The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
NEW YORK, United States — "There were a lot of people doubting what we were doing in the beginning," Tory Burch, both creative director and chief executive of her eponymous fashion company, told BoF on the eve of her Spring/Summer 2013 show. "I'm an information gatherer, I like hearing what people feel and think, but at the end of the day, you have to believe in yourself and go with your instinct and gut."
With neither traditional business school nor design school training, Burch and her well-honed instincts have built one of fashion’s hottest properties in just eight short years. Known for its American, bohemian-prep sportswear, her luxury lifestyle brand, stocked globally in 73 Tory Burch boutiques and over 1,000 department and specialty stores, is expected to make over $800 million in sales this year, according to market sources.
The brand's chic, colourful designs are universally appealing — to fashion insiders, mall shoppers and, unsurprisingly, investors. Last year, Burch hired Barclays Capital to sell a minority stake in the company and while the closely-followed search continues, the company has reportedly conducted meetings with potential strategic partners like Coach and LVMH, as well as private equity firm The Carlyle Group.
A self-described tomboy, Burch grew up romping around a farm on Philadelphia's Main Line with her three brothers. Although both of her parents were "always very fashionable," it wasn't until her senior year in high school that she became interested in fashion, she said. "The prom dress that my mom got me was this light pink sequin and navy tulle Yves Saint Laurent dress. It was a big statement for Philadelphia."
Burch’s mother also inspired her first job after college, with Zoran, a designer known for his deluxe minimalism who dressed Isabella Rossellini and Lauren Hutton. “I cold-called Zoran,” Burch recalled. “Really interesting man and a beautiful designer. My mother wore his clothing. He said, ‘You can have a job, but you have to start in a week.’ So a week after I graduated, I moved to New York and started a full induction into fashion. It was a very interesting time. He looked like Rasputin and vodka would start at ten o’clock in the morning. That was my first job.”
Burch went on to work as a sittings assistant for Harper's Bazaar, then moved into PR and advertising at Ralph Lauren, Vera Wang and Loewe during Narciso Rodriguez's tenure. "Each of those experiences have added some element to how I run and build this company," she recalled. "I talk to entrepreneurs a lot about how each job might not be the perfect job, but you really learn from each job and you take something from that."
While formulating ideas for her own company, “I started to think what I was personally missing,” said Burch. “It was this idea of great American sportswear with a more global point of view. Pieces — like a great trench coat or a cigarette pant — that were well-priced. I thought there was an opening in the market between contemporary and designer.”
Armed with a vision of affordable luxury, Burch founded her label in 2004. “Against a lot of people’s advice,” she decided to launch her own store on day one, leasing space in the up-and-coming New York neighbourhood of Nolita. The strategy gave her total control over the customer experience, right from the start, and provided a powerful platform for brand storytelling. “You could see who we were immediately, just by walking into an environment that we could make look exactly how we wanted — everything from the branding to the candle burning to the music playing. It was really an experience and we wanted the customer to feel that from the beginning.”
It worked. By the end of its opening day, the original Tory Burch boutique at 257 Elizabeth Street had almost completely sold out of inventory.
Today, each of the brand’s stores is built around the idea of “creating a retail environment that feels like you are walking into a home,” Burch said. All feature orange lacquer doors, mirrored walls and Lucite fixtures, “but are different depending on where they are,” she continued. “The Meatpacking [district store in New York] is a little more industrial, whereas our Madison Avenue flagship is more of a townhouse — we wanted to think about what it might have looked like in the 1800’s, which is when it was built. Rome, we did in this ancient building [but the concept] was based on a Donald Judd sculpture, so it’s got very modern elements against very old architecture.”
By the end of the year, Burch will have opened some 25 new stores in 2012 alone, but each opening is “organic and strategic and well thought-out,” she said. “We look at the markets and we study who our customer is and then we wait for the right space to become available. We’re very patient. We want the right adjacencies, we want the right location and we study who’s buying our clothing. We track it on our e-commerce site and in our stores,” she said, in order to gauge consumer demand and help determine future expansion strategy. For example, Burch just signed a lease in Munich because “a lot of German women are buying our clothing. We can see that Brazilian women are buying our clothing in Miami and New York,” she continued, so the company opened two stores in São Paulo this year, with two additional Tory Burch stores expected to open in Brazil before the end of 2012.
But despite her company’s wide distribution, Burch still sees plenty of room for growth. “We see emerging markets as a wonderful opportunity,” she said, “whether it’s Indonesia, Brazil, Russia, India.” Burch plans to visit Brazil in October, followed by the Middle East in November. “We want to look at different places in the world and see how different women are dressing and responding to our collection.” Importantly, the brand adapts its product to fit local tastes and customs. “We make some longer things for the Middle East,” said Burch. “In Brazil, we made our bikinis a bit more skimpy.”
Planning retail expansion is only one of Burch’s many responsibilities at the helm of her brand. “I’m lucky that I can be the designer and the CEO,” she said. “It allows me to be creative, but also look at business in a creative way. It’s a lot of different things coming at me, every minute, every day,” she said, describing her typical workday. “I just got out of a design meeting for the handbags for our show and then I met with IT to talk about warehouse issues. It can be all-encompassing. It’s designing stores and working with our architect, Daniel Romualdez. It can be about product, the website, marketing. On every level, it’s so diverse, and that’s what I think makes it fresh and interesting and exciting.”
The appeal of her brand is just about as all-encompassing. “We definitely have a very diverse customer,” said Burch. “We have a lot of Europeans and Asian women. We have a lot of girls in high school and college, where it’s aspirational. But then we have a designer customer that’s wearing us, maybe to mix with her designer wardrobe. We have a downtown girl and an uptown girl. It’s a lot of different generations. And what I love about that is that they’re wearing it differently.”
Burch is also focused on the digital opportunity. “We want to be at the forefront of social media. I think it’s a very interesting way to have a conversation with your customer and get authentic feedback,” she said. “It’s not always positive, but we have to really listen.”
Authenticity is also key. “We started doing Twitter and I thought it was in the wrong way — it was more promotional. I realized Twitter has to be my voice, it has to be authentic and interesting. It shouldn’t be about something on sale. The customer is very savvy. They want authenticity. They’re not interested in hearing about promotional things.”
Integrating social media with commerce is her next big digital priority. “We look at online as our number one store. What’s exciting is that there isn’t really a cap. So I think the Internet and social media and tying in commerce with that is going to be very important in the future.”
Asked if she has any advice for aspiring entrepreneurs and designers, Burch replied: “Definitely do it if your idea is unique and different. It has to be different. And you have to be prepared for a lot of hard work. Nothing that is successful comes without hard work.”
As for the company she has built, the search for a new investor continues, though the process has been complicated by tensions between Burch and her ex-husband and former business partner, Chris Burch, who was forced to step down as co-chair of the company’s board earlier this year, but still owns a sizeable portion of the brand and has launched a competitor called C. Wonder that, in many ways, mirrors Tory Burch’s bohemian-prep style.
Back in 2009, the designer sold a minority stake in her brand to the Mexican private investment firm Tresalia Capital in order to help fuel global growth. “It was a lot of soul-searching, looking at where we both see ourselves ten years from now, making sure that our vision is aligned and that we have the same ideas about culture and the way we run our business.”
“It’s good to be patient,” she continued. “It’s good to really make sure that you’re doing something that is good not only for the future of the company but also the employees as well. So it has to be a process and it’s not a quick one. Every decision we make is about the long-term and about how it will affect the brand five, ten years from now.”
Tommye Fitzpatrick is a writer based in New York.