Businessweek Archives

What Makes Ryka Run? `Sheri Poe And Her Story'


People

WHAT MAKES RYKA RUN? `SHERI POE AND HER STORY'

"He reached over, pulled the door shut, pushed me down on the floor, and pinned me with one hand. He had me in this headlock. He said, 'I want you to feel in back of your head.' I did, and it was steel. He said, 'This is a gun, and you need to do everything I tell you to do. If you don't, I'm gonna blow your head off."'

Sheri Poe isn't afraid to talk about the day 21 years ago when she was raped in a car near the campus of Southern Illinois University. In fact, she considers it therapeutic. The assault occurred during her freshman year at SIU, after she was picked up hitchhiking. It led to years of psychological trauma, punctuated by bulimia and financial collapse. By slowly coming to terms with what happened, Poe eventually recovered. And in 1987, she founded a sneaker company called Ryka Inc. to produce aerobic shoes designed especially for women.

Lately, the 40-year-old Poe has been telling her story to all who will listen. She has woven it into a potent marketing message that helped boost Ryka's sales by 53% last year, to $12 million. Ryka is too small to attract much attention yet. But it will. While Ben & Jerry's Homemade Inc. and the Body Shop Inc. have led a growing number of companies to embrace "cause marketing" as the selling trend of the '90s, Poe's highly personal campaign has stretched the concept past all previous boundaries.

'WORK IT OUT.' The cynics, of course, will say that Poe has attached her intimate history to Ryka's marketing message in an exploitative effort to sell more sneakers. Poe responds that selling more shoes is merely a means to an end. She has pledged 7% of the company's profits to a fund called the Ryka ROSE (Regaining One's Self-Esteem) Foundation, which channels money to groups helping women who have been victims of violent crime. "There's no hidden agenda for me, except helping the women who are touched by violence

in overwhelming numbers," she says.

Ryka, based in Norwood, Mass., recently launched a hard-edged print advertising campaign that juxtaposes the image of a woman working out with another photo of a teary-eyed woman--presumably the victim of a violent crime. The copy reads: "Sometimes the only way to work it out is to work it out." The two-page spread, appearing in such magazines as Vogue and Working Woman, draws mixed reviews. Former Nike executive Kate Bednarski, who now runs a consulting firm called Dialogue Marketing Concepts Inc., says the ads and the foundation bring credibility to Ryka's claims to be working on behalf of women. But, she adds: "They almost go too far. The risk is she'll turn some people off."

Like it or not, the campaign is working. After six years of selling against giants Nike Inc. and Reebok International Ltd., Poe's company expects to grow another 53% this year--to more than $18 million in sales. It also hopes to turn its first profit, giving a boost to the ROSE Foundation, which has so far gotten by with a $250,000 grant from Poe herself and outside fund-raising. While Ryka remains tiny (Reebok, with almost a one-third share, leads the $3 billion market for women's aerobic, walking, and cross-training shoes), Poe's tactics are carving a convincing niche. Says Jennifer Black Groves, an athletic apparel analyst with Black & Co: "Sure, Ryka's got a good, unique line of shoes. But what's making Ryka work is Sheri Poe and her story."

Poe grew up traversing the country as the daughter of a retail-industry trouble shooter. Her family eventually landed in Illinois, and after high school she headed for SIU. The rape occurred late in her freshman year. And when she speaks to women's audiences, that's where her story begins.

GOING PUBLIC. Poe reported the rape to the authorities. But, she says, police, doctors, and even a therapist blamed her for the crime because it occurred while hitchhiking to work. Ashamed, Poe kept the rape a secret, telling only her two brothers: "I tried to pretend it didn't happen." The result, she says, was deep emotional turmoil, which led to bulimia and several other health problems.

Off and on for five years, Poe was hospitalized. She dropped out of college and moved to Florida to be with her brothers. Her health declined so severely that she couldn't keep the odd jobs she was working, and she wound up on welfare. Her saving grace, she says, was a doctor's warning that her constant binging and purging had wrought such havoc on her body that she was imperiling her chances of ever having children. She was 23 years old at the time. "Something snapped," she says.

She moved to California, where she met her first husband, Martin Birrittella, the vice-president of marketing for a now-defunct company that made fitness-related gift items. As Poe's life began to settle down, the couple had two children and Poe went to work for Birrittella's company, rising to national sales manager. She also began a recovery process that included walking, and later aerobics. The exercise "helped me get in touch with my body," she says.

It also helped her come up with an idea. Having suffered back pains from workouts, Poe observed that most aerobics shoes on the market weren't designed with the narrow heel or high arch typical of women's feet. Why not design a workout shoe specifically for women? Bankers chuckled at the idea, noting the wealth of competition. But one Texas investment banker, also an aerobics fanatic, bought the idea and raised $4 million in 1986 by taking Ryka public on the over-the-counter market. Poe and Birrittela were partners. All that existed of the company then was a shoe design.

OPRAH-STRUCK. Ryka started manufacturing its shoes in Asia and barely hobbled through some initial quality problems after it began shipping in 1988. Poe and Birrittella, meantime, got divorced and he left the company. (She has since remarried and has had another child.) Despite the distractions, Poe has kept Ryka's marketing focused. From the start, she trumpeted the fact that the company is the only producer of women's shoes actually run by women (70% of the employees are female). She also kept some influential aerobics instructors decked out in Ryka products. In 1991, Poe sent Oprah Winfrey a pair of Rykas and wound up as a guest on a show featuring women entrepreneurs.

Poe didn't start telling her own story publicly until last year, when she saw Oprah testify about child abuse before a Senate committee. It shook her. "It's not enough to make a great shoe and support women physically," she says now. "What about their emotions? Not only am I a survivor of violence, but our customers are touched by this." Sensitive advertising, coupled with the ROSE Foundation, she thought, would be an effective way to give women help.

So far, Poe says, "the response has been overwhelming." Not only are sales growing but the company is flooded with phone calls from women victims looking for resources. "It's a smart position to take in the '90s," says Jane McConnell, publisher of Women's Sports & Fitness magazine. "Women tend to respond very positively to cause marketing." Especially, it seems, when the marketer makes it clear she knows what she's talking about.Ron Stodghill II in New York


China's Killer Profits
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus