In Ralph Lauren Corp., raising the brand is the core of the strategy.
“When people ask me what your strategy is, I give them two words – elevate your brand. Patrice Louvet, president and chief executive officer of Ralph Lauren Corp.
Speaking at the National Retail Federation’s “Big Show” conference at the Javits Center in New York on Monday, during his conversation with Sara Eisen, co-manager of CNN’s “Closing Bells,” Louvet said, “We have the opportunity to further enhance the way the brand is perceived. It’s exciting to see more and more people selling cashmere sweaters and fewer t-shirts. Right now there’s an entire comeback to occasion. Ralph Lauren, although pent-up demand has outstripped the product’s supply.
“Consumers are looking for aspirational products and stories. We have a unique opportunity to continue serving them in that space. If you look back at the history of this company, it’s been a journey of growth…”, Louvet said.
“When you look at the stores we recently opened, in Beijing, Shanghai and a few weeks ago in Milan, they were very high-end experiences. They have hospitality in them. And you look at our products available at different points of sale, they’re definitely more advanced than what we had three or four years ago.
“We still believe in the role of stores.” During the pandemic, “As soon as people were able to return to the stores, we saw a significant increase in traffic.”
Louvet also said his company still trusts department stores, although distribution has decreased some. “Over the past few years, we have dramatically re-established our department store presence,” says Louvet. “Wherever we appear, we want to make sure that the brand is represented in a way that is consistent with the image. We’ve moved away from midsize department stores. We focus our traditional presence on more advanced doors and digital wholesale. When I look at the entire ecosystem we’re building around the consumer, department stores clearly have a role to play and we’re grateful for the strong partnership that we have. I have with department stores in the US and around the world. ”
Explaining how Ralph Lauren has coped with the pandemic, Louvet, who has run the company for four and a half years, said, “We’re really, really pleased with where the company stands. Ralph Lauren. We certainly feel as though we are in a position of strength. We have the resources to invest in our momentum. We are opening stores around the world. We’ve opened 80 stores in the past year – a mix of Polo stores and flagship stores. We are investing in marketing. We are investing in the new digital space. We are investing in new categories – footwear, outerwear and home appliances. We feel satisfied with the energy the company has at this point.
“The crisis is really an opportunity for all of us to rethink our lives, what we aspire to and what we dream of. We often talk about our business not being a fashion business. We want to say that we are indeed in the business of our dreams. As consumers rethink what life looks like and what it means to them, I think we’re particularly relevant at this time based on what we can offer people. consumption worldwide. ”
Louvet said: Being a company with “legacy, innovation, resources to stay motivated” and “quite unique relevance at this moment” has helped Lauren navigate the pandemic.
The company bounced back in its second fiscal quarter. ended September 25. Profit came in at $193.3 million, up from a loss of $39.1 million a year before the pandemic kept shoppers close to home. Revenue for the quarter rose 26% to $1.5 billion from $1.2 billion. The top growth was supported by efforts to improve location and increase prices where the average retail unit price increased 14%.
The company has over 50 years of history, all driven by Ralph’s vision, says Louvet. “It is driven by a very clear purpose and a very clear set of values. That has served as a cornerstone for us in times of health crisis and also the North Star that helps us know what to focus on and what to prioritize.
“We all know legacy itself is not enough, and as we have reflected for almost 24 months [of the pandemic] it’s really innovating in the way we interact with consumers, innovating in products, innovating when it goes to market, and constantly re-imagining. The reason this brand has lasted so long is because this muscle has been built over time, the ability to re-imagine, regenerate and renew. ”
Omicron, he said, “has had no physical impact on our business.”
He also said Ralph Lauren is ready to meet the supply chain difficulties caused by COVID-19 and increased consumer demand as it has diversified its supply chain, from depending on into a number of markets to more widely sourcing through Latin America, Europe and Asia, with “Dual sourcing, fallback options and the ability to move production from market A to market B field very quickly.”
Additionally, the company has built “strategic supplier partnerships with a limited number of suppliers,” says Louvet. “We don’t just operate one-year long-term relationships. Instead of a supplier-customer relationship, it is a partnership with shared agendas.”
When asked about inflation, the CEO replied: “We have demonstrated pricing strength for about 19 consecutive quarters with average retail unit gains. It means that the branding strategy is working and consumers are responding to it.
“Transient inflation is driven more by logistical challenges and access to raw materials that will resolve over time because of this massive pent-up demand. There are also long-term [inflationary] pressures related to wage increases. We’ll see which of the two extremes has the biggest impact, but we’re certainly prepared for an environment that will be inflationary through both the pricing power we’ve demonstrated over the past four years. through and through the supply chain capabilities we’ve built. The world drives efficiency… We have a wide range of consumer brands. We have about 50 million people around the world.” The company’s consumer base segments are affected by inflation, he said.
Discussing the metaverse, Louvet said, “We believe in the opportunities around this new digital world and the metaverse. I would mislead you if I told you exactly where all of this would land. But there are a few things that impressed us. One is that there is growing interest from consumers. One of our strategies is to get a new generation and a new generation there. So we have to be there.
“There are similarities between the metaverse and Ralph’s vision, because we are not a fashion company. We are in the dream business. Ralph created different worlds. You can be shown in Colorado. You can be shown in Montauk. We think there is great consistency between our philosophy and what the metaverse has to offer.”
He said the company has yet to offer NFT, although “we have a lot of conversations about how to do it well in a way that is related to what is important to us and how we are going to project it.” and how we want to interact with consumers. We don’t just want to follow the trend. We want to do it in a way that makes sense and is aligned with our strategy and branding. ”
Looking ahead, “I continue to be optimistic about the consumer position. I know continue to be booked and called here and there. We’ll see omnichannel becoming more and more central to how companies need to operate, and frankly, the historical holes are gone. You will see an increasing focus on citizenship and sustainability for consumers, across the board. “
Regarding the big changes for consumers, Louvet said there is comfort with digital platforms and a desire to take advantage of all aspects of an omnichannel setup, and that consumers are reacting to how Ralph Lauren and other companies have pivoted messaging toward more targeted communication. “We focus on the product and focus more on optimism and family. It’s exciting to see consumers respond to that, says Louvet.
He also cited his company’s efforts to “play an industry leadership role in sustainability,” and it debuted at the Australian Open a recycled cotton polo shirt, called the Clarus, engineered for performance with breathability and durability properties.
Louvet also mentioned a partnership with Dow, called “Color on Demand,” which he describes as a new way to color products that dramatically reduces water use. Ralph Lauren is also part of the Fashion Compact, an industry organization that identifies areas to work together to reduce environmental impact.
The conversation closed with some brief remarks about the man Ralph Lauren. “My relationship with Ralph is great. We spent a lot of time before we both signed the dotted line at the end of the contract getting to know each other five years ago, making sure we had a common vision.”
He said Ralph tried to hire him seven or eight years earlier when the company was looking for a head of international business, but he committed to running Gillette. But when former Ralph Lauren vice president Roger Farah retired and other leadership changes occurred at the company, Louvet was approached again for the top job and was accepted.
With Ralph Lauren himself, “It was a great collaboration,” says Louvet. “He is still involved. He’s still completely attached.”
https://wwd.com/business-news/markets/ralph-lauren-patrice-louvet-nrf-1235036649/ Ralph Lauren’s Patrice Louvet on Elevating the Brand, Stores and Disruption – WWD