Jacobs Maps Growth Plan

NEW YORK — Marc Jacobs sees nothing unhip about a mass-marketed apparel line. After all, it could turn his name into a billion-dollar brand.<br><br>One of fashion’s reigning megastars who rose from the urban underground, Jacobs said he...

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NEW YORK — Marc Jacobs sees nothing unhip about a mass-marketed apparel line. After all, it could turn his name into a billion-dollar brand.

This story first appeared in the May 27, 2003 issue of WWD.  Subscribe Today.

One of fashion’s reigning megastars who rose from the urban underground, Jacobs said he doesn’t understand why people refer to him as a hip designer, even though his clothes have long been favorites among the celebrity and artist set.

“This idea of edginess and coolness and hipness is so old-fashioned,” the designer said in a phone interview from Paris last week. “People say I’m a hip designer, but I am so not hip. All these actors and performers [who wear my clothes] are just normal people. They don’t have this hipness that outsiders give them.

“It just seems like there’s an opportunity to continue doing what we do and [the prospect of doing a better-priced line is] very positive. I don’t think we would lose our customers, but gain a wider audience and provide her with more stuff she loves.”

As reported, the company is in talks with various firms around the world about producing a better-priced line that would be even more accessible and commercial than the secondary Marc by Marc Jacobs collection.

Robert Duffy, president of Marc Jacobs, said last week a deal might be finalized within the next year and the line would be licensed to another party to produce. He spoke of wanting to go after the Gap demographic and was intrigued by the prospect of producing jeans that retail for under $100 and T-shirts for between $40 and $50.

Jeffry Aronsson, who joined Marc Jacobs International in January as chief executive officer, said Thursday that while the concept is still premature, it has great potential.

“Why should fashion be barricaded by a price point?” Aronsson asked. “We know it’s a huge potential opportunity for us and that it’s something that would be considered right in its own time. The Marc by Marc line is growing at the rate of 60 percent a year, with sell-throughs off the charts.

“When you look at a jeans potential and one that would be more accessible, one can imagine what an enormous potential that would be and one wishes to be very thoughtful that the timing is correct.”

Aronsson said however Jacobs and Duffy decide to focus the line, it’s destined to be a home run.

“People are trying to be like Marc and he’s hot and a trendsetter,” he said. “Marc Jacobs’ business as a whole could easily be a $1 billion brand in five years. We’re sitting on a powder keg of opportunity.”

Sales at Marc Jacobs have been estimated at more than $50 million through its collection business, the Marc by Marc line and retail operations. The Marc by Marc line is in approximately 200 doors, with selected distribution in department and specialty retailers.

The company has been on an aggressive retail expansion, and is currently scouting locations in the U.K., France and Italy. There are approximately 30 freestanding stores and shop-in-shops in Japan; two freestanding stores in Hong Kong; three Marc by Marc stores in Taiwan along with a newly-opened collection store there; and three in-store boutiques in Korea.

His gardenia-influenced Marc Jacobs fragrance for women has inspired an offspring, Marc, and will also pave away for a Marc by Marc Jacobs fragrance launching in early 2004. The Jacobs women’s scent reportedly generated $17.6 million in retail sales last year, while the men’s pulled in $2.7 million.

There is no question that Jacobs has a major influence on the industry, with everyone from Jones New York, Sag Harbor and Zara looking to the designer for inspiration.

“I’ve seen so many knockoffs [of my clothes] — and I’m not patting myself on the back,” Jacobs said. “There are so many places that produce inexpensive clothes and our line is copied instantly. They’re all over Europe and America and we’re basically doing work for them. If there’s that big of an audience [for this look], why shouldn’t we be providing the material — since we’re providing it anyway?”

Jacobs discounted the common industry notion that a diffusion concept would take away from the prestige of a designer collection.

“I’m really into it and I don’t think it would negate anything. What we’ve found was the customer who wears the designer line also wears the [secondary line] Marc by Marc, and it kind of had an appeal on its own. So why would [this new line] be any different?

“If we could do another range of clothing, with the approach being the same, and the integrity being the same, why not? Of course, we’d have to keep in mind that we’d have to work with certain fabrics, but it wouldn’t diminish who we are.”

Jacobs said he and Duffy have long thought doing a better-priced line was a good idea.

“We hope we’d find our customer who would find stuff in this [price] range,” Jacobs said. “Robert and I have always kind of taken this approach. We don’t really know what it’s going to evolve into and that has worked for us in every case. Of course, we’ll have to come up with a way to define it. We’re sort of open to growing and having something take its shape.”

Aronsson said it’s not so much about when a deal might come about, but more about finding the perfect candidate for the job.

“It’s not so much about the nationality as it is the absolute best and right candidate, and it might mean different arrangements, depending on where [the company] is and how production translates into price in the location of the point of sale,” he said. “There are several choices in the world and one wants to be absolutely certain that it is the best choice.”

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