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business newsUp-and-Coming Retailers: True Religion
Faithful buyers and smart marketing have driven growth at the pricey jeans label.
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Jeffrey Lubell, CEO and chairman, founded True Religion in 2002 and has been on a mission ever since to cover the behinds of the world’s fashion-conscious denim buyers with the brand’s American-made jeans. The Vernon, California-based retailer only opened its first store in 2005, spreading its gospel until then through deals with top market department stores like Bloomingdale’s (M), Saks Fifth Avenue (SKS), and Nordstrom (JWN).
True Religion’s wares could be described as biker glam, and their jeans are recognizable by their back pocket flaps and layers of contrast stitching. To up the glam quotient, the company used heavenly übermodel Gisele Bündchen in last year’s ad campaign. This year’s features Tori Praver, who has graced the pages of the Sports Illustrated swimsuit issue. Prices are high enough to reach the realms of the gods, too: Women’s jeans retail from $172 to $650 for a pair of tight-fitting leather pants which require a supermodel’s legs to pull off with any self-respect. Men’s denim ranges from $172 to $262 a pair.
Lubell, though, is in no way apologetic about the price of True Religion's wares. As he told the Los Angeles Times, "My brand has almost been like the success of Studio 54, where it's not for everybody, even though I would love it to be. It's like being in the club."
True Religion, in an odd way, has joined the distinguished pantheon of highly coveted luxury goods, like Gucci handbags and Dolce &Gabbana sunglasses. If you haven't taken a look at True Religion items in an actual store, you very well may have noticed them being hawked by a street seller in New York or LA, or on eBay (EBAY). Take note: They're fakes. That means you're just buying Religion without the True.
And as True Religion's star power rises, the jeans maker Diesel SpA, long the arbiter of cool, is reportedly enduring a rough patch. The retailer has developed a global brand and expanded into intimates, footwear, and home goods while opening 300 Diesel-branded stores globally. But according to recent reports, not all is rosy at the privately-owned Molvena, Italy-based denim label. It has seen its top U.S. executive, CEO Steve Birkhold, decamp to competition Devanlay U.S., which licenses Lacoste. Wilbert Das, the head designer who spent over 15 years with the company, also recently left.
According to True Religion’s 2009 third-quarter report, the company had 66 stores in the US, up from 42 at the end of December 2008, and net sales of $82.4 million, seeing growth in every segment except for the US wholesale segment which fell 31 percent. Their shares have seen some true highs and lows, too, hitting a 52-week low last March of $7.80 and a high of $28.90 at the end of October. In early January, the share price had stabilized at about $18.
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