Liz Claiborne Wears Just Right

One of the basic rules of retail is know your target market.

For Liz Claiborne, this was easy. For much of her life, she was the target market.

Claiborne was a middle-class working mother in the days before there was a working mother in every other cubicle. She saw there was a gap in the clothing market for people like her — and started filling it just when her sisters started pouring into the workplace. The result was the first Fortune 500 company founded by a woman.

Claiborne's parents had envisioned a less practical road for her. She was born in 1929 in Belgium to expatriate American parents with a strong sense of aesthetics. Her father was a banker, but she remembered being ""dragged around to museums and cathedrals"" due to his love of art. Claiborne said this early environment helped form her eye.

""Europeans have a more careful sense of the visual than Americans,"" she told Esquire magazine in 1986. ""Americans might put a paper carton of milk on the table; Europeans would pour the milk into a pitcher and put the pitcher on the table.""

Equally as important, her mother taught her to sew, and she loved it.

In 1939, the family fled the oncoming war and returned to their home base of New Orleans.

Peace And Design

After World War II ended, Europe and its artistry beckoned again. So when Claiborne dropped out of high school, her father sent her to art school in Belgium and France, hoping she would become a painter.

Claiborne, however, knew she didn't have the stuff to be a great painter. She dreamed of being a fashion designer, combining her artistic eye with her love of sewing. But her father was old-fashioned; he didn't approve of women having careers.

So Claiborne took the opportunities she had. At age 19, she entered and won a national design contest sponsored by Harper's Bazaar magazine. She used this credential to land a job with New York designer Tina Lesser.

Claiborne moved her way up through different fashion houses, eventually becoming chief designer at Jonathan Logan. She worked there 16 years before starting her own venture.

She was married to Arthur Ortenberg, and they raised three children from their previous marriages. Ortenberg kept moving from job to job, trying and failing to start up his own business, so his wife had to be the stable breadwinner.

As it turned out, what he really needed to succeed in business was his wife's genius.

As a working mother in the 1950s and '60s, Claiborne found the clothing choices the stores offered her were inadequate.

Clothing for career women at that time was essentially a female version of the male suit: a matched set that could be worn only one way, usually made of expensive dry-clean-only fabric.

Claiborne thought that working mothers really needed clothes they could mix and match — getting multiple outfits for the price of one — made from fabrics that were easy to care for.

She tried to persuade the people at Jonathan Logan to try this out, but got no takers. So in 1975, after the last child was safely out of college, she quit her job and started rounding up capital.

She and Ortenberg invested $50,000 of their savings, and they drew an additional $200,000 from their friends.

In the fall of 1976, Liz Claiborne Inc. launched with 35 design pieces.

""Her timing was exquisite,"" wrote Gene Landrum in ""Profiles of Female Genius.""

Although career women like Claiborne had been around for a while, it was in the '70s that they reached the status of a mass market. And the loosening of clothing formality that had started in the '60s meant they weren't stuck in navy-blue suits.

Because Claiborne had been there, she grasped her customers: the Liz Ladies, as she called them.

""I listen to the customer,"" she told Fortune in 1990. ""I went on the selling floor as a saleswoman, went into the fitting room, heard what they liked and didn't like. Not that you do exactly what they want. What you do is digest the information and give them what you think they ought to have.""

Claiborne also took a unique approach to pricing.

""We don't do the design and then add the cost of producing and selling,"" she told Esquire. ""We do a sample, and then we think — I think — if I was going to wear this to my job, how much would I pay for it? Then we try to keep the cost to that.""

This meant that Liz Claiborne Inc. was one of the trailblazers when it came to outsourcing manufacturing overseas. It also meant the firm could undercut the prices of most other quality career-woman brands, such as Anne Klein.

As a result, Liz Claiborne Inc. turned a profit in its first year of existence. By 1981 sales had soared to $117 million, and the firm hit the stock market. Over the next 11 years, the stock's value grew 30-fold. In 1987, annual sales passed $1 billion.

The growth came not just from the success of the original concept, but also from continual diversification. Throughout the '80s, a new offshoot appeared nearly every year: petites, shoes, juniors, perfume.

Not all of them worked out, but the successful lines gave the firm commanding market share in 1989.

The company's success grew out of not only Claiborne's strong vision, but also her symbiotic partnership with her husband.

""Arthur was always the administrative and chief operating officer of the company, while Liz saw to the designs,"" Landrum wrote. ""Arthur is outgoing while Liz is shy. She is serious, he jokes a lot. She watches the details, he watches for the big problems. She manages by doing, he by teaching. They were a great team.""

Getting Familiar

Even as it got big, the couple wanted a family feel to the company, keeping things on a first-name basis. They also cultivated friendly relationships with retailers, who were highly appreciative.

Claiborne Inc. sent out new clothing lines six times a year instead of the usual four, keeping inventory turnover high.

Also, the firm sent shipments of related items in sets so they could be displayed in suggested combinations. This helped customers with the mix-and-match concept.

In 1990, Claiborne and Ortenberg retired to spend time at their extensive properties and to work for charity.

"We always intended to leave before we became irrelevant," they said at the time.
BY AMY REEVES