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Havaianas – the simple rubber sandal from Brazil – has become one of the country’s best loved exports. Created in Brazil in June 1962 as a vulcanised rubber sandal based on the Japanese Zori straw sandal, the company has emerged from a major re-branding drive which has moved the shoe as one strictly for poor people to a fashion item even worn by the queen of Sweden! Sitting down with Havaianas’ very international director Carla Schmitzberger – half Brazilian, half Austrian and educated in the United States – we went through the process which has taken the sandal from one wealthier people were embarrassed to be seen in, to one where several pairs now grace their wardrobes.

Havaianas were originally made in one style and in five colours - blue, yellow,

brown, black and pink – with a sole the same colour as the strap. The top of

the sole, where you placed your foot, was originally white, however. For the

first 30 years, from 1962 to 1993, the sandals were sold through small ‘mom-

and-pop’ shops. Packaging was a plastic bag. In-store display was nothing

more than a line of Havaianas placed on the floor. “Not exactly the most

attractive point of sale and distribution,” Carla points out. “But I must admit

the company did quite well.”

At its peak in the late 1980s, Havaianas was selling between 80 to 85 million

pairs each year. Brazil’s warm climate and long coast made the sandal a

practical choice in footwear. It was also the only pair of shoes many poor

people could afford. Sales started to fall as the company moved into the 90s,

bottoming out at 65 million pairs in 1993. “The people managing the brand

realised that if the rate of decline continued at the same pace, the business

would have totally collapsed by 2006 and the brand would have died,” Carla

says.

The main reason behind this dramatic fall in sales was that consumers had

come to view the sandal as a simple commodity. “Every time you have a

commoditised product, you don’t spend anything on communications,”

Carla explains. “Advertising would focus on functionality and the business

began to focus mainly on cost-saving solutions, potentially affecting quality.

This process is then set into a vicious circle.”

From commodity to fashion item

Change was clearly needed. The company started by looking at how

consumers were using the product. Carla: “We saw that consumers were

taking off the sole and turning it around so that the upper part of the sole

was the same colour as the straps”. In response, Havaianas launched a new

product range – Havaianas Top – which was a monochrome sandal originally

launched in eight solid colours and now available in 20.

The second move was to change the packaging. “It was taken out of the

plastic bags and placed in cartons” Carla explains. “In this way, the product

was not limited only to ‘mom-and-pop’ shops, but could also go to shoe

stores and be exhibited in a better way.”

The third and most significant move was to shift the brand perception

from one people were embarrassed to be associated with to a fun and

aspirational brand. The company launched a new high profile advertising

campaign, including print and TV commercials, which always contains lots

of colour, vibrancy, energy and joy. In addition, Havaianas started targeting

opinion leaders such as magazine fashion editors and celebrities, sending

them samples – particularly of a growing range of limited ‘special edition’

models – in a bid to encourage them to wear the new look Havaianas.

The strategy worked and soon the fashion elite of Brazil were being seen

getting about town in their new Havaianas, while the sandals were making

regular appearances in the editorial pages of the country’s top fashion

magazines.

The company also entered into a number partnerships to ensure a continuous

line of new, creative and novel products. Examples include partnerships

with jewellery designers, such as HStern, that resulted in jewel encrusted

versions of the sandals, as well as with famous cartoonists who decorated

special editions. “These special projects helped create a strong emotional

attachment with customers. They also resulted in the creation of a lot of buzz

surrounding the brand. We also do a tremendous amount of brand activation

through partnerships with international brands. The beauty about our brand

is that it is a blank canvas, you can always come up with new ideas.”

Other innovative marketing campaigns saw the company join with environ-

mental groups working to save endangered forest species. Havaianas came

up with a special version of their sandals with the endangered species

printed on them and donated part of the sales of these products to their

partner organisations.

Back in business

Today, Havaianas has around 450 models of different style and colours.

The company has also moved to launch its products globally, with Hawaii

and Australia – both countries that have a strong beach culture and where

consumers already wore sandals – becoming the first targeted markets in

1998. The same branding strategies were put to use and strong sales followed.

Today more than 11 percent of sales are carried out overseas. With the set up

of an office in New York in June 2007 and now an office in Madrid, they are

taking serious steps forward and put feet on the US and European market,

where the opportunities are huge.

Since Havaianas emerged from its re-branding strategy in 1994, sales have

been growing by a steady 8 percent each year. Last year the company sold

171 million pairs of its now famous rubber sandal, 20 million of which were

sold outside Brazil. Inside Brazil, the company has achieved the amazing

brand penetration rate of 850 pairs sold per 1000 inhabitants. “The beauty

of this is that 50 to 60 percent of these pairs go to poor people so despite

all the changes, the brand is still true to its origin,” Carla said. “These days,

however, it is a brand which permeates all social classes. Now it is a brand

for everyone.”

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CEO Mr. Marcio Utsch | Number of employees 16300 | Company

turnover US$ 990 million ( Net Sales 2007) | Brand promise Joy,

colour, energy, comfort and style - improbable combinations |

Brand values Energy, Design, Style, Comfort, Value, Universality, |

Main target group All ages and genders | Primary advertising

media In Brasil – Magazines and electronic Media (TV), in interna-

tional markets Magazines

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