Quick Hits: Investors Take a Bite Out of Crocs

Minyanville Staff  Apr 16, 2008 10:30 am

Quick Hits: Investors Take a Bite Out of Crocs
 
Brief scrutiny of today's headlines.
 

 
Fads, by definition, fade. But fading is too gentle a term for what happened yesterday to shares of rubber sandal-maker Crocs (CROX).

The company issued a profit warning Monday after the bell and the stock fell more than 40% yesterday. Management blamed weakening economic conditions for its poor outlook, but analysts question the long-term viability of the brand.

Crocs are easy to criticize. The rubber shoes are by most accounts ugly as sin and, throughout much of the world, completely impractical for six months of the year. They're great for kids, but in most family units ten-year-olds make precious few purchasing decisions. They are however, sturdy.

That's precisely the problem. Crocs are a one-time purchase. Their rugged rubber frame is built to last, hurting the prospect of repeat business. Crocs should take a hint from Apple (AAPL), whose popular iPods are designed to wear out every couple of years. Failing that, a five dollar umbrella salesmen outside Grand Central Station provide a reliable primer in built-in obsolescence.
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Comments (5) See All Comments »
04-16-2008, 10:55 am
"Apple (AAPL), whose popular iPods are designed to wear out every couple of years."

I presume you have some facts to back up this statement? Note that I'm not implying that iPods don't wear out. Any electronic
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04-16-2008, 11:29 am
Mac Fan,

I love my iPod (and new iPhone too), the comment on being "designed to wear out" was meant to be a bit tongue and cheek ... maybe it could have been more clear. I'd like to think Apple doesn't deliberatel
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04-16-2008, 11:32 am
I have to disagree with that criticism of Crocs. You have to remember that Crocs are target market is childrens shoes. So while the Crocs may not wear out, children continue to grow meaning a larger size needs to be purchased.
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04-17-2008, 10:38 am
I must be missing something here..My IPod mini has worked beautifully since I purchased it in 2004. As for Crocs...I just purchased a pair today..and realised I need more then one color...so as long as they have multiple shades, they'll have a
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04-17-2008, 4:46 pm
Obviously, you don't speak from experience. The bottoms will indeed wear out. I've had 2 pair last summer. Though they are a bit ugly, the comfort is superb and actually eliminated a terrible foot pain that I had for 6 months prior to
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