Ralph Lauren: How I Built a Fashion Empire

[Music] he is the fashion world's reigning superpower whatever aspect of the business that you're in in our industry everybody looks at Ralph Lauren is the model a dream maker who netted billions by imagining what others wished for every time I design clothes I am making a movie I don't think anybody since Walt Disney has been as successful in persuading millions and millions of people to buy into his fantasies wherever you go Ralph Lauren's brands project an aura of rarefied living Ralph's brand stands for classic timeless fashion the brand represents your souvenir of this fabulous lifestyle that you want to be a part of but his life was not as picture-perfect my sense was and thought it would be the last time he walked the road it wasn't not by a long shot we used to joke that he always had to plan to take over the world he's taking over the world just no doubt about it [Music] Ralph Lauren is the most famous one-man brand on the planet a brand that is synonymous with a superior lifestyle Ralph always knew that he wouldn't win if he didn't take risk he's always pushing the envelope he keeps himself awake at night he's worried that he's gonna fail he's obsessed he's brilliant he's irascible he's difficult and he can also be kind and interesting and sweet easy he's a huge bundle of contradictions Lauren insists that the images he creates communicate his story and did not participate in the show before he was Ralph Lauren he was Ralph Lipschitz the youngest of four children who wore his brothers hand-me-downs born in 1939 to Jewish immigrant working-class parents he grew up in the Bronx New York his father was a house painter and amateur artist living with someone for whom aesthetics mattered would of course affect a child in that household Michael Gross is the author of genuine authentic the real life of Ralph Lauren he went to yeshiva and he wore a yarmulke and he wore all the other paraphernalia of Orthodox Jews every single day he told me that at the very beginning when he was living in the Bronx he would go and escape to the movie theater and literally fall into the fantasies of the movies of that era which was really you know one of the great movie-going eras the late 40s and early 50s Warren Hill Steen is one of Lauren's boyhood friends we all as kids looked at the movie screens and the actors and how good they looked I know Ralph particularly liked Fred Astaire and he truly did project himself into the scenes in which men like Gary Cooper and Cary Grant were plagued he sees the characters that populate his dreams and his visions and that vision that ability to step into a fantasy world Ralph brought to the fashion business in one of his only two major television interviews ever Lauren told Charlie Rose back in 1993 about the enduring impact of those experiences I was very influenced by movies I was very influenced by a world that had a sense of dream that had a sense of something else and what I was influenced in these places was the good guy the the Hopalong Cassidy not the corny guy but the there was the man on the white horse my sense was I had an integrity inside me about what I believed in I I did it honestly and but I had a point of view are very strong Warren House team says that when they were teenagers Lauren asked Halston's father a tailor to make him one of his first suits but I remember going down to my father's place with him and it was very difficult you know just said my father dad do whatever he likes he says I can't please him I said okay then that's it even though he was a perfectionist Loren was a guy's guy he liked basketball best I would say okay we're all good in 2011 when Oprah Winfrey came to interview him on his Colorado ranch Lauren shared his earliest ambitions did you always want to be a Cowboys I want to be baseball player I wouldn't be basketball player huh I wanted to be an actor I want to be dancer actually I wanted to be Batman if you don't that's a secret I'm telling you everyone happened when he was in his late teens he and his brother Jerry opted for a name change as ralph said to me the problem with the name lifshitz is it had the words in it and he endured endless teasing that continued through school I'm sure into the army I believe that Ralph suggested to me that the name Lauren came from Lauren Bacall who you know was a great style icon as well as a great actress following high school lauren worked as a salesman while taking business classes at night he never got a degree in 1964 after a short stint in the Army 26 year-old Lauren married Ricky Lowe beer a receptionist he met his office he married the girl who would look perfect in the convertible with her blonde hair flowing Ricki became his model his is backstop Ricki was always I think in the back of his mind still looking for his place in the world Lauren set his sights on New York's fashion industry he became a salesman for Brooks Brothers and then a series of necktie manufacturers I took him to his first polo match in blind Brook where we were exposed to fabulous things the silver the leather the horses the tall slinky blonds big hats just the high society that we really weren't knowledgeable of but certainly it didn't take us a moment to appreciate it that fabulous world transformed Laurens vision he called me up and said he was going to open up his own business and what was my opinion about the name and he said he had it down to players or polo by Ralph polo is totally elitist hardly anybody knows anything about it but everybody play something so there's no choice it's gotta be players he said okay thanks a lot bye and then the rest is history it was the era of plain narrow ties when Lauren offered up a radical design concept colorful white eyes striking out on his own one of his first stops bloomingdales marvin tribe was the former CEO and president of Bloomingdale's shortly before he died he spoke about the brash young designer he showed them to the Bloomingdale tie buyer who said I like them I'll buy them but I don't want that Ralph Lauren label on it I want a Bloomingdale label now his Ralph's starting and struggling in business about to get an order from Bloomingdale's he closed the sample case and said I will not accept the order without my [Music] several months after ralph lauren walked away from an offer at Bloomingdale's the renowned store called him back I thought the ties were terrific and if he wanted his name on it that was fine because I felt the ties would sell and they did other well-known names and men's clothing also wanted in including Paul Stewart and Neiman Marcus within a year lauren sold a whopping half million dollars of ties the designer had designs on something even bigger to expand his brand he aimed to do so he told Charlie Rose by envisioning clothing that himself would want to wear what you thought you can buy in England what you thought Cary Grant was wearing Fred Astaire you could not walk into a store and buy when I came along the business was not at all like the things that I made you could not buy you couldn't find it Bloomingdale's saw potential and profit in Laurens line we worked closely it from the ties to men's shirts to suits sport coat slacks the total men's collection and then he came and said Marvin I'd like to do a women's business I think the most important break for Ralph Lauren was probably getting a boutique of his own in Bloomingdale's it was the moment when someone outside of Ralph's fantasy existence agreed with him and brought him into the world of Commerce this was the first time that Bloomingdale's had given a designer his own in-store boutique and the business grew very rapidly Ralph as in everything else knew exactly what he wanted in the shop what he wanted on the floors what he wanted on the walls it created really a Ralph Lauren environment and it's all Ralph's dream menswear designer John Varvatos was a protege of Lauren's if you go back into the 60s and 70s people put things on a mannequin they never told stories Ralph took you into a fantasy world wealth took you to an island he took you to the Hamptons he took you to the west three years after his first ties went on sale Lauren won the Oscar of the fashion industry the 1970 Kody Award for his menswear line and in 1971 Lauren bought the first of what would be many luxury cars Pulitzer Prize architecture and design critic Paul Goldberger has reported on Ralph Lauren's famous car collection I think it was a Mercedes convertible that he couldn't quite afford at that point he bought anyway because he understands that very kind of aspirational reach that he's trying to sell to other people he reached back to his earlier fantasy that polo match and introduced his signature emblem the polo player but despite strong sales the company found itself in financial trouble to keep it going Lauren was forced to invest most of his personal savings 100 thousand dollars he also hired a new business partner retail executive Peter Strahm who pitched in and bought 10% of the business for $6,000 I think he was very worried they were delivering everything late their distribution pattern was all wrong we solved those problems and we got the right stores to buy the right amount of things to display everything properly two years after Strom's arrival and back on track Lauren's brand got a boost when his men's clothes were cast in the Great Gatsby his ability to create clothes that look like costumes that look like clothes that looked like costumes was unequaled in American fashion hi hi but I actually think that the claim that he designed Annie Hall was more important the Annie Hall look would inspire one of Lauren's earliest women's collections and the designer himself was often the featured model in his brand's ad campaigns commercial director Jeff Madoff has shot many of Ralph Lauren's fashion shows he wears this stuff so he's become the embodiment of what he creates like Frank Purdue with his chickens hit no Ralph in his clothes there was an authenticity to it the company launched a blitz of new collections including a wide-ranging home collection Lauren also licensed his name to other products trading a measure of control for capital now flush with cash in 1986 Ralph Lauren went all-in spending 30 million dollars to open a standalone flagship store housed in New York City's historic Rhinelander mansion my wife and I were there opening day at 2 o'clock in the afternoon and I said in the store was packed with people I said Ralph how are you doing he said I think I'm doing all right and I said Ralph you're a retailer you can ring off the cash register now and the manager came back and said we have 41 thousand dollars in and Ralph said is that good and I said that's very good then I went back to my office and the phone rings about 5:30 and it's Ralph Marvin we have a hundred and one thousand dollars and how is that and I said it was terrific this is Ralph learning to be a retailer I think it told his story to the world anybody who came to New York it's like on the tour guide of New York you know you understand Ralph Lauren's message very clearly when you go through there when you walk by those windows you get it as the business continued to grow lauren pushed his employees harder than ever there's a vast team of designers and creative executives they do the designing they do just about everything but they bring it to Ralph and finally it's Ralph who decides and there are actually this amazing thing little tiny stickers that get put up on idea boards and they say RL likes and in that act Ralph Lauren takes possession of those clothes of those designs and deserves the credit Ralph pays more attention to detail than anybody I've ever met in my life and when he is designing and he's looking at the clothes he'll look and want a lapel ever so much more peaked or ever so much narrower or he likes to plan that he wants it to in 1986 the estimated worth of the privately held company was six hundred million dollars and Lauren not his models was the cover shot it would seem that life couldn't get any better for Lauren when he launched his next woman's collection but behind the scenes something very alarming was shaking up the famed designer we were atop of the st. Regis Hotel and the finale of the show Ralph came out and I saw his face unlike I had seen it before and as I was fighting back tears I started crying because there was something going on I didn't even know what it was it was just visceral no one but those closest to him knew that Lauren had been diagnosed with a brain tumor it was one of those things that you just didn't want to believe couldn't happen to Ralph what did it mean for the future there was all those questions at the time [Music] as I was riding home in the taxi and I heard on the news reports a designer Ralph Lauren was being admitted for emergency brain surgery Wow oh yeah my god sure I worried I felt so bad for him you know fortunately the tumor was benign after surgery there was a long road ahead and new priorities oh I don't think he worried about what would happen to the business I think he worried about living about his life Lauren shared his ordeal with Charlie Rose I remember I came home from the hospital and I took a walk in Central Park and I was very weak and I saw some guys running in the park running and sweating I said to myself I want to do that several weeks later Lauren returned to work I think he came back even more aggressive than ever but I think he was a little bit more relaxed a little bit more laid-back and maybe was valuing every moment a little bit more he launched a fitness wear collection and created a top-selling perfume he spent millions promoting these lines and the product universe surrounding them James Fallon editor of Women's Wear Daily calls Ralph Lauren a powerhouse in the magazine world because he's one of the biggest advertisers out there if I launch my fragrance and I take an ad out in or series of ads you're going to then do a profile of me I mean look at the number of magazines that did put him on the cover when he had his 40th anniversary and that reflects the extent to which they appreciated his financial support in past years appreciated and also depended on it a 200 million dollar annual advertising budget is an 800-pound gorilla Ralph Lauren sits wherever he wants and if that's the cover of your magazine Ralph's going to be there Laurens dominance was also evident when Audrey Hepburn presented him with the Council of American fashion designers Lifetime Achievement Award there was one of his muses his icons audrey hepburn the woman that he watched when he was a little kid in the movies now handing him this statue that for him could have been the oscar remember the princess i got her with the launch of Laurens upscale purple label in 1994 the company looked great to the untrained eye after all sales were at an all-time high but that only told half the story he thought Prabhakar is a retail business journalist like every retailer that has big dreams it just grew too quickly there was a lot of capital expended in order to make that brand where he wanted to be that combined with a very lackluster operations in terms of distribution created really a perfect storm for a company that was almost on the brink of bankruptcy lauren needed a lifeline and founded with goldman sachs the investment firm purchased 28% of polo ralph lauren for 135 million dollars that was surprising to us because we never realized that he had been that close to the you know back to the wall financially and I think that's sort of what led to the goldman sachs investment they're very good about identifying where the growth is and what's going to be a company that's going to have long term growth and that's exactly what they saw in Ralph Lauren and the infusion of cash meant exponential growth with Polo Ralph Lauren opening new stores and overhauling older ones by 1997 Ralph Lauren was the top-selling designer in the world consumers spent almost 5 billion dollars a year on his products goldman sachs saw greater potential and pressed lauren to go public he wasn't so sure he always had concerns at once it was a public company he would have less freedom of action that it was no longer his own brand because he had shareholders and a board to do [Music] despite his initial reservations Ralph Lauren decided to take his company public in June 1997 Liz done a retail analyst at Macquarie Capital has been tracking Lauren's company for years part of the challenge with going public is that investors want to see growth quarter to quarter year to year in a very consistent linear fashion and so I think in the early days of the company's history as a public company they sort of struggled with that when he first went public we would cover his annual meetings and he would stand in front of a shair hose when Wall Street doesn't understand me our shares aren't just sitting there they don't really move I wish they would get what we do Lauren was now working to satisfy his shareholders the company began to sell in more stores but sales growth slowed and profit margins declined and 16 months after its opening day high of 33 dollars a share it fell below $17 I know that it tormented and we talked about he talked about it he was frustrated that Wall Street couldn't see what was abundantly clear to him and always had been since 1967 that he was it but he was the guy it drove him crazy um and he was into that environment that came a man named Roger Farah who was one of the great retail executives in America Roger Farah came over and really restructured the unsexy parts of the business supply chain operations one thing he also did too was it he bought back those licenses he brought those brands back in-house and made sure that all those brands were underneath the Ralph Lauren umbrella they're going through a tremendous growth period and I had suggested that we put together something that really codify the Polo brand message and we called it Ralph Lauren philosophy it's a brand video that Lauren commissioned the way I do collections what inspires me is the story or a theme that gets to me inaudible this I don't build a collection from the sleeve or from a specific fabric I build it out of a dream control to him is very important and this is a way to present a unified message where he didn't have to be there but it was like he was there Lauren continued to expand with an eye on international sales he opened flagship stores in Milan Tokyo and even Moscow America is represented in France by McDonald's and Ralph Lauren and you know which one makes our culture look better in Paris I think the Ralph Lauren store has really become a kind of symbolic American Embassy but in the summer of 2012 the all-american designer was attacked when news reports revealed that the Team USA uniforms Lauren designed were not made in the USA made in China Asus China China I think they should take all the uniforms put them in a big pile and burn them the company said the uniforms for the 2014 Winter Games would be produced in the United States throughout his career Ralph Lauren has carefully cultivated his own image he has homes on Fifth Avenue in Jamaica Long Island and Bedford New York as well as a 17,000 acre ranch in Colorado where he spends time with his wife and three grown children he also spends time and lots of money on his pet passion cards are fun and toys and they all offer you a different experience to me their work for this 2010 promotional video announces a Paris exhibit of some of Laurens 60 plus vintage cars he once told me his car collection is something he does first because he just loves cars and responds to them and he doesn't collect art unlike most people in his income bracket he said you know you can't drive a painting and he loves the idea of being able to take any of his cars and drive it around on a Sunday afternoon Paul Goldberger says that Lauren has changed some of the cars original colors he sort of looks at something and says this is wonderful and exciting and beautiful but it actually could be even better and I want to make it even more for 40 years ralph lauren's pursuit of perfection has kept him firmly in charge as CEO and chairman of the board of the company that wears his name I think that that you know small symbol of the polo pony is is enduring and it's something that customers over a long period of time have chosen this is probably the best long-term story in my coverage because there are these variety of growth opportunities that are really driving a doubling or more of sales over the next several years the former tie salesman at age 72 is one of the world's wealthiest people worth seven and a half billion dollars I think that the last piece of Ralph's Lipshitz that remains in Ralph Lauren is a kernel of insecurity and it is the fuel that runs the engine that runs the person who personifies the brain Ralph doesn't sit as laurels for one minute now for one minute I mean you can enjoy the moment but you have to understand that you have to keep things going and you can't be a one-trick pony we can opponent [Music] [Music] [Music]

Channel: Bloomberg Quicktake

Views: 1,301,996

Rating: 4.9200435 out of 5

Keywords: Bloomberg, Ralph Lauren Corporation (Award Winner), Fashion (Industry), polo by ralph lauren, designer, fashion designer, Ralph Lauren (Organization Leader), Clothing (Industry), Fashion Design (Industry), Style, Entrepreneur (Profession)

Id: WTqYMoz_inU

Length: 25min 8sec (1508 seconds)

Published: Mon Feb 02 2015