On Monday morning at NRF 2022: Retail’s Big Show, Patrice Louvet, president and CEO of Ralph Lauren, discussed his company’s progress, concerns and aspirations with Sara Eisen, co-anchor of CNBC’s “Closing Bell.”
Eisen began the keynote session by noting that some companies had taken advantage of the pandemic to reset their businesses in a big way. Ralph Lauren is one of those companies, and Eisen asked Louvet to discuss what the company has done and where it is now.
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There are several important points to keep in mind, Louvet said. One is that Ralph Lauren has been in business for more than 50 years. “The company has been driven by a clear set of principles that have served us both as a foundation and also a North Star that helps us remember what to focus our attention on, what to prioritize and what isn’t so important,” he said.
Ralph Lauren feels like it is in a position of strength. “We have the resources to invest in our momentum. We are opening stores throughout the world,” he said. “Counting boutiques and flagships, we have opened 80 over the past year.”
One of Ralph Lauren’s primary objectives is brand elevation. “We have the desire to be a leading luxury lifestyle company,” he said. “We know we have to further elevate the way the brand is perceived. More and more, we’re selling more cashmere sweaters and fewer T-shirts.”
This is aided, he said, by a current boom in occasion wear. “If you’re looking for a tuxedo or an evening gown, it’s going to be a bit of a struggle, because they’re selling in huge amounts.”
Brand elevation is evident, he noted, not only in Ralph Lauren products but in the stores themselves. “Ralph Lauren stores we’ve opened in Beijing, in Shanghai and recently in Milan are a very elevated experience,” he said, “certainly more than they were even four years ago.”
We still live in a world of stores, he added. For all the talk of a total ecommerce future in the early days of the pandemic, people went back to stores as soon as they could. “We live in an omnichannel world,” he said. “We need to be wherever the customer expects us to be, and we need to be there in a way that supports the brand.”
“Do you believe in department stores as partners in your strategy?” Eisen asked.
Yes, Louvet said, if it’s the right kind of department store. “We want it to be seen that when we show up, it’s part of the brand elevation,” he said.
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“We also believe in the metaverse,” he said, adding that he has already dressed his avatar. The metaverse is a new revenue source, in which Ralph Lauren has already sold 100,000 units. “You wouldn’t want your avatar to be running around naked,” he said.
As the session ended, Louvet noted a few things that have helped Ralph Lauren execute its current strategy. A few years ago, he said, the company put in a significant effort to diversify its supply chain. Rather than being tied to a specific factory — or even region — it can now move production from market A to market B very rapidly.
The company is also building long-term relationships with its suppliers. Rather than a supplier/client relationship, he said, it’s much more of a partnership.
Finally, Louvet and his team have increasingly been focused on sustainability, an area in which the fashion industry does not have a great reputation. “Consumer interest in sustainability has dramatically increased, and this is an area in which we want to play a leadership role,” he said.
“This company was founded on the concept of timelessness. It’s core to what we are, and sustainability is about timelessness. I greatly fear that in five or 10 years from now, companies that do not put this on their agenda will have a serious problem with their consumers, their employees and their partners.”