Patrice Louvet, chief executive officer of Ralph Lauren Corp., talked disruption, courting a younger customer, innovating with new platforms and making the jump from beauty to fashion in a wide-ranging interview with WWD’s international editor Miles Socha.
Throughout the conversation, Louvet emphasized that courting Millennials and Gen Z was a top priority for the $6.3 billion company, one in which they’re devoting a lot of energy and manpower.
WWD: How do you juggle the steady progress of a giant company like Ralph Lauren with disruption? And what does disruption look like at a 50-year publicly traded company?
Patrice Louvet: We just celebrated as a company our 50th anniversary, and I don’t think we’d be here if we hadn’t been able to deal with successive disruption throughout this whole time period. To some extent, Ralph started the company by disrupting the tie industry. We want to view disruption as an opportunity and not a threat.…For me, there are really three that stand out: One is there’s clearly disruption in the way consumers are engaging with brands today. My daughter, Clara, 19, discovers brands on Snapchat, TikTok, Instagram. If we’re not on those platforms, we’re not communicating with her. As a company we had to make that pivot to be much more digital and to be in touch with these new platforms, to be able to engage with customers like Clara and also to tell the story that will really resonate with her today which is different than prior generations. The second one is digital commerce, and understanding how that fits in the overall ecosystems. Stores still have a very important role to play for customers. Wholesale still has a very important role to play for customers. Creating exciting experiences at a local Macy’s and also being able to transact on We Chat and other social media platforms. The last one is bringing in talent, inspiring and energizing talent. Today, younger employees or young recruits want to understand your purpose…We’re very fortunate at Ralph Lauren to have a purpose that’s clearly defined and established by Ralph and the team. We’re about inspiring the dream, a better life, authenticity and timeless style. To some extent, I think we’re more in the dreams business than we are in the apparel business. Clear purpose and clear set of values and a tangible focus on sustainability and diversity and inclusion. I am also amazed when I do round tables with employees around the world, generally the first question I get is what are we doing with sustainability. The second question will be about diversity and inclusion.
WWD: What types of content or actions do you have on the TikTok platform, and are there other places you’re innovating?
P.L.: We just started with TikTok. We’re in acceleration mode on these platforms. We were the first luxury company to do a social commerce partnership on TikTok in context with the U.S. Open collaboration we have. We had more than a million views and hundreds of thousands of viewers going from the TikTok platform to our Ralph Lauren site to transact. The challenge is how do we expand this across all the relevant platforms.
WWD: What impact do online giants such as Amazon, JD and Alibaba have on your business globally?
P.L.: Our mind-set across the company is we want to be where our consumer wants to shop us, as long as we can be represented in the right way and as long as we can create value. We need a higher degree of agility than we have in the past. Pure players are a very important part of our go-to market. We’ve set some very clear criteria on which pure players we’ll partner with and which ones we won’t. One, if that they represent them in the right way, two, will the partner eliminate all counterfeit and non-authorized third party resellers, three, will the partner help us maintain pricing integrity across the market, and four, will we be able to partner with the company as far as consumer understanding and leveraging consumer data. We have a wonderful partnership with Alibaba and Tmall. We’re working very effectively with them, Asos, Zalando, Net-a-A-Porter. Regarding Amazon specifically, I don’t believe the conditions are set yet for us to be on that platform with the Ralph Lauren brand. We are executing a pilot with the Chaps brand on the Amazon platform, and it’s off to an encouraging start.
WWD: It’s great to be a legacy brand and Ralph Lauren certainly is one, immortalized in an HBO documentary that will be coming out very soon. What, besides TikTok, are you doing to win over a new generation? And what are some lessons you can share?
P.L.: HBO on Nov. 12 will show “Very Ralph.” I encourage everyone to watch it. New generation is one of five key strategic pillars. To make sure we’re attracting Gen Z to the brand as they start to have compensation and revenue to purchase our products. Three things I would call out. One thing is being where they are from a brand engagement standpoint, communicating with them in a way they want to be communicated to. We talk a lot about the role of influencers in our industry, and it’s real. What we look to do in each market we operate in, to create a mosaic of authentic influencing relationships — these are not big checks we’re writing to celebrities — that represents different dimensions of culture: sports, movies, music, sometimes the business world.…TikTok, We Chat, all these platforms are the source of information and the source of inspiration for this younger population. Even some of the traditional tools that we have like the fashion show. Ralph’s Club, which is our latest fashion show, which had frankly nothing to do with a historical fashion show. We recreated a Twenties jazz club on Wall Street. Frankly, what happened outside the club is almost as important as what happened inside the club. We live-broadcasted it around the world, and 21 million young consumers watching it from China from Weibo live. It’s new platforms and modernizing how we leverage our traditional approaches to connect with that consumer. As we look at the data, we’re quite energized by the progress we’re making with young millennials and Gen Z.
WWD: We should probably talk a little bit about product. The company recently had some fashion misses. How do you balance in a large company like yours, luxury with other price zones and also luxury versus core items?
P.L.: We do have a few sku’s, probably a few more than we should have. We’re working on that. For us, there are three operating words. The first one is core and more, the second one is balance. We’ve very fortunate to have an established position in a number of critical categories: the polo shirt (we have some exciting things coming on that front), the cable knit sweater, the military jacket, the chino pant. Focus number one, is to drive those. We’ve identified through significant consumer work about a year and a half ago, we interviewed 12,000 customers around the world, five categories that we have the basics to win but we are underdeveloped. These are denim, outerwear, wear to work, footwear and accessories. How many in the room think of Ralph Lauren as a denim brand? We have one [person]. We internally think of Ralph Lauren as a denim brand. When you see pictures of Ralph over the years, you often see Ralph in denim head to toe, or you see him at the CFDA Awards wearing a tuxedo jacket, a beautiful white shirt, a pair of ripped jeans and cowboy jeans. Denim is at the heart and culture of the company. Our business is underdeveloped in denim. We believe we’re well positioned to win there. We have work to do on the product, on the communication, on the presentation in the stores. It’s balancing this core and more. We expect half of our growth to come from core, and half of our growth to come from more. I don’t come from this industry so we’re still looking for the silver bullet in getting the balance right between core, seasonal core and fashion.
WWD: We recently reported on the influx of beauty executives into fashion. How has your experience at Procter & Gamble colored and aided you in your current role? And what can fashion learn from beauty?
P.L.: Twenty-nine years at P&G was A long time. I finally saw the light. There are lot of parallels between beauty and fashion. If you think of the consumer, everything above the neck is beauty and everything below the neck is fashion. Both businesses are about emotion. If you just get your hair colored, the feeling the woman has is a strong and powerful as if she’s put on this beautiful new dress that she bought. Same things for the guys. If you touch up the goatee with Gillette, the feeling you get is similar to what you feel when you put on this amazing leather jacket. Both businesses are about triggering emotions, delivering emotions to the consumer. The third parallel, is the pace of innovation. In beauty, new packaging, new formulas, new concepts. In fashion, the pace of innovation is quite intense as well. The last one is the need for precision, attention for detail, the need for excellence. I ran P&G’s fragrance business for a few years. The weight of the cap for fragrance says a lot about the quality of the fragrance in the consumer’s mind. The same is true in the fashion world. The way the stitches are finished on the jacket, the way the buttons are chosen and positioned is also about precision and details. What can beauty bring to fashion and fashion can bring to beauty as well. Probably, a greater focus on the consumer. I think fashion is amazing because successful companies have a vision driven by a designer or design team, bringing the vision to life. I think the industry can benefit from connecting that vision better with consumer understanding and what makes her tick. The second area is data. This business is about magic and logic just like the beauty world. There’s an opportunity in the fashion world to use more data, without losing the magic. We have the conversation that artificial intelligence is coming. Do you still need a designer when AI is up and running? Our conviction is absolutely. The last piece is managing complexity. Given the complexity we’re dealing with, given a lot of the waste we’re creating, there’s a lot we can bring from the beauty world to the fashion world on the operation discipline.
WWD: P&G is known about grooming great leaders, and you’re one. Can you share a pivotal Eureka moment about leadership?
P.L.: I was sent to Japan in early 2000 by A.G. Lafley (former P&G charman and ceo) to run healthcare and haircare for P&G across Japan and Korea. The business was in shambles, and the mission was go fix it. I’d lived in different countries. For those of you who have lived in Japan, this is not just another country. Besides the personal challenges of getting in your car, and turning on the navigation system in Japanese, reading the signs on the street in Japanese, and not sure you’ll make it to your destination and make it back, or buying milk for your kids and they spit it back because it’s not milk you bought.
I made a few mistakes professionally that have been a phenomenal learning experience. I came in as a young general manager…My initial assessment was everything is broken here, the leadership team doesn’t have the right composition, the product portfolio is wrong, we’ve focused too much on local brands, we’re not leveraging the global portfolio, the packaging is outdated, the marketing is uninteresting. I went forward and just moved on all these fronts and feeling pretty good I was making progress. Six months in, my head of consumer research came to see me and said, “Patrice this is not going to work out, You’re not the right leader for us.” You can just imagine the punch in the gut having to deal with the cultural challenges already. It was a tough moment but really a defining moment. I realized, I hadn’t taken the time to define the vision for the team, which is relevant for all organizations but is particularly relevant in the Asian world. Second, I was trying to change everything and had successfully confused everybody and had not made significant progress across any of these fronts, and third, the Japanese felt there’s another foreigner who will come and come out and we’ll wait for the next guy to come in. I pivoted. I did a few things. I took the time to find the vision with the team, what’s the direction, where are we headed…sequence the moves. The trap we often fall into is everything needs to be fixed today. Things still needed to be fixed. I think the diagnosis was appropriate. But these roles are not five-minute roles. They’re multiyear roles. You don’t need to go for perfection on everything right away.
WWD: You’re a very busy person, how do you manage to fit it all in? Do you have any advice on managing your time and energies as a leader?
P.L.: You can’t do it all, it’s about priorities.…I like to think of myself as a helicopter. The concept for me is understanding on the different projects what altitude I need to be at. There are some projects while it may be tempting to be in the mud, I need to be flying at 30,000 feet to look at the long-term landscape. There are other projects I need to be with the team in the mud. Finding that right altitude has helped me manage my time and find my level of engagement on different issues. I went to this amazing thing called Corporate Athletes in Florida at a tennis camp. The whole premise is we’re all professional athletes, except we don’t play three times a week. We play 10 hours a day. If we get kicked out of the quarter finals, we don’t have four days to recover. How do we manage our energy? Life is not about managing your time, it’s about managing your energy. It’s about having the right level of energy at the right time. Your energy level is proportional to the level of priorities you set up.
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