Converse Inc.

May 03, 2023

Oscar Hernandez

Professor Stephen Soucy

CONVERSE: THE RISE AND FALL OF THE ICONIC SHOE

The company I chose to research is the iconic shoes and apparel company, Converse.

They are a company with a lot of rich history and stories to tell. “Converse was founded by

Marquis Mills Converse in 1908 in Malden, Massachusetts. Originally, the label was known as

the “Converse Rubber Company” and its earliest inventory included practical and functional

footwear like galoshes, leather duck-hunting boots, and tennis shoes.

(https://www.instyle.com/history-of-converse-7098393)

Converse was the original sneaker that revolutionized the athletic world and became the top shoe

in the sporting world.At the time there was no other type of footwear like it. Due to the

technology and how they started to use rubber, they realized how they could make strong

supportive soles. It became the top shoe and had no competitors for a long time till more modern

times. It eventually took a fall in its popularity and it took some time for them to regain most of

its popularity that it had lost. The one sport that made Converse rise to the top was basketball.
This was way before basketball even became popular. At the time, baseball ruled the sporting

world but soon enough Converse would find ways to be relevant. The interesting thing about

Converse was it originally made more than shoes. It made automobile tires and “really anything

you could make out of rubber,” according to Sam Smallidge, the brand’s in-house

archivist.”(instyle.com), It was the first time that a shoe of that kind was made using rubber. It

was definitely ahead of its time and soon they came out with two models of shoes that were

successful. The first one, in 1917, were the All-Stars and in 1921 it was the Chuck Taylors.

Chuck Taylor was a basketball player from that time period who asked for a certain type of shoe.

So in 1917, “the Converse Chuck Taylor All Star made its debut; a basketball shoe that would go

on to achieve an illustrious level of ubiquity in the sneaker world.” (

https://www.mrporter.com/en-us/journal/fashion/history-converse-chuck-taylor-all-star-sneaker-i

con-1276662 . 1

Even though this wasn’t the first sneaker it revolutionized the way shoes were created with new

features these” included the heel patch, which was placed on the inner (rather than the more

conspicuous outer), a feature supposedly designed to protect the ankle bones of players,

according to Ms Semmelhack. But the diamond tread pattern, which is still present today, was

really the bedrock of the design, Mr Smallidge explains. “The shape allowed people to push off

in multiple directions and stop quickly,” he says.” 2. Converse had the sneaker industry

dominated and there was no rival to them.

In more modern times, Converse’s “sales for the year were up 20.6 percent to $209.5 million

from $173.7 million.” in 1984

https://www.upi.com/Archives/1984/02/23/Converse-Inc-Wednesday-reported-an-increase-of-ne
arly-50/5105446360400). This was a big year because between that year and 1986, basketball

superstars Magic Johnson and Larry Bird really sent Converse to elite status. They wore the shoe

after winning MVP in their respective seasons. This was from 1984 to 1987 and they were as

prosperous as they have ever been. They were the trailblazers but many more followed and they

were all high caliber players. As you will see, Converse was by far the sneaker of choice until it

was eventually surpassed by Nike.

Here is a timeline of key events that happened during Converse’s history.

Follow Company
CONVERSE COMPANY HISTORY TIMELINE

➔ 1908

Marquis Converse started the Converse Rubber Company locally in 1908.

In 1908 Marquis M. Converse established Converse Inc.'s ancestor, Converse

Rubber Co., in Malden, Massachusetts.

● 1910

By 1910, the company had expanded its plant to produce 4,000 pairs of boots and

rubbers daily.By 1910, Converse had started manufacturing rubber soled shoes on a

daily basis.

● 1915

In 1915, the company started making athletic shoes especially made for tennis.

● 1916
● In 1916 they were looking to expand their company and while basketball was on the

cusp of becoming as big as football or tennis, there was still a lack of specific

footwear choices for its players.

● 1917

In 1917, the Converse All-Star basketball shoe was introduced and began to be worn

by Chuck

● 1918

In 1918, the Converse All-Star basketball shoe was introduced.

All Star's rapid success was spurred by the reputation and marketing savvy of

basketball star Charles 'Chuck' H. Taylor, who joined the Converse sales force in

1921 to become the brand's first player endorser. The All Star led the company to

popularity and prosperity, especially when it received the endorsement of basketball

player Chuck Taylor in 1921.

● 1929

However, in 1929 financial troubles hit Converse and the company went bankrupt.

➔ 1932

Because he was so successful in promoting Converse All Stars, as well as making

important changes in the design of the All Star shoe, in 1932, his name “Chuck

Taylor” was added to the ankle patch.

➔ 1933

In 1933 the Stone family bought Converse and operated it for 39 years, watching it

grow into a major footwear contender. At that point, Albert Welchsler became the

company's owner, but by 1933 Welchsler could no longer afford to run the company,

which had experienced poor profits due to the Great Depression.

● 1936
● The first white model was introduced at the 1936 Olympics, a predecessor to today's

optical white high top.

In 1946 the company's Granite State Division in New Hampshire began operating

two large plants.

➔ 1949
➔ The classic black and white high top was introduced in 1949
➔
➔ 1953

In 1953 Converse established the Coastal Footwear Corporation in Canovanas,

Puerto Rico.

➔ 1957

In 1957 the low cut All Star was introduced and became popular as a more casual

alternative to the high top. Post WW2, the Converse brand continues to grow in

popularity based on a reputation for quality and comfort, and by 1957 it accounts for

80% of sales in the basketball footwear sector.

➔ 1962

In 1962, center Wilt Chamberlain of the Philadelphia Warriors scored 100 points in

an NBA game while wearing a pair of Chucks, taking a 169–147 victory over the

New York Knicks in Hershey, Pennsylvania on March 2.

➔ 1968

Because of his tireless efforts promoting the sport, Taylor was called the

“Ambassador to Basketball” and in 1968, Charles H. ‘Chuck’ Taylor was inducted

into the Basketball Hall of Fame. All Stars remained the official USA olympic team

basketball shoe until 1968.

In 1972 Converse changed hands again when Eltra Corporation purchased the

company from the Stone family.

●
● 1975

Converse was also a sponsor of USA Basketball beginning with its inception in

1975.

●
● 1979

Converse lost popularity as a basketball shoe and Tree Rollins was the last NBA

player to wear them in 1979.

●
● 1982

In 1982, however, the giant chemical conglomerate underwent a restructuring and

moved out of the consumer products business.

● 1982

Allied Corporation sells Converse to a group of its senior managers.Converse drops

a Jordan x Converse commemorative pack to celebrate the 30th anniversary of

Michael Jordan’s famous game-winning shot for North Carolina in 1982.

● A pair might have costed $19.99 but in 1982 12 million shoes

reported basis and up 3 percent on a currency-neutral basis, due to wholesale revenue declines

offset by growth in our direct to consumer business.

https://www.statista.com/statistics/241850/sales-of-nikes-non-nike-brands-2006-2010/#:~:text=

Converse%20is%20owned%20by%20sports%20apparel%20manufacturer%20Nike,global%20r

evenue%20of%20approximately%2046.7%20billion%20U.S.%20dollars

They had a rich history as they dominated till about the 70s. “Converse lost their monopoly from

the 1970s onward, with new competitors, including Puma, Adidas, and Nike. A decade later, as

Reebok introduced new designs and technology to the sports market, Converse was no longer the

official shoe of the National Basketball Association (NBA)

https://www.zippia.com/converse-careers-195172/history/

In the mid 80s to late 80s, Michael Jordan would go on to elevate Nike even higher and to the

top. Converse would lose their stranglehold on the industry as a whole and while they still were

doing well, it was not the same. They eventually went through some tough times but they were

able to rebound. The main way they did that was being bought out by their main competitor. By

joining them it would be their best bet for future success. “In July 2003, Nike paid $309 million

to acquire Converse. Around 2010, Nike relaunched the footwear, taking advantage of the wave

of 1980s revival. The company also expanded the Converse brand to other businesses apart from

shoes, much akin to its other brands.” https://www.zippia.com/converse-careers-195172/history/

actors, and other celebrities? Well in this short video, you get a visual of how it evolved over the

years. Here is the link, . The History of Converse Shoes & How They Became So Popular .

What I find interesting is that for over sixty years, Converse was never rivaled. No one else

thought of the idea to create any type of athletic shoe. Part of the reason it seems was Converse

had so much popularity that it didn;t need any other option. It fulfilled all the needs of the

consumers. Then when you add all the famous people across all the genres, not just sports. It

made perfect sense. It would have been difficult to stand toe to toe with Converse. It was only

when quite a few athletic brand companies came into play from 1970 on that things started to

change.

Ironically, their main competitor was Nike and they were the ones who bought out Converse and

basically saved them. Converse was going bankrupt and then within a year they were prosperous.

“As it was reported in 2003, In 2002, the flailing company reported just $205 million in revenue.

Since, Nike has transformed the brand into a $1.4 billion business—and this year’s revenue is on

pace to surpass that number. Converse has seen the strongest growth in North America, China

and the UK, where it’s made significant investments over the past several years.”

https://qz.com/129238/how-converse-went-from-bankruptcy-to-a-1-4-billion-business

Another reason why Converse started to lose its grip as the king of the sneaker industry was their

lack of marketing and belief. Superstar basketball player, Magic Johnson said, ″Converse is still

living in the 1960s and ’70s,″ Johnson said in an informal press conference following Team
USA’s basketball practice. ″They haven’t arrived in the ’80s and ’90s” where advertising and

marketing are the keys. Guys like Larry and myself can’t take ourselves to the next level.″

It was poor marketing and stubbornness that kept Converse from evolving and thriving in the

technological era. Things were simply not done like they used to be done. The problem with

being at the top and having no competition is you have no reason to get better. The motivation is

not there and you are basically competing with yourself to improve. The old adage, “ if it ain’t

broke, don't fix it.” worked for the majority of the twentieth century but was no longer relevant

when it came to adapting. Converse assumed things would stay the same but at the end it was its

downfall.

Currently, things are going pretty well for Converse as they were helped out by Nike and have

gotten their revenue to go way up. It has been about twenty years since this occurred, “On

September 4, 2003, Nike (NYSE: NKE) acquired Converse for $315 million – two years after

the latter filed for bankruptcy. Converse had annual sales of just over $200 million at the time of

acquisition. Fast forward 16 years to Nike’s fiscal year 2019 – Converse sales have ballooned to

nearly $2 billion.”

https://www.forbes.com/sites/greatspeculations/2019/11/15/was-nikes-acquisition-of-converse-a-

bargain-or-a-disaster/?sh=7eb65bfc42f3

That is income multiplied by almost 10 times. That is an incredible amount of revenue and has

increased significantly to the year 2017 even though it remained roughly the same in 2019.

Presently, it has dropped in the last few years from its peak in 2017.Looking at this chart reflects
that.

Converse seems like they will be around for awhile but there footwear line needs to be revamped

to maintain relevance. No doubt, Nike will continue to thrive and help push Converse to stay

afloat. Maybe in the future, Converse will become its own entity again. How Converse went

from bankruptcy to a $1.4 billion business

Stock Chart and Revenue & Profit Table

https://www.statista.com/statistics/241850/sales-of-nikes-non-nike-brands-2006-2010/

Peak Revenue

$1.9B (2022)
MLA works cited

“How Converse Became Fashion’s Favorite Sneaker.” InStyle,

www.instyle.com/history-of-converse-7098393.

PORTER, MR. “A Brief History of the Converse Chuck Taylor All Star

Sneaker.” Mrporter.com, 2020,

www.mrporter.com/en-us/journal/fashion/history-converse-chuck-taylor-all-star

-sneaker-icon-1276662.

“Converse Inc. Wednesday Reported an Increase of Nearly 50... - UPI

Archives.” UPI,

www.upi.com/Archives/1984/02/23/Converse-Inc-Wednesday-reported-an-incr

ease-of-nearly-50/5105446360400.

Accessed 7 May 2023.

“Converse History: Founding, Timeline, and Milestones.” Www.zippia.com,

27 Aug. 2020, www.zippia.com/converse-careers-195172/history/.

Lorenzetti, Laura. “How Converse Went from Bankruptcy to a $1.4 Billion

Business.” Quartz, 28 Sept. 2013,

https://qz.com/129238/how-converse-went-from-bankruptcy-to-a-1-4-billion-business
. Accessed 7 May 2023.

Team, Trefis. “Was Nike’s Acquisition of Converse a Bargain or a Disaster?”

Forbes,

www.forbes.com/sites/greatspeculations/2019/11/15/was-nikes-acquisition-of-c

onverse-a-bargain-or-a-disaster/?sh=7eb65bfc42f3.

Accessed 7 May 2023.

Statista. “Global Revenue of Converse 2010-2019 | Statista.” Statista, Statista,

2010,

www.statista.com/statistics/241850/sales-of-nikes-non-nike-brands-2006-2010/

“Converse Revenue Worldwide 2022.” Statista,

www.statista.com/statistics/241850/sales-of-nikes-non-nike-brands-2006-2010/

#:~:text=Converse%20is%20owned%20by%20sports%20apparel%20manufact

urer%20Nike

. Accessed 7 May 2023.

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