Sartorial Stars: Michael Kaplan, Co-Founder and CEO of Fashion To Figure
March 3, 2011 § 4 Comments
In the 20th Century, U.S. apparel and accessories businesses often began as family enterprises. Some immigrants arrived to America with pre-existing businesses, while others started their companies with little else besides a sewing machine and a pushcart. Over time, with the assistance and input of spouses, siblings, children and grandchildren, these businesses prospered and expanded. Over the latter half of the century, many factors changed the nature of these family businesses. Some grew so large that they went public or were sold to larger corporations. Younger generations who attended college and graduate school often became less interested and less involved in their families’ businesses. At the same time, celebrity designers began to overshadow garment manufacturers, the foundation of family apparel and accessory businesses. These changes, along with the shift from domestic to international production, led to the decentralization of family apparel and accessories businesses over time.
Today, those who do follow in their families’ fashion footsteps are combining historical insights with modern business strategy. One entrepreneur exemplifying this new model is Michael Kaplan, the great-grandson of fashion pioneer Lane Bryant, and co-founder of the fast-growing plus-size business Fashion To Figure.
Lane Bryant, born as Lena Himmelstein, founded a dressmaking business from her home in 1901. As the inventor of the market’s first maternity dress in 1904, Bryant saw an opportunity for ‘special sizes’ segments within the apparel industry early on. She partnered with her second husband, Albert Malsin, to develop her maternity business. Later on, the Malsins extended the reach of their business by capitalizing on the needs of the ‘stout-figured’ or plus-size shopper. Strong mail order and retail store sales further bolstered the company’s growth; sales reached $5m in 1923 and the company went public in 1928. The business continued to flourish under family governance until 1982, when it was sold to The Limited Corporation.
Inspired by their family history, Michael and his brother Nick founded Fashion to Figure in 2004. The Kaplans saw that the plus-size shopper’s needs were not being met by the market and set out to build a fast-fashion brand for this specific consumer. Michael’s background in venture capital and finance, coupled with Nick’s retail expertise led them to open seven FTF stores around New York City as well a fantastic e-commerce site. Their newest store in the Cross County Shopping Center in Yonkers will have an official opening this Saturday. The Kaplans believe that “fashion is truly a state of mind, not a size range.” Their customers, or ‘Trendsetters’ as they’re known at Fashion to Figure, very much agree.
I chatted with Michael over coffee a few weeks ago about his family’s business, how it led him to launch Fashion to Figure, and what their plans are moving forward. FTF is most definitely a brand to watch.
TP: Can you tell us about your great-grandmother and your memories of the family business?
MK: Lena Himmelstein was born in Lithuania in 1879. She immigrated to the United States in 1895. Cousins already there had planned for her to marry their son. Disinterested in their proposition, she fled the scene and moved in with her older sister Anna. She began working on sewing and garment making. She fell in love with and married a jeweler, and they had a child together. When the child was a year old, Lena’s first husband passed away suddenly. The only thing he had left her was a set of diamond earrings, which she pawned off to buy a sewing machine. She planned to make ends meet doing garment work.
She started a dress business out of her house. One day, a woman came in and said, “Mrs. Bryant, I want one of your dresses but I don’t know what to do because I’m pregnant. I’ll pay you extra if you can figure something out.” She agreed to try and decided to put an elastic waistband in the dress. The idea was that the dress would expand with the woman. She was smart enough to patent the idea, and basically invented the maternity dress in 1904. At the time, women in their second and third trimesters of pregnancy weren’t meant to be seen in public. It was very unseemly. Her dresses not only accommodated pregnancy, but they allowed women to go out freely during their pregnancies. That was a great home business.
She then met my great-grandfather, Albert Malsin, whom she had three more children with. He adopted her first child. My great-grandfather was a student at the German Polytechnic Institute and was also from Lithuania. He was an engineer by training, and was actually a roommate of Albert Einstein’s at the German Polytechnic Institute. My great-grandfather saw that my great-grandmother’s business could be a cookie-cutter specialization-type business and worked with her to open stores. They built a multi-million dollar business
TP: Was the idea to mass-produce?
MK: Yes, but it was also about the idea of marketing a specialty business. They introduced the concept of special sizes to the market. At the time, pregnant women were buying what were called slenderizing fashions, fashions that could hide pregnancy and give women freedom. When they started getting the business going, my great-grandparents wanted to advertise in the New York Herald Tribune and the newspaper wouldn’t let them. For something like five years, they had to beat down the doors until they were finally allowed to advertise. The paper didn’t think it was socially acceptable to advertise that pregnant women could be seen publicly. I love that my great-grandmother did all this before women could vote and did things out of need. Her business was incredible. All of her kids went into her business and it expanded and they had stores all over.
TP: Where were the stores located?
MK: In my dad’s day (1980s), there were hundreds of Lane Bryant stores all across America. It’s incredible to think that after only a decade in business, by 1910, my great-grandparents had achieved the American dream. The business went public in 1928 and at that time, they had a big mail-order business and 5 stores in Detroit, Brooklyn, and Chicago.
The interesting thing for me, in thinking about our family’s business now, is that if my great-grandparents lived the American dream in the earlier part of the 20th century, the things that they lived through business-wise were incredible. They lived through WWI and II, The Great Depression, segregation, etc. I’ve got some great catalogs from the Depression that advertise saying “Your Money is Safe With Us” as in, it’s okay to shop with us. I would love to have spoken with one of my great-uncles to ask one of them what it was like trying to market the clothing during that time.
In the 1950s, I wonder if my family was ever told to build a ‘Whites Only’ bathroom for any location. It was always a very liberal, progressive business, as are we as a family, so I can’t imagine the reaction. There’s a woman who occasionally works with our company now when she’s available who is a fabulous ambassador in the industry. Her name is Audrey Smaltz. She started the Ground Crew, which is a fashion show production company. In 1961, my grandfather plucked her off the sales floor, and she became a Lane Bryant model and later on became the face of the Ebony Fashion Show. Our company was always very civic-minded but the issues that society must have imposed on the business are ones that fascinate me.
I’ve always had a bug for this history stuff. My dad was hired out of Harvard Business School by mom’s family. He was the first one hired outside the family, to be groomed for senior management. He ended up marrying his boss’ daughter (my mom). They had a brief marriage, however years after they were divorced, my mom’s family made my father the head of the business. These were defining issues for me growing up and for my family. As a kid, I was used to going to stores, to my father having an office that functioned on Sundays, and to the company having 8000 employees so many of whom we knew personally along with their families. The business was sold to the Limited Corporation in 1982, and though everybody did well financially, I was always weirded out that life totally changed starting then.
TP: How was Fashion to Figure started?
MK: I never wanted to go into the family business, and I never had a ‘fashion bug’ or anything like that. But when I began working in investment banking and mergers and acquisitions on Wall Street after going to Brown University, my mindset began to change. I tried to relate the things I was learning on the job back to the business that I knew.
The most resonant example was when I was in the venture capital business before business school. The guys I was working for asked me to write a business plan as an academic exercise to see how I was doing at my job. This was at a time when iVillage and other specialized women’s businesses were getting funding. These sites and companies were making an argument that the web could serve the needs of women more intimately than just traditional channels. My bosses knew about my interest in my family’s old company so with their input I wrote a business plan for a website that could serve plus-size women. They thought it was a good idea and wanted to actually start it so they launched the site. While I was at Harvard Business School, that business got sold to Charming Shoppes, which is the largest plus size business in the U.S.
When our family business was sold in 1982, there were 18 billion dollars spent on plus size apparel, and 38 million women in the US above size 14. Now, there are 30 billion dollars spent on plus size apparel and 60 million women who wear above size 14. In spite of nutritional consciousness, and workout crazes, the plus size market has continued to grow. With knowledge of these numbers, with my interest in my family’s business, and with insights gained during the Charming Shoppes deal, I realized that other retailers were slow to understand who the plus-size customer was or what she wanted.
I came to the conclusion that when my dad was running the family business, the store was a place to go hide and not be scrutinized while you shopped for functional clothing. But in the post-Oprah Winfrey era (we at FTF divide the world up into post-Oprah and pre-Oprah), women’s body images had begun to change. And while they still haven’t changed enough, there’s certainly a change in the idea that bodies should be just one way. Vogue has a Shape Issue once a year. There are women’s role models on television who are not supermodels. And the psychology of the plus-size customer is that she’s really at peace with herself and just wants the fashion that anybody wants.
So, while still in business school, I started to realize that there was an opportunity for a plus-size business that would sell tons of different fashions and tons of different choices at great prices with great service. I spent the second year of school doing an independent study trying to focus on that. I pulled my brother into it because he had twenty-plus years of retail experience, and he understood how to make my idea a reality.
FTF was built because of the history of my family and of my great- grandmother but also because of the needs of the market today. Any entrepreneur has to be smart and serve a market. But in retail, you can’t begin to be creative or do anything unless you have the right product at the right price in the right place. But if you can execute on those things, which a great merchant like ours can do, then it gives you a whole other window into the customer’s mind. It gives you an ability to serve people in a way that’s really exhilarating.
I still really like reading and thinking about my family’s business. My great uncle started The National Volunteer Awards. These awards acknowledged volunteer service in local communities. There were Presidents of the United States and Senators and other famous dignitaries that used to sit on the judges panel. I’ve also enjoyed reading about the 25-year club for the employees. We at FTF have tried to continue that legacy by sending anniversary emails to our employees. Fifty percent of the people in our business have been there more than a year.
I think retail’s one of the last industries where you can truly affect the quality of a person’s day. When somebody walks into your store, it’s like theatre; you can really entertain them and take care of them and provide them with a happy experience. Their day is better when they leave you than when they found you. That’s the turn-on to me. It’s not about brown sweaters being ‘in’ this season. And it’s not just the clothing, for us, it’s the whole experience. It’s about knowing someone, sending them a thank-you, responding to their emails and more.
TP: Customer Service must be a really major part of what you do.
MK: Yes. This customer has been conditioned to expect so little. But you can’t go for that goal, that relationship, unless you’ve got great product and a great scheme and the right prices. Our business is the only fast fashion retailer that’s based on plus sizes, and we have stuff that’s incredibly trendy by anyone’s definition. But my particular bug is to take care of people. People still come up to us in the market and in the stores and tell us that they used to work for our family way back in the day and they’re so glad we’re still in business. People ask about my dad still. I love that. I love that you’re able to take a person who works with you and treat them well and try to have a good purpose to their job and they feel as though the quality of their life is a lot better.
TP: That kind of 360-degree approach is easier said than done.
MK: It’s tough. We pay our employees well, which is important to us, but when sales are down, that’s tougher to do. But you have to do it. It’s something we believe in.
TP: How many stores do you currently have?
MK: Seven. The internet store is the eighth. We’re trying to expand further now out of the NY area. They’re all in malls that are all ten or twenty miles from NYC. We wanted to prove it was a national, scaleable business.
TP: How long has your e-commerce site been up?
MK: Just under a year. We finally got the right person running it, a great web director. We had a different version of the site up a couple of years ago because the technology came with our POS company, so we just kind of turned it on. But it wasn’t a great experience and we thought we should take it down. If you’re setting the bar high with your stores, you want to match it online. For us, the website allows us to share the experience with women all over the world. We’ve got a great fulfillment partner that allows us to provide good customer service with a customer service rep in our company that answers the phones all the time trying to make sure customers are satisfied and to take care of issues that inevitably come up. It’s a different process than the one you use to sell something in a store. We struggle with the fact that while we have stylists (our name for our sales associates) in our stores, it’s hard to figure out how to have a stylist online. There’s live chat but we’re still figuring it out. It’s the same hurdle as ‘I want to try it on’ but we offer free returns and we offer free shipping over $70. So we try to take the risk out of it.
TP: What’s the brand’s approach to social media?
MK: We’ve got about 7000 Facebook fans. It’s progressively building. We also tweet. We have Facebook deals and postings, and we try to make it interesting. For instance this month we’re doing a push for Black History Month profiling women who have history in business or fashion. We try to do more than deals and new products.
TP: What is the plus size market like currently?
MK: It’s definitely getting more competitive. There are more choices for people, which is great. I think people recognize that it’s an opportunity and it’s less stigmatized. But I still think there aren’t enough people going after it.
TP: Are plus-size customers looking for a certain price point?
MK: I think the world is looking for things to be better priced right now. I think you have to be at either end of the spectrum, and if you’re in the middle, you’re lost. I think you have to provide great value or such rich brand equity, and that something like the bridge market is tough. In the world of fast fashion, we are the best in terms of service, price and style. In a department store, our shopper is reminded of the limitations and perhaps made to feel badly if the plus size department is placed next to the shoe department or something like that. There’s the whole adage that women ‘want to go where their friends go” but if you have a 100,000 square foot department store that all of your friends go to, and you can only shop 10 feet of it, is it a reminder that you’ve been segregated in some way?