Co.Design

Can Marimekko Go From Cult Design Brand To Fashion Empire?

The Finnish brand has cult status among design snobs. Now Marimekko wants to expand by playing up the very thing it got famous for: fashion.

Banana Republic, maker of practical wrinkle-free dress shirts and flattering fit-and-flare frocks, is not typically at the forefront of fashion trends. But it is savvy about marketing. While dozens of mass retailers have tried to make “designer collaborations” work--like the upcoming Joseph Altuzarra for Target and Alexander Wang for H&M--few are so successful that they’re willing to brag about it. Yet Banana Republic’s partnerships--including multiple Mad Men collections and one-off projects with designers such as Trina Turk and Roland Mouret--have been a place of pride for the brand. (The Mad Men line has been highlighted on earnings calls.)

Most recently, Banana teamed up with the quirky Finnish textile company Marimekko on a collection that hit stores in late May. Many items, which included sundresses, shorts, and tank tops in Marimekko prints, sold out within a week. While she won’t comment on sales specifics, Banana Republic Global CMO Catherine Sadler says that the partnership has exceeded expectations. “We’re always looking for a strong collaborator with global relevance,” Sadler says. “For a collaboration to work, the customer needs to see an authentic connection.”

This collaboration illustrates Helsinki-based Marimekko’s effort to get North Americans reacquainted with its bold, cheerful Scandinavian design. Marimekko has cult status among design snobs and has enjoyed a long-time partnership with the housewares company Crate & Barrel. But Marimekko is not a household name in the U.S. And it has suffered some setbacks. Last year, the company's profit loss was about 1 million Euros after taxes. At the end of June, Crate & Barrel closed its Marimekko's shop-in-shops. CEO Mika Ihamuotila, a former bank CEO who joined Marimekko after surviving a brain tumor (and deciding that a life in finance was not a life well-lived), is optimistic--some might say overly so. “I’m personally an idealistic person,” Ihamuotila says. “I don’t think about money first.” His hope, in part, is to create more brand awareness by playing up the very thing that catapulted Marimekko into the American limelight decades ago: fashion.

Marimekko's Rise

Marimekko was founded in Helsinki in 1951 by Armi Ratia as a textile manufacturer; Armi was a trained textile designer, and Viljo, her husband, ran a fabric business. The company made waves early on for its joyful, energetic prints that were welcome in post-war society. Its network of designers soon became famous in their own right. Vuokko Eskolin-Nurmesniemi, who joined the company in 1953, is best known for her striped motifs. Maija Isola, the artist behind the famed Unikko print--which she designed in rebellion against Armi, who had banned floral pattern from the company--joined in the 1960s. Marimekko began making simple dresses early on to serve as an example of what could be done with the textiles--it even hosted a fashion show that first year in Helsinki--but it wasn’t until 1960 when Jacqueline Kennedy bought seven dresses, and posed on the cover of Sports Illustrated in one of them, that the brand gained major recognition in the U.S. “Everyone who wanted to liberate himself or herself wore Marimekko,” Ihamuotila says.

Today, Marimekko sells an array of clothes and housewares but the company is much better known for the latter. Its most well-documented partnership stateside is with Crate & Barrel, which has hosted Marimekko shop-in-shops since 2010. But on July 1, Marimekko lost that deal. Crate & Barrel--whose CEO, Sascha Bopp, is making broad changes after slow growth post-recession--has chosen to close the shops; presumably, they weren’t performing well. (A spokesperson for Crate & Barrel declined to comment on the closings. “We continue to value our longstanding relationship with Marimekko and prefer to offer no additional comment at this time,” she said.) Select textiles and housewares, which were a part of Crate & Barrel’s offerings long before the shop-in-shops existed, will continue to be sold there for the time being.

Crate & Barrel is hardly Marimekko's only strategic partnership. Since becoming majority shareholder of the company in 2007 and its CEO in 2008, Ihamuotila has championed a series of ambitious collaborations. (He currently owns 16% of the company.) There was the exhibit at the Finnish Embassy in Washington, D.C., celebrating Unikko, the company's iconic poppy print. There was a push to get the kids line into more department stores, including Neiman Marcus, Nordstrom and Bloomingdale’s. And then there is the agenda to up Marimekko's fashion cred.

Fashion Forward

As much as design nerds love Marimekko, the brand is still seen as a niche offering: something that only a particular sort of person with a particular sort of taste would buy. Ihamuotila seems to understands his limits--and potential--when it comes to housewares. But fashion is more of a crapshoot. And while the dresses and separates currently available in Marimekko stores are cute in a retro sort of way, the silhouettes feel a little staid. To fix that, Ihamuotila hired fashion hotshot Anna Teurnell as its creative director.

Teurnell, who will start in July, comes from & Other Stories, H&M’s higher-end, high-fashion counterpart. (The average dress is around $150, compared to $40 or $50 at the fast-fashion emporium.) While H&M doesn’t break out & Other Stories’ sales figures, it has repeatedly praised the year-old brand’s early success. It is even opening a U.S. store in New York later on this year. Why that’s such a big deal: it took H&M seven years to launch COS--its other upscale brand--in the U/S. COS just became available in May 2014 to U.S. customers via e-commerce, and its first store will open in New York later on this year.

Teurnell, a Swede who has been living in Paris while designing & Other Stories, is moving to Helsinki to take on Marimekko. “She didn’t even play a difficult negotiator!” Ihamuotila says of approaching Teurnell, who was undoubtedly seen as hot property. A textile designer by trade, one can only assume that a combination of Scandinavian nostalgia--Marimekko is a heralded brand there--and lifestyle were major factors in Teurnell’s decision to leave H&M. But it also sounds like Ihamuotila would have done almost anything to get her on board. “I wanted someone with a strong background in the fashion world,” he says.

The onus will be on Teurnell to design clothes that other stores see as potential best-sellers. (The success of the Banana Republic collection suggests that there is a broad audience interested in Marimekko's particular fashion flavor.) & Other Stores was an instant hit, and the kinds of clothes she designs--hip, trendy pieces reminiscent of ultra-cool brands such as Acne and Céline--play into Marimekko’s Scandinavian sensibility without being a turn off to a global audience. And she also has room to grow. Currently, the majority of Marimekko’s business is in textiles and housewares. Its fashion identity is a vintage one. This means she can almost, if not completely, start from scratch. (Those famous prints will find their way in somehow.) She also has the support of Ihamuotila, who possesses the same sort of inner confidence that great merchants do: he believes that good product, against all odds, will win out. It’s her job to create it, and his job to message it.

But Ihamuotila still has plenty of challenges ahead. The company generated 94 million Euros in sales in 2013, up 6% from 88.5 million in 2012 and 21% from 77.4 million in 2011. But it lost a lot of money in ’13--profit loss before taxes was 804,000 Euros (and equalled about a million Euros after taxes)--mostly due to increased expansion efforts, like write-downs on the company-owned stores in Beverly Hills, Boston, and Oslo, which totaled 1.5 million Euros. Ihamuotila must supplant the Crate & Barrel loss with new partnerships, and convince shoppers that it’s a fashion brand as much as a textile brand. Ihamuotila understands that the beloved, if niche, Scandinavian look needs to move forward to be embraced by a larger audience. The idea is to infuse Marimekko with greater brand affinity and global recognition. And hopefully greater profits, whether that’s at the top of his priority list or not.

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