RG Barry CEO Bob Mullaney on Turning Dearfoams Into a Lifestyle Brand & Pursuing New Acquisitions

September 25, 2023
4 min read
Featured Image

RG Barry isn’t just the house of Dearfoams anymore,” president and CEO Bob Mullaney told FN last month from his office on the Boston waterfront. “It really is a platform for many consumer brands.”

Since joining the company in 2017, the industry veteran has orchestrated several changes within the organization. One is that Boston office. Mullaney said RG Barry Brands continues to maintain its headquarters in Pickerington, Ohio, but opened an East Coast hub in fall 2021. “It has been really helpful for e-commerce, particularly in [recruiting] digital talents and a lot more shoe executives,” he explained.

Mullaney has also worked to modernize the company, which turned 75 last year and currently includes the Dearfoams and Baggalini brands. (It sold off Foot Petals in late 2019.)

The CEO has incorporated a data-centric methodology fueled by artificial intelligence that is honing its focus on the consumer. And RG Barry will announce an “Earth-first” sustainable platform this fall that includes product initiatives.

“The culture of the company has fully transformed in this time of challenge and even some crisis, and we’ve come out the other side even stronger,” said the CEO.

Mullaney added that over the past five years, RG Barry’s business has doubled with a 15 percent compound annual growth rate. And he foresees bigger gains ahead. “By the end of 2030, we expect the company to be four times the size it is now,” he said.

Here, the CEO shares more insights into his strategy.

What has been driving your gains the past few years?

“The biggest thing that’s helped transform the company is Dearfoams. It has very strong satisfaction and repurchase rates — the repurchase rate and satisfaction rate are approaching 90 percent. That encouraged us to go into other categories. During COVID, we signed licensees. So now we consider ourselves a comfort lifestyle brand. We’re in sleepwear, we’re in home goods — we make anything from bath to bedding, novelty throws and pillows. We have a sock license, we have cold-weather accessories — and also pet beds, which is my personal favorite.”

How much of your future growth will be organic versus through acquisitions?

“It’ll be two and a half times the size it is today organically. We think that Dearfoams has a tremendous opportunity going into adjacent categories. We felt strongly about it pre-COVID, and we feel even more bullish now. Obviously, consumer behavior has fundamentally changed, whether it’s work from home or hybrid work or the fact that people are dressing more casually than ever before. There are more closet share opportunities for us beyond the front door — as long as we stay true to who we are.”

What are you looking for in terms of acquisitions?

“We know there are a lot of brands that probably could use our company — our financial backing and our digital brand management philosophy and platform. Looking in footwear and accessories makes the most sense for us, but it has to be additive. We want anybody we would partner with or acquire to feel valued. I’ve been in the industry a long time, and I know how the dynamics of those things go. I’ve seen too many acquisitions where it’s highly competitive and ego starts to get in the way of the inherent opportunities that probably brought everyone to the table in the first place.”

How are you balancing e-commerce and brick-and-mortar?

“We still have a strong brick-and-mortar presence with Dearfoams. [E-commerce represented] less than 1 percent of sales when I got here a little more than five years ago, and we’re over 25 percent today. The important part of that is, we’ve grown. Brick-and-mortar has grown and digital has grown. There isn’t channel conflict. This is about embracing the new consumer journey and the ability for our brands to impact their lives in other categories and other ways.”

Amid all the buzz about AI, how are you utilizing it?

“[You have to] use data not just for the sake of analytics or to sound smart, but to action it. Artificial intelligence just allows us to process data more efficiently and effectively, because she’s talking to us every day, right? Clicks, open rates, likes — how do you digest all that in a way that your team can utilize, and I think that mentality sets us apart. We’re not just selling shoes, right? We’re really pleasing the consumer, which is ultimately our goal in whatever that category may be. Data has helped us reconfigure our focal point and our plan.”

What is your overall outlook for 2023?

“These last few years of challenge have made us even better. We’re a little more grown up after dealing with the supply chain chaos, and that uncertainty has forced us to look at every aspect of the business. You get wisdom from experience. And I think that it’s given us the ability to look around the corner — and the confidence that we’re ready for anything. Like, what can you throw at us now?”

Originally posted at: https://footwearnews.com/