#288 Ralph Lauren

In this episode, the host delves into the life and career of iconic American fashion designer Ralph Lauren, based on Jeffrey A. Trachenberg's biography "Ralph Lauren: The Man Behind the Mystique." Ralph Lauren's rise from a tie salesman to one of the richest self-made men in the United States is a testament to his unwavering commitment to his vision and distinctive style. Despite early challenges, including near-bankruptcy due to rapid growth and manufacturing inefficiencies, Lauren's pivot from manufacturing to licensing propelled his business to remarkable success. His story is not just about building a fashion empire but also about the relentless pursuit of an image and lifestyle that he meticulously crafted and sold to the world. Lauren's journey showcases his intense ambition, self-confidence, and the loneliness that accompanies maintaining such success, with the host reflecting on Lauren's unique approach to business, his refusal to compromise on his brand, and the personal cost of his achievements.

• Ralph Lauren built a highly successful apparel company in the United States.
• He emphasizes authenticity, stating "what you see is what you get."
• Lauren rejects being categorized with other designers, valuing uniqueness in his business.
• His approach is not about following trends but about providing well-made, timeless clothing.

"Don't put me with those designers. My business is not compared to anybody else's."

The quote demonstrates Lauren's insistence on separating his brand from others, highlighting the importance he places on individuality and the unique positioning of his business.

• Ralph Lauren is private about his personal life, rarely appearing at society events, due to shyness rather than modesty.
• He is described as a tough, ambitious businessman with immense self-confidence.
• Lauren's self-confidence is considered as valuable as his sense of color, fabric, and style.
• He owns multiple luxury homes and a collection of antique cars, symbolizing his wealth and success.

"Ralph Lauren is a tough, intensely ambitious businessman who thinks his work has never received the recognition it deserves."

This quote highlights Lauren's drive and the belief that his contributions to fashion have been undervalued, reflecting his ambition and self-assured nature.

• Lauren's success is attributed to his willingness to break rules and do things his way.
• He has been critical of how retailers displayed his clothes, leading him to take matters into his own hands.
• The narrative of Ralph Lauren's life includes his journey from modest beginnings to becoming one of the richest self-made men in the U.S.

"Finally, he decided he was going to do it himself."

Lauren's decision to take control of how his clothes were presented reflects his proactive approach to his business and his commitment to his brand's image.

• Ralph Lauren started his career selling ties, similar to how Coco Chanel began with hats.
• Lauren's insistence on brand integrity led him to reject a major deal with Bloomingdale's that required him to forgo his brand name.
• His early life was marked by financial struggle, which fueled his determination to succeed.

"Take off your brand name, put on our house brand, and you got a deal."

Lauren's refusal to remove his brand name in favor of Bloomingdale's house brand is indicative of his strong commitment to building his own brand identity.

• Licensing agreements, where Ralph Lauren received 5 to 7% of sales, were crucial to his financial success.
• The shift from manufacturing to licensing was a strategic move that saved the company from bankruptcy.

"However, he would have never qualified as one of the world's richest men without licensees willing to pay him five to 7% of sales."

This quote explains how licensing agreements significantly contributed to Lauren's wealth, underscoring the financial impact of this business model.

• Lauren's father was an artist who instilled in him an appreciation for aesthetics.
• Ralph Lauren grew up in a modest environment, which motivated him to achieve wealth and success.
• He was inspired by the lifestyle and fashion he saw in movies from the 1930s and 1940s.

"Ralph didn't fantasize about becoming a fashion designer. He became a designer to fulfill his fantasies."

The quote encapsulates Lauren's passion for transforming his visions into reality, which led him to fashion design as a means to express and realize his personal style and fantasies.

• Lauren's first job at Brooks Brothers provided him with valuable insights into selling to the upper-middle class.
• His enthusiasm and energy compensated for his lack of experience, demonstrating the importance of passion in his work.

"Nobody was as interested in style as Ralph. He would talk about clothes the way others talked about plays and books."

Lauren's passion for style is highlighted, showing that his intense interest in fashion was a driving force behind his career.

• Lauren's vision for his future was clear from a young age, with his high school yearbook stating his aspiration to be a millionaire.
• He consistently believed in his ideas, even when others did not understand them.
• Lauren's resourcefulness in combining thrifted items into unique looks foreshadowed his design philosophy.

"Ralph didn't put a profession beneath his picture. Instead, he chose the single word that best summed up everything he wanted in life. The word was millionaire."

This quote reflects Lauren's ambition and the clarity of his goals from an early stage in his life, setting the foundation for his future success.

• Ralph Lauren's unique style and differentiation in his early career at Rivets.
• Co-workers and industry professionals doubted Ralph's vision, particularly Mel Creedman.
• Differentiation led to early recognition, with a full-page newspaper write-up about Ralph's wardrobe.
• Ralph's persistence to design ties despite Mel's resistance.
• Ralph's desire to choose colors and his relentless pressure to innovate.
• The death of Abe Rivets, the company's supportive founder, coincided with Ralph's wedding.
• Ralph's struggle against Mel's vision of the company and the neckwear industry.

"Ralph was so differentiated that he got written up in trade papers before he was Ralph Lauren." This quote highlights the impact of Ralph's unique style and how it garnered attention even before he established his own brand.

"Ralph was different, says Mel, if everybody was clean shaven, Ralph wore a beard when the industry was selling skinny ties, Ralph had to wear a wide one." This quote exemplifies Ralph's willingness to go against the grain and his early interest in wide ties, which would later become a signature product.

"Mediocrity is always invisible until passion shows up and exposes it." The quote underscores the contrast between Ralph's passion and Mel's lack of vision, and how true passion can challenge and reveal mediocrity.

• Ralph Lauren's passion for clothing details and design contrasted with Mel's focus on traditional sales.
• Ralph's determination to push through barriers and his strategy to achieve his goals.
• The importance of self-confidence in the face of opposition.
• Ralph's understanding of the need to sell not just a product, but a vision and commitment.
• The emphasis on selling plans of action and the entrepreneurial need to sell to various stakeholders.

"Ralph could spend hours talking about the location and dimension of belt loops on trousers or the size of pocket flaps." This quote illustrates Ralph's deep interest in the minutiae of fashion design, which was not understood or appreciated by his then employer.

"Mediocrity is always invisible until passion shows up and exposes it." This quote reiterates the theme of passion exposing mediocrity, with Ralph's enthusiasm and ideas challenging the status quo at Rivets.

• Ralph Lauren's transition from working at Rivets to starting his own company.
• The origin of the Polo brand name and its connotations of luxury and exclusivity.
• Ralph's approach to creating a high-end, distinctive product line.
• The challenge of balancing the need for exposure with maintaining brand integrity.
• The importance of difference and control in building a brand, as exemplified by Ralph Lauren and Akio Morita of Sony.

"Ralph was over the top. Wide ties. Wide ties looked absurd. A man might as well wear a bib to work." This quote captures the skepticism Mel had towards Ralph's ideas, particularly the concept of wide ties, which were seen as ridiculous at the time.

"Ralph thought Polo was a terrific name." This quote reveals the strategic choice behind the Polo brand name, aligning with the luxury and style Ralph wanted his products to represent.

"Difference for the sake of it in everything, because it must be better from the moment the idea strikes to the running of the business." This quote, while referencing James Dyson, aligns with Ralph Lauren's philosophy of creating a distinct and superior product.

• Ralph Lauren's refusal to compromise on his vision for the sake of immediate success.
• The parallels between Ralph Lauren and Akio Morita in their commitment to brand identity.
• The strategic use of exposure and the role of influential supporters in growing the brand.
• Ralph's early use of cold outreach to gain support and recognition in the fashion industry.

"Ralph said no. The way he saw it, if he narrowed his ties and took off his label, he wouldn't stand for anything." This quote highlights Ralph's commitment to his brand's identity and his refusal to dilute his vision for short-term gains.

"50 years from now, I promise you that our name will be just as famous as your company name is today." Although referring to Akio Morita and Sony, this quote parallels Ralph's determination to build a lasting and renowned brand.

"Playboy would become the first national magazine to feature Ralph's ties." This quote demonstrates the significance of gaining influential supporters and the impact it had on Ralph's burgeoning brand.

• Ralph Lauren's entry into Bloomingdale's marked a significant milestone in his career.
• His insistence on maintaining brand exclusivity and high quality was central to his strategy.
• Lauren's intransigence, or refusal to change his views, played a crucial role in his early success.
• Despite financial challenges, Lauren was committed to building a lifestyle brand beyond just ties.
• Lauren's approach to business involved creating products he liked and assumed others would too.
• His strategy was not a master plan but a natural progression based on customer demand.

"Ralph finally got into Bloomingdale's, and then once he's in, there's this line that's just fantastic." "His intransigence at the time, where no one really knows who, you know, a small amount of people do know who he is. It's like he's still intransigent."

The quote highlights Ralph Lauren's breakthrough in getting his products into Bloomingdale's and his steadfastness in his business approach, even when he was not widely known.

"It was one thing to like Ralph Lauren. Understanding him was something else."

This quote reflects the complexity of Ralph Lauren's vision and business tactics, which may not have been immediately apparent to others.

• Lauren's partnership with Norman Hilton provided the necessary financial backing to expand his product line.
• The decision to allow Lauren to take the company name underscores his importance to the brand's identity.
• Lauren's transition from tie maker to menswear designer marked a significant expansion of his brand.
• His choice to avoid traditional industry practices, like setting up shop alongside competitors, set his brand apart.

"So he's going to leave Hilton later as well. But he has to link up with Hilton because Hilton's got the money needed to start creating things other than the ties."

The quote explains the strategic partnership with Hilton, which was instrumental in enabling Lauren to diversify his product offerings.

"I let Ralph take the name for two reasons. First, it was his idea. Second, we didn't think we could move forward without him."

This quote from Brower highlights the recognition of Lauren's integral role in the brand and the decision to let him take the company name.

• Lauren's insistence on creating a distinct shopping experience led to the concept of a store within a store.
• He pioneered lifestyle marketing, assuming customers had varied clothing needs for different settings.
• Lauren's refusal to conform to industry norms, such as grouping his clothes with other brands, helped establish Polo as a unique brand.

"Polo stood for something special, something unique."

This quote encapsulates Lauren's vision for the Polo brand as something beyond just clothing, but as a representation of a particular lifestyle.

"Ralph told Frank he was selling an image, a way of life, and he didn't have the money to advertise, which meant he could only tell his story through his own store."

Lauren's quote to Frank Simon at Bloomingdale's illustrates his dedication to storytelling through retail experience, emphasizing the importance of a branded store.

• Rapid growth led to financial strain for Lauren's company, with manufacturing challenges and lack of cost controls.
• Hiring a financial partner, Michael Bernstein, was necessary to manage the company's finances.
• The company's near-insolvency led to a reevaluation of manufacturing and a move towards licensing.
• Lauren's personal investment and commitment to the company were evident as he faced the possibility of bankruptcy.

"Embarrassing as it was, Polo could not afford to pay Ralph any money. Instead, he had to step up to the table."

This quote demonstrates the dire financial situation of Polo, requiring Ralph Lauren to personally contribute financially to keep the company afloat.

"Buying Norman Hilton's stock... Was a catastrophe because it wiped out Polo's net worth."

The decision to buy out Hilton's stock is described as a catastrophic financial move that severely impacted the company's net worth, illustrating the risks involved in business management decisions.

• Lauren's public image contrasted with the internal financial struggles of his company.
• Industry peers and the public questioned the stability of Polo due to its rapid rise and apparent challenges.
• The fear and uncertainty within the company and among its partners were palpable as Lauren navigated the company through difficult times.

"There was fear in the showroom. There was fear in the factories."

The quote captures the atmosphere of anxiety that permeated Polo during its financial struggles, affecting all levels of the company.

"Now Ralph Lauren was getting hit."

This statement reflects the schadenfreude some felt as Ralph Lauren, who had risen rapidly in the fashion industry, faced significant business challenges.

• Business relationships are often thought of as familial, but they are more accurately described as team-based.
• Loyalty can be fleeting in business, especially during financial crises.
• High-profile examples include Ralph Lauren's experience and the exodus from Amazon during its stock price drop.

"See, this is why it's weird where companies like, oh, we're a family. No, we're not family. We're a team. Because what's about to happen here is people, first of all, he considered family. He had a fire, including his brother, but his partner, Bernstein."

This quote emphasizes that business relationships are not familial and that tough decisions, such as firing close associates, are sometimes necessary for the survival of a business.

• Charlie Munger's quote, "Wisdom is prevention," suggests that being smart means avoiding problems, not just solving them.
• It's important to prepare for the possibility of losing support from those believed to be loyal.

"Wisdom is prevention. I really like that line. It's like, okay, if you're really smart, you should avoid the problems, not just have to solve the problems when they pop up."

The quote highlights the importance of foresight and preventive measures in business, rather than solely relying on reactive problem-solving.

• Employee resignations can feel like personal betrayals to business owners.
• Ralph Lauren's experience with Sal Cesare's departure is an example of the personal toll business challenges can take.

"To Ralph, each resignation was a personal rebuke. It was Sal's departure, though, that hurt most of all."

This quote illustrates the emotional impact that employee resignations can have on a business owner, particularly when those employees are close associates.

• Cash flow is critical in business; without it, even the most reputable companies can face credit issues.
• Warren Buffett emphasizes the importance of cash reserves for unforeseen events.

"When bills come due, only cash is legal tender. Do not leave home without it."

The quote underlines the essential role of cash in meeting financial obligations, especially during times of crisis.

• Polo Fashions' survival depended on a shift from manufacturing to licensing.
• Cost management is vital for a business's success.
• Ralph Lauren's turnaround strategy involved licensing, capital investment, debt deferral, and renegotiation of repayment terms.

"Dave Goldberg insisted polo fashions had to do four things to survive."

This quote outlines the strategic steps that Polo Fashions needed to take in order to recover from financial difficulties and avoid bankruptcy.

• Efficiency can be more important than brilliance in business.
• Sam Walton's philosophy suggests that an efficient operation can recover from mistakes, while inefficiency can lead to failure despite brilliance.

"You can make a lot of different mistakes and still recover if you run an efficient operation, or you can be brilliant and still go out of business if you're too inefficient."

The quote from Sam Walton conveys the idea that operational efficiency is crucial for a business's longevity and can compensate for other errors.

• Ralph Lauren's success is attributed to his unwavering focus on his vision.
• Even after facing challenges, he did not consider quitting, which is a testament to his dedication.

"The thing that set Ralph apart was his single-mindedness of purpose."

This quote reflects on Ralph Lauren's determination and consistency, which were key to his success in the fashion industry.

• Licensing can be a significant source of income for designers, often surpassing earnings from their own collections.
• Historical examples include Bill Blass and Pierre Cardin, who made fortunes through licensing agreements.

"Licensing would explain how the designers amassed such large fortunes so quickly."

The quote explains how licensing deals can rapidly increase a designer's wealth, demonstrating the financial power of licensing in the fashion industry.

• Success in business can lead to loneliness and a lack of fulfillment.
• Ralph Lauren's continual drive is not motivated by money but by a desire to maintain his status and the fear of losing it.

"I don't want to tell you it's lonely, but it isn't completely fulfilling."

This quote reveals the emotional cost of success and the internal struggles that successful business figures like Ralph Lauren may experience.