You’ve seen (and possibly bought) the Polo Ralph Lauren polo shirt. Now the brand’s European president wants the market to get acquainted with the relaunched Polo Jeans brand
Barack Obama’s global popularity seems to be shifting more than just political views. The day that Drapers catches up with Polo Ralph Lauren European president and chief operating officer Brian Duffy is the same day Tommy Hilfiger posts its full-year results. Duffy says he hasn’t seen the figures but he nods in agreement when Drapers quotes back to him Tommy Hilfiger chief executive Fred Gehring’s views on the potential swing back from anti-Americanism among Europeans and what this shift in mindset could potentially do for sales of heritage US brands.
Ralph Lauren is one such brand and the rise of Obama couldn’t have been timed better. The premium US brand is relaunching its Polo Jeans line for spring 10 at Bread & Butter (B&B) in Berlin (the first time it has exhibited at the show) and what’s more, it features heavy heritage branding with vintage-looking patch labels based on the Old Glory flag.
Duffy says the uplift in popularity of the US alongside the relaunch was more by chance than by design. “The resurgence of the US is a happy coincidence but we can clearly see a surge of popular feeling about America.”
Ralph Lauren took the licence back for its Polo Jeans brand from Poloco in 2006 with a view to upgrading the product to a more premium positioning. Duffy says: “There were so many parts of the business we had plans for. Other priorities came before the Polo Jeans relaunch but we took the brand completely out of the US market when we took back the licence. It was being sold with a too price promotional-oriented stance and we wanted to get away from that.”
He adds: “We had always planned to develop a position in the jeans market. Denim is a really important product to our company because we are the ultimate US lifestyle brand and jeans are part of our whole aesthetic and feeling. We’ve now got the collection to a point where we are all very excited and we agreed to do a full-on global relaunch for spring 10.”
While Obama might be taking a diplomatic approach to world politics, Duffy is adopting a more aggressive stance towards his European denim rivals with the relaunch. “Here in Europe there is a great market for jeans. It’s not driven by a singular product or totally by price. You have premium brands too,” he says. “We’ve spent a lot of time analysing the market. G-Star, Diesel, Armani Jeans, Paul Smith, Boss Orange, Acne…these are the brands we will sit alongside. We see ourselves competing equally with the specialist denim brands because Polo Jeans will have a big emphasis on denim, whereas designer labels just offer denim as a part of their collection.”
The Polo Jeans collection will feature washed, worn and clean finishes on both men’s and women’s jeans. Fits include skinny, boyfriend, flare, straight leg and loose. Western or military influences also feature and there is a selection of non-denim pieces including jackets and accessories, though half the range is denim.
The collection is divided into three stories: Sunbleached Surplus which includes stonewashes, distressed denim, fleeces and loose-fitting T-shirts; Romantic Rebel which offers vintage-inspired motorbike jackets and flowing silhouettes; and Telluride has denim shorts, rumpled florals, washed flannelled shirts and faded indigo denim. Retail prices are ¤100 (£85) to ¤150 (£127) - putting it bang on par with the Diesels and G-Stars of the denim industry which Duffy cites as targets.
It is aimed at 18 to 35-year olds who Duffy describes as having “a strong fashion sensibility, who dress down but are thoughtful about how they look”, and will have its own distinct in-store identity, which will be used in some department stores and stockists’ stores. “We have a new shopfit for it. It’s more monochromatic - more in keeping with dedicated denim departments with lots of metal and loft-style imagery. The look is quite cool and understated.”
The launch will also be supported by a widescale consumer advertising campaign which will break next February (deliveries of the spring 10 range will begin in December).
While Ralph Lauren has significantly scaled back its wholesale doors in recent years, largely driven by the axing of several of its licensing partners and its desire to have full brand control, Polo Jeans will be available to new accounts, though there is likely to be minimum order rules. “We want the best fashion specialist stores to stock Polo Jeans but only if they represent it in a meaningful way. We also want it in the department stores where there are the right brand adjacencies. We want proper representation in every country and market.”
The market is generally cautious about what Polo Jeans will bring though. Buyers contacted by Drapers said they had yet to see any real return to US brands and pointed out that to take on G-Star and Diesel, Polo Jeans would not only need to have exceptional product, it would also need to fill other criteria, like great stock service, great pricing, good margins and reasonable minimal orders to enable them to cautiously test the brand in the current climate.
One buyer says he will look at the range at B&B, but adds: “Polo Ralph Lauren is a phenomenal lifestyle brand but its denim has always been woeful. In the denim market you must have attention to detail. Having said that, if they make a bold statement with Polo Jeans and get all the key components right it could be a fabulous brand.”
Another chief executive of a multi-brand store says: “American branding isn’t really working for us at the moment and some of those types of brands have slowed down for us whereas the likes of G-Star and Diesel are picking up. But we will look at it of course.”
One denim expert adds that aside from market leaders like G-Star and Diesel, Polo Jeans will have to compete with the UK high street, which has strengthened its denim considerably in recent seasons. He says: “The UK is possibly the toughest market outside the US to crack. Retailers are reluctant to test brands at the moment and high street denim is getting better all the time. The worry is that the Polo Jeans customer may already be getting his jeans from Blue Harbour at Marks & Spencer or elsewhere on the high street.”
But he adds: “The denim market is severely in need of something fresh and the jeans market is the only area of menswear likely to grow in the next few years. But Polo Jeans would have to tick more than just the product box.”
Duffy is defiant though. He throws in to the conversation that his target is to double sales of the Polo Jeans line within three to five years - and this target doesn’t seem too outlandish. Sales at Polo Ralph Lauren rose 3% to US$5.02 billion (£3.06bn) in the year to March 31 2009 in spite of the downturn. However, there were some signs of a slowdown in the fourth quarter, when the economic crisis took a real hold and sales for the period declined 1% to USStory text.22bn (£746 million), with the retail sales taking the largest hit.
By comparison, Tommy Hilfiger saw its sales rise 21% to ¤1.6bn (£978.4m) in the year to March 31.
Duffy says: “We are doing better than most. We have a strong brand, a strong balance sheet and a strong management team.” He goes on: “In 2002 our sales in Europe were less than US$300m, now we do over UStory textbn. We have shown consistently strong growth. People thought Ralph Lauren was already a strong, mature business but we have elevated it through marketing and distribution.”
Taking back the licence for kidswear in 2004 has also added top-line sales growth. Duffy says the kids’ Polo Ralph Lauren category is now between three and four times the size it was when the firm regained control of the category. An overhaul of womenswear and more space devoted to it also boosted business.
The axing of both the kidswear and Polo Jeans licences prompted the company to press ahead with a significant retail roll-out strategy. It has opened or refurbished shops in Milan, Cannes, Istanbul and Moscow, as well as in Bond Street, Brompton Road and Westbourne Grove and kidswear stores in Fulham Road and Bond Street, all in London. It has also begun a roll-out in the Middle East, where it has seven stores. “We needed more mono-brand stores,” says Duffy. “We wanted to have 100% control over presenting the brand. Although the stores are about that, they are also profit centres. We wanted the business to be appropriately balanced between retail and wholesale and more stores remain on our agenda.”
Its Glasgow store was relaunched in May with a more contemporary look and a more cohesive display of its sub-brands. Womenswear was also given a bigger space. Duffy says that since its relaunch last month sales at the store are up 60%. “It’s quite an amazing reflection of demand for the brand,” he says.
Next spring, Ralph Lauren will open its biggest standalone in Europe in Paris. “We are continuing to invest in retail,” explains Duffy. “We have a store opening programme. We will open in airports and in the next six months launch stores in Geneva and Munich.”
While retail is still a big plank of the Polo Ralph Lauren strategy, there remains a big commitment to wholesale. In Europe it has more than 3,000 doors, of which about 300 are in the UK.
Polo Jeans won’t be stocked in the existing Polo Ralph Lauren standalone stores, and at present there are no plans to open a Polo Jeans flagship or pursue a retail strategy for the new denim brand.
“The goal is to double the size of the jeans business within three to five years,” says Duffy. “We’ve doubled our average wholesale order with existing doors in the past five years. Driving partnership is what this brand is about.”
- 2003 President and chief operating officer, Polo Ralph Lauren Europe
- 1999 Chief executive and corporate vice-president, Sara Lee Courtaulds
- 1998 Chief executive, Pretty Polly parent company Sara Lee Legwear Europe
- 1995 Chief executive, Pretty Polly UK
- 1992 Chief executive, Playtex UK
- 1989 Chief finance officer, Playtex
- 1986 European finance director, Playtex
- 1983 Finance director, Playtex UK
Who in the fashion industry do you most admire and who is your mentor? The answer to both really is Ralph Lauren. I have always been a Ralph Lauren consumer, but since I have worked with the brand and dealt with Mr Ralph Lauren himself I have learnt so much about style and taste and about believing in and not compromising on the brand vision.
What is your favourite store? My favourite Ralph Lauren store is Brompton Cross in west London. Our creative team excel in this store. My favourite non-Ralph Lauren store is a little speciality store in Florence called Eredi Chiarini. It’s a mixture of frescoed ceilings, vintage oak furniture and banisters and delightful Florentine service.
What has been the proudest moment of your career?We have built a fantastic team of 300 staff in the Ralph Lauren headquarters in Geneva in Switzerland. Ralph Lauren visited in February this year and hearing what he had to say and seeing the team’s reaction tops my list of career moments.
What is the best-selling product you have ever worked on? Our best-selling product is the custom-fit polo mesh shirt. All of our markets in Europe are of equal importance, from the UK and Italy to Germany and Spain. Scandinavia is growing quickly too and the emerging markets in the Far East are also bringing growth.
What would be your dream job apart from your current position? The other guitarist in the BB King band.
Polo Ralph Lauren
(Figures for the fiscal 2009 year)
US$5.02 billion (£3.06bn) +3%
US.89bn (£1.76bn) +5%
USStory text.94bn (£1.18bn) +1%
Undisclosed but known to be in excess of USStory textbn (£613.1 million)
US$406m (£248.4m) -3.3%