One-on-one with Iconix Brand Group’s Yehuda Shmidman
In September, I had the pleasure of sharing the podium with Yehuda Shmidman, Chief Operating Officer of Iconix Brand Group, at LIMA’s inaugural Retail and Brand Conference in New York. Iconix is the second largest licensor in the world and, in the aggregate, the company generates over $12 billion in annual retail sales by managing and marketing a diverse portfolio of more than 25 consumer brands including PEANUTS / Snoopy, London Fog, Royal Velvet, Mossimo, and Joe Boxer. Mr. Shmidman also heads up global business development for Iconix and this year he was included in the “40 Under 40? list by Crain’s New York.
In the first of two parts, Shmidman discusses lifestyle branding, Iconix’s diversification strategies, and the company’s recent brand acquisitions.
Carol Spieckerman: You’ve certainly been busy since I last saw you in New York in September. Just in this last week, we’ve heard about another exclusive deal with JC Penney, as well as the big announcement that you’re acquiring Sharper Image.
Yehuda Shmidman: That’s right.
Spieckerman: I think that’s a good place to start. Sharper Image is following Borders and Linens ‘N Things as the latest retailer to go from being store-based to more of a pure intellectual property model, and now you guys own it. In the old days, these brands would have just faded away. If the stores went away, the brand went away. What do you see as the possibilities today?
Shmidman: I believe that brands are valuable. So, regardless of whether a brand started as a retailer at one point, or as a shoe brand, like we did with Candie’s, or started in some other form, the intellectual property behind it has tremendous value and that’s what we look to leverage, to grow, and to continue to market. So for us, it’s not so much where a brand came from but where it can go, what it means to consumers, and what the emotional connection is. We do a lot of research on our brands to understand what consumers believe about the brand and how they see the authenticity of the brand. There was a funny episode of Mad Men, the TV show. I don’t know if you happen to watch.
Spieckerman: Sure, I do.
Shmidman: I think it was the last season or the season before, but in the season premier, really the entire episode was built around one of our brands, London Fog. The premise of the episode was that Mad Men, the ad agency, was meeting with the ownership of London Fog and the discussion was “Where do we think we can take this brand into other categories?” I promise you that we didn’t script the show but it was exactly what we did. They talked about how London Fog is not about a coat. It’s not about rain-proof jackets. It’s about a lifestyle that is somewhat mysterious, or maybe even romantic. Whatever the brand is, whatever it means to consumers, that’s what you’re looking to home in on and then, of course, it grows up and becomes a lifestyle brand. Candie’s was the beginning of our company, when we were an operator and then it was about shoes. Today, with Candie’s in so many different categories, it has become a lifestyle brand. We look at all of our brands in the same way.
Spieckerman: Boy, talk about great publicity!
Shmidman: Right! We thought they did a great job with the show.
Spieckerman: To me, the Sharper Image deal also validates your business model and what (CEO and president) Neil Cole has said all along, that Iconix is a business model and, therefore, you’re not limited by category, even though your portfolio has been heavily weighted toward apparel and home.
Shmidman: A lot of people had called us an apparel company and in their defense, I guess, we have a lot of apparel brands. But it’s never been about apparel. We don’t make a stitch of clothing. We’re not even trying to go into factories. So what are we doing? We are a marketing company that happens to own brands. The way we look at the business model is about branding and brand extension. It’s not about category. A good analogy would be to look at any great ad agency in the world. They will market anything, from cars to tobacco – you name it. They are focused on how to develop great emotional connections between consumers and brands and that’s what we’re all about. So for us it’s not about the category of consumer electronics or apparel. It’s not about clothing brands, character brands, or consumer electronics brands. It’s just about great brands, and hopefully great global lifestyle brands, which we can take around the world.
Spieckerman: Your Royal Velvet exclusive with Penney’s brings up how brands operate in the retail space. Penney’s has one of the more robust brand portfolios in retail, in terms of private and proprietary brands, and particularly in apparel and home, which of course is the category where Royal Velvet is going to play. When you’re looking at a retailer and their brand portfolio, how many brands is too many and how do you compete in some of these more crowded retail playing fields?
Shmidman: It’s a good question. The retailers we deal with have tremendous scale and J.C. Penney is the most recent retail partnership that we’ve announced. We also have partnerships with Walmart, Target, Kohl’s, and Macy’s, all of which do a lot of business. We’re starting to do deals around the world with retailers like The Bay in Canada, Falabella in Chile, and the list goes on. There is a lot of business being done in retail and, even though the American market is going through some challenging times, we see lots of opportunities. With our current retailers, it’s not as if they’re running out of space for brands, and we want to make sure that they have the right ones.
In part two, we’ll discuss direct-to-retail and private branding, the role of emerging media in Iconix’s brand strategy, and more.
Want more insights from the conference? Read Carol’s interview with HSN’s Bill Brand.
To learn more about how retailers are redefining scale and what the touch point transformation means to your retail strategy, join me for my LIMA webinar on 11-16 at 12:00 pm EST. Invite your sales and marketing teams for a one-and-a-half-hour learning opportunity – no travel required!
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