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THE SHARE price of Crocs (NYSE code crox) has already fallen by 97% in the past year, and, along with victims like Freddie Mac and Fannie Mae, it is now among the poorest performers on the New York Stock Exchange for this year.
But Crocs isn't a financial share tainted by all kinds of sub-prime nonsense. The company is a manufacturer of plastic footwear, among which Crocs is the best-known name.
A year ago, there was still a waiting list for the manufacturer's popular shoes, which are sold for between $30 and $60 in the US.
Now Crocs is starting to remind one increasingly of the hula hoop of a few decades ago. For the young ones who don't know, the hula hoop is a large hoop that is swung around the body by gyrating the hips. It was very popular sometime in the 1960s.
The prime life cycle of this toy was just more than 72 hours, before the craze started to taper off. Crocs, personally my favourite footwear, seems to be following a similar path. Just as with the hula hoop, this is an illuminating study in marketing and brand name development.
Flawed
The genuine article manufactured in the US by Crocs are at least 10 times more expensive than the Chinese and other imitations. However, teenagers aren't very keen on Crocs. Look in the street; the few people who still wear the very comfortable slip-slops tend to be older.
Crocs established a brand name. The genuine ones have a nice stud on the side with the brand name clearly visible.
Brand-sensitive teenagers won't be seen dead in an imitation, but older wearers don't find that very important. As long as it fits comfortably and the quality is the same, the brand is usually immaterial.
And this may be responsible for the downfall of Crocs and the equally popular slip-slops. Users of this footwear are older and not particularly worried about the brand, and besides the imitation Crocs last for years.
Without the backing of fashion and a label statement - or a product, because even the fakes last for years and are worn by older consumers - the Crocs company is fading rapidly.
Another interesting lesson from the US during the past year in the midst of the total slaughter of everything consumer is that the share price of Dollar Tree (code DLTR), the most popular One Price store in the US, has risen by 36%.
Also, the share price of Family Dollar Stores (code FDO), which has risen by 33%, tells the tale of the US consumer, who has long felt the pinch. First there was higher fuel prices and more expensive food, and now of course the great consternation around falling house prices.
No room for snootiness
This may also be the story of our own fate. The old Five Rand, and later R10, stores here have definitely deteriorated over the past few years. Snobbery and too much money almost makes some people think it a disgrace to buy from these stores - just as in fine houses in the best circles it's apparently beyond the pale to drink wine sold in a cardboard box.
Trader Vic's two pairs of fake Crocs are still in very good condition, and between them they are still good for many weekend kilometres. At the old Five Rand stores, you could always buy a nice 5-litre plastic bottle of detergent. Now there are no Five Rand stores anywhere nearby.
I hope my friends at Beyerskloof and Tokara don't hold it against me, but I recently came across a very pleasant blended red wine at under R75 per five-litre box. Now there's nothing better than relaxing over a few glasses of this on a Sunday... wearing my fake Crocs.
In the present economic climate, labels and all that kind of empty posturing aren't important. It's better to help Family Dollar Stores and Dollar Trees on the JSE.
After the slaughter of 2008, I could do with an increase of 36% per year.
- Fin24.com
