You might have caught the news recently that after some pretty significant write downs, Billabong and it’s brands are being valued at effectively zero. In other words, they have worked 40 years for something of no value… In money terms anyway. But is it actually true? After reading this BRW article this morning, it got me thinking about some of the reasoning around the brand value and the direction of the company.
First, in dealing with the BRW article, there’s a few issues in there. It talks about Australian retails struggle to grasp online while discussing Billabong. They happen to part own Surfstitch which is a bit of a bright spot for the company. I’ve seen their operation and it is (or was) pretty slick and they had some great plans for it. Then there’s the assertion from head of Interbrand Australia, Andy Wright, that “If you’re not making a profit, the reality is zero brand value,” which I believe Amazon might argue with, being that they’ve never really shown much of a profit but I doubt anyone would argue they have zero brand value.
And that leads me to where Billabong’s opportunities lie. They’re in a mess, management have screwed up in some incredible ways over the last few years and put the whole company in jeopardy. But if you ask someone who has been around surf, skate and snow for a few years what they think, no one is saying ‘let them die’. Everyone is hopeful that it can be turned around. Billabong still hold a nostalgic place in the hearts of a good percentage of the Australian population, and that’s a great basis to rebuild the brand. I’m sure there’s plenty of qualified people but I think Scott Olivet must be the best choice for the role having worked with brands that effectively leverage their heritage through their marketing and understanding the importance of the team. Given the opportunity, it would be exciting to see what he can do for Billabong.