Since Reef will be celebrating its 25th anniversary in 2009, Transworld Business conducted a series of interviews with the some of the people who have had the biggest impact on the brand over the years. The first of these features Dave Gatto, who played an integral role within the company from 2003–2006 before being promoted to President of VF Corp’s Outdoor Americas Coalition. Here’s Gatto’s take on how Reef fits into VF’s stable of brands, what the future holds for the company, and his strategy for weathering tough economic times.

How/ when did you first get involved with Reef?

I was recruited to Reef by Fernando and Santi [Aguerre] in the Spring of 2003.

What were you doing before you came on with the brand?

Immediately before Reef, I was an operating executive for a private equity firm in Los Angeles.  I enjoyed being part of that investment team but not nearly as much as being a hands-on manager running a business.

How have you seen the brand evolve during your tenure?

I’ve seen Reef evolve through three phases: a sandal only brand at the time I joined; to a footwear and guys apparel business though challenged by limited funding and resources as a private business; to, now, a larger global business with footwear, guys apparel, girls swim and girls apparel.

How does Reef fit into the overall strategy of VF Corp’s outdoor coalition?

The outdoor coalition is one of the leading sectors of VF’s business. VF recognizes the long term growth opportunities, as well as the marketability of authentic lifestyle brands. Reef fits that niche perfectly, and will remain an anchor of the outdoor coalition.

How many retail accounts does Reef currently sell to worldwide?

Reef’s distribution spans through 80 countries worldwide, with a global account base of 15,000 doors. We focus on core and specialty, as well as finer department stores and on-line retailers.

How is the brand performing in the current economic climate, and what steps are you taking to drive sales, profits, etc?

The brand is performing as to be expected in this new environment. The Reef customer is loyal, but they are instinctually cutting back on unnecessary spending… this exacerbates the ripple effect of a faltering economy. In the 25 years that Reef has been in business, the company has seen recessions before, the way to come out on top is to stay focused on the consumer, foster the relationships we have with our accounts, our vendors and our factories to help work through these tough times. We all know there can be a huge up-swing when the market recovers; it’s just a matter of adjusting the business responsibly to survive the lulls and hopefully emerge a stronger, more efficient brand.

In your experience with the brand, what has been the most difficult decision and/ or obstacle to get through?

There are no easy decisions in the 21st century business environment. The industry is evolving, the consumer is changing behavior, the technology is changing, and even the political landscape is shifting. We are constantly in a state of change, but fortunately, Reef has strong leadership, innovative designers and marketers, a savvy sales force and distribution model that keeps the brand on the right track.

How have the brand’s product expansions (closed toe shoes, apparel, swimwear, etc) been performing, and are there any further expansions planned for the future?

2008 was a really aggressive year for Reef with regards to product expansion. Sandals remain the company’s strongest categories, but Girls’ apparel has been a bright spot for the brand. We feel we can to a better job in swim and we’ve been talking to experts about dialing in the fit. Incremental expansion in the apparel category is what we will focus on the future. Men’s Spring 09 boardshort collection is garnering a good response, and we’re excited to get it our to retail in the coming weeks.

How important is the US market to Reef, and what other markets are part of the brand’s focus/ offer growth opportunities right now?

The U.S. market is crucial to Reef. Trends originate here and trickle down into other markets, our headquarters are here and this is where the brand direction is set. Right now, there is a big emphasis on China as an explosive growth market. This year we went direct, with an office in Hong Kong.

As the President of VF’s outdoor coalition, what can you tell me about current market speculation that VF Corp has an interest in acquiring either the Quiksilver brand, or a segment of the Quiksilver business?

Quiksilver has tremendous brands but I can’t comment on any acquisition interest.

Stay tuned to Transworld Business for an in-depth history of the brand from Founders Fernando and Santiago Aguerre, an update on the company’s current initiatives from President John Wilson, and insight from a couple of additional key players in Reef’s 25-year past.

Tags: 25th Anniversary, catching up with, Dave Gatto, reef, vf corp

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