Athletic footwear maker New Balance on Tuesday announced that on Dec. 31 Chief Commercial Officer Joe Preston will take over the company's chief executive spot from President and CEO Rob DeMartini.
Preston began at New Balance in 1995 as senior product manager, running and custom products, and later served in various executive roles overseas before leading the brand's global product, r&d and sports marketing and ultimately taking on the chief commercial role, according to a company press release.
DeMartini has led New Balance for 12 years, a time of growth for the brand, and lobbied hard for the Berry Amendment, which restricts the U.S. Defense Department's procurement of certain food, clothing, fabrics and specialty metals to domestically produced products, to apply to athletic footwear. That stipulation was just renewed in Congress this week.
New Balance is keeping things in house for this changing of the guard. It has good reason to: DeMartini oversaw global growth from $1.5 billion in 2007 to $4.2 billion in 2018, a time when the brand stoked international sales to 65% from 30% — much of that under Preston’s leadership — and averaged an 11% compound annual growth rate, the company said in a press release.
As Nike reigns supreme and Adidas and Under Armour battle it out for the number two spot in the market, New Balance is among a number of smaller athletic brands, along with Puma, Reebok, Fila and Champion, that "are all enjoying nice growth," according to Matt Powell, NPD group vice president and senior industry advisor of sports. "New Balance is having a good year on the retro trend," he told Retail Dive in an email. "'Small is the new big' is helping them as well."
Bob Phibbs, CEO of retail consultancy The Retail Doctor, noted that New Balance had a firm vision of what it wanted, and also that the brand resonates with millennials and Gen Z because it's "known for their quality and being ethical."
"I do think they understand runners and they understand that broader audience that understands sneakers," he said. "They're not over-exposed like Under Armour, they're not Adidas that's had scandals like payoffs. They're a niche."
The company has recovered from a setback in 2016 when a spokesperson's comments about its support of Trump's actions with the Trans-Pacific Partnership were taken out of context by a neo-Nazi site, which used them to paint the company as the "official brand of the Trump Revolution."
The company joins Skechers in a trademark battle over Nike-owned Converse's Chuck Taylor designs that was just renewed Tuesday by a federal U.S. circuit court. Although New Balance claimed victory, that ruling actually makes it more likely that Converse could ultimately prevail in the long-running dispute.