Editor’s word: This text appeared within the Nov. 11, 1996 challenge of Fortune.
On a brilliantly sunny summer time afternoon, the sort of day folks dream about to get them via the dreary frigid winter, we’re in a Manhattan workplace constructing attempting to determine the place Ralph Lauren will sit. Truly, we’re in Lauren’s small, all-white workplace on Madison Avenue, and with two giant, beautiful chairs and a giant comfortable sofa laid out earlier than us, the reply is much from apparent. Relatively than probability some large fake pas by claiming his favourite spot as our personal, we bravely put the query to him: “Mr. Lauren, is there a particular place you’d like to sit?” His response: “Wherever the light makes me look best.”
That’s Ralph. For practically 30 years Lauren, 57, has earned a good-looking residing displaying People (males particularly) the right way to look good, utilizing himself because the mannequin. And therein lies a puzzle.
In some way Lauren, who thinks it’s effective for males to put on (as he does) black velvet slippers within the workplace, has grow to be the designer of alternative for guys to whom the mere point out of velvet slippers causes first one after which the opposite eyebrow to be raised. Males with no tolerance for velvet slippers within the workplace, at house, within the software shed, or on the moon. Males whose emotions towards males who do put on velvet slippers could pretty be expressed as: Yikes!
Then contemplate Ralph in his Rancher guise. Does this appear like any actual rancher of your acquaintance? Any rancher, that’s, who’s prepared to interrupt both a sweat or a number of vertebrae chasing after cattle? Actual cowboys have nicknames for such ranchers. Ralph’s could be “Hopalong Casually.”
And but mainstream guys purchased $2.7 billion in fits, shirts, ties, and different Ralph Lauren clothes final 12 months. Add in ladies’s garments, eyeglasses, fragrance, bedsheets, dinner plates, leather-based couches, and the remainder, and customers across the globe spent some $5 billion on Lauren items—making him the best-selling designer on the planet. In some way Lauren—fake cowboy, relentless Anglophile, exponent of yachting and polo—has come to occupy the sort of strong center floor that Brooks Brothers did within the Nineteen Fifties: He’s the default style alternative for males who don’t care an entire lot about style however however wish to look good in workplace garments. “Buying Ralph is like buying a Maytag,” says Hal Reiter, president of the manager search agency Herbert Mines Associates in New York, who owns six pairs of Ralph Lauren trousers and two Ralph Lauren fits. “He’s an established brand that stands for reliability and quality.”
“I try to give people a clean, aspirational quality, with no bullshit. Where’s the negative in that?”
Let different designers—Italians, handbag-toting Frenchmen—urge kilts and capes and corduroy plus fours upon an impressionable public. Lauren stands manfully above the fray, upholding easy, basic attractiveness (permitting for infrequent lapses like these slippers). Dangerous dressing? Not for Ralph. He’s the nation’s main proponent of secure slacks.
“Ralph’s world is not unapproachable or scary,” says Neil Kraft, former head of promoting for Calvin Klein. “Everything is done with the promise of good taste.” And by-product idealism. When Lauren creates the look of an English nation house, the panache of a Savile Row swimsuit, or the luster of some Western belt belonging to an imaginary rancher, his model is at all times just a little cleaner, just a little brighter, only a contact extra polished. He doesn’t promote socks; he sells his very mildly fevered (98.7º) dream.
Might Martha Stewart have existed with out Ralph? He blazed the path of “lifestyle” merchandising, promoting not simply gadgets however his personal private context—and at a premium value, no much less—at a time when such issues weren’t accomplished. He was the primary dressmaker to have his personal shops. He was the primary to promote not solely the swimsuit you put on to work however the pajamas you put on to mattress and the sheets you sleep on. And certainly, earlier than Martha was Martha, she made reward baskets for Lauren’s clientele within the Eighties. “When people buy his products, it gives them the feeling of having class and stature,” she says. “They’re buying a piece of his world.”
The worth of admission is comparatively excessive, as befits a enterprise with aspiration at its soul. A Polo swimsuit may promote for $600 to $900; a lady’s blazer for $1,200; a pair of socks, $11; a leather-based couch, $9,000. Even so, there are sufficient prospects to maintain 116 freestanding Polo/Ralph Lauren shops, 62 low cost shops, and a few 1,300 boutiques inside department shops everywhere in the world. A brand new, 45,000-square-foot retailer—the size of a whole metropolis block—is scheduled to open in London, of all locations, late subsequent 12 months.
Since 1993, Polo/Ralph Lauren’s income—together with its share of worldwide licensing revenue—has elevated 30%, to some $900 million; working revenue has grown practically 70%, to round $110 million. Not surprisingly, maybe, the excitement is that Ralph is considering going public. Over the previous 12 months buyers have been interested in designers and department shops like lint to a sweater: Witness such high-profile IPOs as Gucci and Saks Fifth Avenue. In June, Donna Karan lastly dropped the veil. Now, with the potential exception of Calvin Klein, no personal firm will get funding bankers’ mouths watering fairly like Lauren.
Lauren himself admits an IPO is “in the realm of possibility,” however provides “I doubt if I’m going to do it. I like my privacy. I have no reason to do it unless I want to buy something else. And I sort of have everything I want.”
Darn it, he just about does. His automotive assortment features a 1929 blower Bentley, a 1937 Alfa Romeo, a 1938 Bugatti, and a 1962 Ferrari GTO. He has a 13,748-acre ranch in Colorado, a duplex condominium on Fifth Avenue in Manhattan, beachfront properties in Jamaica and Lengthy Island, a 240-acre property in Bedford, New York—and a company-owned Gulfstream II to get from one house to a different. His estimated internet value? Higher than $1 billion.
Lauren admits an IPO is “in the realm of possibility,” however provides, “I doubt if I’m going to do it. I like my privacy. I have no reason to do it unless I want to buy something else.”
Lauren has Goldman Sachs largely to thank for his present consolation. Two years in the past, when Polo/Ralph Lauren wanted cash to open new shops and overhaul older ones, it raised $135 million by promoting a 28.5% stake to the funding home.
With its minority stake, Goldman doesn’t become involved within the day-to-day operating of the enterprise. “They’re in my hands, I’m not in theirs,” Lauren says firmly. However few on Wall Road consider Goldman isn’t needling Lauren for an IPO. Says Richard Friedman, the accomplice at Goldman who heads GS Capital Companions, the funding pool that bought Polo: “Both Ralph Lauren and Goldman Sachs would be remiss in not looking at the possibility. But there’s no pressing need to do one other than the strength of the market.”
How does Lauren maintain coining cash? His accomplishment relies upon partly on magic, totally on equipment. The magic half he expresses as a query: “Did you ever see a man or a woman walk into a room and they look great, but you don’t know exactly why they do? You just know that you want to look like that?”
The machine is pushed by licensing. No fewer than 26 firms pay to make, ship, and promote Lauren’s items. Lauren offers the design and inventive expertise, getting in return a minimize of gross sales (round 6%) plus minimal assured funds. Polo/Ralph Lauren nonetheless manufactures its top-of-the-line males’s and girls’s garments, however the bulk of its revenue comes from these licensing agreements. Instance: Cosmair, a division of L’Oréal, which makes Lauren scents, is likely one of the largest licensees; perfume trade skilled Allan Mottus figures this one license might put as a lot as $20 million in Lauren’s pocket this 12 months alone. He sews not a lot, however rattling if Ralph don’t reap!
Simply final August, Lauren launched two huge new licensing ventures, Polo denims and a line of girls’s clothes referred to as Lauren. Each are priced far under what Lauren’s garments have bought for prior to now—denims at roughly $48, ladies’s pants and jackets largely under $250. The thought is to succeed in an entire new class of buyer, those who couldn’t afford Ralph Lauren earlier than.
Each the denims and the Lauren line are scoring nicely with buyers; the latter has retailers significantly giddy. “It’s just been remarkable. Overwhelming,” says LaVelle Olexa, a senior vp at Lord & Taylor. “The clothes hit the floor, and they just go.” A giant a part of the attraction is that buyers are in love with standing manufacturers once more, particularly if they will get them for below 4 figures. The Lauren line options Ralph’s best-known kinds—crested navy blazers, tartan plaid skirts, and crisp oxford shirts—however all accomplished up in inexpensive materials with fewer particulars.
Different designers have gone down the licensing highway, after all, and fairly a quantity have lurched right into a ditch once they let their licensees get management of their model. That isn’t prone to occur to Lauren: His want to guard all the things bearing on his firm’s picture, and his personal, is palpable, unsleeping, electrical, scary. Whereas we had been capturing the studio pictures for this story, Lauren weighed in on lighting, backdrops, props—even on the peak of the tripod holding the digital camera taking his image. (He stands about 5 foot 6.)
Greater than some other designer, he grasped early the significance of defending his model. Again in 1967, as he struggled to construct a enterprise out of his line of huge males’s ties, he refused to promote to Bloomingdale’s. The retailer needed him to make the ties narrower and take his title off the label. “We’re talking a quarter of an inch. That’s all they wanted,” Lauren explains. “And as for my name being on them, well, no one could care less who Ralph Lauren was. But I said no. When I left the store, I thought, ‘What am I, crazy?’ I was dying to sell Bloomingdale’s, but I didn’t because I really wanted to do what I believed in.” Months later, Bloomingdale’s got here knocking on Lauren’s door. It noticed how briskly his ties had been promoting in opponents’ shops and agreed to hold the ties precisely as Lauren had designed them.
Emboldened by this early success, Lauren subsequent designed a line of males’s shirts, then turned his consideration to fits, favoring huge lapels—to go together with his ties—and pure shoulders. It wasn’t lengthy earlier than Lauren branched off into ladies’s garments (partly to swimsuit the tastes of his spouse, Ricky).
In 1971 he opened the primary Polo/Ralph Lauren retailer on Rodeo Drive in Beverly Hills. Extra shops quickly adopted.
In 1983 he began his house assortment of sheets, towels, flatware, and furnishings. Relatively than merely placing out new colours or patterns like others within the area, Lauren created merchandise that revolved round themes, like New England Cottage and English Countryside. The latest Serape assortment, as an example, options aged solid-oak tables and chests in addition to distressed leather-based chairs and couches tooled, because the brochure factors out, “in the tradition of fine leather boot making.”
“I bought some Ralph Lauren sheets last year, and I just love them,” says Sheri Kersch-Schultz, spouse of Starbucks (SBUX) founder Howard Schultz, from their summer time house in New York’s tony East Hampton. “And he has a sleigh mattress that’s simply to die for. “
The newest addition to the house line: paint, produced below license by Sherwin-Williams. “I was a little skeptical at first,” says Bernard Marcus, CEO of House Depot, whose shops have carried the road since early this 12 months. “But we’re happy with the progress it’s making. When I first heard about it, I thought it was just paint with a big designer name on it.”
That’s precisely what it’s.
“Look,” says Mort Kaplan, head of Inventive Licensing, a agency that brings collectively licensing companions, “I’m sure the paint is good, but azure blue is azure blue is azure blue. The difference here is that Ralph Lauren stands for something. He knows how to package it, how to set it up in stores so it conveys his image.” Stroll into any House Depot, and also you’ll see what Kaplan means: Behind every mixing counter stands a Ralph show, all lit up. Brochures group paint hues by theme—Safari, Desert Hollywood, Santa Fe—and present not simply paint swatches however evocative bits of Laurentian context: a horse, a sideboard, a pair of satin gloves. One brochure shows 32 shades of white. Don’t snigger: Lauren’s house furnishings enterprise rings up retail gross sales of $535 million a 12 months worldwide, vastly outselling some other designer’s.
Ever since his first in-store store opened in Bloomingdale’s in 1971, Lauren has insisted that retailers promote his items his manner, in boutiques arrange along with his props and fixtures. More often than not he will get what he needs. Says Kenneth Walker, an architect who has labored for department shops putting in Polo in-store outlets: “Ralph’s people are hard but fair. They don’t throw hissy fits, but they know exactly what they want.” They usually stroll once they don’t get it. Final 12 months when Bergdorf Goodman’s males’s retailer in New York refused to construct a Polo boutique to the corporate’s specs, Lauren pulled his enterprise from the shop.
Nowhere is his want for picture management as evident as in his flagship retailer at 72nd Road and Madison Avenue in Manhattan. The shop, opened in 1986 within the landmark Rhinelander Mansion, marked the primary time Lauren had gathered all his items below one (slate) roof. He oversees presentation, service, decor, even perfume (which, the day Fortune visited, gave the impression to be a compound of patchouli, cloves, and leather-bound units of Scott’s Waverley Novels).
The shop is sort of merely excessive in its Englishness, missing solely an Anglican bishop, a Simpson’s meat cart, and Dr. Johnson buried below the tie counter. Virtually all the things is on the market. If, as an example, you need to end up buzzing a Ralph-sanctioned tune whereas buying (“Pennies From Heaven” was enjoying as we warmed ourselves in opposition to the air con’s chill, rubbing our palms beside a gas-fired fireside), $15 buys it: Ralph Lauren’s Black Tie Assortment CD from Sony.
Wanting the place over, it’s a marvel there’s a single cricket bat left in England—or set of sculling oars, or antlers, or silver croquet trophy, or oil portray of a canine smoking a pipe. (The place does all these things come from? It’s simply as you suspected all alongside: Lauren has an enormous warehouse in New Jersey jammed with props and antiques. A workforce of 75 folks has traveled the world and crammed the 25,000-square-foot house with vintage mahogany chests, lots of of mattress frames, vintage Persian rugs, a hay bale, hundreds of hardcover books, golf golf equipment, baseballs, a lobster lure, an elk’s head, polo helmets, saddles, suitcases, ship’s wheels, and chunks of coral. Lauren periodically prunes the stock: Final 12 months a pair of tapestry-upholstered Queen Anne walnut settees, circa 1710, bought for $54,625 at Sotheby’s.)
With entry to a company attic like that, the 72nd Road flagship retailer makes an indelible impression—however not cash. A former high-ranking Polo govt figures that what with contemporary flowers, antiques, blazing fuel hearths, and funds on a long-term lease, the place loses $1 million a month. “I’m not going to comment on exact numbers,” says vice chairman Michael Newman. “I can tell you that it meets the budget we plan for it. When I look at it that way, the fact [the store loses money] doesn’t trouble me.”
The shop does bother some WASPs who see it as a rip-off of their heritage. Explains one patrician younger girl: “It’s like this: People who buy Ralph Lauren are trying to keep up with the Joneses. We are the Joneses.” Amongst her set, Lauren won’t ever be something greater than a parvenu. It will likely be simpler for his camel’s-hair coat to undergo the attention of a needle than for Ralph to get invited to Newport (as if that mattered to him).
Which raises the query: Who’s he?
Lauren was born Ralph Lifshitz within the Bronx. His father was an artist who painted homes for a residing; his mom raised the children (Ralph was the youngest of 4). He performed stickball, dated ladies, did all the traditional stuff. He didn’t develop up sketching garments, and he didn’t go to style faculty. “I don’t know, from the time I was 12 years old I looked cool,” he explains. “My father was a painter, so perhaps I bought some sense of shade from him. I do know that no matter I had on, different youngsters would say, ‘Hey, where’d you get that?’ “
As he bought older and labored after faculty, Lauren would use his paychecks to purchase costly garments. “If I saved $100 to buy a suit, which in those days was a lot of money, my parents would say, ‘Why didn’t you go to this place? It’s cheaper.’ And I would say no.”
Lauren pursued a enterprise diploma at Metropolis School in Manhattan, taking evening lessons, however dropped out after two years. He labored as a salesman for 2 glove firms after which for tie producer A. Rivetz & Co. Whereas working at Rivetz he began designing his huge ties, and earlier than lengthy he determined to enter enterprise for himself. In 1968, Norman Hilton, a clothes firm govt, took an opportunity on Lauren and backed him with a $50,000 mortgage. Lauren referred to as his firm Polo Fashions, a reputation that he and his older brother Jerry (now govt vp of Polo males’s design) appreciated as a result of it connoted cash, fashion, and a form of worldwide mystique.
By the early Nineteen Seventies gross sales had been practically $4 million, and the corporate was increasing too shortly. Lauren purchased out Norman Hilton’s stake and employed a boyhood chum as his treasurer and CFO. The pal turned out to be “somewhat in over his head,” Lauren says, and the enterprise, although reserving plenty of orders, was hemorrhaging cash.
In contrast to different designers, Lauren didn’t make his runway fashions appear like hookers from house.
To avoid wasting the corporate, Lauren poured in his life financial savings—$150,000 —and employed one in every of Hilton’s key executives, Peter Strom, to assist run it. Strom appreciated Lauren and agreed to return aboard if Lauren gave him a ten% fairness stake within the enterprise. “When I joined the company, it had 800 accounts, was doing about $5 million in sales, and wasn’t making a dime,” recollects Strom, who retired from Polo in April 1995. “I thought we’d be lucky if we ever broke $20 million in sales,” he says. “Ralph loves to remind me that I said that.”
There wasn’t actually any breakthrough that thrust Lauren’s clothes into the nation’s style consciousness; the closest his work got here to creating a splash was when Diane Keaton wore his clothes in Annie Corridor. Lauren did runway reveals, however relatively than make the fashions appear like hookers from house, he dressed them in clothes you could possibly put on to the workplace. From one 12 months to the following, adjustments had been of diploma, not of sort. On reflection, he was formulating the Ralph Doctrine: clothes that isn’t surprising, simply incrementally nicer, with snob enchantment prominently within the weave.
That’s his similar m.o. at the moment, after all, and its newest expression is his Purple Label line of “mostly handmade” fits, shirts, and ties. Within the late Eighties, through the peak of Giorgio Armani and the Italian energy swimsuit look, Polo’s preppy clothes began to look just a little boring. “Polo had been the power suit back in the early 1980s,” concedes Lance Isham, head of Lauren’s males’s put on enterprise. “But it was difficult to hold onto that because of the influence from Italy.” Lauren places it one other manner: “I was selling the Madison Avenue and Wall Street guys, and Armani was selling the Hollywood agents—the Mike Ovitzes of the world.”
Lauren noticed that his swimsuit enterprise was stagnating. “I wanted something not Italian-looking, just more sophisticated.” He envisioned elegant hand-sewn clothes minimize from effective materials, then formed nearer to the physique. Lauren needed a tasteful search for somebody with a well-toned physique who isn’t shy about displaying it off—himself, in different phrases.
Buttons wouldn’t simply be sewn onto jacket sleeves however would have actual buttonholes. (We questioned: Does that actually make the swimsuit match any higher? No, admits Stanley Tucker, style director at Saks Fifth Avenue in New York. “It’s just a little bit of snobbism. If you leave one of the buttons undone and someone notices, they’ll see you have actual buttonholes. It’s just very Savile Row.”)
It’s these incremental touches, nevertheless, that make Ralph Ralph. Some Purple Label fits, for instance, sport a discreet tab on the highest of their left lapel. “That’s a wind tab,” defined a salesman within the flagship retailer. A wind tab? we requested. “That’s so that when you’re walking home from church across the moors on a windy day, you can pull that lapel over and button it to a corresponding button on the jacket collar.” Oh.
A swimsuit like that prices an ungodly quantity, after all: between $1,500 and $2,500. However just like the flagship retailer itself, the Purple Label line is meant extra to solid an extended shadow of opulence than to be a lot of a moneymaker.
How does Lauren give you a factor like a wind tab? In New York Metropolis and elsewhere, Lauren’s scouts comb classic clothes outlets, on the lookout for clothes (or for particulars on clothes) that they assume Ralph may like. A few of them he does. After experiment and prototyping, an previous green-striped broadcloth shirt from the Nineteen Thirties, say, could get a brand new lease on life.
Ralph has had his share of duds. For greater than a decade, as an example, he has been stumped by—of all issues—blue denims. His first strive at that market, in partnership with the Hole (GAP) within the late Nineteen Seventies, bombed badly. One Hole govt says of the enterprise: “Every possible mistake that could have been made, was made.” Over time Lauren made different blunders: Both the denims had been minimize too slender for ladies of regular measurement (that means those that really possess hips) or deliveries had been late or the merchandise weren’t correctly merchandised within the shops.
Lauren’s final foray was three years in the past with a line of weathered, vintage-looking denims and shirts referred to as Double RL, named after his ranch in Colorado (which is brief for Ralph and Ricky Lauren). These garments, aimed on the school crowd, turned out to be manner overpriced. Denims and flannel shirts price as a lot as $78, and weathered leather-based jackets upwards of $300. “They totally misjudged the demographics,” says Jerry Magnin, proprietor of the Polo/Ralph Lauren retailer in Beverly Hills.
This fall Lauren is attempting once more, as you’ll have observed: He’s bought a whopping $20 million promoting funds, supplied by Solar Attire, the licensee for Polo denims. The print adverts are visually startling: They function clean-cut, healthy-looking women and men, with out tattoos or nostril rings, who aren’t bare, underage, or anorexic, and don’t grope each other. Calvin Klein received’t be making any noise about Lauren stealing his concepts. Says Lauren: “Look, I’m not anti-sex. But what’s sexy to younger people may not be sexy to everyone else. It might be the right time not to cater to the kids.”
Lauren surrounds himself with seasoned executives, most of whom have been with him for years—a rarity within the style enterprise. They perceive what Lauren needs, normally with out his having to spell it out. Says Buffy Birrittella, senior vp of girls’s designs and a 25-year veteran of the corporate: “When Ralph says he wants something white, I know what kind of white he means.”
Or the sort of brown. Final 12 months Birrittella, Lauren, and some different executives had been in Europe on the lookout for materials that might be used for the autumn garments now within the shops. Throughout this specific journey, they felt that they had been seeing manner an excessive amount of of 1 shade: grey. Says Birrittella: “I don’t know why I said it first—sometimes Ralph will feel something first—but I just looked at him and said, ‘brown.’ And he said, ‘Yeah, I’m feeling brown too.’ We were just both … well, just feeling brown.” As we stated earlier than, it ain’t all science.
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Fortune Archive
A query of authenticity has dogged Lauren a lot of his profession. Chatting with him late one sunny afternoon on the porch of his Colorado ranch home, it’s clear he’s weary of the cost that someway his work, and by extension his life, are phony. “I slept in a room with two brothers growing up,” he recollects. “I couldn’t wait for one of them to move out so I could have half the drawers. That molded me. But do I want to live like that today? No, I don’t. I don’t think it’s a comfortable way to live. So is it phony, then, to say I want to live out west, or I want to live in the country? If you’re born in the Bronx, does that mean you have to stay in the Bronx?
“I’ve tried to do things honorably in my business. I think I’ve added something to America. I don’t rip people off. I don’t downgrade children,” he says, getting in a parting dig at Calvin Klein. “I try to give people a clean, aspirational quality, with no bullshit. Where’s the negative in that?”
To which we reply: There isn’t one. Our financial system is stored wound by aspirations of the kind younger Ralph held (hell, previous Ralph holds). No marvel enterprise folks like to purchase his clothes: In Lauren they acknowledge a brother below the pores and skin (these velvet slippers however).
Reporter Affiliate: Joe McGowan
