Ryka Inc Case Study
Autor: simba • March 8, 2011 • Case Study • 1,888 Words (8 Pages) • 1,422 Views
Ryka, Inc. is one of the highly specialized companies in the competitive athletic footwear industry. What sets the company apart from others in its class is the fact that Ryka designs, develops, and markets athletic footwear just for women. The company was originally founded in 1986 as ABE Corporation. In 1987 it changed its name to Ryka. Sheri Poe was the first CEO of Ryka. She also served as an outstanding spokeswoman for the company. Being an exercise fanatic, she injured her back and was convinced that the problem was related to her footwear. She started investigating athletic shoes that could be made specifically for active women. In September 1987 Ryka introduced its first designs. Poe experienced difficulty obtaining capital funds from venture capitalists. In order to finance the company, she leveraged her house and turned to friends and family for resources. In 1988 Ryka went public and sold 4 million shares at one dollar each.
As a new company in the already crowded industry, Ryka spent a lot of energy and finances on marketing in order to find its niche. Ryka's marketing technique was aimed at creating brand awareness and sales at the retail level. The company acquired name recognition through the variety of key audiences by gaining the support of professional sports organizations including U.S. Ski Team and American Aerobics Association International.
In 1990 Ryka had a big marketing break when Sheri Poe appeared on Oprah Winfrey's talk show as a successful female entrepreneur. Ryka's new Ultra-Lite aerobics shoes became an overnight success. With increasing demand, the orders became backlogged by a minimum of three months. Ryka also advertised its product in numerous popular magazines including Shape, City Sports, American Fitness, Elle, and Idea Today. The company created the ROSE (Regaining One's Self Esteem) Foundation which appeals to kind-hearted women consumers. ROSE Foundation is a non-for-profit organization that helps women who have been victims of violent crimes.
Traditionally, the athletic shoes industry has been divided into seven product categories. When the company was first founded, it attempted to produce athletic shoes in all of the categories. Today Ryka competes only in three markets: aerobics, cross-training, and walking shoes. Ryka's largest market, the aerobic segment, accounts for 80 percent of Ryka's sales. The market is primarily made up of athletic women. The second major market for the company is the "Walking segment". It accounts for 10 percent of Ryka's sales. Reebok, the leader in this market, concentrates its marketing on younger women; whereas Ryka focuses its product on women 45-55 years old. The third market Ryka competes for is the cross-training segment. Cross-training shoes can be used for a different variety of activities.