Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Exclusive: Tommy Hilfiger proves its worth as sales soar

Daniel Grieder, the European chief executive of Tommy Hilfiger, said he had seen evidence that the UK and European markets were returning to growth for autumn 10, just days after the premium lifestyle brand was sold to US giant and Calvin Klein owner Phillips-Van Heusen (PVH).

Daniel Grieder, the European chief executive of Tommy Hilfiger, said he had seen evidence that the UK and European markets were returning to growth for autumn 10, just days after the premium lifestyle brand was sold to US giant and Calvin Klein owner Phillips-Van Heusen (PVH).

In an exclusive interview with Drapers, Grieder said the UK order book for autumn 10 was up by double digits and that total sales in Europe were “definitely growing”. He also issued a clear message to European stockists of the label that it was “business as usual” in spite of this week’s mega £2bn takeover deal.

He said: “We are looking to a strong next 12 months.” He attributed the order book growth to both the improvements in brand perception and a general improvement in market conditions for wholesale stockists.

However, he said it was too early to say whether the European fashion sector was over the worst of the downturn. “If I knew that I would have a crystal ball. We are more positive but we will stay careful. The crisis may come back in a different way but we are ready for that.”

UK-based private equity firm Apax sold Tommy Hilfiger to PVH this week in a deal worth £2bn. Apax bought the brand in 2006 for $1.6bn (£1bn), during which time its sales have grown to $2.25bn (£1.47bn).

The sale marks a terrific turnaround in fortunes for the brand, which was created in New York in 1985 by its eponymous founder. In the 1990s it lost its way, particularly in Europe, after its brand image was damaged when it was picked up by and extensively worn by US rap artists and it neglected the core polos and chinos product categories it was originally built around.

Grieder said the success of Tommy Hilfiger through the recession had been boosted by its investment in product and people, and its strategy to shrink back its wholesale account base and supplier base. It has 6,000 stockists across Europe, 15% fewer than 12 months ago, after it culled some accounts that did not represent its new lifestyle image and those that were deemed risky in the recession.

He said: “We have put a clear image behind our brand - it is classic American cool. We have invested in trading up our quality so the price/value of the product went up. We put more design elements into it.”

Grieder added that the business had also benefited from shoppers trading down. He said: “In the past 12 months we have truly become a premium lifestyle brand. We are not luxury, we are premium placed. We have definitely seen luxury shoppers trade down to us and when those customers have bought our product at our affordable prices they have realised how good it is.”

Tommy Hilfiger’s growth strategy, which centres on driving wholesale sales with existing European stockists, particularly on womenswear and accessories, remains unchanged under PVH.

Grieder said there was also potential for Tommy Hilfiger Europe to bring PVH’s lifestyle brands Arrow and Izod to Europe, although there is no timescale for a launch.

PVH-Hilfiger deal

Value of the deal 2.2bn (£2bn) plus 100m (£89.8m) in liabilities

Combined turnover About $4.6bn (£2.7bn)

PVH-owned brands include Calvin Klein, Izod, Van Heusen, Arrow, GH Bass & Co

PVH’s licences include Timberland, DKNY, Ted Baker, Kenneth Cole New York

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.