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Jerome A. Chazen, co-founder and former chairman of Liz Claiborne Inc., wants to get a few things off his chest.
This story first appeared in the January 20, 2012 issue of WWD. Subscribe Today.
In his new book, “My Life at Liz Claiborne: How We Broke the Rules and Built the Largest Fashion Company in the World,” (AuthorHouse), Chazen describes how the partners took a small start-up fashion business and propelled it into the Fortune 500. He believes he hasn’t always gotten the public recognition or credit for building Liz Claiborne into the powerhouse that it was, since the perception was always that the company was run as a husband-and-wife operation by Liz Claiborne and Art Ortenberg. But the 84-year-old Chazen writes that he likes to think of it as being “Liz’s and Jerry’s.”
While people who worked at Claiborne during that time may strongly disagree with that claim, Chazen, who spearheaded sales and marketing, gives his version of the events at the firm.
“Art always had difficulty giving me credit for the key role I played in the company. I had to live with that reality then and for many years after, no matter how my ideas and my management guided the company to success. I guess that I was having so much fun it didn’t really matter. But, to be honest, sometimes it did get to me,” Chazen writes.
Internal struggles and tensions notwithstanding, Chazen — who had a successful retailing career before teaming up with partners Claiborne, Ortenberg and Leonard Boxer — described how he set out to break the rules of retailing to build a major company, which, by the time he left in 1996, was generating more than $2 billion in revenues. Since leaving Claiborne, he’s often asked what he thinks about the turn of events. “All I can say is it’s obvious the years have not been kind to Liz Claiborne. The company has changed dramatically and, unfortunately, not for the better,” Chazen writes. He still serves on the board of the Liz Claiborne Foundation, the philanthropic arm.
WWD sat down with Chazen to talk about the glory days of the brand and the landscape the business deals with today:
Why did you decide to write a book?
The easy answer was my grandchildren were bugging me. They heard about the story of the company and said I should write it down so they could read about it, since they weren’t around when all this was happening. That’s part of the impetus. Then I thought it was a story that deserved to be told. The story between the designer and a businessperson is very critical in the success of any company.…To some degree, from an ego standpoint, even though I was the face of the company in terms of Wall Street, and I spoke to the analysts and made speeches, I felt the fashion community was all about Liz. Liz was the company. Whoever else happened to be there didn’t really matter.
In the book, you describe a chilly relationship with Art Ortenberg. Was it like that from the beginning? Why do you think he downplayed your role in building the company?
It was frosty. And it was too bad. They [originally] called me when they were out of work.…We were very good friends. He was my roommate in college. I knew Liz before Art married her. The friendship and the business part didn’t mesh properly. We got along. Art was never really a businessperson. He was a lot of good things. He’s very smart, very articulate, very aware of what was going on in the world, but business was not his main focus, and I think he didn’t want me to be the dominant force in the company. He wanted to make sure it was Liz. When we formed the company, we made the decision to call it Liz Claiborne. The whole concept behind the company was taking designer characteristics and translating them to more affordable clothes. [It] was what we wanted the company to be.
Having a designer name for the company was a no-brainer. Because Liz was the president, all these articles eventually came out about her being the first female president of a company this size. While her title was president, she was a designer. She didn’t want to be president. One of the main reasons she left the company when she did was when her designing role had become a management role and she hated it. Why do something you hate, especially when you have a lot of money?
Each of you (Liz, Art, Leonard and yourself) had an equal percentage?
Yes, Liz and Art were always a duo. They were a bloc vote. They always voted together.
Can you give me some examples of some of the rules that you broke?
Twenty-five, 30 years ago, department stores were set up by classifications: pant department, skirt department, sweater departments. That’s what we faced. Here, we were making a whole collection. There was nobody else doing it at our price range. We were taking another peg from the designer world and moving it to lower prices. But what we ran into was department stores which said, ‘Where do we put this stuff? I don’t have a buyer who knows how to buy all these different classifications. My sweater buyer knows how to buy sweaters.’ Eventually we got a few stores to say OK. Saks and Bloomingdale’s both had departments where they could put our merchandise. Bamberger’s and J.L. Hudson Co. made room for us. There was all kinds of pleading; fortunately, the stuff sold. It flew out.
What made you so confident that this would work?
I just knew it. The idea of a woman being able to go to one place and put together an outfit for herself…the movement away from dresses towards separates was just beginning. Dresses were still the big shots in the stores. Within two to three years, they were closing the dress departments because women wanted separates. I just felt it. This is the way women wanted to shop. I felt so strongly that we started a whole company on that basis. They had to buy the whole collection. We tested in a few stores; once they were convinced, all hell broke loose. Then it became a question of how fast can we deliver and how much goods can we ship them. At the same time, it also became apparent to us that we couldn’t manufacture domestically, we couldn’t find the factories, and we ended up going overseas, and, of course, that was probably the single most determining factor in both our growth and our profitability.
How do you describe the relationship between you and Liz?
I think Liz and I understood each other very well. She had a very good eye. She had a faultless taste level. We [occasionally] made bad styles, but nothing was ever in bad taste. She had a sense of color not to be believed. She got more recognition for being the head of a very large company, as opposed to a designer. She never wanted to be part of the CFDA shows. She used to say, “I’m not a runway designer. I design for a person, and my stuff just doesn’t look so extravagant and I don’t feel good even trying to play in that field. I don’t want to be confused with those people, because I’m not those people.” You had to get beyond that to appreciate her design qualities. Liz could, at the beginning of the company, fuss over the placement of a dart for an hour. But it was never, “I’m going to make this fabulous thing in this crazy fabric.” Not only did I understand that about her, I appreciated it, because it fit right in the field. Because those were the kind of clothes I wanted her to make. I wanted to take care of as many people as could afford our clothes. I wanted us to be the ones that would dress her, and we were. In 1981, we were shipping hundreds and hundreds of thousands of units every single day. It was incredible. We had 10, 15, 20 million customers. Everybody wore Liz.
How did the influx of women into the workplace in the late Seventies and Eighties impact business?
Women entering the workforce was very important and had so much to do with our growth. There was also an explosion of department stores being built and new malls. They had to fill them up. Mostly in the Eighties, we had our reputation, when they were planning new stores we would sit down with them, and say, “Where is the Liz Claiborne department going to be? How much space are you going to give us?”
What do you think of Claiborne landing at Penney’s?
I feel very badly that the company was not able to succeed with the original customers that we had. I think perhaps more could have been done earlier on to make the line more relevant than it was, if it was the lack of relevance that eventually led to its nonperformance in the stores.
Do you think Penney’s can recapture the Claiborne customer?
Ron Johnson [Penney’s new chief executive officer] called me and we had a meeting, and we talked about Liz Claiborne and what we could do. He asked if I had any suggestions, and my big suggestion was that it’s not handled by the rest of the people who handle J.C. Penney merchandise. There were 20 people at Liz that were putting together the product when J.C. Penney had the license. Now they own it, and they hired all those people, so they’re using those people to put the line together. If you do it right, there are tens of millions of Liz Claiborne consumers out there. One of the things they told me was during the first year they had the license, 400,000 consumers who had never shopped J.C. Penney before came in and bought Liz Claiborne. Who knows if it means anything anymore?
You mention in the book that you tried to re-create [former Claiborne ceo] Paul Charron in your image, but you had a problem with that. Paul wasn’t as interested in the product, and he didn’t have a feel for women’s apparel.
It was big problem. [When he was hired] he was interested, and he said he was interested. He just didn’t want to be a participant in it. He wanted to be able to manage the people who were doing that, which is a little bit different in our industry. That’s why we hired Denise Seegal [as president]. I told Denise this was going to be a tough guy, but I’m bringing you into this company as his equal, even though he’s the ceo. He’s very good at organization, planning, meetings, but he’s not a garmento, he just doesn’t have it. [I told Denise] that’s what you have to bring to the company. All the designers have to report to you.
How would you characterize the job that William L. McComb [Claiborne’s current ceo] has been doing the last five years?
I’m not involved with the company, only what I read in the papers. He seems to have a plan. He came into this when there was a big financial crisis. I don’t think he’s enjoyed making any of the moves he had to make, and now he’s just trying to regroup and basically start a new company.
Finally, what do you think about Liz Claiborne changing its name to Fifth & Pacific?
It’s the kind of name you have to get used to. Right now it still sounds strange to me, but perhaps one day people will get used to it. Obviously it didn’t make any sense for the company to be called Liz Claiborne. They had to make a change. I hope in its new incarnation, management is able to pull it off.