NEW YORK, United States — It's been just over a year since Alexander Wang ran skipping and smiling down the runway, taking a bow after his last Balenciaga show. Following a three-year stint as creative director at Balenciaga, Wang returned to New York re-energised. With experience at one of the industry's most revered and elevated fashion businesses and new learnings to apply to his own namesake label, he was now, as he puts it, "an American brand of Asian descent with European training."
In June, the company announced that in addition to his role as designer, Wang would take on the role of chief executive and chairman, replacing his sister-in-law and mother, respectively. Today, the Alexander Wang business is said to turn over about $150 million in revenues with over three hundred employees spread across New York, Paris and Hong Kong. The company declined to provide actual sales figures but says the business is growing at double-digit percentages annually, with revenue split equally between apparel and accessories.
But in the worst year for the fashion industry since the financial crisis of 2008, running and growing a fashion business is difficult, even for the most seasoned of executives. How is Alexander Wang doing it and how will he drive and shape the business in his new role? Here, he speaks exclusively to BoF about returning to New York, balancing the roles of chief executive and creative director, and his first 100 days as CEO of his brand.
BoF: What was it that first motivated you to take on the position of CEO?
AW: I always had my sister-in-law as the CEO, and as we grew, and as we expanded, we brought on sales leaders, merchandising leaders, etcetera.
When I got to Paris, it was a very different way of working. Not good or bad, but just different in the sense that everything was very silent. The sales team had their own conversation, the creative teams had their own conversations. I never worked in that way. It was always about transparency, over-communication, and an intent to know each other’s expectations and goals.
When I came back, there was definitely a different viewpoint in how I wanted to be involved with the company. And the discussion of CEO, with my sister, had been something that was going on for a while — she had two kids, I was growing up and I wanted to take on more responsibilities — and it kind of just led to this.
I’ve always had an innate sense of the business side, and that’s something that’s always interested me. Just having the creative, for me, it wasn’t enough. Essentially, when you’re a creative, you’re a dreamer, and when you’re a business person, [you’re focused on] execution. A dream is only a dream until you execute it.
I like to use creative thinking when it comes to business decisions, and I always like to use business thinking when it comes to creative decisions.
BoF: So you’re a creative executioner then?
AW: I’d like to say so. I like to get things done. I like to see things come to fruition. I like to use creative thinking when it comes to business decisions, and I always like to use business thinking when it comes to creative decisions. The more that I can be that bridge between the different functionalities within an organisation, the more I feel proud of the work we’ve done together as a team.
The way that teams work is very much that you don’t have to know everything else that everyone else does, but you have to understand their intent. If you are a designer, you have to understand why the merchandisers are looking for certain things. You have to know why the press and communications teams are asking for certain things. You don’t have to know the span of it, but you have listen to it.
BoF: If your company had instead decided to appoint a CEO, and I was sitting down with them today for the first time, I would probably ask them about what they want to bring to the business side, their 'first 100 days' and the vision they have for the business. What's yours?
AW: The first thing I said to my team when I got back was that this year, we’re not going to focus on expanding exponentially. We are going to focus on our internal functions: we are going to look at our inventory levels, we’re going to look at our merchandising strategies. We are going to look at how we function internally. That was something I really wanted to strengthen, especially in this time when stores aren’t coming in with huge budgets buying. You have to be very focused and strategic in what you’re creating and putting out there.
Once we get that locked down and zipped up, then we will talk about what our next step is. I feel like we’ve done an incredible job already … I’ve seen so much change happen in one year for us that I am just really excited for what the next years are going to be.
BoF: So what have been the biggest changes you have put into place?
AW: Efficiencies in role clarifications. I think that we grew so fast and organically that a lot of the time, people that have been in with us for a long time took on responsibilities where they were unsure how to function [within the team]. Kind of like, where does that person leave off, and where do I pick up?
It sounds really dry, but it’s like setting up a RACI model —Responsible, Accountable, Consulted and Informed. At the end of the year, when people get bonuses, they want to know why they got it, why they didn’t. You kind of have to back it up with information. It’s very hard to set up those kinds of accountability structures.
BoF: It’s interesting, because in terms of roles and responsibilities, you might have streamlined other people’s responsibilities, but you’ve radically expanded your own. How do you split your time between the creative and business roles?
AW: You have to know what you’re good at and what you’re not good at, and where people have different points of view — and you have to listen.
Just because I’m a CEO and I have a big responsibility now doesn’t mean I’m executing on every single one of those action items. Knowing where you have to hire people, to bring people on — to delegate those items is very important. I would say that structuring my time and meetings, and putting it where I feel that I could delegate more creative responsibility or less business responsibility is something that I sit down with each team member and discuss on a weekly basis.
BoF: Almost by definition, it seems you must be spending less time on the creative stuff and more time on the business stuff than before?
AW: Yes, but the time I spend on the creative is much more efficient. When I go to a creative meeting now, they know that we have to set up by delivery, by price point — having [already] met with merchandising. So I’m not sitting there going this should go into this pile; this should go into that pile.
Because we grew organically, the most dangerous thing you can do is go on cruise control when you’re at a junior — or even at a senior level — in terms of a day-to-day. There weren’t enough questions being asked on a day-to-day basis.
You can’t move forward without taking a risk. And if people are afraid of taking a risk because they don’t want to make a mistake, then they kind of just go into cruise control and say I’m just going to do the same thing that’s been told to me over and over again and that’s been done in the past. I think especially in this industry where things change so drastically every single day, you have to want and be willing to take risks and change and question the way you do things every day.
BoF: Let’s talk a bit about the brand. It’s very impressive how this brand has been built but also how it’s so stretchable. How do you describe it to people?
AW: You know, when people ask: “What do you want to be in 10 years?” Are we an American lifestyle brand? Well, yes, we’re based in New York, and our business today is bigger internationally than domestically. We’re equally stable in all divisions that we do. As an American lifestyle brand, one that has equally big ready-to-wear, accessory [and] T businesses is something that we are very proud of — of having these pillars. But then again, back to how I would describe it emotionally…
BoF: Is it you?
AW: It’s me.
BoF: So how would you describe yourself?
AW: Fun. Mysterious, I would hope. Hard-working. Celebratory. Very driven, I would say. Ambitious, you know? I’m very much into things that feel like cross-contextualising. Taking something very banal and making it interesting. Or taking something that is too precious, or too pretentious, and making it undone.
That’s how I kind of approach almost everything. From product to campaign to show, or you know, a store design. That’s really everything. How do we disrupt the ingredients that we know and make it something that still feels very immediate and there’s a slant or edge to it. Something that gives it meaning and value.
We are aiming to be the most prominent digital lifestyle brand that redefines everyday luxury for our generation. That’s something we’ve been working towards, as we move from collection to collection and articulate more what our vocabulary is.
Hybrid is a big part of how I approach the design process — whether it’s business of creative thinking. This idea of unpretentious luxury that is really kind of… How else do we talk about that in a way that has more depth to it? The collections and the idea of being physical — not just the idea of workwear, but this subversive kind of physicality. The idea of everyday with an edge. To contextualise them in a way that makes it appropriate for every day.
BoF: Do you think the brand will change as you change?
AW: Definitely. I feel like it. It’s a hard balance because you want to make it a brand that stands on its own. I’m not a teenager, I’m not in my twenties anymore, now I’m 32, and what is my life about? But still, what are the things that I feel that I can still detach myself away from. That’s why I have two Instagram accounts. We have a company one, and I have my personal one. It’s important that not everything about myself is something appropriate to be communicated through Alexander Wang the brand, but there is still Alex Wang the person, you know? And creating that separation is, I do feel, important.
BoF: I also want to talk about positioning. You’ve managed to do a high and a low under the same brand. I think there was a move at some stage to also take the brand up to much higher price points. It seems to me that you’ve settled things back down a bit. How are you thinking about how far you can stretch things?
AW: I never like to define [the brand] by price point, and I feel that’s always been — since day one — our motto. A young American label is really defined by the wholesaler. And that was an infrastructure that I worked really hard to evolve from. I felt that international stores or partners got us a lot more, who they put us adjacent to, how they perceive the customer shopping, etcetera. That’s something that’s very fluid now. Everyone does that now.
The way I see it is that just because we are not designer luxury, and we’re not contemporary by definition, doesn’t mean we can’t do a $5,000 or $10,000 embroidered dress and sell it. We’ve done it and it does sell. It just goes back to brand and product value. The customers, the audience, everyone knows. They know how much things cost. If it’s hand or machine-embroidered, where it’s made, what the material is. If we do something of a certain price tier, it just has to reflect that.
We’re very rarely hesitant and say, “Oh we can’t sell that price, we’re not going to do it.” You just have to know how to balance it. Especially in accessories.
BoF: Let’s talk about accessories, which are a renewed focus for the business. When I think about the real success point of your business, of course, there’s the stuff from T, but I always think about the accessories as a really defining element.
AW: At least for our case, the way that we kind of slightly renewed our viewpoint on the business is not just to look at top line and bottom line. We have to look at each business as its own individual [business]. So when we look at our footwear business, when we look at our handbag business, we are not looking at it as in, “Okay, where does our Alexander Wang brand sit next to in terms of this over here.” It’s more like, “Who are the strongest leaders in the footwear business.” Eventually, the goal is to have a president on top of each of those categories.
BoF: Is that an example of how thinking about Alexander Wang as a business has impacted the creative side?
AW: [Take] our little cut-out heel. It’s something that we’ve had since 2009. It’s always done really well. We’ve kept it in every collection. I would say probably within the last year-and-a-half, it really blew up. We were like, “Where is this coming from?” I don’t know if it can be defined by one moment, when everyone started buying them.
BoF: I also want to talk to you about growth. Most fashion businesses are not growing right now. They’re lucky if they’re staying flat in this market. How are you planning to drive growth?
AW: The lucky thing is that because we are privately-owned, we do not have to answer to other expectations. We can manage our way of growth however we see fit. Like I said, we didn’t have huge plans to grow this year. We did grow — double digits — but that wasn’t in our focus. I really wanted to make sure we understand what our language and what our products stand for. How we fit into the marketplace.
In terms of the next phase, the lucky thing for us is that we are actually really nimble in terms of our retail. We have three stores we operate directly, and the rest are partner stores. We don’t have to close down stores that aren’t performing. Our big focus is digital. That’s where we want to restructure our platform. Testing some new things with direct-to-consumer. This sort of “buy now, wear now.” That’s something we’ve been talking about. Does it make sense or not? What can our resources deliver? What can we do?
BoF: How did these tests go?
AW: Let me break it down for you. We purposely took three segments of the brand: the embroidered dresses in the Spring show, which were kind of around $3,000-4,000, we had our denim capsule, in the $300-400 range; and then we had our Adidas collaboration announcement.
The thing that we learned is that a customer is not going to buy something just because it’s available — especially at certain price points. They’re going to buy one coat a season, one $4,000 handbag a season — whatever is in their wardrobe, it’s one at that price point. The things that people buy in a “see now, buy now” mentality are things that they feel they have to have at that moment, and that they can buy at that price point that feels very accessible and gratifying.
BoF: Finally, yours is a privately-owned business and I know there are some investors right now, and you always said you’re open to investment, but only in very vague terms…
AW: I’ll bring more clarity to it. I’ve spoken with probably at least a good handful of people from all different sectors from the investment arena. Private equity investors, sovereign, strategic. My takeaway is that certain strategics, it’s not about helping your business growth. It is about sustaining business; it’s about being able, for them, to put their stamp on young talent and have it on their family, so that when one of their big racing horses open up, they have talent to support that. But what’s 20 or 30 million dollars to be able to buy them that advantage. So I say, okay, that’s not for me.
Private equity: Very short horizon, three to five years, seven if you’re lucky. It’s a pump and dump. Not for me.
Sovereign? Well, if I am going to do that, I want to partner with someone with an equally strong business in making this a success story as I do. I want to be the main racing horse. I want to be the one that we’re going to work together with — with enough interest to make something that we feel really proud of, is meaningful, has integrity behind it, and that’s why I say that I’m open to it but haven’t necessarily landed on the perfect fit yet.
BoF: Do you have a sense of what that fit could be?
AW: The ideal situation would be someone with a strategic advantage, where we would be one of their sole focus investments. That’d be an ideal situation. We’ve been very fortunate to be profitable and need to sustain ourselves. But I still want to experiment while we do have the creative flexibility to try different things and do what we feel is right. I’m not in any rush to jump on that boat, but if the right opportunity comes along, I definitely have my eyes and ears open.