The rise and evolution of the Australian-authentic, globally famous surf-centric retailer.
Increasing competition within the athletic fashion segment has created a tribe of fans who are constantly seeking out new styles. The number of innovative and emerging brands entering the space is growing, but few are investing in the right data and even fewer can deliver true value and satisfaction to their consumers.
Athletic fashion lies at the intersection of streetwear and athleisure and a growing number of brands are falling into these related categories. As the interest in sports-related fashion rapidly rises, water sports are becoming more of a focal point, with surfing taking the top spot in the category. Particularly looking at top surf brands such as Billabong, Stüssy, and Hurley, innovation continues to find new ways of expressing creativity in the genre. Some other top surf brands include Quiksilver, O’Neill, Volcom, and Roxy.
Billabong is a growing Australian surf brand with over 30 years of experience and innovation under its belt. By maintaining strategic operations, the brand has been able to sustain its status and popularity within their surf-talented clientele.
This article aims to study Billabong's history from its inception till the 21st century.
- Billabong History
- Billabong Marketing Strategies
- The Rise and Fall
Founded in 1973 by Gordon Merchant, Billabong is an Australian company with its headquarters in Gold Coast, Australia. The merchant was known to design and produce homemade board shorts and sell them to nearby surf stores. He used a unique technique known as triple-stitching on his shorts, which was extremely durable for his customers. As a result of this technique, surfers began to prefer his shorts over those available in stores over time.
Upon realizing that the demand for his shorts was increasing, he realized that the company needed to be established more firmly. As the brand grew, he knew he would be able to satisfy more global audiences. as part of his expansion plan. Merchants used the company's positive reputation to plan events tailored to surfing and this strategy over time, created the core DNA of Billabong as we know it today. By providing the company with publicity and prominence, Billabong's well-thought-out surf shorts took over Australia in the 80s.
Around the end of the 1980s, Billabong began exporting its products on a more global scale including Africa, Asia, and Oceania. Billabong was a significant contributor to the growth of the surf industry during the following decade.
The Bloom of the Surf Brand
At the beginning of the 21st century, Billabong made its first trade on the Australian Securities Exchange, which helped the brand grow exponentially and acquire other brands. In addition to buying other brands, Billabong opened retail outlets to receive supplies from wholesalers.
The first 10 years of the 21st century was an adequate expansion time for Billabong. In 2001, Billabong acquired Von Zipper, an eyewear company. In July of that same year, the surf brand announced its acquisition of Element, a hard-goods brand and skateboarding apparel manufacturer. Several acquisitions have been made over the years, including the acquisition of Kustom surf shoes in 2004 and the acquisition of Xcel, which produces wetsuits and technical water sports accessories in 2007.
However, Billabong's history changed in 2007 when a new gender focus was introduced. With the changing times and the emergence of the new woman, the brand released a line of clothing designed specifically for women. The Tigerlily brand was acquired as part of this process.
The majority of the company's acquisitions during this period were made on the Gold Coast in Australia. In 2008, however, the company expanded its investment into the United States, acquiring Quiet Flight, a retail brand that operated retail shops for both Element and Billabong in Times Square, New York City. As a result, more retail outlets were developed in Florida. Furthermore, Billabong acquired the UK-based company Two Seasons in 2008.
Billabong Marketing Strategy
Considering Billabong offers a wide variety of products, the brand has employed an array of different marketing strategies throughout the years. In addition to helping the brand remain relevant and competitive in the industry, these strategies have also helped establish its reputation in a position where they have established market dominance. As a result of investing time and energy into identifying and engaging with the company's target audience, Billabong has been able to create a kind of tribe around surf culture and its products.
It has been evident from the onset of Billabong's journey that the brand has a uniqueness that no other brand can match. The company satisfied the needs of its customers by producing valuable items that had stable features regardless of the unfavorable conditions of surf.
Due to its surfing services and funding of international events, the brand has successfully established itself as a global brand. Apart from its global prominence, it has become dignified and a recognized symbol to its target market.
The product strategy is one of the most significant aspects of Billabong’s marketing strategy and is very notable in Billabong’s history. The company has maintained a high sales record due to the fact that its customers were willing to exchange money for the value of its products.
Billabong uses a variety of strategies to not only promote the brand, but to create a community around surf culture.
In addition to sponsoring surf competitions on a global scale, the company has a long history of supporting high-performance surf athletes. Further, during Billabong's prime era, one of the brand's essential marketing strategies focused on hosting brand-sponsored global surf events and tournaments in the company's hometown. By leveraging this strategy, the company hoped to enhance the image of its products, preserve its heritage, and bring like-minded people together to build a sense of community centered around its brand.
In addition, Billabong has achieved high levels of accessibility by providing global fans with a user-friendly online shopping experience.
In order to maintain their position in the market, Billabong employs a competitive pricing strategy. The strategy allows Billabong to price its products in the same range as its competitors, despite the fact that they are of higher quality. A key objective is to prevent customers from choosing lower-cost products in the industry. Among Billabong's competitors, QuickSilver and Rip Curl are well known. Although
The Rise and Fall
Billabong continued to expand at a rapid pace, acquiring various companies such as Xcel, Tigerlily, Sector 9, DaKine, and RVCA joined the Billabong family, amongst others. As of 2009, revenues were over 1.7 billion dollars, up from around 225 million dollars. As shown in the below graph (created using Billabong Financial statements along with data from IBIS world and eCommerceDB), the brand however, shortly thereafter, began to deteriorate. The rapid pace at which they acquired companies may have resulted in a high level of debt. As a result of its mass marketing through large department stores, the brand had lost its appeal and consumers increasingly turned to competitors like Abercrombie & Fitch.
It was evident that the brand was struggling by 2012. There was a major overhaul undertaken by the company, which resulted in the closure of stores and the substantial layoff of employees. Marchant sold a stake in Nixon to repay some of its debt and TPG Capital offered to purchase Billabong, but Marchant declined the offer. Additionally, Bain Capital and VF Corp were involved in the takeover battle, but Oaktree Capital in partnership with Centerbridge Partners ultimately prevailed. It was eventually decided to sell some of the brands, such as West 49, Surfstitch, and Swell, in order to generate cash flow. In 2018, Quiksilver purchased Billabong from Boardriders and became the parent company.
As a company that was birthed in humble beginnings, Billabong has sponsored elite junior teams and professional surfers to encourage customers to discover the inner coastal lifestyle that they possess. From high-performance athletes to casual beachgoers, this Australian brand offers something for everyone. Billabong has had a long journey with a very clear rise and decline, although has truly maintained the brand's core identity.