Hot Stuff

Hot Business: Niche Label Clothing

Teens will be teens, and as we know, they're a fickle lot. Their lack of long-term loyalty to any particular clothing brand has sent formerly "hot" giants like Nike and Levi's to the drawing board, thinking up youth-grabbing ad campaigns to win back the segment that Promo magazine says spent $27 billion of their own money last year. That's why niche, or indie, labels that round out specific lifestyles--be it skate, surf, punk, hip-hop or rave--are thriving, even without excessive marketing bulk.

Take twin brothers Sean and Barrett Murphy, 31, and their Santa Barbara, California, clothing company L&H Apparel Inc., makers of the Porn Star clothing line. In only their fourth year in business, they expect to gross $12 million to $15 million, and predict as much as $20 million by 2001. Never heard of them? Don't forget about teen word-of-mouth. "Now teens all over the country see or hear about cool new clothes more quickly, and they're getting access to them through direct-mail and Internet businesses, which have sprung up and been able to roll out on a national level much more quickly than specialty stores," says Hunter Heaney, president and CEO of teen-focused interactive magazine MXG in Manhattan Beach, California.

Although the Murphy brothers started with $350,000 in funding from partner Charles Logue, Sean says $250,000 would have sufficed to get the line made, do minimal advertising, hire a sales force, secure a warehouse, go to trade shows, take orders and cover travel expenses.

Targeting a lifestyle tends to be the risk. "The thing that's cool about our line is 'Porn Star' doesn't really mean anything," says Sean, whose company recently launched its less "edgy" Starlette line. "It's just so broad." Launching a too-specific lifestyle brand could be label suicide, given fleeting trends, but if you heed the advice of a pro, you should fare well. Says Sean, "[Brands] should find their identity and roll with it." Because remember: Teens can smell insincerity miles away.

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This article was originally published in the December 1999 print edition of Entrepreneur with the headline: Hot Stuff.

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