A poor economic environment has presented an opportunity to bring a new denim concept to the market for Anlo founders Jenna Andreola Lonstein and David Lonstein.
The husband-and-wife team will launch OTR, which stands for Off the Record, this fall. The line marks the Lonsteins’ entrance into the increasingly crowded field of labels billing themselves as premium alternatives, with prices ranging from $95 to $136.
“A lot of our stores were telling us that, while Anlo is still doing well, their customers are becoming more price conscious,” said David Lonstein, who handles the business and finance side of the company.
The success of Anlo’s denim leggings, which sold at a lower price point, was one indicator that moving forward with a new line could work.
“[The leggings] were flying off the shelves,” he said. “We thought maybe there was something to what people were saying about that and thought we could try a whole new line.”
The couple launched Anlo at retail in May 2006 with about 12 specialty stores nationwide, making a mark with sophisticated styling and retail prices around $200. Originally based in New York, they moved to Los Angeles to have more access to and control over the line’s production. Last spring, they added a collection of silk tops and dresses to Anlo, which prompted a move back to New York. Within the last several months, they said the introduction of a lower-priced label became more alluring.
“Even though customers have been price conscious, Anlo has been steady,” said Jenna Lonstein. “So we didn’t see the need to lower Anlo’s price points.”
David said, “We didn’t want to do an Anlo B line. We wanted a fresh company with a fresh concept,” adding he didn’t want to confuse customers with a sublabel.
Jenna said designing for OTR frees her up to push trends and be more fashion forward. In the higher ends of the premium spectrum, she believes customers and retailers are playing it safe with more basic styles.
“Fashionwise, I can take more risks and customers are able to take the risk and buy a fashion jean at $136 versus spending $200,” she said.
The difficult economy has also played to their advantage when it comes to raw materials and production. David said he’s been able to buy premium fabric at a significant discount, a trend he chalks up to larger brands overbuying in tough times and being forced to unload the excess. That, in turn, allows them to continue producing domestically while keeping the price of the line low.
“It is very hard to project in denim and with the lead times from the mills it does get complicated,” he said. “A lot of the larger companies will buy what they think they need and know they can off-price anything they don’t use.”
David said he views the growing number of brands entering the $90 to $150 price zone as a positive.
“It brings more attention and I don’t think it hurts,” he said. “A year or two ago, if you told people you were doing premium denim at $120 and in the U.S., people would have trouble believing the quality. When a lot of people are doing it, it proves that it can be done.”
He also believes that having the Anlo name behind it gives OTR more credibility with retailers.
OTR has been picked up by Revolve Clothing, an upscale store in West Hollywood, Calif., and a handful of boutiques throughout the U.S. Orders have also been placed by stores in Australia, Japan and Kuwait. With retailers still being cautious, especially with new brands, the Lonstein’s anticipate slow but steady growth. They declined to offer sales projections for the first year, but believe some of the 200 doors that carry Anlo will pick up the line, along with a number of stores that had steered away from the high price of Anlo.
“People are going to be hesitant, even though Anlo has a proven track record and people like the brand,” said Jenna.
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