Thursday, May 17, 2012
Why do smart people do dumb things? Take this case. Any half-aware executive should know that when making dubious claims, sooner or later regulators will come after you. One is justified in asking what the Skechers' executives were thinking. Maybe they believe what they are promoting and indeed, the company is standing by its product. But, that isn't enough in the face of other evidence. Settling and paying a fine is more than business decision. Perceptually, it is an admission of defeat. Perhaps, the public will forget in a few months that the company paid out $40 million, and it will be back to making millions. From a PR perspective, this isn't a way to do business. The company should substantiate its claims with independent studies not funded by Skechers and not performed by anyone connected to the business. But, if its executives have chosen to skate close to the edge of legality, they aren't likely to do so.