New Balance #111 on the Forbes America’s Largest Private Companies List
New Balance is a Private Company. (Private companies are not on the stock market. If you don’t understand this, ask and I will explain. A company has to have an IPO and then be publicly traded which allows people to purchase shares. I hope this is clear.)
Current Share Price: N/A
2017 Recap: Unlike Puma, New Balance appears on this site often. The shoe made its way into my top 40 shoes of 2017 in a number of spots and rightfully so. New Balance delivered what I thought in many ways was the shoe of the year in the 247. They also delivered several classic drops and positioned themselves with Stance socks as Stance found itself on the outside looking in when Nike killed their NBA affiliation.
In 2017 New Balance also had to overcome the touchy subject of politics and identifying with the current administration, although their alignment with the current administration was a response to their position on the TPP which was a problem that was created by the previous administration.
The brand at one moment was being labeled as the shoe of the Alt Right and White Nationalists. By the end of the year, the lifestyle division was operating like a well oiled machine. Here is what’s interesting about NB. The brand is a private company. It doesn’t have to answer to shareholders. This actually creates a situation where New Balance is able to thrive to the tune of 3.8 Billion a year. Think about this… I make the mistake of listing Under Armour as a part of the big three. Most people do. I will write, adidas, Nike and UA as the triumvirate. UA is a 5 Billion dollar a year company that has the benefit of being on the stock market. This means that UA is worth as many shares that are made available. The worth of the company can grow with enough people buying stocks. This actually gives the company access to capital via shareholders. New Balance has to rely on good old fashioned sales to generate revenue. When you think about it New Balance at 3.8 Billion a year is more a part of the big three than Under Armour.
2018 Analysis: New Balance is in position to carry their momentum over from 2018 with the 247 and the revitalized 547. The brand still maintains a strong connection to the performance running world, but I can see the brand growing considerable tentacles into fashion as the “dad” shoe becomes the go to for fashion in 2018. New Balance is perfectly positioned to capitalize on this. The brand does have issues with marketing although they shouldn’t. They have one of the best skate shoes, but NB is not looked at as a skate brand. They have a roster of the best lifestyle shoes, but on sneaker sites or in sneaker media they are an afterthought unless they are a part of a collaboration. In 2018 if New Balance can begin to utilize their site as the foundation for marketing and begin developing a few campaigns and programs that establish its cool I think New Balance, not Under Armour will move up into the echelon of footwear companies positioned to see an adidas type surge next year. The problem is going to be authenticity for the brand. They have to be very careful not to go the influencer route to gain the cool factor. They have to do it organically which is a definitely possible.
2018 Prediction: How will 2018 play out for the N? I predict that New Balance will figure out how to remove their shoes from the promo wall and into a position that makes them the third option. They don’t have a choice. In one year their grasp on baseball will decline and that’s a place where they have put considerable resources. In 2020 Under Armour takes over sponsorship of MLB. This means that the UA logo will be everywhere in a place that New Balance has taken a lot of time and effort to grow. Cleated sales may not be mainstream, but they are important. Under Armour will have a chance to improve that area, so naturally this will take a bit away from NB, but that’s in the future. This year if NB can make a few adjustments in the delivery of their product I think they become more of a household year. If New Balance was publicly traded I would say they are the best buy of 2018 in footwear.