation. By

the mid-1980s, Converse running shoes had become a popular item. Sales of tennis
shoes, including the popular Jimmy Connors leather model, increased 400 percent in
1983 alone. By the 1990s, the Converse brand was associated not only with the
famous Chuck Taylor All Star line, but with other fashion canvas shoes and footwear
for all major sports played by all age groups.

To ensure continued development of innovative and well-designed footwear,

Converse invested in an advanced technologies lab staffed by a 70-member
research and development team. Upon its completion in the early 1980s, it was one
of only two in-house, biomechanical footwear labs in the country. The facility
included work stations equipped with powerful computers, robots, and testing
systems.

In addition to designing the most effective shoes possible, Converse enhanced its
reputation by sponsoring major basketball organizations and events worldwide.
Converse was the first company named the official shoe of the National Basketball
Association. Valid from 1995, its contract granted the company permission to use
the NBA name in all advertising and promotions and to manufacture shoes with
logos of NBA teams or other affiliations. Converse also supplied merchandise to
cheerleaders and ball retrievers throughout the league.

Converse was also a sponsor of USA Basketball beginning with its inception in 1975.
The Colorado Springs-based group was responsible for selecting national teams to
represent the country in various international competitions and served as a class A
member of the United States Olympic Committee. After 1977, Converse was
contracted as the official shoe of USA Basketball, which agreed to 'use its best
efforts to outfit players in Converse shoes,' according to Jeffrey Orridge, assistant
executive director for corporate and legal affairs for the sports group, in a
September 1992 article in The American Lawyer. That agreement later caused legal
conflicts, as USA Basketball team members including Michael Jordan held contracts
with competing shoe companies such as Nike. Requiring players to wear Converse
shoes introduced ethical and legal problems that had to be carefully resolved.

With the globalization of basketball, Converse increased its overseas contacts. In

1988 the company signed a sponsorship for the World Association of Basketball
Coaches (WABC), located in Rome, Italy, and responsible for more than 50 clinics
worldwide. In February 1990, the company began a five-year, seven-figure contract
as the sponsor of the Federation Internationale de Basketball (FIBA). Founded in
1932 and based in Munich, Germany, FIBA included 176 member countries and
approximately 119 million registered players. Its competitions included the
European Championship Club Cup Final and the European Championship for both
men and women.

Converse also made a presence at the Olympic Games. Though the company had
provided Olympic footwear every year since 1936, in 1984 it became the first
footwear supplier ever chosen to officially represent the games. The honor was not
cheap: Converse paid the Los Angeles Olympic Organizing Committee (LAOCC) $4
million and spent an additional $3.5 million for national television advertising. Total
promotional costs approached the $10 million mark.

New and Innovative Marketing Strategies in the 1990s

Ever since Chuck Taylor served as its first player endorser, Converse has continued
to promote its footwear through high-profile sports celebrities and athletes. By
1990, the brand had contracted endorsements with more than 14 pros representing
11 different teams across the United States. In addition, company statistics showed
that 21 percent of all professional basketball players wore Converse shoes.

In the case of basketball endorser Earvin 'Magic' Johnson, Converse received more
publicity than it may have bargained for. In 1979 Johnson was enlisted as an official
company endorser until 1994. By the late 1980s, Johnson showed dissatisfaction
with the deal, which placed him in the top income echelon of Converse endorsers,
but yielded less than those of other top endorsers with other leading brands. After
Converse filed suit against the player for failing to comply with his long-term
endorsement contract in 1987, matters were resolved temporarily.

When Johnson won the NBA's most valuable player award, Converse created a 30-
second highlight piece of his best moves in the NBA tournament filmed in slow
motion to the accompaniment of 'Amazing Grace.' In 1990 the brand allotted a
quarter of its $40 million advertising campaign to launch its Magic Johnson footwear
and apparel line. After the player announced that he had tested HIV positive in the
winter of 1991, Converse aired a $1 million public service campaign called 'Magic's
Athletes Against AIDS.' Yet, in 1992 old friction resumed with Johnson's public
statements that Converse marketing was outdated and that he was terminating his
contract before the official date. 'Converse as a company is stuck in the '60s and
'70s. They think the Chuck Taylor sneaker days are still here,' Johnson told reporters
in Monte Carlo after the U.S. basketball team practiced for the Olympics. 'I've been
trying to get out for years.'

Despite Johnson's criticism, Converse moved into the late 1980s and early 1990s
with new and innovative marketing strategies aimed at regaining lost market share.
In 1985 the brand paired two rival coaches--Denny Crum from the University of
Louisville Cardinals and Joe B. Hall of the University of Kentucky Wildcats--on one
poster to promote the Converse brand. Other promotional strategies included free
trial shoes at the 1985 Sports & Runners Expo in Boston; environmental sponsorship
of the Windstar Foundation of Snowmass, Colorado; and sponsorship of the Hoop-It-
Up three-on-three basketball tour, bringing the game of American streetball to 13
European cities and to youth groups at home.

In the late 1980s, Converse stressed advertising and promotional campaigns to

compete with such brands as Nike, Reebok, L.A. Gear, and Keds. Even under the
financial strain of its bankrupt parent, Converse garnered an effective creative team
at its New York agency, Ingalls Quinn and Johnson, which developed a hit campaign
featuring NBA Rookie of the Year Larry Johnson dressed up as his basketball-playing
'grandmama.' In her new, light Converses, the ad proclaimed, grandmama could
blow by you 'faster than a passing thought. She'll eat point guards for lunch and
pick her teeth with a power forward.'

In October 1986, Converse was acquired by Interco Incorporated, a broad-based

manufacturer and retailer of consumer products and services primarily in the areas
of footwear and furniture products. Citing doubt regarding Interco's future
profitability, Standard & Poor's placed the company on CreditWatch. Nevertheless,
Converse announced record sales for fiscal 1987, breaking the $315 million barrier
and representing a 36 percent increase over 1986.

In January 1991, however, Standard & Poor's doubts proved justified. Interco filed
for relief under Chapter 11 of the federal bankruptcy laws. Until it emerged from
bankruptcy proceedings in the autumn of 1992, support for rapidly slipping
Converse brands was limited to a dangerously low budget. Apollo Investment Fund,
led by former Drexel Burnham Lambert dealmaker Leon Black, wound up with 60
percent of the company's stock.

Interco's 1992 financial restructuring, however, freed up new funds for Converse
investments and marketing plans. In June of that year, Converse's advertising team
at Ingalls startled Madison Avenue by pulling up stakes and moving across town to
Houston, Effler & Partners Inc. The $25 million Converse account followed along one
day later. Houston took off with a new generation of ads to sell new shoes. In 1993
Converse introduced its Run `N' Gun, featuring a patented React cushioning device
with a combination of gas and gel built into the heel to absorb shock and provide
additional maneuvering control. After some critics objected to the shoe's name as
too violent, Converse changed it to Run `N' Slam.

Houston also designed a 30-second television spot featuring Kevin 'KJ' Johnson of
the Phoenix Suns, with music by pop group En Vogue. The spots primarily targeted
cable channels such as the Black Entertainment Network and MTV. In another 1993
award-winning campaign for the new AeroJam shoe, the agency again played off
Larry Johnson's 'grandmama' theme. While grandmama performed staggering
jumps and dunks in her AeroJams, Johnson narrated: 'There was an old lady who
lived in a shoe. ... And that shoe let her do things that no man could do.'

These and other aggressive promotional programs began to pay off for Interco's
shoe business. Footwear group sales by Florsheim and Converse for the second
quarter of 1993 were $162.1 million compared with $146.2 million in the same
period of the previous year. In 1994, however, despite record revenues of $437
million, increased profits of $17.6 million, and the success of Converse's Jack Purcell
racquet sports shoe, Interco Inc. decided to sell its Converse subsidiary. It was spun
off in November 1994.

Diversification into the Apparel Business in 1995

Diversification followed for the once-again independent company. In 1995 it entered

into a licensing deal with Shalom Children's Wear to manufacture infants' and
toddlers' sporting goods apparel. It also purchased Apex One Inc., a designer and
marketer of sports-related footwear and apparel that also made products under
license with professional sports teams, leagues, and institutions of higher education.
Following the acquisition of Apex, Converse launched an 'integrated head-to-toe
apparel program' of coordinated outfits bearing the colors of top college teams. The
universities of Arkansas and Kentucky were the first to take to the court in Converse
garb and matching sneakers.

But the second half of 1995 unfolded in a fiasco for Converse, with layoffs, leaky
shoes, and trouble at its new subsidiary. In June, it announced the cutback of 200
jobs at its Lumberton plant; in August, just 85 days after its Apex One acquisition, it
decided to close down that business given unexpectedly slow orders and high costs
in the face of a soft apparel market. In fact, the undercapitalized Apex, which had
long had trouble making orders, no longer had the trust of most retailers, despite its
affiliation with Converse. Converse eventually won $25.6 million in settlement from
Apex for misrepresentation, but the episode hurt Converse, which was having
financial troubles of its own--an operating loss of $8.4 million in the second quarter--
and in September, it moved to indefinitely suspend operations at its Mission, Texas
factory. In October and November, it laid off two more rounds of employees, and in
December, just when it looked as if Converse was getting back on track with the
decision to eliminate its outdoor, running, walking, tennis, and football product
lines, its RAW Energy and RAW power basketball shoes literally sprang a leak, and
the company was faced with the embarrassment and recall of 400,000 pairs of
shoes. By year's end, Converse posted a loss of $71.7 million, compared with profits
of $17.6 million in 1994.

New Management and the Retro Trend in the Late 1990s

Looking to regain momentum in 1996, Converse hired Glenn N. Rupp, former head
of Wilson Sporting Goods Co., to replace Gib Ford, who retired as chief executive in
that year. Rupp believed Converse should play to its strength as one of the few
shoe companies with sizable domestic production facilities. Exploiting the
marketability of the 'Made in the U.S.A.' label, Rupp's goal was to decrease the time
it took for an order to be filled from six to only a few weeks. Together with President
Michael 'Mickey' Bell, who would resign abruptly in August 1996, Rupp undertook a
restructuring of the nation's No. 5 athletic shoe company.

Fortunately, for Converse, 'retro' was in, and the company undertook its biggest
campaign ever aimed at recapturing the glory of its past. Its All Star 2000, a
leatherized update of its traditional basketball show, which featured an old-
fashioned Chuck Taylor All Star patch, began selling at a rapid clip in 1997. In the
wake of this success, Converse made plans to market the Dr. J 2000 basketball shoe
and the All Star 91, or Dennis Rodman shoe, in spring 1997 in time for the NBA's
50th anniversary. The company entered into deals with Rodman, Latrell Sprewell,
Larry Johnson, and ABL star Theresa Edwards (40 percent of Chuck Taylor high tops
were purchased by women) to help market its updated old shoe designs. In
addition, Converse initiated a licensing agreement with A4 of Los Angeles to
produce its Star 91 line of apparel and footwear, as well as two other men's apparel
lines. The idea was to leverage the company's history as a long-time staple among
professional athletes and to play up the emotional ties people had to the Converse
brand.

Unfortunately, by the end of 1997, people had shifted from wearing basketball
sneakers and other athletic shoes to what the industry called 'brown shoes'--work
boots, hiking shoes, and casual footwear in brown or black. Converse slipped to
sixth place in its industry, posting a $5 million loss despite record sales of $450
million and an increase in revenues, while throughout the sector inventories bloated
and sales showed signs of going flat. In early 1998, Converse cut more jobs and
changed its marketing strategy, instituting its new 'Stay true' campaign, designed
to appeal to 12- to 18-year-old athletes and featuring younger players at the start of
their careers. The campaign was at least in part a reaction to the embarrassment
brought upon the company by Rodman and Sprewell, whose behavior on and off
court was no longer something with which the company wanted to be associated.
The company also continued to promote its athletic originals, its Chuck Taylor and
Jack Purcell shoes.

Converse continued to struggle throughout 1998, at which point it moved to reduce

its heavy reliance on its basketball category and to institute other footwear
categories, such as men's and women's athletic originals and action sports. Rupp's
goals for the year included marketing the retro look, expanding the supply of
children's lines, pursuing a larger share of women's and girl's athletic shoes, and
garnering a significant portion of sales in its new action sports category--gear for
boarding and eco-training. Still the company's market share slipped further, from
3.6 percent in 1997 to 2.3 percent in 1998, and revenues for the year dropped
about 30 percent to $308 million despite an increase in action sports sales.
The company's strategy for 1999 was likewise broad. With sales outside of the
United States now close to 50 percent of net revenues, Converse formed Converse
Canada and assigned the new division exclusive distribution and license rights for
footwear, apparel, hats, and bags in Canada. It also continued to promote its
athletic originals in Japan, where they were a huge success, and its skate casual
shoes in Europe. Back home, it instituted a new approach to its children's product
market, focusing on colorful and imaginative footwear designed specifically for
children and partnering with OddzOn, Inc., marketers of Koosh sports toys. It also
introduced a women's line of athletic originals in the spring of 1999.

Drawing upon the fruits of the $6.5 million, $8.8 million, and $7.7 million it spent on
research and development in 1996, 1997, and 1998, respectively, Converse
introduced a new shoe technology in 1999: He:01, a helium gas-cushioned shoe and
the company's first technological innovation since the early 1990s. To better market
its products, it partnered with pro basketball hopeful and recording artist, Master P,
on a line of sneakers to complement its joint No Limit apparel, the All Star MP. It
also signed a licensing agreement with Genender International design to
manufacture and market a line of Converse clocks and watches. In this way, despite
the ongoing layoffs and losses that continued to plague Converse into the first half
1999, the company aimed to position itself to take advantage of the anticipated
improvement in industry conditions.

Principal Divisions: Converse Canada.

Principal Competitors: Adidas; Fila; Nike; L.A. Gear; Keds; Reebok.

With its roots as a popular basketball shoe worn by professionals, Converse has rebounded under NIKE
as fashionable footwear and all-around cruiser for those off the court, too. Converse has sold some 750
million pairs of its classic Chuck Taylor All Star canvas basketball shoes, appealing to everyone from
school kids to clothing designers. It licenses its name to sports apparel makers. Converse makes
products under the names One Star and Jack Purcell that it sells through retailers such as Target and
licensees in some 160 countries and its more than 40 stores. Converse operates as a separate unit from
its parent's competing sports brands, reining in the kitsch value of Converse's vintage Chuck Taylor
brand.

Converse Inc.
Converse, Inc., established in 1908 and based in North Andover, Massachusetts, has
built a reputation as “America’s Original Sports Company”™ and has been
associated with a rich heritage of legendary shoes such as the Chuck Taylor® All
Star® shoe, the Jack Purcell® shoe and the One Star® shoe. Today, Converse
offers a diverse portfolio including premium lifestyle men's and women's footwear
and apparel. Converse product is sold globally by retailers in over 160 countries and
through more than 50 company-owned retail locations. Converse realized $915
million in sales in fiscal 2009. For more information on Converse and the company's
latest collections, please visit www.converse.com.

OVERVIEW
Converse, Inc. manufactures athletic shoes and sells them at its 31 company-operated
retail stores. Converse led the athletic footwear market for many years with the Chuck
Taylor All Star basketball shoe, but when the company encountered brisk competition
in the 1980s and 1990s, its sales dropped below those of companies such as Nike,
Reebok, and Fila. Nonetheless, Converse still ranks among the six leading athletic
footwear producers in the United States. Converse remains well below Nike and
Reebok, which in 1997 held 47 and 15 percent of the U.S. athletic shoe market,
respectively. In the 1990s Converse Inc.'s revenues fluctuated in part because of the
fickle nature of the athletic shoe market, much of which is made up of male
adolescents under age 17. In 1997 sales totalled a record $450.2 million, a 28.9
percent increase from 1996. The company registered sales of $349.0 million in 1996,
a 14 percent increase over 1995 revenues of $300.0 million. Converse also performed
well in 1994 with revenues of $437.0, a 15 percent climb from sales of about $371.0
million in 1993. To remain competitive and increase its share of the sportswear
market, Converse plans to continue introducing new shoe lines fortified by
endorsements from professional athletes and to enhance its athletic apparel presence.
COMPANY FINANCES
Converse's 1997 sales totalled $450.2 million, a 28.9 percent increase from 1996.
Domestic sales represented63.0 percent of the company's net sales. Non-U.S. net sales
accounted for 36.7 percent of total revenues in 1997, compared to 44.4 percent in
1996.
ANALYSTS' OPINIONS
Industry observers expressed mixed feelings about Converse Inc.'s efforts to hasten its
turnaround. Some maintain that changing the company logo to the Chuck Taylor
patch will not inspire the double-digit growth Converse expects. According to Mark
Tedeschi in Sporting Goods Business, analysts believe the company's reliance on
Dennis Rodman's endorsement is poor, since the endorsement may fail to drum up
substantial new sales because of waning consumer interest in Rodman and
competition from Nike's Jordan collection. Even though many observers feel the
company lacks a broad enough product focus, they contend that Converse will
experience new growth, but at a moderate rate.
HISTORY
In 1908 Marquis M. Converse established Converse Inc.'s ancestor, Converse Rubber
Co., in Malden, Massachusetts. After two years of operation, Converse Rubber
generated an average of 4,000 boots per day. In 1917 the company launched its most
popular shoe of all time, the All Star basketball shoe. The All Star led the company to
popularity and prosperity, especially when it received the endorsement of basketball
player Chuck Taylor in 1921.
However, in 1929 financial troubles hit Converse and the company went bankrupt.
Mitchell B. Kaufman took over Converse in 1929 and ran it until he died just a year
later. At that point, Albert Welchsler became the company's owner, but by 1933
Welchsler could no longer afford to run the company, which had experienced poor
profits due to the Great Depression. In 1933 the Stone family bought Converse and
operated it for 39 years, watching it grow into a major footwear contender. During
World War II Converse supplied the U.S. military with footwear and outerwear. After
the war Converse shifted its focus back to the consumer market, opening two new
plants for large scale production.
In the 1970s Converse began to diversify, adding hockey pucks, boots, and
teethguards to its repertoire of products. Converse also created three sales divisions—
sporting goods, footwear, and industrial products—to oversee its assorted products. In
1972 Converse changed hands again when Eltra Corporation purchased the company
from the Stone family. Eltra held on to the company through most of the 1970s as
Converse expanded and acquired other companies. However, when the economy
soured in the late 1970s, Eltra's parent company, Allied Corporation, took control of
Converse. In 1982 Allied abandoned the consumer market and sought a buyer for
Converse, which by then was the leading producer of basketball shoes, manufacturing
12 million pairs of shoes a year. Executives at Eltra eventually bought Converse from
Allied for $100 million and took the company public in 1983.
The company's next owner, Interco, acquired Converse in 1986 and sales rose to $315
million the following year. However, its new parent company suffered from a series
of financial problems and filed for bankruptcy in 1991. Converse remained an Interco
subsidiary until November 1994 when the ailing company sold its shares of Converse,
spinning off the shoe maker as an independent company.
STRATEGY
From its entrance into the athletic shoe market, Converse has used endorsements of
famous athletes to promote its products. Basketball player Chuck Taylor promoted the
company in the 1920s and 1930s, and basketball stars such as Earvin "Magic"
Johnson and Dennis Rodman carried the company's banner in the 1990s. Converse has
sought to diversify its footwear offerings and expand its product line to include more
athletic apparel. In 1996, apparel represented $9 million of the company's total sales,
and the company projected a 10-percent increase for apparel in 1997.
FAST FACTS: About Converse, Inc.

Ownership: Converse, Inc. is a publicly owned company traded on the New York
Stock Exchange.
Ticker symbol: CVE
Officers: Glenn N. Rupp, Chmn. & CEO, 53, 1997 base salary $476,538; Donald J.
Camacho, Sr. VP & CFO, 47, 1997 base salary $192,837; James E. Solomon, Sr. VP
Marketing, 42, 1997 base salary $285,577
Employees: 2,249
Principal Subsidiary Companies: Converse has 17 international subsidiaries in
France, Netherlands, Belgium, Germany, Portugal, Spain, Italy, Japan, Scandinavia,
Mexico, Brazil, and Barbados.
Chief Competitors: Competition in the athletic footwear market considers fashion,
price, quality, performance, and durability. Some primary competitors include:
Reebok International, Inc.; adidas AG; and Nike Inc.
In the mid-1990s, Converse removed its star and chevron logo of the 1980s and
1990s, replacing it with the Chuck Taylor patch. In 1996 Converse introduced a new
line of basketball shoes, the All Star 2000, as part of its campaign to increase new
product offerings. Furthermore, Converse eliminated its baseball and football shoes
and tightened its focus on basketball, cross-training, leisure, and children's shoes.
Converse also renovated a North Carolina production plant so it could produce more
shoes in the United States, thereby expediting the company's shoe deliveries.
INFLUENCES
Because of the initial success of the All Star shoes, Converse relied on them to drive
its sales. This strategy helped the company become the leading basketball-footwear
provider for many years. Eventually this success eclipsed the company's vision.
Consequently, Converse failed to continue developing innovative shoes as
competition in the athletic footwear market started to intensify in the 1970s.
Companies such as Nike and Reebok introduced leather performance shoes (previous
models had been canvas), which received a strong response from both consumers and
players. However, in the 1980s Converse followed this trend and launched numerous
new athletic shoe styles, boosting its sales by 400 percent.
Converse Inc. also learned some lessons from its disastrous 1995 acquisition of Apex
One Inc., a producer of licensed athletic apparel from professional sports teams.
Converse quickly attempted to increase its presence in the apparel market by
purchasing the nearly bankrupt Apex One, but Apex had fallen so far behind in
delivering products to retailers that the retailers scaled back business with Apex or
severed their connections completely. As a result, Converse lost $41 million from the
purchase and closed the apparel manufacturer just three months after buying it.
CURRENT TRENDS
With the 1997 emergence of two professional women's basketball leagues as part of
the Women's Professional Basketball Association (WNBA), athletic-shoe producers
expanded their basketball shoe lines to target women for what some analysts predicted
may be the fastest growing product area. As of 1997, only Nike and Reebok sold
women's basketball shoes, but others (including Converse) planned to introduce them
in 1998.
PRODUCTS
Part of Converse Inc.'s plan to improve its sales included the introduction of new
high-performance and athlete-endorsed shoes. In 1996 Converse rolled out its All Star
2000 shoes, which proved popular and helped the company improve its sales. To
compete with Nike's Air Jordan concept, Converse decided to launch a series of four
shoes designed around the styles of Dennis Rodman. The first style released featured
splashy colors, while the remaining were planned to be more conservative, given the
lukewarm response to the first. In addition, Converse continued to manufacture and
market its classic Chuck Taylor All Star canvas athletic shoe, which sold more than
560 million pairs since its introduction.
CHRONOLOGY: Key Dates for Converse, Inc.
1908:
Marquis M. Converse establishes the Converse Rubber Company
1917:
Converse introduces the Converse canvas All Star, one of the first basketball
shoes
1921:
Charles "Chuck" Taylor becomes the brand's first endorser
1929:
Converse Rubber Company files for bankruptcy
1933:
The Stone family purchases Converse
1953:
Converse establishes the Coastal Footwear Corporation in Puerto Rico
1972:
Eltra Corporation purchases Converse ending the Stone Family's 39 years of
ownership
1977:
Converse is contracted as the official shoe of USA Basketball
1979:
Allied Corporation takes over control of Converse from Eltra
1982:
Allied abandons the consumer market and seeks a buyer for Converse
1983:
Eltra buys back Converse and takes it public
1986:
Interco Incorporated acquires Converse
1994:
Interco spins off Converse and it becomes an independent public company
1996:
Converse introduces the All Star 2000 in an effort to increase new product
offerings

Recently Converse used its tag and marketing statement "Stay True." The reasoning
behind this slogan is that athletes should "stay true" to themselves, be proud of their
success, and appreciate those who have helped them succeed.
CORPORATE CITIZENSHIP
Federal, state, and local laws monitor companies regarding possible environmental
contamination, such as waste disposal and emission of various materials. The main
materials used in Converse's shoes are canvas, linen, and rubber. The company
believes any negative environmental claims they may incur will not affect its
business.
Converse maintains a state-of-the-art biomechanics research laboratory that supports
an ongoing search for new technology and enhancements to shoes geared for specific
sports. The company's patented REACT shock absorption technology acts as a
cushion in certain areas of the shoes' construction to protect athletes' feet from high
impact.
From 1936 to 1984 Converse sponsored the Summer Olympic Games and provided
footwear for the athletes. In addition, Converse has funded an abundance of basketball
organizations and events around the world. The sportswear company supported USA
Basketball, which organizes basketball teams to represent the United States in
worldwide basketball tournaments. Converse also has sponsored international
basketball organizations including the World Association of Basketball Coaches and
Federation Internationale de Basketball, an organization composed of members from
176 countries.
GLOBAL PRESENCE
Converse products are marketed in 90 countries outside the United States. Foreign
sales in 1997 were 36.7 percent of total earnings, compared with 44.4 percent in 1996.
Although the majority of the company's footwear is sourced from various Far East
factories, most of the athletic originals products are manufactured domestically. In
1997, 16 manufacturers in China, Taiwan, Macau, Vietnam, and the Philippines sold
over 13.3 million pairs of shoes to Converse.
EMPLOYMENT
Converse has a 38-member sales force that markets its footwear through
approximately 4,200 active retail accounts. In 1997 domestic sales represented 63
percent of the company's net sales. The 13 account executives who service national
and regional accounts are paid salaries plus bonuses. The company has a non-
contributory pension plan for domestic salaried employees based on years of service
and final annual compensation. Hourly employees also have a non-contributory
defined contribution plan. Converse also sponsors a savings plan and offers stock
options to key employees. In addition, the company has a Non-Employee Director's
Plan, which encourages non-employees of outstanding ability to enter and remain with
the company as directors.
THESE SHOES WERE MADE FOR BASKETBALL
One of Converse, Inc.'s greatest accomplishments came early in its history, in 1917.
That year brought Converse its most successful product, its trademark All Star
basketball shoes. At that point, basketball was still in an embryonic stage, invented
fewer than 30 years earlier in 1891 by James Naismith at the International YMCA
Training School.
Nonetheless, with the endorsement and marketing abilities of basketball star Charles
"Chuck" Taylor, the shoes' success soared to great heights. Taylor joined the company
in 1921 and his signature was added to the shoe in 1923, helping launch Converse All
Stars as the standard for basketball players for many years. Since no professional
teams had been established, Taylor built his reputation as a basketball player in high
school and adult leagues. While working for Converse, Taylor traveled around the
country, hosting basketball clinics, meeting coaches, and promoting his signature
Chuck Taylor All Stars.
Eventually, Taylor was inducted into the Naismith Memorial Hall of Fame. The shoe
has a kind of "hall of fame" status as well—the Chuck Taylor All Star canvas athletic
shoe has sold over 560 million pairs since its introduction.