New Balance Made This Mistake. Here's What We Can Learn

I'm going to share a story about New Balance. Bear with me. I think it'll be worth your time.

According to Yahoo Finance, the "dad shoe company" made $6.5B in 2023.

But here’s what you probably don’t know:

In the late 2010s New Balance was not achieving significant growth. Especially, compared to industry leaders like Nike and Adidas.

They were heavily focused on making comfortable and simple products while competitors we're focused on:

• Riding trends

• Partnering with athletes and celebrities

• Innovating the classic shoe

• Attracting younger, high spending customers

Leaving New Balance "out of the loop" and slowing growth.

Why was this happening?

Here’s the story:

Start Here

In a shoe market where customers could associate themselves with:

• Famous athletes

• Trendy styles

• Ben and Jerry's Ice Cream

Dad's and people with back pain valued comfort. And they were pretty loyal to the brand.

This is why New Balance would direct most of it's marketing budget at getting them to buy again. It was a safe and reliable approach.

Here's the issue:

The spent little money getting new customers and filling the funnel. The customers they had, are the customers that bought. Which ultimately, was their recipe for failure.

Not filling the funnel means:

• No one is finding your brand

• No one new is buying your stuff

• No one is telling their friends about you

The future of New Balance was completely limited to their older, frugal demographic.

Now, we meet Chris Davis. The shoe marketing wizard.

The Rise of New Balance

After becoming the new head of marketing, Chris Davis implemented the 50-30-20 marketing rule.

The 50-30-20 marketing rule:

👉 20% of the marketing budget is gambling money and goes to experimental strategies.

👉 30% is invested in calculated risks. (like influencer partnerships).

👉 50% is directed towards proven tactics that deliver results (like ads).

In a few years, New Balance went from:

• Not doing what competitors were doing

• Not achieving significant growth

• To spending 50% of their budget on new things

• And becoming one of the fastest growing performance brands in the world

Today

Now New Balance is one of the biggest performance brands in the world. I can't imagine where they would be if they continued to play it safe years ago.

Why Does This Matter to Short Term Rental Marketing?

"Safe" marketing strategies don't work forever. Which is okay. The fun in marketing comes from testing new things to see what works. If you:

• Send emails to past guests

• Post a couple times on social media

• List on Airbnb and VRBO

But, still don't get enough bookings. You simply have to try new things and fill the funnel.

Just like New Balance.

If you haven't tried these yet, here are my favorite ways to fill the funnel:

• Meta ads

• Google ads

• Influencer partnerships

• Chamber of commerce collaborations

Then commit for at least 90 days.

Strategically do what makes you nervous.

That's all for today. I'll see you in the next article.

Before you go

I just launched my brand new direct booking marketing agency, Lodge Social.

We help rental operators get more guests to like, share, and book.

Apply to work with me and my team here.

Links you might like:

1. This is my favorite article from 2024

2. This is my second favorite

3. I spent less on ads but made more money

4. I did this to increase bookings by 30%