What are these Allbirds everyone keeps talking about?

I remember my first pair of Nikes as a middle schooler. I felt that I had arrived showcasing them around school and town. Sure, they may not have gone with my all girl’s school uniform, but I felt cool, trendy and popular. There was no doubt in my mind that I had the best pair of sneakers and that this pair would last a lifetime of memories. As years progressed, I was an avid soccer player, and I remained brand loyal to my Nikes. There was no other sneaker or athletic brand that would change my mind. It was Nike all the way. The world acknowledged it too as some of the best print and digital advertising came from Nike.

This ad came out just in Sept. of 2018: https://www.youtube.com/watch?v=Fq2CvmgoO7I     

Let’s bring it back to the main reason I am talking about Nike. Remember when Nike dominated the shoe market? Not only were they the coolest sneaks in town, but they also had the marketing and advertising to back it up. Let’s not forget the greatest tagline of all time: Just do it. For years, the sneaker industry has been off the charts with entrants entering the market, fighting for that extra market share that Nike would never give up. As we fast forward to present day, there is not a shortage of other shoe brands that are giving us a refresh. 

You may have heard of Allbirds or seen people sport the shoe. They could potentially be a mass disruption in the athletic sneaker market there is since Nike. This San Francisco-based sneaker company is making some really cool, comfortable, refreshingly simple and also ecologically friendly shoes. So why now? Why have other sneaker brands remained stagnant in what they do best and how can they face this new disrupter called Allbirds?

Let’s start with what the fuss is about with Allbirds and why it is transforming the sneaker industry. In 2012, Tim Brown had a professional soccer career that led him to FIFA World Cup for a staggering eight years. He had the best shoes that were customized and flashy. However, he saw an opportunity to come in and create a shoe that was less flashy and with no corporate logos. Not only are they cozy and sustainable, but they’re also minimalist in look and sales strategy. You do not see ads pouring in online or on the web marketing Allbirds. It was a new revelation. People cannot stop buying them, let alone wearing them. They have officially become an athletic sneaker that is making companies like Nike and Adidas turn their heads. But why have they become increasingly popular without the digital marketing and advertising efforts that these top sneaker firms have done? With only one kick-starter campaign, that described the sneakers as “a world first: woolen running shoes specifically designed for sockless wear,” Allbirds has owned the direct-to-consumer model. It has a direct relationship with customers and is constantly improving the product. The company has raised over $77 million of venture funding. That speaks volumes to the belief that these shoes could potentially be the next “Nike” but in a sustainable and comfortable way. Its attributed success can be connected to its strong first-party data. It uses customer data to decide where to launch next, with a focus on what resonates with the new customers. Their data analytics is a big piece of the puzzle that will hopefully get them booming into a new market.

https://www.cnbc.com/video/2018/12/18/allbirds-from-silicon-valley-staple-to-1-point-4-billion-sneaker-start-up.html

Furthermore, it has taken the tech world by storm, that is part of the casual workplace uniform at start-ups and venture capital offices. Even celebrities are wearing them from Leonardo di Caprio to Oprah Winfrey. This is free press and press that will last. The New York Times even refers Allbirds to as “Silicon Valley’s cobblers.” Social media has become Allbirds’ main channel to build its brand identity and leave a lasting impression. However, venture capitalists are singing Allbirds’ praises the most. Investors are personally advertising their pair on Instagram 

and Twitter.

Their posts are amounting to the greater public and spreading the word without marketing or massive amounts of digital spend. Let this be a lesson in digital that although we have all these new innovative technologies that are currently disrupting the industry and allowing brands to speak freely, the marketing power is in the consumer and investor this time. To bridge this gap and continue to promote freely, they will continue to push new campaigns to run on air, on digital and in cinema with interactive websites that tapped into fashion trends of sustainability and transparency. They are now launching in international markets. How do you think they will enter this new market and what tools will they use to transform their product into a long lasting legacy like Nike?

13 comments

  1. They’ve successfully cornered a very specific demographic: the millennial upper-middle class. This demographic has looser corporate dress codes, higher levels of discretionary spending, and signals wealth or status through “in-the-know” purchases like these. They’ve backed into being an aspirational brand. Nike, on the other hand, led from aspiration via athletic achievement.

    I wonder if Allbirds has the power to sustain a brand based on these attributes. I assume it will be harder for them to branch out into other lines of sportswear or apparel, as Nike has done.

    But what they are doing is certainly working. They’re spending a ton of money to capture this market. They’re basically across the street from Nike on Newbury st. in an enormous retail space. Curious if anyone thinks they can successfully diversify.

    1. I agree with you Jim; they’ve found their perfect market, but this market is a popular one. I think Allbirds will fall into place with other “new classic” brands that target this group, plus sustainability conscious consumers, like Warby Parker, Everlane, Away, Harry’s, Glossier, etc. But, I don’t think Allbirds will diversify anywhere close to Nike-level. They would probably be able to successfully branch out into other types of shoes, given their reputation for comfort, but I don’t see clothes in the future. Given the success of all these different companies, I think this market prefers more specialized companies anyway; owning more brands shows off more money, more expertise, and more conscientiousness.

  2. I was lucky enough to attend a talk with the founders this past summer and you articulated their vision extremely well in this post! Their key selling point is the fact that they are sustainable and people increasingly care more about this aspect. Nike has an extremely poor reputation for how their products are produced and Allbirds counteracts this with their values and mission. I think people also really like the minimalistic look of them. There is no flashy logo but rather the style of the shoe speaks for itself. I am not sure if they will ever reach the monstrous level that Nike has, but they appeal to those who genuinely care for sustainability and seek something more simplistic. I think they will have to ramp up their marketing campaigns because Allbirds has not become a household name just yet. I wonder if they will ever launch into clothing and what that could potentially look like, but they have done an incredible job with their shoes, considering how consolidated that market is. Great insights!!

  3. dilillomelissa · · Reply

    Thanks for the post! I am always intrigued by anything new and up-and-coming in fashion (which I consider any types of shoes). Nike has been what we’ve grown up with and therefore, the roots are extremely strong for many people. Allbirds has happened overnight in some sense. I remember seeing them posted on Instagram and other social media and thinking the look was sleek and clean and simple. While I don’t currently own a pair, I’m sure I’ll be hopping on the Allbirds train soon enough. Because of the type of publicity you described, more and more consumers become potential buyers on a daily basis. There was definitely a gap in the market that Tim Brown was successfully able to fill. As mentioned in the comments above, I’m very interested to see their next move. Will they move into clothing or something else completely? How will they sustain this success?

  4. I have yet to invest in allbirds, but I do plan on purchasing soon! My roommate raves about how comfortable the shoes are and I do agree that they are stylish. The main advantage of Allbirds is its flexibility- they can be used for both athletic and casual wear…it is the perfect shoe for folks who have to walk a good distance on their commutes to work. It is also impressive how Allbird doesn’t do a whole lot of advertising, outside of its own social media posts. They primarily have been successful by word of mouth- through other’s social media as you described in your post.

  5. Although I have more pairs of shoes than I care to mention, Allbirds have been on my radar for a while, but I have yet to bite the bullet and purchase a pair. My main reason for not purchasing a pair is because shoes are the one thing that I don’t love ordering online, but now that I know that there’s a store on Newbury street, I’ll be paying them a visit. I think that they’ve done a great job to disrupt the shoe market, but without having to utilize some sort of mass marketing plan. Word of mouth and social media have proven to be a key to their success and I don’t see that slowing down anytime soon. I have friends that work in a variety of different fields and one common thread that they all share is that Allbirds are their shoe of choice because of the simple nature of the design and the level of comfort that they provide. I see them continuing to have success with their current product line and similar options moving forward, but I don’t necessarily see them expanding more than that. They have tapped into a market that had a relatively unmet need and are booming, so I think it is best to continue to hone in on that.

  6. Like everyone else, I’ve been debating purchasing Allbirds for a while. My roommate swears by them and almost never wears anything else. Although they are winning in the comfort category, I don’t think they will ever be able to reach the level of Nike. Performance and style-wise, Nike has too much of an upper hand. I personally own two pairs of Nike Cortes that I love and get complimented on them all the time. While Allbirds are gaining popularity with millennials, I think Nike’s legacy and strength of brand will be nearly impossible to compete with.

  7. I remember the first time I saw Allbirds and immediately liked the low profile style they had. I have since bought two pairs and given one away as a gift as well. I think this post and the comments sum up their business plan and target clientele quite well – and its working for them. Almost everyone I know who owns them is a repeat customer, and gets excited every time a new colour or model is launched. They have developed a very brand loyal customer base that is likely to continue purchasing their products. With that being said, I think they are in a very niche, “athleisure” market, and I cant see them expanding into true running shoes or many other categories.

  8. Love this, I’m a huge Allbirds guy. I actually found them on Kickstarter, shortly after they reached their goal and began production. Really weird, but I honestly hate socks and the ability to wear the shoes without them was a huge draw. I’ve been following the company for a while and it’s honestly unbelievable the awareness and consumer base they have built without large scale promotional campaigns. Just yesterday somebody asked if I had a pair and told me that they were thinking about getting one. They are clean, simple, and like you said more sustainable than some of the other options on the market. They literally feel like you’re wearing slippers and one pair took my all over Europe from hiking mountains to exploring cities.They really have made a name for themselves seemingly organically which is something all companies strive to do today. With a good product, mission, and management, Allbirds seems like a winner.

  9. I love Allbirds, both from a product and marketing standpoint. However, I don’t think they share the same market or customer as a company like Nike. Allbirds really aren’t made for performance activities (sports, running, cross-training, etc.). I would definitely consider them to be in the “athleisure” category but I don’t see them overtaking Nike, Adidas, Under Armor, or Reebok any time soon. I can absolutely see them taking market share away from something like a Stan Smith sneaker, but in my opinion, they don’t have the technical experience to create a performance shoe that can match the likes of Nike. I also wonder if they will continue to grow as a brand or if another company will become the hot, new sneaker (similar to what happened with Nobull).

    1. Arkadiy, I’m with you on this. I think Allbirds are a great product, and they’ve definitely identified their target market, but I can’t see them growing into a big athletic company. I do, however, see them taking some athleisure market share away from companies like Nike or even Steven Madden. They also have the advantage of being one of the first movers in this market – I first found out about them about 3 years ago when my sister bought my dad a pair to replace his dorky white New Balances.

      As companies like Rothys gain prominence with similar products and similar marketing points, it will be really interesting to see where Allbirds goes in the long term.

  10. I got my pair of Allbirds this summer. I am a huge fan of them and their sustainability mission. I think they are in a great spot right now and have entered a niche market. I do not think they should directly compete with Nike. Rather I believe they should stay with what they know well and leave the performance shoes to Nike and others.

  11. These are terrific, and another great example of an organization seeing success utilizing data analytics and marketing directly to the consumer. Aside from these shoes looking super cool, it also seems like they are filing a niche within an industry where they are creating cool products that are sustainable as well. I will definitely be purchasing a pair of these this summer!

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: