Analysts Believe Lululemon’s Sun Choe Can Make Vans’ Turnaround a Reality, But It Might Take Some Time
Vans has a new brand president – and analysts say she could be the one to get the struggling brand back on track.
VF Corporation late Thursday said it tapped former Lululemon chief product officer Sun Choe as Vans’ new global brand president – a role that has been vacant since Kevin Bailey stepped down in October. The move, effective in late July, is the latest leadership change at Vans, following the departure of chief product and merchandising officer Marissa Pardini in March.
Choe joins Vans as the company leans into a reinvigorated product and distribution strategy. Just last week, VF chief executive officer Bracken Darrell said that Vans was witnessing early green shoots — such as strong direct-to-consumer sales in Europe and positive Google search trends — despite overall weak financial results in the fourth quarter, in which Vans revenue dropped 27 percent.
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Looking ahead, Vans will utilize a marketing plan that emphasizes fewer, more powerful stories and will build up brand equity and profitability with a focus on its new OTW line, which officially launched in February.
Given Choe’s strong background in brand building and footwear (she was instrumental in Lululemon’s successful expansion into men’s and women’s shoes), her appointment at Vans was met with praise and positive commentary from analysts.
“This is undoubtedly a win for VFC, as a turn in Vans is key for a turn in the stock, and this is a strong hire with a fresh, outside perspective and a proven track record,” said BTIG analyst Janine Stichter in a Thursday note to investors. While she noted that a full brand turnaround might take some time, she was confident that Choe has “the skillset to breathe new life into Vans” given her experience in helping Lululemon quadruple its revenues from when she joined in 2016.
Prior to her time at Lululemon, Choe also held positions at Marc Jacobs, West Elm, Madewell, Urban Outfitters, Levi’s and Gap.
Wedbush analyst Tom Nikic also noted it might take some time for Choe’s product impact to be tangible (especially given the long lead times for footwear), but described the hire as a “key step in the right direction.”
“At Lululemon, Ms. Choe was instrumental in creating best-in-class product, helping expand the company’s core female demographic while also building out the men’s assortment, and, more recently, helped to introduce footwear,” he said in a Friday note. “The hope is that the appointment of Ms. Choe can help reinvigorate the product line and bring excitement to [Vans] once again.”
According to Stifel analyst Jim Duffy, Choe’s departure from Lululemon to Vans represents “an endorsement of brand potential.” Duffy also noted that VF will also name a new global head of design in the next six weeks.
Traction with the Vans turnaround, a potential sale of assets, and continued strength at The North Face brand could help lift VF’s performance and stock price in the next six to nine months, Duffy said in a Thursday note.
“We remain bullish on long-term prospects for the brand portfolio and convinced that the sum of the parts of brand value net the debt obligations is undervalued in the equity,” he said.
