Net-a-Porter. Natalie Massenet
The AFR magazine December 2010
by Marion Hume
Ten years into the life of the web’s most successful high- fashion salon, former journalist Natalie Massenet’s Net-a-Porter is fast growing and fabulous
Natalie Massenet makes me feel like an idiot. Not because this woman who changed the way we shop isn’t charming. And heavens, she’s chic in her teeny white shirt layered over a long T-shirt and leather leggings, rolled up today because cropped is so this season. No, the reason is because she was so right and I was so wrong. You want some numbers on that? How about 3 million unique users, 171 countries, 1,000 employees, annual sales topping more than £300 million and – here’s the zinger – the company was acquired by Richemont, the world’s second-largest luxury group, in a deal valuing Net-a-Porter at £350 million. And it was me who thought, “I hope she doesn’t give up the day job.”
Massenet used to be a fashion editor. One morning more than a decade ago we were standing in the aisle after a Paris show and she told me about her notion to sell designer fashion over the internet, which sounded nuts because, of course, women always want to handle and try on the clothes first, don’t they? But what makes my own lack of vision considerably easier to bear is that, back then, Massenet was only looking for my interest, not my investment. Imagine how idiotic those who passed on that opportunity felt in April when the Richemont deal went through. As to those who did see the light, some were to be found packing boxes the day after multiples of millions hit their bank accounts. It was a Saturday, but staffers showed up anyway to prepare for moving offices. Massenet, who pocketed £50 million, was busy vacuuming.
But it should be remembered that in the run-up to Net-a-Porter’s launch in 2000, the appeal of a vast selection of skilfully curated designer pieces, available for purchase 24/7, and arriving at your door tied with a bow, did not seem the no-brainer it does today. The internet’s promise of low operating costs and high profits seemed so tricky to translate to fashion back then. When Massenet launched with an £850,000 war chest raised from friends and private investors, better funded start-ups were crashing and burning around her.
She succeeded because she understood that it was about indulgence and that geek side was nothing more than a sideshow. Although she is recognised as one of the world’s leading internet entrepreneurs, her big idea was a simple wish – that the things she loved in magazines could pop off the page and into her wardrobe. The beauty is that Massenet has always insisted hers is a service business, a fashion business, hence, from day one, packages done up like a special gift are part of the transaction. (Customers are able to request a discreet brown paper bag instead, where verbiage on the inside reads, “Psst… Your shopping’s safe with us”).
Today that shopping can also be less expensive, following the launch, last year, of the Outnet, which sells past seasons’ designer fashions. From January, the first global menswear online retail destination, Mr Porter, opens its virtual doors. with labels including Burberry, Ralph Lauren, Gucci, Lanvin and John Lobb. Add to this new technologies that mean no shopper has even to sit at a desk any more. Net-a-Porter’s sophisticated iPhone app means you can shop as you go about your day. For the iPad, there’s the interactive online magazine, updated every week, in which every item is available to buy.
Before Massenet and I meet up to chat during Paris Fashion Week, I head to west London to check out the new offices (she’s not there, she’s already on the Eurostar). Somewhat ironically, these are located on the top floor of a Westfield mall, thus right above the bricks and mortar competition. To say Net-a-Porter’s 3,000 square metre London HQ is impressive is to underplay the wow factor. You enter through vast black lacquer doors, so you feel literally as if you are walking into one of the sumptuous black boxes that are the brand’s signature.
Peppered over acres of dark carpet are white leather sofas; then there’s a gigantic video screen projecting the latest from the catwalk. And that’s all before a cheery, “Hello!” from a receptionist seated behind a desk so bristling with awards – ‘One of 100 best companies to work for’, ‘UK’s Top Places for Women to Work’, ‘Entrepreneur of the Year Award’ – that you can hardly see past them to her.Behind another black-lacquered door, battalions of gorgeous young men and women called ‘visual merchandisers’ scurry around with armfuls of clothes as photographers (plural) snap scores of treasures on both static mannequins and living models. The scene is intensely fabulous. But not as fabulous as what’s around the corner, where everything opens out into a vast open-plan cathedral, lit by natural light from floor-to-ceiling windows and a brace of truly splendid Murano glass chandeliers. Hundreds of people sit on Eames office chairs at white desks, including the tech team, who sit up in the mezzanine area. It’s all so 21st century.
Everyone, of course, is at a computer and some might just be shopping – come payday, apparently, the office is stacked with black boxes containing this season’s must-haves from Chloe, Rick Owens, Marc Jacobs, or packages containing last season’s ‘chiconomic’ finds from the Outnet. “How people multitask, and whether people [should be] shopping [at] work, it would be hypocritical for me to say,” comments Massenet when we meet up. (She even furnished her weekend cottage entirely online).
“People are on Facebook, they’re on mobile phones, they’re Twittering and carrying on 20 different conversations at the same time, and they’re shopping, and they’re getting things delivered to the office. But they’re getting the job done. So as long as the results are there, how they [personally] manage their time is up to them.” No wonder Net-a-Porter wins all those ‘cool place to work’ awards and that the HR department receives thousands of unsolicited resumés every month.
When Net-a-Porter first launched, every time something was sold, someone jumped up and rang a bell. Today, the item, and the location of the customer flashes up on yet another big screen, the images changing constantly while the ticker running underneath, when I glanced at it, read £455,443. Since when? “That’s what’s been sold this morning,” I’m told, and it’s still before elevensies. “It gets impressive once New York wakes up.”
Natalie Massenet is 45. She was born in LA to a former Chanel model from Britain and an American journalist father to whom, she says, she owes her independent spirit. An only child, her parents split when she was 11 and, unusually, she was raised by her father. Data seems to be emerging to suggest entrepreneurs are often oldest children; often an only child, and the majority have witnessed their parents divorce. “I guess all those experiences have added up to make me the person that I am,” shrugs Massenet, “although, of course, I can’t tell you how I would have turned out differently.”
While Massenet’s young years included time spent in Paris and Madrid, where her father was a foreign correspondent, he scraped together the finance to send her to a smart private school in LA in her teens. There she witnessed how casually girls could spend and determined to be the architect of her own financial fortune. Her first summer job, before going to UCLA where she studied Japanese, was at a mens clothing store in the Beverly Centre, LA, where the other shop assistant was Lenny Kravitz.
After entering fashion journalism, Massenet moved to England for love, having met a French financier called Arnaud Massenet, who spent a decade building stock at Lehman Brothers only to see it disappear overnight when the firm went belly up in September 2008. The couple’s two daughters were born at the busiest possible times; Isabella, now 11, arrived during the first round of funding for Net-a-Porter, her gestation roughly equal to the time it took the geek-squad to prove that, technically, Massenet’s idea could work. Ava, who is now four, came along as the American launch was rolling out. When asked by other women for advice about setting up their own businesses, her prepared answer is this: “Find a husband who supports you; a perfect nanny and forget about any social life.”
By now we’ve found time to get together, just before the Valentino show, to talk business. So onward to the Outnet, which in just one year matched figures it took Net-a-Porter five to achieve. “It’s a different customer,” explains Massenet of a woman who wants, but perhaps cannot afford, this season’s designer clothes. “The Outnet is not saying ‘Come and get this stuff because it’s cheap’. We’re saying, ‘Come and get the most beautiful designer clothes from previous seasons that still have relevance’. We’re educating a new consumer who, instead of buying high-street knock-offs, can get the real thing at a quality that’s going to last.”
To expand its reach, the site recently hosted an anniversary sale where everything was £1 or $US1, “which was absolutely crazy. It was a meltdown all over the world with people posting themselves on YouTube and going into a panic.” The Outnet’s in-house fashion team scour the world for the coolest clothes at a price.
As for Mr Porter, what it won’t be when it launches in January is Net-a-Porter for men, because Massenet’s belief is that while women usually love to shop, men usually hate to. “Yet they want to look good; they want approval; they want their colleagues and friends to know they’re wearing the right things. But they don’t shout about it.” Massenet promises Mr Porter will be “a very private experience. And the fact that the internet is so systematised, and its functionality, speed and efficiency allow you to transact all over the world; it’s about service, and it involves a computer.” At this, she allows herself the faint smile of someone who knows it will be a sure-fire hit. As for the equivalent of Net-a-Porter’s black box and tissue paper? “You’ll have to wait.”
The deal with Richemont, whose especial strengths lie in menswear (Dunhill) and watches (Jaeger-LeCoultre, Cartier, Baume et Mercier, to name a few) may appear to give a nice synergy to the upcoming Mr Porter. But Massenet insists independence will be maintained. “If Dunhill were no longer interesting, we wouldn’t be carrying it,” she says boldly. But, on the distaff side, surely alignment with Richemont means that the other luxury giants, LVMH and Gucci Group, many of whose brands are sold on Net-a-Porter, are less than pleased? “We are enormous partners [with them],” she counters. “If anything, it strengthens our relationship as the business is growing; our audience is growing; our buying power is growing and they’re very happy to know that I’m not going anywhere.”
What is moving is fashion itself. Massenet senses an ‘end of an era’ moment, given, “the consumer is now watching all the shows; they’re just not being let in the front doors. It’s like Bastille Day; they’re going to come and burn down the gates and it’s really exciting. Retailers moan about consumers not going into shops. Well, invite them to the show and they’ll shop right then and there! Look at Burberry selling straight from the runway, as we started with McQueen, with Halston, with Roland Mouret.”
Where it is certainly going to get tougher is staying ahead of the game. When Massenet set out on her online journey, she was speaking a new language. Now, her four-year-old is learning how to spell on an iPad. “A website is to e-tailing what a bricks and mortar store was to retail 10 years ago. If we don’t diversify, we’re going to fall off a cliff,” Massenet acknowledges. “Our customer has already moved away from her desktop. She’s in the back of a cab, on her mobile phone. In a few years’ time, if she has some sort of holographic projection in her bedroom, that’s where we need to be.”
Massenet admits her personal challenge is to be fast enough, but not too fast. “I’ve learned to respect pace and do things beautifully and I realise that not everyone within an organisation wants to operate at the speed of light,” she says, before quickly changing tack. “We’ve got plans stacked up for the next 10 years. I’m thinking of five right now and one of those is an entirely new business.” For one terrifying moment, I think she’s going to tell me more. I’m relieved that she doesn’t for, to paraphrase Oscar Wilde, to fail to get one great idea may be regarded as a misfortune, to fail to get another – well, you’d have to be an idiot, wouldn’t you?
The AFR Magazine December 2010
Story by Marion Hume
What is old is new again, and the advantage for me, racking up fashion years (which multiply at twice the speed of dog years, by the way) is that I’ve been round this circuit before. What’s the biggest trend right now? The seventies. Where did my fashion consciousness awake? Bliss was it in that dawn to be alive and wearing leg warmers.
In the 1980s, some fashion wag dubbed the ‘70s, “the decade that style forgot”, which stuck, although it was wrong. In fact, the ‘70s were rich and diverse. In just ten years, I dressed my teens through hippy, glam rock, disco, punk and then, at last came chic, as captured with the ultimate ‘70s movie “American Gigolo” (it came out in 1980, but it was made in 1978).
Paul Schrader’s movie, which opens with a scene that succeeds in making even the Los Angeles freeway look glorious, wasn’t a hit in Kyoto, Japan or, if it was, Akira Isogawa – who despite still looking annoyingly youthful was very much alive in the ‘70s – managed to miss it. So, on his recent trip to London, I felt duty-bound to re-rig the video recorder (how clever to have kept that hidden away) and soon we were listening to the soundtrack by Giorgio Moroder and I was trying quite hard not to sing along to Blondie’s “Call Me”.
Much has been made of the scene in which Richard Gere prances around like a latter-day dandy (or, to be accurate, just like the male hooker of the title role), matching “griege” shirts with beige ties as if that were hard.
This is the fashion world’s no. 1. favourite movie clip and certainly, I will never forget watching it WITH Richard Gere (gray around the temples, even more handsome) at the Giorgio Armani retrospective at the Guggenheim in New York a few years’ ago. When I say I watched it with Gere, there were only four people in a room at the museum in which the high points of Armani’s movie successes were being projected on a vast screen. Alas, I must concede that Gere is unlikely to reminisce about me being there, but watching him watch himself was a thrill all the same.
But I realised, re-watching the celebrated scene with Isogawa instead that the familiar version has actually being clipped; this to omit the opening where Gere scrapes his finger through a mountain of cocaine and rubs it vigorously into his gums before he begins the Herculean task of working out what he’s going to wear. Since 1978, there have been moments at Armani shows when a little lift would not have gone amiss, but despite all you hear about us drug-addled fashionistas, I’ve never seen anyone go that far since.
While Gere gets the glory, actually, it is Lauren Hutton who fascinates in the movie now. Hutton began the ‘70s as both gap-toothed girl next door and the world’s first supermodel and ended them (lucky her) kissing Gere and wearing satin blouses which look so utterly “now”. While Gere’s outfits changed menswear in what was then the future (think of a Hollywood agent in the ‘80s and you’ll imagine him wearing a beige Armani suit), Hutton’s outfits were a sartorial lament to a softness that was already disappearing and has taken 30 years to return. In between, womenswear has had a harder edge, starting with the “me me me” styles of the ’80s.
Why is softness back? It’s partly due to the achievements of a band of women who prefered dungarees when Hutton was wearing grey silk and who manned the barricades to fight for the equality we all now enjoy by law. Today’s designers – many of them women – are, largely, the first generation to be the children of working mothers and they are working mothers themselves.
Hence the 70s looks at Celine, Chloe, McCartney. But who I wonder, is going to reissue the fabulous soft trench coat Hutton slips off in the movie? We’ll have to wait for next season’s shows for that.
The Telegraph Magazine | October 2010
Diamond mining’s shining example
Ellendale in Western Australia, where Tiffany sources its coveted yellow diamonds, is leading the way in restoring the tarnished image of gem mining
by Marion Hume
Ellendale is a cattle station as big as a country. But the reason for crossing the world to land at a red-dirt airstrip in north-west Australia is what lies beneath: Ellendale is the world’s leading yellow diamond field.
It is purely by chance that my arrival here should coincide with Naomi Campbell’s diamond-related court appearance in The Hague this summer. But in contrast with the link to ‘blood diamonds’ being discussed there, Ellendale’s crop is entirely ethical; in the palm of your hand, these rocks look not one bit like ‘dirty little stones’, but like ravishingly lovely petrified sunbeams.
Fewer than 0.1 per cent of all diamonds are yellow, the hue caused by the presence of nitrogen or other gases at depths of 60-100 miles within the earth’s mantle just as a precise combination of pressure and temperature enabled carbon to take on a tetrahedral structure. All diamonds, coloured or clear, were formed 400 million years ago; 20 million years ago volcanic eruptions brought them closer to the surface. About 3,000 years ago glittering stones washed up by river systems started attracting the human eye.
The geological reasons why Ellendale is peerless when it comes to yellows are a bit hard to grasp, but they distil to this: even within the 0.1 per cent of diamonds that are yellow, not all yellows are created equal. More than 93 per cent of the 0.1 per cent are actually so pale that you could call them beige, or so dark as to be brown. You can knock out the pale primrose ones too, leaving only a rare few, in the colours of Van Gogh’s sunflowers, that radiate inner fire and make the top-notch category that is called ‘fancy’. At Ellendale, about 20,700 carats of ‘fancy yellows’ are mined each year.
Yellow diamonds do turn up elsewhere, such as Lesotho and Botswana. The world’s most famous yellow, a 128.54-carat, brilliant-cut rock called the Tiffany Diamond – on permanent display at the jeweller’s New York flagship store – was found as a 287.42-carat rough in South Africa in 1877. But Ellendale represents today’s finest reliable source. It is for this reason that Tiffany & Co has forged a long-term alliance between its gem acquisition subsidiary, Laurelton Diamonds, and Kimberley Diamond Company, which owns the mine.
Tiffany & Co has good reason to pride itself on a squeaky-clean supply chain right up to its trademark blue box (which has been green since 2009 – made only from Forest Stewardship Council certified paper). Tiffany was the first major jeweller to embrace the objectives of No Dirty Gold, a campaign that aims to clean up gold-mining. The company lobbied US Congress to close a loophole whereby rubies were funding the Burmese military junta. It will not stock coral, to protect fragile marine environments. And Global Witness, an international lobbying force that exposes human rights and environmental abuses, has singled out Tiffany with rare praise for offering ‘one possible model of what major diamond jeweller retailers and manufacturers should do’.
It must be disclosed that my access to Ellendale is courtesy of Tiffany. While there is no sign of guards with guns, no iris recognition or fingerprinting, there is also no way in uninvited, especially as the mine owns the airstrip.
To get through the gate, your police records will have been scrutinised and you will have agreed to X-ray searches (unique among gems, diamonds are carbon and thus fluoresce under X-ray). Overall, security is the remit of an (unseen) former commanding officer of the SAS. Any guest tempted to roll a few rocks around the palm of their hand and joke about pocketing one will find this does not go down well. ‘You can hear the snap of the rubber gloves,’ I am told, not entirely jovially.
There are 257 people working here, mostly on two weeks on, one week off rosters. Given that racial and sexual equality are enshrined in Australian law, it should be no surprise – yet it is – that plenty of those are women, including a third of on-site management. Of those working here, 12 per cent are indigenous; the land’s traditional owners are the Bunuba tribe, their customs respected, their sacred sites left alone.
The centre of operations is a tin hut, which has a notice on the back door giving details of ‘snake relocation training’. (There is also a programme for relocating wallabies.) Those present inside include Alistair Croll, Ellendale’s managing director, and Nick Selby, the general operations manager of the Kimberley Diamond Company, along with Lee Bouckaert, who leads the emergency response paramedic team. Bouckaert’s aim is to do nothing more taxing than the drug and alcohol tests every worker must submit to every day. What he hates is accidents, although they have had only one so far this year, when the driver of one of the trucks that look like giant Tonka toys didn’t shake her boots out and was bitten by a centipede.
Mine-issue boots, hi-vis jackets, hard hats and wraparound sunglasses must be worn at all times. The place is incredibly dusty – because finding diamonds first entails moving a whole lot of mud. Way in the distance, through the gum trees, are mountains that look much more attractive than the slag heaps that they actually are.
Getting to the pit is a long drive, around natural, ephemeral wetlands where flocks of pelicans and galahs disport themselves. Given the severe heat, there is an ‘eski’ icebox in each vehicle. ‘Everyone who comes to work for us has the right to go back the way they arrived. People could get hurt. People could get killed,’ Selby explains, running through the safety drill once more as the pit comes into view. To find diamonds here, you drive into an enormous hole in the ground. The pit currently operational at Ellendale is called E9; it covers 116 acres and will reach a depth of 548 feet below sea level.
Some employees come from as far away as Adelaide, a 12-hour commute each way by air. The mine funds travel, door to door. There is no family life at Ellendale, but that doesn’t put women off working here. Gayle Keys, the environmental supervisor, laughs when asked how many women do the macho jobs. ‘Driving trucks is not macho! You don’t even get dirty!’ she hoots.
It is a myth that a diamond is for ever. The word itself comes from the ancient Greek, (adamas: ‘unbreakable’) and a diamond is thousands of times harder than the next hardest substance, from which rubies and sapphires are formed. ‘But it’s a frozen crystal,’ Dudley Corbett, the senior mine geologist, says. ‘You can smash it with a hammer.’ You can also smash it with enormous jaw crushers, so it is disturbing to discover that once the diamond-bearing lamproite ore is transported to the processing plant, everything is reduced to the size of a marble. This is down to economics. Geologists determine, through extensive sampling, that 14 carat rocks are the largest likely to be unearthed here. The crushers are set to smash everything – mud and stones – to that size for the next stage of processing.
While a 14-carat diamond is nicely large by most standards, what this eliminates are those rare ‘eureka’ moments from the days when men mined with pickaxes and a truly massive rock was found. Today, the revered Tiffany Diamond would have been crushed into some 20 smaller diamonds before anyone was any the wiser. Which doesn’t seem to bother Corbett. ‘So 14 carat is the biggest you’ll find.’ He shrugs.
Before you can sift through the ore you have to blow it sky-high, although this is less exciting to witness than it sounds because controlled explosives aren’t as crazy as dynamite. There is no death-defying dash out of the pit either. Instead, from a very safe distance, you watch the shot firer and the blast controller stroll to their vehicle and drive up and out at a cautious crawl. The speed-of-light sequence of flashes that follows is nowhere near as impressive as throwing a match into a big box of fireworks, but it is completely thrilling when a vast curtain of earth rises up silently, then crashes down with a thud that you feel through your feet.
There is no shower of diamonds to jump up and catch, though. Instead, you get coated in dust from your hard hat to your boots (hence eyes covered at all times). What is weird is that before the dust settles, the shot firer and the blast controller do exactly what you are told never to do on November 5: they go back and examine any holes that may not have detonated. It is called ‘walking the shot’.
John Hickling looks more like a maths professor than a miner. Ellendale’s senior metallurgist, he tells me that 14,740 tons of earth is moved for every 600 carats of diamonds. ‘There are five carats to the gram, 20 per cent of which will be good, so you move a mountain to get the yolk of an egg.’ What Hickling likes to talk about is how pure diamond mining is – diamonds are hydrophobic, which means that water doesn’t stick to them, so the way to dislodge any mud is with water. ‘We run a chemical-free process, except for the one they use to preserve salami: sodium nitrite.’ This is used for a final clean before the diamonds leave the site.
The following day starts with watching the scrubbers at the treatment plant where yesterday’s ore is being mechanically cleaned and screened. Anything that fluoresces goes to the recovery sort house, another tin hut, inside which diamonds are sorted within a metal and glass contraption with lots of attached gloves – imagine a very long incubator for a procession of premature babies. Then, at last, the result of two days’ hard graft and the shifting and processing of some 30,000 tons of ore lies in four Petri dishes. These roughs have still to journey on, first to a faceless building in a faceless suburb of Perth to be sorted, then to Antwerp for cutting and polishing. Yet only a few stones of this little haul might make it all the way to the Tiffany design studios in the United States to become heart-shaped rings or gem-encrusted pendants to fuel the desire of latterday Holly Golightlys.
It is still impossible to calculate how much those most precious stones are worth. As a rough rule of thumb fancy yellows can be worth three times more than most, though not all, white diamonds. Given that there are 16,000 categories of diamond grading, the price of any stone in the rough is no more than a guess.
So will anyone hazard one?
‘They don’t look like dirty little stones at all, do they?’ says Nick Selby, riffing on what has become as catchy a statement as any slogan dreamt up for diamonds by those Mad Men admen of old. ‘But let’s just say, if three of these were mine, I’d be on the beach.’
KISS AND SELL. SIR PHILIP GREEN
by Marion Hume
The AFR Magazine September 2010
The self-made king of affordably fabulous has the retail touch: Sir Philip Green ships about 150 million garments a year through ‘cheap chic’ outlets such as the Topshop chain. He’s worth about $7.6 billion and is still working
on how his businesses can adjust to a new consumer embracing social media
Sir Philip Green doesn’t waste time. My allotted slot with the global king of affordable chic is at 1 o’clock, and at 12.59pm, after ice water and coffee has been served in the plush reception area outside his office (pale carpets, swanky sofas, Jo Malone scent in the loo), the door swings open and here he is; pin-neat grey suit, pristine white shirt open at the neck. Two buttons, no tie; silver swept-back hair shimmering with the sheen of a shampoo commercial; tanned skin positively glowing. In other words, the absolute picture of a 58-year-old, self-made man worth about £4.43billion ($7.6billion), whose Monday morning commute from the family home is by private jet from The French Riviera.
Green is famous for the fact he pulls no punches and answers his own phone (not some new-fangled device but an old Nokia; he has a stockpile of them). Want to know about the ethics of the rag trade – a tough call for a man whose fortune rests on cheap chic manufactured in the murkier corners of the world? He faces it head-on, doesn’t blink. The only thing his VP of communications has suggested is that I don’t ask for his life story “because the risk is, that’s your time gone”.
I decide not to ask about his plush pad in Monaco, a tax haven, either. As Green has told reporters before – not angrily, just firm – he pays tax in Britain. He does not claim non-residency. (However, that Britain’s ninth-richest person has received hefty dividends from Taveta Investments, which is in the name of his Monaco-based wife, Lady Tina, has been widely reported; less publicised is the fact that he has not done so for the past four years.)
In Australia, Green’s best-known brand is Topshop, which, famously, carries a collection by Kate Moss and sells in Incu in Sydney, as well as in New York, Paris, Hong Kong. It also sells in The Department Store in Takapuna, New Zealand, where, when the brand arrived last May, the first sale was at 7.03am and it took four hours to clear the queues around the block.
Green’s Arcadia Group, privately owned by Taveta Investments, also numbers a score of High Street chains not present in Australia, as well as vast and growing e-commerce sites. The brands operate in more than 30 countries across Europe, the Far East and Middle East. Pretax profit for 2008-09, the most recent data available, was £213.6 million, up 13 per cent from £188.9 million. This in a recession still being felt deeply in Britain.
Those MBAs that have become fashion’s favourite accessory are not for this high-school dropout. “There’s parts of it you can learn, which are probably the mechanical pieces,” the billionaire concedes. “But you can’t learn to have a good eye. You either have it or you don’t.” Of course, Green has it and his decisions are snappy. “I’m doing this on the run, I’m turning up, show it to me,” is how he explains his M.O.
“So just now, I was just going through ladies dresses for Christmas; before that, knitwear. When you’ve finished, I’m going to see Kate Moss about her collection. Do I chuck stuff out I think won’t work? Yeah. I saw some knitwear this morning. Didn’t like it on the hanger. Then I’m looking at dresses and I asked [myself]: ‘If this was your last bet, is that where you’d be putting your money?’ In my mind, you weigh up the risk/reward box. I said, ‘If you want to buy a dress that sells at £40, and you want to buy a dress that sells at £70, buy 5,000 of the one that sells at £40, and 600 of the one that sells at £70. It’s not negotiable – unless they prove to me the reason why they think I’m wrong.”
Green hails from London’s Croydon, a suburban sprawl better known as the birthplace of Kate Moss, whose Topshop collections reward her with an undisclosed fee, plus a percentage. As for the ‘Sir’ bit, no one from Croydon, where there are no stately homes or rural acres, has one of those inherited toff titles. Sir Philip Green’s was earned, bestowed for services to business. He was born not rich, not poor. His parents ran garages, electrical shops, property. When he was 12, his father died, his mum carried on and he helped out in the business during school holidays until he left school at 16 and started out on his own. He hawked cheap shoes from China, then jeans. Then he bought up some struggling shops, was making money and, well, let’s fast-forward to 2002, when he acquired the Arcadia Group, including the Topshop chain, for £850 million – or we will, indeed, be here all day. He acquired British Home Stores, rebranded now as Bhs, before Arcadia but has failed in three attempts to grab the High Street prize that is the giant Marks & Spencer.
No surprise that the king of the hill is both liked and loathed; he’s liked by Kate Moss and Naomi Campbell – both of whom call him ‘Uncle Phil’ – and by most key staff, who praise his unerring instinct, photographic memory and ability to helicopter in (often literally) and sort things out. Green is loathed, or more accurately envied, by a certain segment of the British tabloid press, which deems it obscene for a man who has made his own money to relish spending it, hence snide asides about the Gulfstream jet, the pad in Monte Carlo, the family cruises aboard the 63-metre yacht, Lionheart, while the Greens’ now-adult children, Chloe and Brandon, weigh anchor nearby aboard the 33-metre Lionchase.
Sir Philip and Lady Tina throw lavish parties, hiring Beyoncé or Rod Stewart to entertain their guests. The list of charities supported by a spectacularly fat wallet is long, so we’ll start and end with how Green first met Moss when he paid £60,000 for a kiss in a charity auction. Aware how seedy taking the prize would look, he donated it to the underbidder, Jemima Khan. Images of the girl-on-girl smooch went around the world.
You won’t, by the way, find many of the fashion pack scoffing at Green, especially since it was under his ownership that Topshop, once notorious for rip-offs that stole designer ideas, turned into a fulcrum of creativity. For almost a decade, Topshop has been funding New Gen designers in the early stages of their careers, plus (brilliant this) every season, Green and team set up what has to be the world’s most glamorous soup kitchen to feed and water (and champagne) the international fashion pack during London fashion show season.
Green takes plenty of time off – summer on the Med, winter in Barbados, fitness breaks in the US in between – but that isn’t to say he switches off. “I went walking in Arizona last week and a lot of the time I spent thinking, ‘How can we do things differently? How do we adjust to the new world we live in?’” he says. “We’re in an over-shopped world, so you’ve got to create more theatre, more fresh … You’ve got young kids now who spend their time on this Twitter, Facebook, YouTube and every other form of communication on the planet. You have to be clever, smarter, newer …”
Back when Green was flogging his first cheap shoes, the consumer didn’t care about workplace practices, ethical fashion, carbon footprint. Arcadia owns none of the factories in about 60 countries – including China, India, Mauritius, Romania, Turkey – that supply its stores, although, of course, its management and staff are acutely aware that proof of something ghastly, like child labour or mistreatment of women, could threaten everything. Arcadia funds what is probably the global clothing business’s biggest compliance team, last year alone staging 1,044 factory ethics audits, carried out by independent bodies trained not just to look but to ask, and in such a way that those on the economic margins fearful for their livelihoods are able to respond.
“When you’ve got a business directly employing 45,000 people, therefore probably indirectly [benefiting] 150,000 with families and kids, you know everyone is watching,” Green says. “I want to sell the best products I can, at the best price I can, in the best quality I can and there’s no point cutting corners, because you’ll get caught. You’ve got to educate the people who work for us that we want to do things in the right way. We run a very professional, proper ship. There’s no dodging round.” In 2009 alone, the group rejected approaches from 37 new factories until work practices were brought into line. Thus, the consumer can enjoy fast fashion, confident that it has been produced fairly, although there are still improvements to be made. “I don’t want to be a manufacturer,” Green says. “I finance them; I lend them money; I help them buy machinery; I help them build factories but I don’t want to be the owner because I don’t live there. I can’t put my hand on my heart and say to you I know about every single worker. We’re shipping 150 million garments a year. I can’t look you in the eye and say I can guarantee every single piece because someone’s got to go to Timbuktu, make it, inspect it, colour it, ship it. But, hopefully, we are doing as good a job as we can.” Arcadia also has an in-house ‘police’ force, the Fashion Footprint Group, which has a clear mandate to align social responsibilities with business practice, encompassing everything from recycling to taking a stand on the mulesing of Australian sheep. (From the end of 2010, Arcadia will not work with wool suppliers who practice mulesing against fly strike, irrespective of the use of pain relief.)
But enough of the worthy stuff. What Green really wants to talk about is shopping, knowing that, on the way here, I’ve popped into some of the stores. “What didn’t you like?” he demands. Eyes locked, I say I found the flagship Bhs store hard to navigate. “In which way?” The first floor didn’t entice me. “OK, that’s because you walked up [and] so hit childrenswear first. There’s always a struggle and a debate how we tell people what is on each floor. We’ll fix that.” On to Topshop, where the crowds and the chaos and the neon may be heaven on a stick to Sir Philip and every teenager – “if you took 20 CEOs to Topshop, they’d be dishonest if they didn’t say, ‘Wow, this is a real retail experience’,” he beams – but I found it such a jumble and so packed. “Jumbled up in which way?” he booms, “and who complains if it’s busy? Put that on your tape! That’s what those retailers want!”
Of course, what Topshop has, which fast fashion competitors such as Zara and H&M don’t have, is Kate Moss. (H&M did have her, but dumped her after an alleged brush with drugs earned her the nickname ‘Cocaine Kate’ in 2006.) As the myth goes, Kate moseyed up to ‘Uncle Phil’ in a restaurant a couple of weeks after the paid-for pash at the charity do, said something along the lines of, “We’re both from Croydon, let’s do business together”, and it’s been the music of the tills ringing ever since. But it wasn’t quite like that. Negotiations, apparently, were protracted, especially as Green, used to people snapping to attention, needed to be convinced a fashion princess could do things his way. “To be honest with you, at the time, without being conceited, I think it was actually pretty brave because a lot of people had dropped her,” Green recalls now. “People said to me, ‘Are you sure?’ And this is back to instinct, because that told me ‘Good moment’. Topshop had never had a ‘Face Of’ so it was a complete departure. Part of being an entrepreneur is risk and my attitude was, if I’m wrong, what’s the worst that’s going to happen to me? It’s not going to threaten my whole business.”
Actually, it has lifted it hugely. Moss is helping to push the image of Topshop to a whole new level. “It would be fair to say it [lifted] the profile,” Green says. “It’s never been a huge piece of business, and it was never planned to be a huge piece of business. It was about her brand, our brand coming together and you hit the right mood, the right moment. But at the end of the day, the product can’t lie. The merchandise has got to be great. You can’t kid people, and that’s what’s key.”
“Of course, Kate Moss helps,” says designer and retailer Karen Walker, of The Department Store in Auckland. It was Topshop that suggested forging a deal with the hip Kiwis of Takapuna, following successful partnerships with Opening Ceremony in New York, Colette in Paris, Laforet in Japan and Lane Crawford in Hong Kong. Walker says, “The volcano [in Iceland this year that disrupted air travel worldwide] interrupted our initial deliveries, so what we ended up doing was a one-weekend preview, which sold out, then we closed down for two weeks and the second opening was even bigger. We’re the custodians of the brand in New Zealand and both companies, long term, will benefit from the mutual experience.”
The brand made its Australian debut in October 2009 at Incu, transforming a little-used upstairs space above the Paddington store into a must-shop destination. “It’s provided us with a whole new customer base,” Incu director Brian Wu says. “Now, customers can go upstairs to our Topshop area to buy pieces to wear on the weekend and then head downstairs to buy a jacket they have been saving up for, which will last them for many seasons.”
As to why people somehow go more crazy for Topshop than its key competitors, specifically Zara, Green puts it thus: “Zara’s is a great business. I admire and respect it and I’d love to own it. We’re in a slightly different business, though. We’re more edgy. Mr Ortega [Amancio Ortega, Zara’s founder] told me one of his favourite shops in the world is our Oxford Street store, and if you’re in our industry, it would be.”
Later, we’ve moved on to chat about a schools program dedicated to fostering entrepreneurial flair when there’s a sudden ‘knock-knock’ and, “Sir Philip, your 1.30 is here”. It is 1.28pm. “Hello, Naughty,” he calls out through the open door, “with you in a minute.” “Hi Uncle Phil,” Kate Moss says as she pops her head around the door, then he’s back with me, 100 per cent focused, wrapping things up before we shake hands. And then Moss comes in, shakes my hand and we’re done. So it’s a minute later, back in the snazzy reception that the true power of Sir Philip Green hits me. Yeah the billions and the retail turnarounds in record time are impressive, but lordy! What about getting a supermodel to turn up two minutes early! ■