Wolverine World Wide, Inc. (WWW): Business Model Canvas [11-2024 Updated]

Wolverine World Wide, Inc. (WWW) stands out in the competitive footwear and apparel market with a robust business model canvas that emphasizes strategic partnerships, innovative product offerings, and a commitment to sustainability. This post delves into the intricacies of their business model, exploring how they maintain strong customer relationships, effectively manage costs, and generate diverse revenue streams. Discover the key elements that drive Wolverine's success and its adaptability in a rapidly changing retail landscape.

Wolverine World Wide, Inc. (WWW) - Business Model: Key Partnerships

Collaborations with third-party manufacturers

Wolverine World Wide, Inc. engages in partnerships with various third-party manufacturers to enhance its production capabilities. As of 2024, the company has streamlined its manufacturing processes, allowing it to leverage external expertise to ensure high-quality production while managing costs effectively. The total cost of goods sold for the third quarter of 2024 was $241.0 million, down 22.8% from $312.3 million in the same quarter of 2023.

Licensing agreements for brand expansion

In May 2024, Wolverine World Wide entered into global multi-year licensing agreements for Merrell® and Saucony® kids' footwear and Merrell® apparel and accessories. As of September 28, 2024, the company is due $41.5 million of remaining fixed transaction price under its license agreements, which it expects to recognize through December 2028.

Partnerships with retailers for distribution

The company has established robust partnerships with various retailers to enhance distribution channels. For the third quarter of 2024, Wolverine reported total revenue of $440.2 million, a decrease of 16.6% compared to $527.7 million in the third quarter of 2023. The revenue breakdown indicates that the Active Group generated $318.7 million, while the Work Group contributed $109.1 million.

Distribution Channel	Q3 2024 Revenue (in millions)	Q3 2023 Revenue (in millions)	Percentage Change
Wholesale	$327.8	$391.1	(16.3)%
Direct-to-Consumer	$112.4	$136.6	(17.7)%

Engagement with logistics providers for supply chain efficiency

Wolverine World Wide collaborates with various logistics providers to enhance supply chain efficiency. The company reported a gross margin of 45.3% during the third quarter of 2024, an increase from 40.8% in the same quarter of 2023, primarily due to lower supply chain costs. This reflects the effectiveness of their logistics partnerships in optimizing operational costs.

Wolverine World Wide, Inc. (WWW) - Business Model: Key Activities

Design and development of footwear and apparel

The design and development process for Wolverine World Wide, Inc. (WWW) focuses on creating innovative footwear and apparel products across its brand portfolio, including Merrell®, Saucony®, Sweaty Betty®, and Chaco®. The company emphasizes sustainability in its product design, aiming to reduce environmental impact. For instance, in 2024, the gross margin was reported at 44.7%, an increase from 39.6% in the previous year, indicating improved cost management in production processes.

Marketing and brand management

Wolverine World Wide utilizes a multi-channel marketing strategy to enhance brand visibility and consumer engagement. The company reported a reduction in selling, general, and administrative expenses from $610.8 million in the first three quarters of 2023 to $514.6 million in the same period of 2024, reflecting a strategic focus on cost efficiency in marketing efforts. Key marketing initiatives include digital campaigns, social media presence, and collaborations with influencers to drive brand loyalty and awareness.

Sales through wholesale and direct-to-consumer channels

Wolverine World Wide generates revenue through both wholesale and direct-to-consumer (DTC) channels. In the third quarter of 2024, total revenue was $440.2 million, down from $527.7 million in the previous year. The breakdown by sales channel showed wholesale revenue of $327.8 million and DTC revenue of $112.4 million. Direct-to-consumer sales saw a decline of 17.7% compared to the same quarter in 2023, reflecting challenges in consumer demand.

Channel	Q3 2024 Revenue (in millions)	Q3 2023 Revenue (in millions)	Change (%)
Wholesale	$327.8	$391.1	-16.1%
Direct-to-Consumer	$112.4	$136.6	-17.7%
Total Revenue	$440.2	$527.7	-16.6%

Supply chain management and logistics

Effective supply chain management is critical for Wolverine World Wide to ensure product availability and timely delivery. The company reported a significant decrease in inventories from $563.8 million in September 2023 to $285.5 million in September 2024, indicating improved inventory turnover. Furthermore, lower supply chain costs contributed to the increase in gross margins, which were 45.3% in Q3 2024, compared to 40.8% in Q3 2023. The company continues to optimize logistics and distribution channels to enhance operational efficiency and reduce costs.

Wolverine World Wide, Inc. (WWW) - Business Model: Key Resources

Strong portfolio of recognized brands

Wolverine World Wide, Inc. boasts a diverse portfolio of well-known brands, including Merrell®, Saucony®, Sperry®, and Hush Puppies®. As of September 28, 2024, the Active Group generated $914.4 million in revenue, while the Work Group contributed $304.2 million. The company's brand value is further reflected in its gross margin, which was 45.3% for the third quarter of 2024, up from 40.8% in the same period in 2023.

Manufacturing facilities and partnerships

Wolverine has strategically partnered with various manufacturers to optimize its production capabilities. The company reported total inventories of $285.5 million as of September 28, 2024, which reflects its reliance on efficient supply chain management. The company has also divested from several businesses, including the U.S. Leathers business and Sperry®, to focus on its core competencies.

Skilled workforce in design and marketing

The company employs a talented workforce specializing in design and marketing, essential for maintaining competitive advantage. As of September 28, 2024, Wolverine reported selling, general, and administrative expenses of $171.2 million for the third quarter. This investment in human resources is pivotal, considering the decrease in revenue across various segments, including an overall decline of 16.6% in total revenue for the third quarter of 2024 compared to the previous year.

Extensive distribution network

Wolverine World Wide has established a comprehensive distribution network that includes both wholesale and direct-to-consumer channels. For the quarter ended September 28, 2024, wholesale revenue was $327.8 million, while direct-to-consumer revenue was $112.4 million. The company reported a total revenue of $440.2 million for the third quarter, with a significant contribution from its extensive distribution efforts.

Key Resource	Details
Brands	Merrell®, Saucony®, Sperry®, Hush Puppies®
Revenue (Active Group)	$914.4 million (2024)
Revenue (Work Group)	$304.2 million (2024)
Gross Margin	45.3% (Q3 2024)
Total Inventories	$285.5 million (Q3 2024)
Selling, General & Admin Expenses	$171.2 million (Q3 2024)
Wholesale Revenue	$327.8 million (Q3 2024)
Direct-to-Consumer Revenue	$112.4 million (Q3 2024)
Total Revenue	$440.2 million (Q3 2024)

Wolverine World Wide, Inc. (WWW) - Business Model: Value Propositions

High-quality, innovative footwear and apparel

Wolverine World Wide, Inc. is recognized for its dedication to producing premium quality footwear and apparel. The company achieves a gross margin of 45.3% in the third quarter of 2024, up from 40.8% in the same quarter of 2023. This increase is attributed to a favorable distribution channel mix and lower supply chain costs. The company's focus on innovation is evident in its product lines, such as the Merrell® Moab Speed and Speed Strike, which have received positive market reception.

Diverse product offerings for various customer segments

Wolverine offers a wide range of products across different segments. In the third quarter of 2024, the Active Group generated $318.7 million in revenue, while the Work Group brought in $109.1 million. The company also reported a notable decrease in revenue from its Other category, which fell to $12.4 million from $76.1 million year-over-year. This diversity allows Wolverine to cater to various consumer needs, from outdoor enthusiasts to occupational footwear users.

Segment	Q3 2024 Revenue (in millions)	Q3 2023 Revenue (in millions)	Percent Change
Active Group	$318.7	$328.6	(3.0%)
Work Group	$109.1	$123.0	(11.3%)
Other	$12.4	$76.1	(83.7%)

Strong brand heritage and recognition

Wolverine World Wide boasts a strong brand heritage, with over 140 years of experience in the footwear industry. Brands such as Merrell®, Saucony®, and Hush Puppies® are well-recognized in their respective markets. The company’s ability to maintain brand equity is reflected in its diluted earnings per share, which rose to $0.28 in Q3 2024 compared to $0.11 in Q3 2023.

Commitment to sustainability and ethical sourcing

Wolverine World Wide is also committed to sustainability, emphasizing ethical sourcing practices. The company has made significant strides in reducing its environmental impact, with a focus on sustainable materials across its product lines. This commitment is further highlighted by the cash flow provided by operating activities, which was $97.7 million for the first three quarters of 2024, compared to $7.0 million in the same period of 2023.

Wolverine World Wide, Inc. (WWW) - Business Model: Customer Relationships

Direct engagement through owned retail stores and eCommerce

Wolverine World Wide, Inc. operates a combination of owned retail stores and eCommerce platforms to engage directly with its customers. As of the third quarter of 2024, the company's direct-to-consumer revenue was $112.4 million, representing a decrease of 17.7% compared to $136.6 million in the third quarter of 2023. The total revenue for the quarter was $440.2 million, down 16.6% year-over-year.

Channel	Q3 2024 Revenue (in millions)	Q3 2023 Revenue (in millions)	Percentage Change
Direct-to-Consumer	112.4	136.6	-17.7%
Total Revenue	440.2	527.7	-16.6%

Loyalty programs and customer feedback mechanisms

Wolverine World Wide has implemented various loyalty programs aimed at enhancing customer retention and engagement. These programs leverage customer feedback mechanisms to refine product offerings and service delivery. The company collects feedback through surveys and direct customer interactions, allowing adjustments in product lines and marketing strategies. In 2024, the company reported a cash flow from operating activities of $97.7 million, significantly higher than $7.0 million in the previous year.

Active social media presence for community building

The company maintains an active social media presence across platforms such as Instagram, Facebook, and Twitter, focusing on community building and brand engagement. In the third quarter of 2024, social media campaigns contributed to a broader reach, although specific metrics on engagement and growth were not detailed in the financial reports. The company’s brands, including Merrell and Saucony, have seen a focus on digital marketing strategies to enhance customer interaction and brand loyalty.

Customer service support for inquiries and issues

Wolverine World Wide has established a comprehensive customer service support system to address inquiries and issues. This includes online chat support, email assistance, and a dedicated customer service hotline. The company's selling, general, and administrative expenses decreased by 15.8% to $171.2 million in the third quarter of 2024, down from $203.3 million in the same quarter of 2023, indicating a potential optimization in customer service operations while still maintaining support quality.

Wolverine World Wide, Inc. (WWW) - Business Model: Channels

Direct-to-consumer through online platforms

Wolverine World Wide, Inc. has been enhancing its direct-to-consumer (DTC) strategy significantly. For the third quarter of 2024, the DTC revenue was reported at $112.4 million, a decrease of 17.7% compared to $136.6 million in the third quarter of 2023. This decline reflects broader market challenges but remains a critical focus area for the company.

Wholesale partnerships with major retailers

The wholesale channel remains a vital component of Wolverine's business model. In the third quarter of 2024, wholesale revenue was $327.8 million, down from $391.1 million in the same quarter of 2023, marking a decrease of 16.6%. Key partnerships with major retailers continue to drive a significant portion of sales, particularly in the Active and Work Groups.

Multi-branded retail stores

Wolverine operates multi-branded retail stores that feature several of its brands. For the year-to-date period ending September 28, 2024, the Active Group generated $914.4 million in revenue, while the Work Group accounted for $304.2 million. This strategy enhances brand visibility and provides consumers with a diverse product selection.

Licensing agreements for expanded market reach

The company has entered into global multi-year licensing agreements to broaden its market reach. Notably, effective January 1, 2024, Wolverine licensed its Merrell® and Saucony® kids' footwear and Merrell® apparel and accessories. These agreements are expected to provide additional revenue streams and enhance brand presence in new markets.

Channel Type	Q3 2024 Revenue (in millions)	Q3 2023 Revenue (in millions)	Change (%)
Direct-to-Consumer	112.4	136.6	-17.7
Wholesale	327.8	391.1	-16.6
Active Group (Retail)	914.4	1,097.8	-16.7
Work Group (Retail)	304.2	355.3	-14.4

Wolverine World Wide, Inc. (WWW) - Business Model: Customer Segments

Outdoor enthusiasts and active lifestyle consumers

Wolverine World Wide, Inc. targets outdoor enthusiasts through its Active Group brands, which include Merrell®, Saucony®, and Chaco®. In the third quarter of 2024, the Active Group generated revenue of $318.7 million, down from $328.6 million in the same quarter of 2023, reflecting a 3.0% decrease. The company emphasizes performance and durability in its products, appealing to consumers who prioritize functionality in outdoor activities.

Working professionals requiring durable footwear

The Work Group segment, which includes brands like Wolverine® and Cat®, caters to working professionals needing reliable and durable footwear. In the third quarter of 2024, the Work Group reported revenue of $109.1 million, a decrease of 11.3% from $123.0 million in the third quarter of 2023. This segment focuses on providing footwear solutions that meet safety and comfort standards for various work environments.

Families looking for children's footwear

Wolverine World Wide also serves families through its children's footwear offerings under brands like Saucony® and Keds®. The demand for children's footwear is significant, as evidenced by the company's strategic emphasis on this segment. However, specific revenue figures for children's footwear are not separately disclosed. The company's overall revenue from the Active Group, which includes children's footwear, was $914.4 million for the year-to-date period ending September 28, 2024.

Fashion-conscious consumers

The company appeals to fashion-conscious consumers through brands like Hush Puppies® and Sperry®. The revenue from the Other category, which includes these brands, was $12.4 million in the third quarter of 2024, down from $76.1 million in the same quarter of 2023, indicating an 83.7% decrease. This decline reflects the challenges faced by the brand in maintaining its market position amid changing consumer preferences.

Customer Segment	Brands	Revenue Q3 2024 (in millions)	Revenue Q3 2023 (in millions)	Percentage Change
Outdoor enthusiasts	Merrell®, Saucony®, Chaco®	318.7	328.6	-3.0%
Working professionals	Wolverine®, Cat®	109.1	123.0	-11.3%
Families (children's footwear)	Saucony®, Keds®	N/A	N/A	N/A
Fashion-conscious consumers	Hush Puppies®, Sperry®	12.4	76.1	-83.7%

Wolverine World Wide, Inc. (WWW) - Business Model: Cost Structure

Manufacturing and Production Costs

Cost of goods sold for the third quarter of 2024 was $241.0 million, a decrease of 22.8% compared to $312.3 million in the same quarter of 2023. For the first three quarters of 2024, the cost of goods sold was $696.5 million, down 32.8% from $1,036.7 million in the corresponding period of 2023.

Marketing and Advertising Expenses

Advertising costs decreased by $7.3 million in the third quarter of 2024 to $19.0 million from $26.3 million in the third quarter of 2023. Year-to-date advertising expenses for 2024 totaled $57.5 million, down 27.5% from $85.0 million in the first three quarters of 2023.

Selling, General and Administrative Expenses

Selling, general and administrative expenses (SG&A) decreased to $171.2 million in the third quarter of 2024 from $203.3 million in the third quarter of 2023, marking a reduction of 15.8%. For the first three quarters of 2024, SG&A expenses were $514.6 million, down 15.7% from $610.8 million in the same period of 2023.

Expense Category	Q3 2024 (in millions)	Q3 2023 (in millions)	Year-to-Date 2024 (in millions)	Year-to-Date 2023 (in millions)
Cost of Goods Sold	$241.0	$312.3	$696.5	$1,036.7
Advertising Costs	$19.0	$26.3	$57.5	$85.0
SG&A Expenses	$171.2	$203.3	$514.6	$610.8

Research and Development Investments

Research and development (R&D) investments for the third quarter of 2024 were reported at $1.7 million, a decrease of 83.3% from $10.0 million in the third quarter of 2023. Year-to-date R&D expenses for 2024 were $9.3 million, down from $15.2 million in the first three quarters of 2023.

Wolverine World Wide, Inc. (WWW) - Business Model: Revenue Streams

Sales from Branded Footwear and Apparel

Wolverine World Wide, Inc. generates significant revenue through the sale of its branded footwear and apparel. In the third quarter of 2024, total revenue amounted to $440.2 million, which represented a decrease of 16.6% compared to the same quarter in 2023. For the first three quarters of 2024, total revenue was $1,260.3 million, down 26.6% year-over-year .

The breakdown of revenue by segment in the third quarter of 2024 is as follows:

Segment	Revenue (Q3 2024)	Revenue (Q3 2023)	Change (%)
Active Group	$318.7 million	$328.6 million	-3.0%
Work Group	$109.1 million	$123.0 million	-11.3%
Other	$12.4 million	$76.1 million	-83.7%

Licensing Income from Brand Collaborations

The company has increasingly focused on licensing agreements to enhance its revenue streams. In 2024, Wolverine World Wide entered into global multi-year licensing agreements for the Merrell® and Saucony® kids footwear lines and Merrell® apparel and accessories. These agreements are expected to contribute positively to revenue but specific figures for licensing income are not disclosed in the current financials.

Wholesale Revenues from Retail Partnerships

Wolverine World Wide's wholesale revenues are a crucial component of its revenue model. In the third quarter of 2024, wholesale revenues were reported at $327.8 million, down from $391.1 million in Q3 2023. This decline reflects a 16.6% decrease in overall wholesale revenues .

The wholesale revenue breakdown for Q3 2024 is as follows:

Segment	Wholesale Revenue (Q3 2024)	Wholesale Revenue (Q3 2023)	Change (%)
Active Group	$217.1 million	$225.2 million	-3.0%
Work Group	$99.8 million	$111.4 million	-11.3%
Other	$10.9 million	$54.5 million	-83.7%

Direct-to-Consumer Sales through eCommerce and Retail Stores

Direct-to-consumer sales remain a vital revenue stream for Wolverine World Wide. In the third quarter of 2024, direct-to-consumer revenue was $112.4 million, down from $136.6 million in Q3 2023, marking a decrease of 17.7% . The overall trend indicates a shift in consumer purchasing behavior, with direct sales facing challenges amid broader economic conditions.

Year-to-date figures for direct-to-consumer sales in 2024 show a similar decline:

Metric	Direct-to-Consumer Revenue (YTD 2024)	Direct-to-Consumer Revenue (YTD 2023)	Change (%)
Total	$298.0 million	$297.4 million	0.2%

Updated on 16 Nov 2024

Resources:

1. Wolverine World Wide, Inc. (WWW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Wolverine World Wide, Inc. (WWW)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Wolverine World Wide, Inc. (WWW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.