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Now that Allbirds has turned the corner on its transformation plan, the brand is doubling down on revamping its product line-up.
In a call with analysts discussing the company’s second quarter results, Allbirds chief executive officer Joe Vernachio said that consumers are already reacting positively to Allbirds’ new product strategy , which involves refocusing on core styles like the Wool Runner and limiting launches to avoid saturating the market.
According to the CEO, new products like the Wool Runner 2, Tree Runner Go and Canvas Piper “have all been met with positive consumer response.” He expects a similar result when the new Tree Glider launches in the next few weeks.
In describing Allbirds’ new focus, Vernachio compared a brand to an orange, and design to its juice.
“If you’ve ever had an orange with no juice, it’s not very good, right?” Vernachio said. “So we are spending a lot of time and energy and momentum in creating that juice that we are going to be using to then apply to a product line and a product offering.”
To “inject newness as quickly as possible,” Vernachio said Allbirds used its resources to create new colors and materials for existing silhouettes for the second half of 2024 and into 2025. Allbirds is also currently working on creating 10 new product launches for fall ’25 and spring ’26, which Vernachio said will “not only enhance our product range, but also reinforce our dedication to quality, comfort, style and sustainability.”
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When it comes to measuring progress, Allbirds is looking to acquire new customers that are entering the brand through new products and marketing.
“Paramount to the new products, we have to get new customers into our business,” Vernachio said. “And so we’re really focused on that performance.”
He added that all of Allbirds’ new products are selling for full-price, which is also important for brand equity.
“All of this combined, we feel really positive about where we’re headed,” Vernachio said. “We think we’re just at the very beginning of the process.”
The San Francisco-based footwear company on Wednesday reported that Q2 revenues dropped 26.8 percent to $51.6 million, in line with its guidance. Net loss was $19.1 million, or 12 cents per basic and diluted share, which was also in line with guidance. The results beat the expectations of analysts surveyed by Yahoo Finance, who were looking for a loss of 17 cents per share and $50.51 million in revenues.
After several quarters of falling sales, Allbirds announced a business turnaround plan in March 2023 centered on revamping product, optimizing U.S. distribution and store profitability, re-evaluating its international strategy and improving cost savings.
Since then, Allbirds has closed 14 retail stores, transitioned to a distributor model for its international business, cut goods and operating costs, decreased inventory and narrowed operating cash use. In addition to bolstering product, the next phase of the transition will also strengthen storytelling and shopping experience.
Allbirds Enters the Next Phase of Transformation After Reporting a Solid Q2
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