In Focus

Jim Jannard, Oakley's Man On A Mission

NOTE: All this month in the Chicks' Eye View we will be featuring the richest of the rich from the Forbes List of the World's Richest People. Just who are they and how'd they get to be so filthy rich?

I must admit, Jim Jannard never would have been my pick of guys to research. I'd never even heard of him. He was actually a suggestion from our Head Hen, Chick Karin. "C'mon Cheryl, you're the California Chick, you should do that sunglass guy from Oakley." What the heck, I thought. It ended up being fascinating research. Once again, I learned so much about a company simply by getting to know its leader. Now, I'm not going to tell you about Jannard's birthplace and childhood experiences. I didn't find that kind of stuff. The facts I did find are closely tied to the company, and from what I've learned, Jim Jannard pretty much is the company.

If you're not too familiar with Oakley, Inc. (NYSE: OO), they are most famous for their sunglasses. I associate them with those real cool, sporty looking, wraparound styles. By the way, their glasses are designed to be cool, targeting that hip 18-34 age group. Although they have ventured into other product lines, sunglasses have provided the strongest brand awareness and the most revenue. Back in 1975, when Jim Jannard founded Oakley, he was a twenty-five-year-old drop-out of the University of Southern California selling motorcycle parts out of the back of his Honda. He named the company after his English setter. Jannard was noted for having an intense distaste for mediocrity coupled with a fierce desire to innovate. These principles have catapulted Oakley into a company known today as an original and innovative world brand. His first creation was actually a handgrip for motorcross cycles that marked the merging of technology, ergonomics and art that would typify all of Oakley's innovations to come.

Although popularly known for their unique sense of style, Oakley has prided itself on their products' high performance. The company gained real recognition when it caught the attention of world-class athletes in the early 90's. In fact, Philip Knight, founder of Nike and former friend of Jannard's, was rarely seen without sporting a pair of Oakley's. He liked the company so much he offered to buy his friend out... twice! All right, Chickies, here's where it gets interesting and my research became almost as riveting as the soap I used to act on. In 1995, Jannard took his beloved Oakley public. And I don't mean he took his dog out for a walk -- Oakley Inc. had an IPO and became the darling of Wall Street. At about the same time, Michael Jordan signed a ten year contract to serve on Oakley's board and also to assist in design consultation. Shortly thereafter, Nike burst onto the scene with wraparound sunglasses. I guess Philip Knight was serious about getting into the market and was willing to destroy a friendship to do so. Infuriated, Jannard not only sued Nike for patent violations, but embarked on what some might have called a mission of revenge. He announced that Oakley would soon be entering the athletic footwear industry. In an attempt to further stick it to his former friend, he brazenly stated that they would not use Asia for its manufacturing (as Nike has taken heat for doing), but instead, promised to produce their products in the US.

In 1998, Oakley came out with its first footwear and the company soon went into a tailspin. Shareholders, unaware of Jannard's personal vendetta, became increasingly frustrated by what they saw as a lack of focus. Conversely, Jannard felt that Wall Street simply wasn't giving his plan enough time to work. Either way, the stock plummeted. Periodically, along its descent, Jannard continued to pick up more Oakley shares for himself, bringing his company stake to a whopping 62%. Jannard would not give up his quest and threw more money into his footwear line. In 1999, he ousted the CEO (a former Gatorade executive whom Jannard felt no longer shared his Oakley vision) and appointed himself to take the vacant spot. He also swallowed his pride and sent the manufacturing to Asia. Lo and behold, things began to turn around. Any shareholders left in the trenches have been rewarded by the stock's rebound.

A few weeks ago, on July 18th, Oakley announced record second-quarter sales, beating analysts' estimates. In addition, they actually portrayed a rosy forecast for year-end sales figures, projecting a 36% increase over the year 2000! Wow, sounds like they've bucked the current economic downtrend! Today, the company is not only selling sunglasses and footwear, but they're also designing apparel, wristware and accessories. Reading about their designs, you'd think they're building a rocket instead of designing apparel. This isn't surprising, considering they use several technologies developed by NASA, along with the guidance of a host of pro-athletes. The company's international presence has expanded, servicing consumers in over 70 countries. They've maintained their high-end status by carefully selecting their retailers and distributors, while supporting a well-trained sales staff. The company may never be the size of Nike, but Jim Jannard seems okay with that. As the Chairman and CEO himself says, "We don't aim to be bigger than Nike... just better."