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I Am American Business

Tory Burch

Producer Notes

Photo: Neiman Marcus

In only 4 years, Tory Burch has created an amazingly successful fashion brand. The LA Times recently called her "the most influential fashion designer in America." She combines a flair for color and cut, with a remarkable head for business. We shot at her Chelsea offices, which were decorated in a vibrant shade of Tory Burch orange, and at her glittering and plush store in Manhattan's Soho neighborhood. In person, she comes across as very focused and serious. And she has clearly thought about her message to women. Tory Burch believes that women should embrace ambition, and that it is possible for women to juggle family and business responsibilities successfully. The press seems to enjoy portraying her as a party-going "socialite", (and all the press coverage certainly helps the brand) but Tory Burch is no lightweight and she has the bottom line to prove it.

Video Interview

A Brand Is...
That Day Was Amazing
It Changed Our Business Overnight
No Advertising
I Don't Want to Over-Distribute

The "I Am" Q&A

What kind of car do you drive?
I drive an Escalade.

What’s your favorite place to go?
Southampton.

What website do you like to visit?
Style.com.

What was your worst moment in business?
I’ve had many. When our clothing was held up in customs for four months.

What’s your favorite drink?
A Virgin Mary.

What’s your favorite food?
French fries.

What’s your idea of fun?
Hanging out with my boys.

And at work?
Really designing, working in my design teams.

That personal weaknesses do you forgive in someone?
I'm very forgiving so I forgive most things, really. I forgive everything, if they mean it.

What movie star do you like?
Cate Blanchett.

Who’s a business hero of yours?
There’s so many. Steve Jobs.

What personal qualities do you admire in business?
Ethics, morals, and honesty.

Are you doing anything for the environment?
Just looking at our factories and the way we do our dyes, and the way we produce things, and looking into different fibers as well.

What was your greatest moment in business?
This company, I mean really just everything about this company.

What is your dream?
To start a foundation.

Do you have a motto?
Be true to who you are and treat all people well.

And what is your present state of mind?
Very happy.

Transcript

CNBC:
What helped your business grow so quickly?

TORY BURCH:
Well, Oprah actually did a show on our company and it was, “The Next Big Thing,” and she picked us for fashion and it was our first year in business and we were fairly unknown, and then the next day we had eight million hits on our website.

CNBC:
Eight million. Was your website equipped to handle that?

TORY BURCH:
We were told we needed to back it up, so it worked and it just changed our business overnight.

CNBC:
How did you get on Oprah?

TORY BURCH:
Someone had given her a piece of our clothing for Christmas and she started wearing it, and it was just something like that, one of her producers.

CNBC:
Oprah reaches a very mass-market audience. Did you want to reach Oprah’s audience as well as a high-end New York audience?

TORY BURCH:
Well, I mean hopefully that’s what the goal from the onset was. I wanted to start a company that was a designer luxury brand that was accessible. I love fashion. I love designer clothing, but I was tired of spending that price point, so I really wanted to focus on finding things that were beautiful and detailed with incredible fits and great fabrics, but well priced.

CNBC:
How did you find that price range?

TORY BURCH:
I knew a general area of where I wanted to be, and I looked at the markets very carefully. I looked at what contemporary was, and I looked at what bridge was, which wasn’t a very attractive name at the time and so I wanted to forge our own way and go somewhere in between.

CNBC:
Can you explain what contemporary and bridge are and where you fit in?

TORY BURCH:
Contemporary and bridge are just labels that people put on different segments of the market. Certain designers fit into contemporary, and it’s a younger designer. It’s a certain price point. Bridge is a little more expensive, a little more traditional, and I think that the customer and the retailers were getting tired of that. I think they were all looking for something new.

CNBC:
Do you think the labels don’t apply anymore?

TORY BURCH:
I think they apply to a certain extent and I think bridge is becoming obsolete. What we’re doing is hopefully forging a way for what they’re calling, “new luxury,” which is a little bit more sophisticated, and a little less pricey than a designer collection. The old labels still apply, but I think they’re changing. We’re doing something entirely different from what’s out there.

CNBC:
Do you think that’s because the consumers have changed, or the market’s changed?

TORY BURCH:
I think everything has changed. The market’s changed and the economy is changing. I think that there are so many different factors that are taking play, and I think for the positioning of our brand, it’s a good place to be.

CNBC:
You came out of PR. What did you learn in PR and marketing that helped you target this market?

TORY BURCH:
Well, I’ve had great experiences working with designers. Particularly Ralph Lauren, I think it was a huge inspiration and I learned a lot in PR and marketing there and just about branding and I think that’s something from the onset that I was very interested in.

CNBC:
What makes a brand?

TORY BURCH:
I think a brand is all encompassing and it’s everything from the initial hangtag, to the logo, to the packaging, to obviously, the product. And I think it’s a cohesiveness that is what’s making our brand work. With the Tory Burch brand, there are certain things that are becoming iconic. Definitely color. I think orange is one color in specific. Prints, our price point, our ballet flat, our tunic; we have several silhouettes that we’re becoming known for, but also, our new tote bag. So it’s evolving.

CNBC:
Were you looking for iconic themes when you launched the company?

TORY BURCH:
I wasn’t looking for iconic themes. I was looking at a business within businesses. Like cashmere was interesting to me and different silhouettes were interesting. I was looking at designing pieces that I wanted to wear myself, and that were missing, in my opinion, in the market.

CNBC:
What about color? How important is that to identifying a brand?

TORY BURCH:
I think color is crucial in identifying a brand, particularly our brand. I think that women love color. I think it makes you feel happy when you wear it. I think for me, I like doing unusual mixes of color. So for us, it’s a tremendously important part of our business.

CNBC:
And you haven’t done any advertising? Can you tell us about that?

TORY BURCH:
We’ve done no advertising as of yet, and hopefully won't for a while, but we do it in our own way. Obviously, editorial is very important for us, and getting our clothing on celebrities also helps a tremendous amount, but as far as traditional advertising, we’re not there yet.

CNBC:
Why not?

TORY BURCH:
Well, one, we can’t afford it. We’re a very new company and at some point we’ll be able to afford it, but I just want to do that in a very careful, thought out way.

CNBC:
But do you think it was your PR background that enabled you to get this kind of exposure?

TORY BURCH:
I think my PR background definitely helped and I think that working in this industry, we all grew up together. The people that I'm working with have been incredibly supportive and the magazines have really supported our brand. I think that’s added to where we are today. We were all assistants together. We all grew up together, and now we’re each doing our own thing and helping each other. At some point, I will want to advertise. I can envision what the advertisements will look like, and I can’t wait to do that. But for now, it’s all about timing.

CNBC:
You’ve grown pretty fast. Can you talk a little about the evolution of the company and how it’s grown?

TORY BURCH:
We’ve been in business for four years and we’ve had a tremendous growth period, but it’s very strategic and very well planned. We are very careful with the opportunities that we encounter and our expansion. We’re not growing, nearly as fast as we could, so we’re really holding back our growth.

CNBC:
Why?

TORY BURCH:
I just want to be careful. I don't want to over distribute. I think that our customers don’t want to see themselves coming and going. I want to be really thoughtful where we open our stores. I want to take every decision we make very seriously. We’re very careful with every decision.

CNBC:
Is that about establishing yourself as a luxury brand?

TORY BURCH:
I think we are trying, and hopefully being successful in becoming a luxury brand. It’s a different kind of luxury brand. I think our price line alone is that. And one aspect of our brand that I'm really thrilled about is that it’s cross generational. We have a fourteen year old wearing it as well as her mother and her grandmother. I think it’s an incredibly important aspect of growth, building a company and having longevity to have that baby boomer, but also look to her granddaughter and children.

CNBC:
How do you appeal to all ages?

TORY BURCH:
Well our clothing is definitely interested in fashion and what’s going on, but it’s not trend-driven, and for me that’s a very important part of our company. I love fashion and I love trends, but I think if you’re our woman, and our customer, I want you to look beautiful and not necessarily dressed for trends.

CNBC:
But isn’t the ballerina flat, the Reva flat, very trendy?

TORY BURCH:
I guess it is, but that wasn’t the intention. I think it’s become that and it’s something that will never go out of style, and I think that women will always wear ballet flats.

CNBC:
So when did you know that the ballerina flat was a trend; that it hit big?

TORY BURCH:
The Reva ballerina flat became a trend pretty quickly. We knew right after market week, and just the reaction that stores had to it. It was incredibly well priced. We thought that it was giving someone part of our brand that was accessible and with a tremendous amount of comfort.

CNBC:
And a lot of young girls loved it.

TORY BURCH:
Definitely, the Reva ballerina has brought in a much younger customer for us and our footwear in general, so it’s been great for us and our brand.

CNBC:
You talked a little bit about luxury. Can you just tell us what that is for you?

TORY BURCH:
Luxury to me is not about money. It’s about the way you live your life, and for me it’s everything from how you are as a parent, to how you are and treat people in business, and how your company is run. So I feel that it crosses over in every aspect.

CNBC:
How would you describe luxury as a parent?

TORY BURCH:
I would say being with your children and giving them the real time that they need and just teaching them the important things in life.

CNBC:
And what about luxury in business?

TORY BURCH:
When I hire people in our company, I say, “Listen, this is a different environment. It’s not a traditional fashion environment.” We all have lives; we have to be happy. We want everyone to love what they’re doing and really feel part, as if they’re growing something together. I think for people, a business luxury is when people go into the office and love what they’re doing. At the end of the day, if that’s something I can give the team, it’s a tremendous success.

CNBC:
And that probably is communicated somehow through your clothes…

TORY BURCH:
I think so. I often hear that women are happy wearing our clothing. Also, their husbands or boyfriends love them in it. It’s great if you can make someone be in a better mood or a little bit happier, to me, that’s a great thing.

CNBC:
A lot of people think that if it’s a luxury item, then it has to be expensive, and if it’s not expensive, then it’s not a luxury item.

TORY BURCH:
Well yes, a lot of people do feel that. I don't feel that. I feel that a luxury item doesn’t have anything to do with price. I think that there are beautiful luxury items that are incredibly expensive. I look at some of our things that I think are beautiful that are 295 dollars, so I think it’s about how you live your life, how you put things together, how you mix things, how you have your own sense of personal style. I think that now when women dress, the sophisticated women wants to mix it up a little bit, and doesn’t want to wear one designer, one price point. She has more individuality than that. She’s creative and wants to dress in a creative way, and by meaning that, she wears a J. Crew t-shirt with a Valentino jacket and one of our tops. I think it’s about mixing. For me when I started the company, I was tired of spending designer price points and I wanted to find great looking clothing that I could spend money on, and feel good about it.

CNBC:
Do you wear everything? Do you try things out?

TORY BURCH:
I wear a lot of what we design. I try everything on. Fit is incredibly important to me. I wouldn't say I wear our clothing head to toe because I always mix it up.

CNBC:
If you try it on and you don’t like it, what happens?

TORY BURCH:
Sometimes, if I take it off the line, try it on, and don’t like it, it won’t get shipped.

CNBC:
Has that happened?

TORY BURCH:
It has happened. It’s definitely a lot of trial by fire, learning as I go along. I had no design experience so it’s been a total process of learning.

CNBC:
So how does the fashion industry feel about someone with no design experience starting a very heavily designed brand?

TORY BURCH:
I think when I first started the brand, there was a lot of skepticism and I think that people were coming and looking and wondering what it would be. I think the first day we launched; it was a different thing than they thought they might have seen. We launched with fifteen categories. It was very well thought out. It was everything from towels, to shoes, handbags, bathing suits, ready to wear, candle, so it was really a lifestyle concept. CNBC: What was the first store that you launched?

TORY BURCH:
Our first store was downtown on Elizabeth Street, right here in February of 2004.

CNBC:
And what happened that day?

TORY BURCH:
That day was amazing. It was during Fashion Week and we were up all night, my step-daughters and I, trying to get the store ready, which it wasn’t, but we opened anyway and we had a party from ten until six. We had everyone in the fashion industry, to friends, to editors, and we basically sold out through our inventory. It was amazing. We sold about a hundred thousand dollars that day.

CNBC:
Were you stunned?

TORY BURCH:
Yes, we were stunned, and then we thought we might be onto something. It was a culmination of three years of effort and late nights, until four in the morning. The first year, we did incredibly well; exceeded all of our numbers, and the second year, we actually turned a profit.

CNBC:
What do you think your secret is? So many people work for years and years without turning a profit.

TORY BURCH:
Well I think part of it is that we are great with production because our quality is there, and we’re delivering what women want. And we have always paid very close attention to the bottom line and everything that we have has been bottom line driven, even when we worked out of my apartment for the first eight months. Everything has been, “How do we save money?” and how do we really look at different ways of saving money.

CNBC:
Do you think that’s atypical for the fashion world?

TORY BURCH:
I think it is atypical for the fashion world to really look at the bottom line. I think designers are often very creative and that’s where their head is. With me, since I don't have that design experience, I think from both sides of my brain. I definitely think from the business side and hopefully have the creativity as well. I look at how much every yard of fabric is and to me, part of our challenge is finding a beautiful fabric for eight dollars a yard. It’s not easy and often, we’re weaving our own fabrics. We’re really trying to do things in a different way, push the limits.

CNBC:
You talked about wanting to have a lifestyle brand from the very beginning. What is a lifestyle brand?

TORY BURCH:
I think a lifestyle brand is a brand where a woman can walk in a store and outfit herself for the beach, an evening out, her children, get a beautiful candle, maybe some home items, and things that I'm looking to find for myself; a hostess gift, certain things that I can’t find and would want in one store. I love jewelry, I love handbags, I love shoes, and so it really came from within me. I designed everything that I loved. I love printed towels, so it wasn’t as thought out as it might have been. It has just evolved into that. It was ambitious, but for me when I decided that I wanted to start this company, I really wanted to start it.

CNBC:
On the one hand; your personal image helps you sell the brand. On the other hand, you reached this huge mass audience that’s not necessarily living a New York lifestyle.

TORY BURCH:
Well when people are looking at our brand, particularly women, I think they’re looking at me as someone that’s a mom, that gave up her career for a while and got back into starting a business. I think they’re relating to that on many levels. I think women in general struggle with that and they want to understand how they can work and be a great mom and do it all. Listen, I'm very honest when I talk to them, and I say, it’s not easy and it’s something that I struggle with, but it’s doable and I'm doing it, but it’s a challenge.

CNBC:
And some people want to label you as a socialite.

TORY BURCH:
It’s not my favorite word, “socialite.” I think it’s a light, vacuous word and I don't see that relating to anything that I'm doing in my work life or in my personal life.

CNBC:
As a woman in business, I think it helps that you're a mother. I think that’s part of what people like to see, because it makes you more accessible and appealing.

TORY BURCH:
Well, there’s been a stigma to women in business, and I think the women traditionally in business that are successful are not married and do not have kids. That has got to change, and if I can help change that in any way, that would be a big, big feat for me. I feel that women are tremendously successful and add incredible value to the economy of our country, and for me that’s very important. I think that women in the past haven’t been able to have successful marriages and children and do it all. It’s a stereotype and it’s one that I would really like to get rid of. It’s very important to have successful women that have successful marriages and who are incredible moms. That’s a big, big part of who I am and what my company is about.

CNBC:
But don’t you think people pay more attention to a woman’s private life, whatever it is?

TORY BURCH:
Oh of course. I think when women are in business, they’re all out there and they’re fair game. I don't think men are looked at in the same way.

CNBC:
What message would you like to give to women?

TORY BURCH:
I would like to show women that they can do it all, and it’s not easy but it’s doable. I'm asked that question all the time, how do you do it? How? You’re a mom. You have stepdaughters, you have three sons and you're running a business, and what I say? It’s time management and it’s doable. You put your children and family first and then everything falls into place. That’s how I look at it.

CNBC:
Does anybody ask men that question?

TORY BURCH:
I think it’s very rare to find people asking men how they do it all.

CNBC:
At the same time, the image of your clothes is very feminine, very girly, very colorful.

TORY BURCH:
Yes, I'm not some hard feminist but for me, I think it’s feminine and girly but it has a tomboy edge because I'm certainly a tomboy and I think that our clothing is different and it stands out. It’s unique. To me it’s different than what’s out there, it’s classic but it has an individual edge.

CNBC:
When you started out, you weren’t even thinking about wholesale.

TORY BURCH:
I started the company as a retail concept, so I could control every aspect of it: the look of it, the image, and the way it was merchandised. That was something that I was really interested in; rolling out stores immediately.

CNBC:
So you have more control if you stay at a retail level?

TORY BURCH:
You do because you can put it together how you want, and accessorize it how you want. Everything is about control, and for me, that was very important from the onset.

CNBC:
How did you end up getting into the wholesale?

TORY BURCH:
We got into wholesale because I was friendly with two men at Bergdorf Goodman. I also understood that in building a brand and a business, you need wholesale as a support and to get it out there to the consumer. So they convinced me to start with our first fall collection as an exclusive for them. They came to me before I even launched the brand. Before, it was just a concept, so it was definitely in my mind that yes, we probably would do wholesale as well, but I was more interested in the retail end.

CNBC:
How many stores do you have now?

TORY BURCH:
We have thirteen stores and we’re opening four more.

CNBC:
Are you looking into a global market?

TORY BURCH:
Yes. I'm opening an office in Milan in September and I really want to focus on where I want to open stores throughout Europe and Asia.

CNBC:
Are women wearing the same things all over the world or is it still different?

TORY BURCH:
I think women are wearing the same things all over the world but they’re wearing them differently and they look very different. It’s technically the same designers and they’re just putting it together in a very different way. When I have European buyers come in to look at our line, they buy it in a different way. They buy different pieces, different shoes, so it just depends on what country. In Paris they’re not as safe as they are in London. In London it’s a little bit more conservative, but they’re also on the forefront of fashion as well. Dubai is amazing. I mean women are buying our clothing up. It’s out of control in Dubai. I think it’s a huge opportunity there.

CNBC:
And you're manufacturing in Brazil and China?

TORY BURCH:
We are doing most of our manufacturing in China. We do our footwear in Brazil, we do handbags in Italy, we do things in India, so we’re all over but most of our manufacturing is done in China. I would love to be able to make things in America, for sure. I think at our price point, it becomes very difficult. And if we could find a way to do that, I'm all for that, but in the meantime, I have no problem making things in China.

CNBC:
How does it feel now to have such a successful brand?

TORY BURCH:
It feels amazing. I mean for me, it’s still hard for me to believe, and it’s something I'm thrilled about. I don't take it for granted. I see people wearing our things on the street. The excitement will always be there.

CNBC:
Where does your ambition come from?

TORY BURCH:
I think “ambition” is a word that many women are scared of and I'm not. And I think that it’s something that I'm proud to be. A friend once told me after she read something that you should embrace ambition. And when men are told that they’re ambitious, it’s a great thing. With women, it’s a little bit sketchier, so for me, when someone says she’s ambitious, I take that as a big compliment.

CNBC:
A lot of people are concerned about the economy. How are you thinking about that in relation to your business?

TORY BURCH:
I think the economy is going to affect everyone but I think for us it’s going to be okay. Our price point is accessible enough that I think we can hopefully weather the storm.

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