Dr Martens announces new strategy to engage more consumers as profits drop

Heritage footwear brand Dr Martens has reported overall revenues were down 10 percent year-on-year, in line with guidance, due to "a challenging macroeconomic and consumer backdrop" in several of its core markets.

In the preliminary results for the 52 weeks ended March 30, 2025, Dr Martens’ group revenue dropped from 877.1 million pounds to 787.6 million pounds. Adjusted pre-tax profit declined to 34.1 million pounds from 97.2 million pounds in 2024, while profits before tax plummeted from 93 million pounds to 8.8 million pounds.

However, the footwear brand that welcomed new chief executive Ije Nwokorie in January added that for the coming year (FY26) the business is expecting "significant profit growth," within the consensus range of 54 to 74 million pounds as its turnaround strategy takes shape.

Dr Martens also added that there was some optimism in its results, as its Americas direct-to-consumer (DTC) channel was back into growth in H2, while its marketing reset approach continued to “relentlessly focus on product,” and the business had delivered 25 million pounds in annualised cost savings.

Ije Nwokorie, chief executive officer at Dr Martens, said: “Our single focus in FY25 was to bring stability back to Dr. Martens. We have achieved this by returning our direct-to consumer channel in the Americas back to growth, resetting our marketing approach to focus relentlessly on our products, delivering cost savings, and significantly strengthening our balance sheet.”

Dr Martens is optimistic about returning to growth in FY26

For FY25, Dr Martens reports revenue was down in Europe, the Middle East and Africa (EMEA) by 11 percent (10 percent constant currency (CC)) driven by the UK, which it describes as a “challenging market,” while Americas revenue also dropped 11 percent (10 percent CC), with Asia–Pacific (APAC) having a “good performance” thanks to Japan and China, with revenue only down 4 percent (up 1 percent CC).

DTC revenue was down 4 percent (2 percent CC) and wholesale was down 20 percent (18 percent CC), as expected. Within DTC, retail revenue was down 6 percent (3 percent CC) and e-commerce was down 3 percent (1 percent CC).

Current trading shows that the Americas is continuing with its “positive momentum” in DTC growth from H2 last year, while EMEA performance remains mixed, with the UK continuing to see revenue decline, and APAC continues to “perform well”.

Looking ahead into FY26, Dr Martens said it will look to reduce discounting in Americas and EMEA, across both its e-commerce channel and through wholesale, with the aim of driving full-price sales. It adds that it has a “positive” autumn/winter wholesale order book in EMEA and the USA order book is currently “broadly in line with last year,” before the benefit of any in-season re-orders.

Dr Martens anticipates foreign exchange (FX) headwinds for FY26, which it estimates will dent group revenue by around 18 million pounds and profits before tax by around 3 million pounds.

Dr Martens accessing continued US tariffs “carefully”

With regards to tariffs, Dr Martens said that while the US is an “important market” it is a truly global brand and is sold in more than 60 countries around the world. However, in the US, it states that its spring/summer 2025 stock was already in the market, and by the start of July, the majority of autumn/winter 2025 will be either in the market or in transit.

Dr Martens adds that it believes it will generate strong product gross margins, which is helpful given "that tariffs are charged on cost, not retail price".

The footwear brand adds it will continue to “assess the situation carefully,” but can confirm that for SS25 and AW25 it will be keeping average prices unchanged in the market.

Dr Martens announces ‘Levers For Growth’ strategic plan

Dr Martens also shared a new strategic plan to engage more consumers, drive more purchase occasions, curate the right distribution in each individual market, and simplify the operating model to drive efficiency, scale and speed.

At the heart of the ‘Levers For Growth’ strategic plan is moving away from its narrow focus on boots to take full advantage of its shoes, sandals, bags and leather goods offering, broadening its consumer audience to target “everyday wearers”.

Currently, Dr Martens’ product revenue split is between boots (57 percent), shoes (26 percent), sandals (12 percent) and bags and other (5 percent). The footwear brand adds it is looking to drive growth in product families such as Buzz, Zebzag and Lowell to diversify its product revenue base.

It also wants to move towards a more tailored approach when it comes to channels, with less focus on its DTC channels, such as its own stores and websites, to a mix of DTC and wholesale to be more responsive and implement a more “partnership-based” approach. Another key objective towards delivering growth for FY26 is to open in new markets through a “capital-light structure”.

Nwokorie added: “We are today sharing our Levers For Growth, which will increase our opportunities by shifting the business from a channel-first to a consumer-first mindset. We will give more people more reasons to buy more of our products, whether that’s our iconic boots and shoes, newer product families such as Zebzag and Buzz, or adjacent categories, such as sandals, bags and leather goods. And we will tailor distribution to each market, blending DTC and B2B, optimising brand reach and ensuring a better use of capital.

“I’m laser-focused on day-to-day execution, managing costs and maintaining our operational discipline while we navigate the current macroeconomic uncertainties. Looking ahead, there are significant markets for us to grow into, and we currently own just 0.7 percent of a total relevant market of 179 billion pounds. This, combined with the enduring demand for our products, the robustness of our operations, the strength of our cashflow generation and balance sheet and the expertise of our people, gives me confidence that we will deliver the sustainable, profitable growth that this brand is capable of.”