By  on November 17, 2004

As chief executive officer of Sara Lee Branded Apparel, Lee Chaden oversees a $6.45 billion business with 55,000 employees, marketing some of the world’s best-known apparel brands including Hanes, Champion, L’eggs, Playtex, Bali and Wonderbra. In fact, apparel — not cheesecake — is the biggest line of business at the $19.6 billion Sara Lee Corp., the parent company where Chaden also serves as executive vice president.

“We think of ourselves as a branded consumer product company, and that thinking certainly applies to our apparel business,” said Chaden, who in his presentation focused on innovative strategies vendors and stores can pursue to exploit robust brands in today’s evolving retail environment. At Sara Lee, for example, that’s meant working with a powerful mass retailer such as Target to create a new brand called C9 by Champion, an exclusive label for that retailer that leverages the Champion name.

“Not long ago, a good manufacturer’s brand could not get enough business out of one account to justify exclusivity to one retailer,” said Chaden. “This is where the scale of today’s retailers is changing the game.”

Through the continued consolidation of traditional retailers, there are now a handful of companies vying for dominance in the retail marketplace and, as Chaden pointed out, these titans are constantly looking for new ways to build customer loyalty and reduce reliance on price promotions through differentiated product and brand offerings. “It was Target’s scale that made this program economically viable for us to pursue,” noted Chaden. “And we believe that you’ll see more manufacturers’ brand offerings tailored for particular retailers.”

These partnerships are especially attractive to vendors, given the efforts by large retailers to circumvent national brands by developing brands of their own, either via private label programs or through exclusive licensing deals for names such as Cherokee and Mossimo at Target, Martha Stewart at Kmart or White Stag at Wal-Mart. “I would say that we are very selective in terms of our decisions to venture forward in this area, but we are also very realistic that this is a way to take retailers’ scale — which a lot of people on our side of the table are saying is a threat — and turn it into an opportunity,” observed Chaden.

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