Havaianas invests $US50 million in Asian expansion plan
Jul 30, 2020
Undeterred by the advent of Covid-19, Brazilian flip-flop brand Havaianas is investing US$50 million into expansion of its retail footprint across Asia-Pacific between now and 2024.
Havaianas – which sells about 1 million pairs of footwear a day worldwide – was until 2017 represented by a small group of licensed distributors in Asia, overseen by an export manager in Brazil who also had responsibility for Africa, South America and the Middle East. However in 2018 the company opened a regional office in Hong Kong and appointed an Asia regional president, experienced retailer Robert Esser, to build a team managing expansion from Greater China down to Australia and New Zealand.
Esser has since built a team of around 30 staff and opened a sub office in Mainland China to accelerate the push there.
New distributors have been appointed in multiple markets and the network has since grown from 35 to about 135 stores, augmented by another 25 or so short-term pop-up stores in regional areas where cold winter weather is not conducive to wearing flip flops all year round. Flagships have opened in Manila in the Philippines, and at Sydney’s iconic Bondi Beach in Australia, and the brand has established virtual stores on Chinese marketplaces including JD and Tmall.
“In Asia Pacific today, our biggest potential markets are China, Indonesia, Thailand and Malaysia,” explains Esser. “We now plan to reach more local consumers and deliver a change in the way they perceive and wear flip-flops. Havaianas wants to enchant Asian consumers and build a strong emotional connection and affective memory, occupying a unique space where attributes like functionality, style and accessibility meet.”
Esser believes the expansion reflects a great opportunity to introduce consumers to “a whole new concept in flip-flops”: not just functional footwear, but a combination of comfort and style and “a true fashion accessory”.
“Apac is diverse but consumers are looking for authenticity, high quality and fashionable products so Havaianas can be perfect for them,” said Esser.
With Covid-19 leading to the closure of many of Havaianas and its partners’ stores across Asia for varying amounts of time, the company invested “disproportionately” into online channels, he says, setting out to achieve “find-ability and visibility”.
“We set up stronger social-commerce platforms and built a relevant influencer strategy with local brand ambassadors, like Luna Maya in Indonesia and Nelydia Nik Sen in Malaysia. This has already delivered promising results with online business growing three-fold during the first quarter and six-fold during April.”
In most parts of Asia, you can buy a pair of cheap flip flops for about US$2 – yet Havaianas sees the continent as one of its biggest growth opportunities worldwide. Inside Retail Asia talks at length with Robert Esser about why the Asian market is so important and how the brand has conquered the price challenge in an extended interview in the next edition of Inside Retail Asia magazine out next week and available by subscription only.