The Drapers Interview: Tom Murry

It is already a household name, but fashion giant Calvin Klein refuses to stand still. Khabi Mirza meets president Tom Murry to see which area it plans to conquer next

Elegant though it is, the sumptuous backdrop of Claridges feels slightly too ornate for a Calvin Klein interview. Causing a stir in the central foyer is the immaculately groomed Nancy Dell'Olio, the girlfriend of former England football manager Sven-Goran Eriksson, who, in her dominatrix leathers and an oversized pair of sunglasses, is hard to miss. Her presence underlines the Claridges personality – more showy than the understated modernism that informs the Calvin Klein design mantra.

A few minutes of courteous interview preamble with Calvin Klein president and chief operating officer Tom Murry emphasises the understated cool that has maintained the brand as an international byword for accessible fashion. Pristine in his Super 100 two-button suit – a black Calvin Klein number, of course – the only giveaway that Manhattanite Murry landed at Heathrow barely two hours ago is his open-necked shirt.

Softly spoken and rigorously trained in diplomatic corporate communications, Murry has the confident but guarded charm of an international fashion executive. Along with his designers Francisco Costa, Kevin Carrigan and Italo Zucchelli, Murry is in town for a 24-hour whistle-stop trip to attend a spattering of interviews and store visits, followed by a heavily choreographed presentation of the brand's spring 08 collection in the evening.

The timing of the event is not by chance. After several years living under the trend radar for hip UK consumers, Calvin Klein is reasserting its design credentials once again. "Events like tonight are designed to help get the message across," Murry explains. "The venue and presentation will be breakthrough, and it will have a high celebrity quota. It's through these events that the Calvin Klein message  reaches fashion-aware shoppers."

Hosted in a stark, subterranean Baker Street car park, the event features a catwalk-elevated single file orchestra playing a monotonous thunder-clap soundtrack, while a stop/start parade of expressionless models display the simple silhouettes, sleek fabrics and muted tones that were welcomed with broad critical praise during New York Fashion Week.The presentation and ensuing party are well attended by buyers, fashion hacks, and a barrage of celebs, from LA starlets Naomi Watts and Mary-Kate Olsen to indie rock bands The View and The Kills, as well as party circuit regulars Bianca Jagger, Kelly Osbourne, Alexa Cheung and designer Henry Holland.

The importance of celebrity endorsement in today's fashion climate is a concern for every fashion brand leader, and Murry is more aware of their role in driving sales than most. "Francisco Costa, our creative director of womenswear, is a great ambassador for the brand. He has a warm and engaging personality and enjoys interacting with press and celebrities alike. The fact that Francisco is such an incredible talent when it comes to eveningwear means celebrities are drawn to us, which of course is an advantage," he explains.

Originally employed by Calvin Klein himself, Francisco Costa was handed the reins as creative director in 2003 after Klein sold his business to North America's biggest shirtmaker, Phillips-Van Heusen, in 2002. The deal was worth US$400 million (£195.3m) in cash, plus another US$30m (£14.6m) in stock and up to US$300m (£146m) in royalties over 15 years.

Now in his seventh season, Costa presented his most critically acclaimed collection to date during New York Fashion Week in September, helping to fuel the fire of global interest surrounding the Calvin Klein brand.

"We're rebuilding the trend-led aspect of the collection and Francisco has played a big part," says Murry. "We're also investing in all the parts required to generate more commercial success throughout the sub-brands. It's taken serious investment. Last year we recruited more technically proficient people to the creative team and set up an atelier so we can deliver buyers' expectations for a high-quality catwalk collection."

By investing in the brand's catwalk offer, Murry's strategy is driven by his ambition to boost sales throughout the company's sub-brands, of which there is no shortage. The portfolio includes Calvin Klein Collection, ck Calvin Klein, Calvin Klein, Calvin Klein Jeans and Calvin Klein Underwear.

In an era where most designer brands, from Burberry to Gucci, have concentrated on reining in their licenses to ensure global consistency, Calvin Klein and owner Phillips-Van Heusen have made considerable profits through a tightly controlled licensing strategy. "The only categories still in-house play on the strengths of Phillips-Van Heusen. They include men's higher-end sportswear, dress shirts and ties," Murry explains.

Called Calvin Klein Collection, the catwalk range, which includes dresses, coats, shirts, eyewear, footwear and leather goods, is sold under the top-end Black Label umbrella, a licence held since 2005 by US company Warnaco Group, whose brand roster includes Speedo and Lejaby.Pitched below Collection and sitting under the Grey Label umbrella is ck Collection. Run under licence by Club 21, ck Collection represents the brand's bridge business, which has been a key driver since Phillips-Van Heusen acquired the brand. Below that is White Label, an opening-priced proposition dominated by Calvin Klein (a competitively priced collection only available in the US), Calvin Klein Jeans, and underwear collections all run internationally by Warnaco Group.

Then there's the fragrance collection, which is run by US cosmetics giant Coty; the watch range handled by Swatch Group; a women's sportswear line run by Kellwood Group; and Calvin Klein Home, a homewares range that is overseen by Crown Crafts.

As if Murry were not busy enough spinning his existing licensing plates, 2008 will see the brand launch ck Calvin Klein Beauty, a potentially lucrative cosmetics and skincare range produced under licence by cosmetics firm Markwins. "We're already in most product categories," says Murry, reinforcing the fact that the brand operates across such a wide spectrum of the market. "In November we are launching a new golf collection, retailed through an international network of Pro-Golf golf club stores. We have furniture coming next fall and we're testing a new performance sports range in the US aimed at activities such as cycling and yoga, although that one's not yet a done deal."

Selfridges head of menswear David Walker-Smith says: "The brand name is fantastic. We do a great business on Calvin Klein underwear in Selfridges and I have good memories of the brand in its Kate Moss days. The question now is what it will mean to the next generation. This is more important than how it is recalled by those who have preconceived ideas of the brand.

"Now is a good time for the Calvin Klein renaissance. Fashion is getting cleaner and the rebirth of Calvin Klein should be all about clean lines, fantastic fabrics and great proportions."

When Murry is quizzed on the biggest challenges he has faced during his eight years at the helm of Calvin Klein, he points to the issues of finding and maintaining effective licensing partners. "We've sometimes worked with partners who haven't been up to standard," Murry admits. "To do effective business, our licensing partners need to be on the same page as we are in terms of consistent execution, great design, and our commitment to protecting the brand."

Moss Bros chief executive Philip Mountford is committing to the ck by Calvin Klein range for his stores, and says the consumer view of the brand is still strong. "At £299 for suits and £50 for shirts, ck has already had a great response. We are selling 300-plus shirts a week from just 20 stores. We did some market research before stocking the brand, which showed consumers hold it in high regard."

In the UK, the rise of the discount retail market, particularly at the start of the decade, led to greater availability of Calvin Klein merchandise, most of which, according to Murry, was sourced via the grey market. The flood of product from both the grey market and counterfeit sources had an immeasurable effect on the brand's perception among consumers.

"In terms of counterfeiting, it's a better picture than it was 10 years ago, but we had to face up to it aggressively," he says.

With no general manager in the UK, Calvin Klein's Europe and Middle East operation is handled from Milan by Giuseppe Rossi, managing director for Calvin Klein EMEA. Next month the brand will cut the ribbon on a new 4,300sq ft Calvin Klein Jeans store on London's Regent Street. The opening will be Calvin Klein's eighth shop in the UK, followed next year by a dedicated ck Calvin Klein Beauty store.

The company is guarded when it comes to revealing the extent of its UK wholesale arm or breaking down sales information by territory, although total revenue rose 20% to US$552.4m (£269.6m) for the three months to August 5, with revenue from the Calvin Klein licensing business rocketing by 27% and sales in the combined wholesale and retail businesses growing by 30%. "We have 320 free-standing stores globally, and half of those are in Europe and the Middle East," says Murry. "Equally, of the US$5bn of sales we generate through global retail, half is in the US and half is generated through Europe, Asia and the Middle East. Annual growth is consistently in high single-digit percentage increases.

"Two years ago it was tough, but today Europe is looking solid and has been strong in the past year. We're growing fast in territories such as China and Russia through retail partnerships. And while it's still too early to say for sure, we're confident about India. Over the next five years we have planned between 30 and 40 stores there. The picture in the US may be sluggish overall, but we're performing well.

"Our business is about consistent execution of well-designed, quality product. Our designs are modern classics. Market issues such as fast fashion have had very little impact on us because we're not very trendy. If anything, we see a return to quality merchandise, or what Europe calls 'investment dressing'. Even though the US consumer mentality is still weighted towards making more purchases at lower prices and lower quality levels, people are beginning to gravitate towards more investment purchases and less trend-driven merchandise. That phenomenon is only good news for Calvin Klein."