Holiday Central

Ugly sweaters move from jokes to niche product

Andrew DiScenza, special to
CNBC celebrates Ugly Sweater Day

'Tis the season to be ugly?

On Friday,offices around the country celebrated one of the more obscure holidays on the calendar, National Ugly Christmas Sweater Day. Around this time of the year, people indulge their silly side by sporting one-of-a-kind sweaters.

All jokes aside, unattractive yet festive holiday sweaters are growing niche in retail. Major retailers like Target, Kohls and Macy's boast their own collection (perhaps unsurprisingly, Macy's is offering their ugly sweater collection at steeply discounted prices), while numerous specialty sites populate the Web.

Ugly sweater rentals, powered by Rent the Runway

My Ugly Christmas Sweater is one of those sites that has turned ugly sweaters into a viable business model by upping the ante on the novelty trend. Founded in 2008, the company has since provided its hideous seasonal apparel internationally. 

The high demand for the sweaters is related to the trend of ugly Christmas sweater parties, and whoever is dressed their worst (or best) wins.

"I knew that if I were going to a party that I would want to win … and to win I would decorate the sweater to be 'over the top' ugly," said Anne Marie Blackman, president of My Ugly Christmas Sweater in a recent interview with CNBC. "So that's what I tried for a product: embellished Christmas sweaters. And I marketed them to people who wanted to win a contest."  

In the fall of 2008, Blackman was searching on eBay for something to market on the popular e-commerce website when she came up with the concept. The sweaters were an instant sellout, and soon national publications were swarming over the company to tell her story.

Strangely enough, in a multibillion dollar industry based on getting people to by the most fashionable products, some think there's a workable strategy in selling something whose time may have come.

"From a marketing standpoint there are a couple different things with an ugly Christmas sweater; they are obviously very visual in nature," noted Carol Roth, entrepreneur and former investment banker. "So a great strategy is getting the sweaters on people and asking to promote through networks."

For Blackman, getting her sweaters on influencers was just the trick. Recently, her sweaters can be seen featured on "Glee" stars Jane Lynch and Matthew Morrison in a newly aired Febreze commercial.