By his own admission, Alex Bolen "never meant to become a garmento." Before his father-in-law, the late Oscar de la Renta, appointed him CEO of his namesake company in the summer of 2004, Bolen had spent 14 years on Wall Street. "It was a big surprise."
In the United States, de la Renta's name was as famous then as it is now, but the business has changed dramatically. Ahead of the house's fall show, we spoke with Bolen by phone about the company's transformation over the past 11-and-a-half years, why he's not obsessed with chasing younger customers and what it's like to work with de la Renta's creative successor, Peter Copping, who will be celebrating his one-year anniversary on the Oscar runway this Tuesday.
You became CEO of Oscar de la Renta in July 2004, when you were just 36, and the company was a $650-million business with no stores and quite a number of licenses. Where is the company now compared to then?
The business has really been dramatically reoriented. In 2004, our business was organized in a kind of designer 1990s licensing model, where the high-end runway product was not the driver of the business, but was very much a promotional tool to drive a lot of very lucrative licenses. Those licenses were not approached in a highly thoughtful way, other than how much income was generated by them. And it was, for Oscar, a great business model. But it's not a business model that in our estimation would stand the test of time — let's not forget that in the '90s there were many, many department stores in the U.S., and now there's only one left, and that's Macy's. So we had to reorient things. We decided we would focus more on the high-end women's ready-to-wear product, and make that the core of our business. We have built a series of retail stores around the world, and expanded our geographic footprint both through retail and wholesale. In 2004, somewhere between 96 and 100 percent of our business was U.S.-oriented, despite the fact that Oscar's name was known around the world. That seemed to me an opportunity, and it has been. Our business today is roughly 60/40 North America to the rest of the world. In 2004 our revenue was 100 percent wholesale, 0 percent retail, and now it's about 50/50.
For most brands, leather goods and accessories are where the money's at. But that's not the case for Oscar — you've said before the company's staple is $4,000 cocktail dresses. Is that a model you're trying to change?
It's not as if we haven't tried in accessories, but there was more authenticity, more brand logic to pursuing women's ready-to-wear. That's what Oscar did, that's what Oscar loved, what our brand was about — making beautiful dresses for day, evening, long, short. We do still aspire to having a robust accessories business — shoes, bags, those are works in progress. We'll get there.
What is currently driving company growth?
I would say our expansion internationally, and to a lesser degree our expansion in the U.S. The U.S. business is a very mature business, but it continues to grow. There's more we could do, but that is going to require a $50-$100 million solid sales increase to really move the needle. That's going to come from an accessories offering. I think in other parts of the world, notably Europe, the Middle East and Asia, there's a lot more we can do with the product as it exists today. Places like Japan, where we have typically not had business, are now generating important business. And they really love what [Creative Director] Peter [Copping]'s doing. In the very near term, the next year or two, much of our growth is going to come from continued penetration of international markets.
What are the advantages and disadvantages of being an independent, family-run luxury business vs. being part of a big conglomerate like, say, Kering?
It's difficult for me to speak intelligently on what it's like to be part of a big conglomerate, because I don't really know. I can tell you what I perceive. I am envious of their ability to retain talent, because they have many brands under their umbrella, and when somebody is talented and is unsatisfied at Brand A, they can offer them an opportunity to work at Brand B, and I can't do that. I think that so much of our business is about recruiting talented people; certainly I spend a lot of my time on matters of talent. Without great people, we won't have a great business, it's as simple as that. We have some advantages in regards to talent in a certain way. We are a family business, and we are very non-bureaucratic. I, we, our family want to hire people who are outstanding at their jobs and let them do their jobs. If you would like to run your own show, that is something we can organize here. It requires the right sort of person, and somebody who is very self-motivated, but when we find those people this environment appeals to them.
For a luxury fashion brand, you were incredibly progressive in your embrace of live-streaming and social media, particularly Twitter and Tumblr. How has that investment played out for you?
In our business, it's important to embrace innovation. We try to figure out what is innovative in our industry — whether it's technology, 3-D printing, distribution, commerce or communication — and try to figure out if we can be an early adopter of those things. One other advantage of being a medium-sized business, or independent company, is that we can move more quickly. It's a way we can compete with some of our larger peers. I would say that with regards to social media in particular, that reflected a lot of [former SVP of Communications] Erika [Bearman]'s enthusiasm for that project. We still want to do that, I think it's a great way to communicate with new customers.
Our industry is obsessed with the pursuit of younger customers. I'm not sure we are so obsessed. We are obsessed with new customers, we are obsessed with more people understanding what our brand is about, but I don't know if that's necessarily young. Oscar used to say, I don't make clothes for children, and I would say we do make clothes for children, and he would say that's not the point. The fabrics we use, the way we cut, the techniques, there is a certain sophistication — a customer has to have tried other things to understand why we charge the prices we charge. It's not because we make off-the-charts margins, but look, we put a lot of work into what we do, to understand that comes with understanding of [clothes]. Does that really suit a young customer? I'm not so sure. Every day, a whole new group of people turn 35 — we want to talk to them more often. They have a lifestyle that lends itself to dressing the way that we build a collection of clothes. We don't want to be thought of as their mom's, or grand mom's brand, but I'm not sure we're designing with 20-somethings first and foremost in mind. We hope they're fans, hoping they're thinking when their life and budget allow, they'll wear Oscar.
In what other ways has technology changed the business, or the way things are done?
There's so many examples. We are now developing prototypes in our jewelry business using 3-D printers. Fabrics that used to need to be done by hand in Italy, we can now work with laser printing. Likewise in the sample room, pattern-grading can now be done on a computer. There's a billion things where small innovations create big changes in our production process. In our stores, the ability to have a global inventory system, so that if someone in [our] Madison Avenue [location] is looking to buy a blue dress that's not there, in a second we can find where it is in the world and how we get it to her.
Who is the Oscar de la Renta customer today?
The Oscar de la Renta customer is a woman who appreciates well-made, feminine product, who is very dressed up at all times in her life, day and evening, wants to look great, wants to feel great. Oscar always said that it was his job to help women lead easier lives, to solve their problems, to help them feel great. That is what we're trying to do with our product.
Has the Oscar customer changed since Peter Copping joined the company?
I think that Peter joined our company with his own loyal following, and so he's brought those into the mix. I think some of our business partners in Asia love Peter's aesthetic; at the same time, Peter's very much on board with the general mission of well-made, sophisticated, feminine product for women who like to dress up.
What is your working relationship like with Peter? I never got to see you work directly with Oscar, but I read that you two were quite jokey and you were often jumping in to make design suggestions.
Oscar and I had a bit of an ongoing comedy show, and I think that with Peter, we have a fantastic working relationship — we talk daily, we go over general things, what's happening with our lives in New York City. It is of course a bit different than with Oscar and me because Oscar was [my wife] Eliza's stepfather.
Can you talk to me a little bit about your red carpet strategy. Why is that important to you, how much do you invest in it?
I think that what we strive for is to really develop a relationship between the designer — Oscar in the past, Peter today — and the person they are dressing. I think that Oscar always tried to understand the customer. Whether it was a customer for the red carpet or the customer on a Tuesday buying a skirt on Madison Avenue, he really wanted to solve a problem, to see what she needed. When we can do that as Oscar did with Sarah Jessica Parker, that can be a great thing. I think that when it becomes transactional in nature, I'm not sure what the point is.
Luxury likes to talk about exclusivity, but that's never been the Oscar de la Renta approach. How come?
I object to the word exclusive, because on some level it means to exclude. We want to include as many people who are fans of our aesthetic. For example, our fashion jewelry business, we offer earrings for $200, we offer rings in some cases for under $100. So perhaps in the grand scheme of rings available in the world, at $100, it's still expensive, but that's a really low price point relative to the product line. It's not a dumbed down product, it's not cheap or poorly made, it's an Oscar de la Renta piece we can do for $100. [The key is to find] ways to include more people that are authentic and appropriate to our brand.
What kind of environment do you want your stores to have?
I'm not a customer for our product, but I find that shopping, whatever it's for, can be intimidating and we don't want to do that. Our price tags can be intimidating enough, I don't think we need to add to that a staff that is not welcoming, that is not ready to explain, that is not ready to help. We do charge a lot for what we do, it costs a lot to make what we do. I hope we can take the opportunity to explain what it's all about, and hopefully make them fans of our brand when they're in our stores.
In your first interview as CEO you said you were considering menswear. Is that still something you think about doing, now that Peter Copping is on board?
I think about it a lot. I think that Peter also thinks about menswear a lot. We have some business plans that we are working on. After Oscar passed away, I read some list that he was the seventh most elegant man in the world. I thought, I'm going to jump out of a window if we don't find a way to bring this to our business. Menswear happens to be an important category right now — I think that men are spending more.
Are there any other categories you're considering?
Sleepwear and intimate apparel are other areas where our brand's aesthetic could make some sense. I look at things a company like Spanx is doing. We could bring a more elevated approach to shapewear in our own product line. But if we don't figure out the right way to do them we won't do them.
What's one of your primary goals for this year, or the next five years?
In 2015 we had a lot going on in the world that created cross-currents in our business. The fluctuations of currency are a major driver. The stronger dollar meant that European tourists that came to the U.S. didn't shop this year. We have two factories in Italy and two factories here in the U.S., so those currency costs affect how and where we do production. The impact of oil prices is hard to underestimate in terms of customer psychology... some of our customers make a living from oil, so when oil prices fall, they have less disposable income. What we have seen, historically, is that when you can find an opportunity where the short term is difficult, but medium and long term you're fairly confident [in your success], you should march ahead. For example I'm trying hard to make a store in Paris right now. I think the retail economics of Paris are challenging, and a lot of people are negative on Paris right now. I'm not. If you don't think Paris is going to remain an important world fashion capital, you should be in a different business. I think we need to take advantage of others standing still. Also, China. Historically we've not had much business there, but this is a good time for us to march ahead.
This interview has been edited and condensed.