Despite experiencing a 7.8 percent drop in Q2 sales to $792.2 million, impacted by ongoing macroeconomic pressures on consumers and an “extremely promotional” retail environment, Designer Brands executives, including CEO Doug Howe, are encouraged by the company’s wholesale segment, and expanding own brands business. That portfolio now consists of Keds, Topo Athletic, Le Tigre and Hush Puppies among others.

The company has a long-term goal of doubling total sales from its own brands between 2021 and 2026. In Q2, wholesale net sales improved by 20 percent as the Keds and Topo Athletic brands were integrated into the business. Year-to-date own brands penetration for Designer Brands, including wholesale revenues, has risen by 60 basis points to equal 25 percent of overall revenues. In early August, Le Tigre offerings for men and women debuted, marking Designer Brands’ first-ever launch of a national brand. Additionally, Hush Puppies, licensed from Wolverine Worldwide for the U.S. and Canada, is slated to debut an expanded assortment in Spring 2024. The brand generated nearly 60 percent in Q2, fueled by the men’s category in the casual, dress and boots segments.

As for Keds, the integration of the business is moving forward. Most recently, the brand debuted collaborations — one with Recreational Habits on a classic court sneaker and the other with Saks designed to capitalize on the current Pickleball craze. Meanwhile, at Vince Camuto, a dress-meets-casual hybrid shoe collection has been launched with the FLY365. The company sees the men’s footwear category as one of its largest “white space” opportunities.

In July, Designer Brands named Laura Denks, most recently chief merchandising officer for Michaels, as the new president of its Designer Shoe Warehouse business. Her prior experience includes stints with Macy’s and Claires. She joins the company as it eyes improved comparable sales performance for the remainder of the FY, launches a new partnership with Nike and initiates a brand marketing campaign this fall.

During Q2, the company improved its consolidated gross margin slightly due to fewer markdowns and year-over-year profitability that was aided by lower logistics costs and a consolidation of fulfillment centers.