While Beyoncé’s “Cowboy Carter” album may be driving boot sales across the U.S., the Grammy-award winning artist isn’t bringing much business to Boot Barn, according to its chief executive officer Jim Conroy.
On the company’s fourth quarter conference call on Tuesday, Conroy fielded a question from an analyst asking if Boot Barn may be experiencing a lift from the recently released Beyoncé album. In response, the CEO noted that she isn’t “meaningfully impacting” business at the moment.
“I suppose we anticipated this question because, first, it was ‘Yellowstone,’ then it was Taylor Swift and now its Beyoncé,” Conroy said. “We love Beyoncé. We love the fact that she’s actually wearing hats. We love the fact that she seems to continue to be leaning into Western. Notably, she’s been doing this for five years now, but now she’s got a new album and I think that’s sort of hit the zeitgeist of the people that are newer to watching country music.”
“[But] it’s not apparent to us that she’s having a meaningful impact on our business,” the CEO continued. “If the sequential improvement that we saw was being entirely driven by ladies’ fashion cowboy boots or ladies’ western fashion apparel than I would feel differently. But we’ve seen just very broad-based improvement for several months now going back to the third quarter that it would kind of be foolhardy to tie it all to or really any of it to Beyoncé.”
Conroy also noted on the call that the company probed its customers through a survey on if they were aware of the artists’ latest album. “Very few people, like 3 percent, commented that the album was going to change their buying behavior in a positive way,” the CEO noted. “So, some of the qualitative comments were almost like, ‘are you joking that Beyoncé is going to impact our business?’ That said, hopefully, she’ll introduce a new customer to Boot Barn, and that might help us get some additional business, but it’s just a fringe piece or an icing on top of our typical customer database.”
But as far as Williams Trading analyst Sam Poser is concerned, Beyoncé is most definitely helping Boot Barn’s bottom line.
“We are confident that the guidance will prove conservative as Boot Barn will materially benefit, despite management’s protests, from a new focus, thanks to Beyoncé, on authentic western boots and apparel,” Poser wrote in a note on Wednesday. “It’s incumbent on Boot Barn management to improve the manner by which customers are attracted and retained, and further improving the management of its fashion businesses, and to further appreciate that adding and retaining more female customers is essential for long term same store sales growth for both the women’s and men’s businesses across categories.”
Poser went on to show through data how he believes “Cowboy Carter” has a direct correlation to the improvement of Boot Barn’s trends, despite management’s belief that “it’s just a fringe piece or an icing on top of our typical customer database.” He pointed to the improved sequential sales of categories like ladies’ western boots, which rose in April from Q4 by 1,500 basis points, as proof of concept.
“The fringe customer that watched ‘Yellowstone’ appeared to have stopped shopping at Boot Barn over the past two years,” Poser wrote. “Today, there’s a necessity to retain the ‘fringe’ new customers driven to Boot Barn by Beyoncé’s new album. The work related and western lifestyle fashion businesses must be managed differently.”
Activist short seller Spruce Point Capital has also recently spoken out against Boot Barn’s take on celebrity-driven western boot sales. In an email statement sent to FN, Spruce Point Capital said that it believes Taylor Swift, Beyoncé and the ‘Yellowstone’ TV series’ effects on sales are “potentially misunderstood.”
“Boot Barn has downplayed any uplift in sales from Taylor Swift’s 2023 concert tour, though our on-the-ground research indicates there may have been a one-time benefit,” Spruce Point stated. “The company has said that Morgan Wallen, George Strait and Garth Brooks are names that drive its business.”
As for Beyoncé, the financial firm said they believe Boot Barn is late to the party. “The current product assortment looks nothing like the western clothing and apparel that has been photographed on Beyoncé,” Spruce Point said. “In our view, Boot Barn is already late to the party and is unlikely to materially benefit from the celebrity effect.”
This comes as Boot Barn wrapped up fiscal 2024 with mixed results on Tuesday, reporting a decrease in sales in the fourth quarter and a slight gain for the year overall.
According to the Irvine, Calif.-based footwear company, net sales in the fourth quarter of 2024 decreased 8.7 percent over the prior year period to $388.5 million. Net income in the period was $29.4 million, or 96 cents per diluted share, compared to $46.4 million, or $1.53 per diluted share the same time last year.
As for the full fiscal year 2024, the company said net sales increased 0.6 percent over the prior year to $1.67 billion. Net income for the year was $147.0 million, or $4.80 per diluted share, compared to $170.6 million, or $5.62 per diluted share in fiscal 2023.
In terms of category performance, Conroy noted on Tuesday’s call that every single department from work boots to ladies’ apparel has seen sequential positive improvement. “We saw that building from Q3 into Q4 and then Q4 into April and then April into May,” the CEO said. So the sequential improvement story is just fantastic. And it’s across the board.”
More specifically, the executive noted that ladies’ western boots from Q3 into the current quarter has improved sequentially by 15 points, work boots have improved 5 points, work apparel has improved 11 points and men’s western boots has improved 9 points.
“The ladies’ business has improved slightly more than the men’s business, but it also had further to go,” Conroy said. “In terms of sustainability, we’ve clearly put out a guide that we think has some conservatism in it. But there’s no reason to believe that these numbers will turn the opposite direction on us.”
Looking ahead, Boot Barn expects total sales in fiscal 2024 of $1.766 billion to $1.800 billion, representing growth of 5.9 percent to 8.0 percent over the prior year.
