Cut From a Different Cloth
Ask a guy in his 20s about Hickey-Freeman, and he’s likely to respond, “Hickey who?”
But to post-middle-age American executives, Hickey-Freeman represents the old-guard establishment in men’s tailored apparel, an enduring bastion of home-spun quality favored by CEOs and seasoned Wall Street players.
Therein lies the predicament facing the Rochester, N.Y.-based Hickey-Freeman and an affiliated firm, Hart Schaffner & Marx, both owned by Hartmarx Corp. of Chicago. These labels still attract mature, well-heeled businessmen. But the rise of casual attire at the workplace and the fascination with designer labels have forced these century-old clothiers to change their ways so they can attract more youthful customers.
“There’s a joke that every time a hearse goes by, Hickey-Freeman loses another customer,” analyst Margaret A. Gilliam said.
To entice younger men, both companies have brought out trimmer, more contemporary tailored clothes, increased their advertising and added full sportswear lines.
Luxury-priced Hickey-Freeman sportswear is targeting men from age 30 upward with cashmere sweaters, blazers and casual pants that compete with Ralph Lauren, Giorgio Armani and Hugo Boss. The upscale, but more moderately priced Hart Schaffner & Marx has set its sights on college graduates with its knit shirts, wool sweaters and suede jackets that go head-to-head with Brooks Brothers.
The changes show that Hartmarx realizes it can’t ignore fashion. But for old-guard clothiers with stodgy reputations, reinvention isn’t easy. Hartmarx needs to build credibility with consumers as a sportswear company. But it doesn’t spend as much on advertising as does its trendier competitors.
“Reaching the young, conservative consumer is more difficult than reaching fashion-conscious youngsters, who are driven by the media to make fashion decisions,” said David Wolfe, creative director of a New York fashion trend firm.
After a disastrous expansion of its retail operations in the late ‘80s and early ‘90s, Hartmarx paved its comeback by shedding Silverwoods and its other retail operations and by broadening its manufacturing to include a wide range of licensed and company-owned labels.
Now Hartmarx sells tailored and casual men’s and women’s clothing under various labels to everyone from Neiman Marcus to Sears. It produces trendy Tommy Hilfiger casual slacks and the new Kenneth Cole tailored men’s line, as well as low-priced Desert Classic golf wear. Its 1996 acquisition of the bankrupt Plaid Clothing Group further boosted its base, adding such brands as Evan-Picone, Palm Beach and Claiborne.
Attempts to remake itself have helped the publicly traded firm rebound. Last year, Hartmarx sales increased to $718 million, from $610 million in 1996. Sales and earnings also were up during the first quarter of 1998.
Still, the former billion-dollar-plus company has a long way to go. It plans to continue expanding into new clothing categories and seeking licenses. But its most notable commitment to change may be the freshening of its mainstay brands, Hickey-Freeman and Hart Schaffner & Marx.
Through two world wars, the Depression and stock market crashes, both have preserved their reputations as manufacturers of fine tailored suits, sport coats and dress pants geared toward businessmen.
But both companies have come to realize they can’t depend on tailored clothes to drive their sales. The U.S. market for men’s tailored apparel dropped more than 10% last year to $4.2 billion, according to industry tracker NPD Group.
Two years ago, Hickey-Freeman introduced its first sportswear line, aiming at the upper end of the sportswear market. It had hoped that its suit wearers would buy the sportswear and that younger customers might discover the brand through the casual apparel, which runs from $85 for a knit shirt to $575 for a jacket.
“The sportswear area has been growing, and we saw no reason Hickey-Freeman couldn’t do it too without damaging the brand,” said Chairman Duffy Hickey, whose grandfather founded the company.
“We had to be conscious of what’s going on in the marketplace. People are still wearing tailored suits, but we had to recognize the growing segment involved in sportswear.”
Last year, Hart Schaffner & Marx came out with its sportswear, selling for between $75 and $425.
Both companies also came out with trimmer, more contemporary suits to make their tailored collections more appealing to younger men. About two years ago, Hickey-Freeman introduced its Moda line, which is hipper in styling and slightly less expensive than its other suits.
Hart Schaffner & Marx about five years ago brought out its Westport line, geared toward a younger man’s body. And next year, it will introduce dress shirts, neckwear and other men’s furnishings to complement its suit line. Before 1993, the boxy Corporate Collection comprised 100% of sales.
With the new product launches, both companies have increased their advertising, which consists of in-house print ads that run in national magazines.
Last year, Hickey-Freeman, which didn’t advertise at all between 1985 and 1991, spent about $620,000 on advertising, an increase from $440,000 the previous year, according to Competitive Media Reporting.
Hickey-Freeman uses models in their 40s who have no gray hair but a few lines in their faces. Ads appear in publications such as the Wall Street Journal, Forbes and Departures.
Hart Schaffner & Marx, while continuing to place ads in business publications, is pitching its clothing in Men’s Health and Cigar Aficionado to reach younger men. It wouldn’t disclose ad expenditures. Hart Schaffner & Marx spent $166,000 in advertising, a boost from $140,000 in 1996, according to CMR.
“When you advertise in a magazine like Men’s Health, young people find out about the name,” Hart Schaffner & Marx Chairman Ken Hoffman said.
Sales of Hickey-Freeman and Hart Schaffner & Marx clothing rose 16% in 1997. Last year, Hart Schaffner & Marx sales reached $200 million, while Hickey-Freeman sales exceeded $60 million in the roughly $1.2-billion U.S. market for premium-priced men’s tailored clothes.
In particular, Hart Schaffner & Marx sportswear has performed well. The company said retailers have ordered three times as much sportswear for the fall of 1998 than they did for the fall of 1997.
Hartmarx said Hickey-Freeman’s sportswear line is doing well, but declined to give details.
Are younger men driving sales of Hickey-Freeman and Hart Schaffner & Marx?
At Hartmarx’ annual meeting earlier this month, Chief Executive Elbert O. Hand offered anecdotal evidence.
He’s noticed different customers buying Hickey-Freeman clothes during recent visits to stores. And his son’s stockbroker friend told him there’s a cache to wearing a Hickey-Freeman suit among the younger Wall Street set.
Dan McCampbell, vice president of men’s tailored clothing at Saks Fifth Avenue, also has noticed more younger men buying classic apparel such as Hickey-Freeman, which he attributes to a renewed interest in tailored clothes.
“We’re trying to expand our franchise to include lots of other products,” Hickey said. “This is a noticeable change for us. But we know there’s lots of younger people with disposable income out there. We just have to make ourselves more attractive to them.”