[Hidden Business Story] New Balance, the World's Oldest Sports Brand with 114 Years of History
"Bringing Comfort to Every Foot" Inheriting the Founder’s Spirit... Developing Wide Sizes
Committed to 'Made in USA' to Highlight New Balance Origins and Craftsmanship
[Asia Economy Reporter Shinwon Yoon] Issey Miyake's black turtleneck, Levi's 501 jeans, and New Balance 992. These are signature items of Apple founder Steve Jobs. Among his items, which he wore at every presentation and often caused sell-out crazes, I would like to talk about 'New Balance.'
New Balance was born in the early 1900s from the hands of British inventor William J. Riley. After immigrating to Boston, USA, he wondered, "How do those chickens support their bodies with such legs?" while observing the chickens he raised in his backyard, and began studying the shape of chicken feet. He observed that the three-pronged arch-shaped claws formed a perfect balance and applied this to the structure of the human foot. By supporting three important points on the foot to achieve balance, he created shoes with orthopedic therapeutic effects. The shoemaker was named 'New Balance' to mean 'creating new balance for unbalanced feet.'
First introduced in 1906 under the name 'New Balance Arch,' New Balance is also one of the oldest companies among sports brands. Among sports brands with over 100 years of history, only Dassler (the predecessor of Adidas, 1920), Fila (1911), and New Balance exist. Among them, New Balance was the first to earn the title of a '100-year company.'
"Even those with disabilities should be able to wear shoes" - A founding spirit continued for 100 years
The reason New Balance has maintained its legacy for a long time is that the management philosophy established at its founding has continued to this day. The most important philosophy throughout New Balance's 114-year history is to provide comfort to all feet, whether born with physical discomfort or having acquired it later in life.
In fact, the operation method that best fits this philosophy is the handmade approach, making shoes tailored to each individual's foot size. However, the problem was that it took a long time for consumers to visit stores, have their foot size and shape measured, and then have shoes made, making mass production impossible. Therefore, William J. Riley focused on 'width size.' While most shoe brands segmented shoe sizes only by 'length,' New Balance introduced a new size dimension: width.
After founder William J. Riley passed away in 1956 at the age of 84, Paul Kidd acquired New Balance. Paul Kidd inherited Riley's founding spirit and focused on making 'comfortable shoes.' In 1960, the 'Trackster,' with a wavy sole, caused an explosive reaction. Famous athletes eagerly wore Tracksters. This shoe, which applied width sizing, needed no separate promotion. Thanks to athletes wearing them in competitions, advertising and promotion happened naturally. The company saved on marketing costs and invested in research and development.
Especially during the running boom in the 1970s in the U.S., New Balance released its masterpiece, the '320 series.' The 'N' logo, which New Balance has since trademarked and places on every shoe, was born with the New Balance 320. The 320, featuring foot width and cushioning, became even more famous when marathoner Tom Fleming wore it to win the 1975 New York Marathon.
In 1982, the 990 series, famous as Steve Jobs' shoes, was released. At that time, New Balance instructed its R&D staff to "use all available technology without regard to time or cost," and completed the 990. It was an innovative technology that provided both flexibility and stability, scoring 990 out of 1000 points. Despite its high price of $100, many runners chose these sneakers.
Therefore, this sneaker, more familiar to us as 'Jobs' shoes,' was actually a 'national item for middle-aged men' in the U.S. It was one of the representative shoes office workers wore comfortably, and not only Jobs but also many political and business figures, including President Clinton, wore the 990 series. After the 990, New Balance released the 991, 992, 993, and other 99x models, which remain the most beloved series to this day.
Two stubborn principles of New Balance
Even the successful New Balance faced challenges. After Jim Davis became the third-generation CEO, the 'width size' became a stumbling block. Because of the detailed size segmentation, the product lineup was more complex than other brands, and the inventory of shoes to be held in warehouses was large. This caused dissatisfaction among employees. Still, New Balance maintained the width sizing according to its management principle of 'maintaining the quality consumers want, even if it is demanding.'
Jim Davis listened to employees instead of abandoning it. He visited retail stores to ask dealers about complaints and improvements and reflected them. New Balance created a 'Code of Conduct for a Healthy Work Environment' and promised suppliers in the U.S. and abroad to adhere to this code. At that time, he said, "If we do not know how much we need each other to achieve our goals, New Balance has no future. This goal is for New Balance and also for ourselves and our families."
Another stubborn principle New Balance keeps for consumers is 'Made in USA.' Although it has expanded worldwide, to promote the brand's origin and craftsmanship, it has a separate 'Made in USA / UK' line, producing certain models (992, 990v5, 991, 1300, etc.) in the U.S. or the UK. New Balance is the only sneaker brand with production factories in the U.S. Having production facilities in the U.S. is a huge deal because labor costs are ten times higher than in China. Shoes made with at least 70% labor and manufacturing in the U.S. and UK carry a 'Craft Membership' label so consumers can clearly recognize them.
While this is also for 'trust' with consumers, there is another reason. Jim Davis said, "When competitors all fight in the same way, nothing is more foolish than fighting in the same way." This is to differentiate from other brands that pursue cost reduction alone.
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