MARLIES DEKKERS (B):
Recovery and Regrowth
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Redressed: Marlies Dekkers' Recovery and Regrowth
Dutch lingerie designer Marlies Dekkers started off with a creative mission to change
the lingerie business, a belief in herself, and a feminist message embodied in her brand.
She rode the crest of success and celebrity and opened a few own stores stretching
from the Benelux to New York. As the international appeal of the brand became
apparent, the brand and company went into a growth spurt phase. Many investors and
banks lined up to invest in the brand, wanting to be a part of the global expansion.
However, the roll out was too aggressive, reaching too far out and in multiple
countries where the brand awareness was still low. The turnover didn’t grow as
planned.
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To compensate at the time, different business-level strategies were pursued
simultaneously, which negatively impacted the premium status of the brand. The
investments failed to fuel the growth and the company became overleveraged. At the
same time ta major supplier went bankrupt. All of this occurred against the backdrop
of a stagnating economy and finally resulted in the bankruptcy of the company in
August 2013.
Yet, Dekkers did it her way and got an all-woman investor company, Karmijn Kapitaal,
on board to restart the company. Together they paved a new strategy, drawing on
Marlies’ strong brand, creativity and entrepreneurial vision. It took a bit longer than
expected to recover, but the brand is still running strong.
Yet, how sustainable is the Marlies Dekkers business today? Can her Feminine Feminist
message continue to resonate with a younger generation? What are the next best
steps?
"I am as beautiful, as sensual, as desirous, as I believe myself to be."
-- Marlies Dekkers
This case was written by Jacqueline Nolan under the supervision of Dr Magdalena Cholakova
and Professor Dianne Bevelander from Rotterdam School of Management, Erasmus University.
The case is based on field interviews and desk research. It is written to provide material for
class discussion rather than to illustrate either effective or ineffective handling of a
management situation.
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"Women, like men, should try to do the impossible."
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Redressed: Marlies Dekkers' Recovery and Regrowth
The Female Investors
"The entrepreneur, the product, the heritage and philosophy – the fact that these
elements are so congruent and aligned, and the way she embodies the brand through
a genuine and personal message, is the beauty Marlies Dekkers held and holds for us,"
said Karmijn investor Hadewych Cels, who also served as interim director during the
transition period. Karmijn invested in the company's relaunch as Dare to Be, including
buying up the company's debt from Rabo Bank for an agreed amount. The decision
to back Dekkers wasn’t exactly risk-free:
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"Usually, when we invest, we spend a lot of time assessing the market and conducting
research, a real risk assessment. In the case of Marlies, this wasn't possible. Because
of the bankruptcy, we had to dive in and follow our gut feeling. Of course, diversity in
the management team and the added value of a strong female role model attracts us;
and if any company fits that bill, it's Marlies Dekkers."
Karmijn Kapitaal believed in the Marlies Dekkers concept, but also had a number of
concerns:
•
Because Marlies Dekkers was a big name and personality, the bankruptcy was
bound to attract considerable media attention.
•
Loosing know-how when the company has been skills-drained after the
redundancies (even basic procedures like how to put in a purchasing order).
•
If the company developed their e-commerce strategy, how would retailers in
smaller retail outlets feel about that, as it was bound to cannibalise part of their
business?
•
What would be the psychological impact on employees, once the number of
employees had been reduced from 110 to 35?
Strategic Renewal at the Top
In the turnaround period, the old management team was replaced in order to align
with the new strategy. Marlies, after 20 years of leading the company, chose to seek
for a new CEO, together with Karmijn, who could roll out the new business plan (see
Appendix 4), while she remained the Creative Director. Eppo van Berckelaer, with a
wealth of experience in business development and brand management at O'Neill and
Coca Cola, was the winning bet for them.
"Eppo was the right person when he came in,” recalls Dekkers. He complements my
skills and style. He's a real manager, not an entrepreneur, and took the time needed
3
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Karmijn Capital, an investment company led by three female investors, stepped in at
the time of crisis. They recognized all the strong elements that established the Marlies
Dekkers brand and were attracted by its female empowerment message.
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"It's almost impossible to change the leadership and create new entrepreneurial spirit.
But here it has worked. Externally, Marlies is the company's face and entrepreneur.
Eppo has qualities that make the relationship symbiotic. And you have a be a pretty
strong male not to mind that she's the one in the limelight. There are not that many
men around who can deal with the fact that they're not number one," said investor
Cels.
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Less is More
From a product perspective during the turnaround period, the company cherished
and continued to invest in the signature strap design via seasonal trend updates, thus
focusing more exclusively on the higher-end luxury sector. In 2014, Dekkers launched
back her signature, style and couture collections, which was followed by subsequent
line extension within the premium category (see Appendix 3).
Dekkers had learned from the growth period in the 2000s that increasing the product
portfolio made life complicated: “When the brand is on fire, they want you to make
shoes, sunglasses, have your own hotel.” “Different products require different
distribution channels, and different production sites, and you end up losing money.
“Productwise, it was better for me to stay with lingerie products in the new company.”
– Dekkers recalls.
Going E: Online Sales
For Dekkers, the restart meant "No coming back. We had to get rid of the old way of
thinking." E-commerce was a pivotal part of her new vision, and, Karmijn supported
her in this. Dekkers even wanted to opt for 100 percent online sales, but Karmijn found
that too risky, and upheld their retail proposition with a limited number of points of
sales parallel to the development of e-commerce. Indeed, Karmijn supported Dekkers
in the negotiations with Dutch high-end retailer De Bijenkorf, where Marlies Dekkers’
products were sold nationwide: it was imperative that the company could keep their
spots
there.
Having a certain physical brand presence in selected regions was still seen as
important for brand awareness and turnover, thus specialty stores in Holland, Belgium,
Germany and France were retained and also equipped with a business to business
order portal.
At the same time, Van Berckelaer immediately set about paving the way for a digital
transition in line with Dekkers' vision. Going online doesn’t necessarily mean success
in every sector, Dekkers and Cels agree, citing Belgian lingerie producer Van de Velde
(brands such as Marie Jo and PrimaDonna) as an example of a company that has
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to implement the strategy. We're both methodical when it comes to tasks, but when
it comes to people, I'll get impatient if I have to explain something three times. Eppo,
on the other hand, will go over something ten times until they understand. And he
knew how to stick to the plan."
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Redressed: Marlies Dekkers' Recovery and Regrowth
To get it right, you had to have the right people in place, the CEO and Creative Director
knew. Van Berckelaer persuaded O’Neill’s e-commerce Director, Jerome Orlemans,
to join the Dekkers team. Orlemans: “Lingerie is an essential part of the fashion
industry nowadays, so in that respect, it’s not a hugely different world from O’Neill.
But what I discovered is that Marlies has real fans – not just customers, but aficionados
– and that’s a strong foundation to build online business on.”
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Dekkers herself travelled to conferences in England seeking information, talking to
supervisory board members who had their ear to the ground. She visited companies
that had invested in e-commerce in order "to take a look in the kitchen," and she
recalls being surprised to see so many employees involved in the online processes. "I
thought all I had to do was set up a website, and that was it, more or less. But there
was a multitude of specialists involved to ensure that every single obstacle between
the customer's fingers and payment was removed."
When Orlemans started off, three percent of sales came from e-commerce; in 2018,
it was almost 50% (see Appendix 4 for more details). Given that two-thirds of the
workforce had been laid off, it was a challenge to succeed in online acquisition with
such a small team – an intimate two to start with. The implications of that e-growth
were initially palpable throughout the whole company, said Orlemans.
E-commerce, however, didn't just boost revenue; it also helped the company's cash
flow. When Dekkers went online, she implemented a new condition that specialty
retail distributors pay immediately if they purchased through the portal. "A rigid
choice," she said. They let their direct customers pay the price of returned goods, too.
It would be impossible to compete with online giants like Zalando and Wehkamp in
this respect, affirmed Dekkers.
Since 2016, customers can also make purchases on their phone through a mobile app.
“I really hadn’t expected that so many customers would actually use our app,”
conceded Orlemans, “Downloading and installing an app seemed like a threshold, and
how often do women shop on a luxury lingerie site? Well, some of them on a daily
basis, I learned from the e-traffic. A substantial percent of our online orders are now
placed through that mobile app.”
And how was it to be a male among the bras? “It took some getting used to, as a man;
it was quite a step,” Orlemans laughs, “But now I know everything about shapes and
fit. I’ve become an expert.”
Human Instinct, Artificial Intelligence
The technological transformation at Marlies Dekkers has impacted the nature of the
customer response to the Feminine Feminist message and helped identify the
different communities that tap into it.
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struggled with the choice of going into e-commerce because of their loyalty to the
physical stores and distribution.
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Redressed: Marlies Dekkers' Recovery and Regrowth
“Are the women different in France? Of course they are, but I can’t use this information
in itself. What I ask is: ‘Is a country ready for it? And how should I decide?’ First I go
there by myself, go dancing and to bars and talk with people. I do not do any market
research. It’s very personal. If I think country X is too macho and it will be a menbuying- for-women and not women-buying-for-themselves market, then I don’t
enter that market. Ten years ago I would not have gone into France for that reason."
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The company’s recent digitalisation has carved out a new type of border. “We don't
think in terms of countries anymore. We see cross-country ‘heat maps’ – an area with
a dense population of people who are buying our products, and we then do marketing
in that area.” The company has identified some ten heat maps, e.g. in the Netherlands,
Los Angeles, two to three in Germany, in Scandinavia, Poland and Russia.
It’s a learning process in terms of applying the analytics data in their decision-making,
Dekkers explains. The presence of brick-and-mortar retailers has been the most
consistent factor in the company’s heat maps (if an area with activity or 'heat' has been
identified, the team checks that there is a point of sales close at hand); other pillars
include the activity of social media users – social media influencers – in that area.
Analytics with AI is complex, Dekkers says, as they have to analyse the desktop web
store and the app as well as sales from other online sites and social media, but
gradually the company has started to benefit from using the data analytics in their
decision-making.
"The team has been incredible investing in and applying the right technology and
tools," said investor Hadewych Cels, "We can see where the online sales activity or
website visits are happening. If you target your marketing euro specifically in this
postal code, then it brings the most value. So, we may not have enough money to
ensure Marlies Dekkers is the first company that shows up when you Google 'bra'; but
if you know there's sales activity going on in, say, Frankfurt, you can pay to have Marlies
Dekkers show up first in the Frankfurt area. Targeted marketing pays back in
dividends."
In this respect, Marlies Dekkers is ahead in the lingerie sector, still largely retailoriented and lagging behind on the digital transformation front. "Her 25-year-old
message is still on trend, too, maybe even more than ten years ago," asserts Cels,
particularly among young people abroad in Germany, Poland and Russia. The targeted
audience approach and on-trend message has proven to be a winning combination.
Changing Customer Demographics
Dekkers claims she has never focused on a ‘type’, though the company has identified
three customer profiles since the relaunch: a professional or businesswoman; a
6
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In the past, Dekkers had a very instinctive approach when it came to market research
on international expansion. When questioned about opening a store in Paris in the
past, for instance, Dekkers said:
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Redressed: Marlies Dekkers' Recovery and Regrowth
Marlies Dekkers’ strong visual look has paid dividends. Young followers frequently post
photos of themselves wearing Marlies Dekkers on Instagram. “They’re also good in
finding discounted prices. They know how and where to follow us. Sometimes we
only have a price reduction for 24 hours and they strike at the right moment so they
can buy our product and yet stay within their budget.”
CEO Van Berckelaer feels that with A-listed celebrities like Tyra Banks, Britney Spears,
Lady Gaga, Fergie from The Black Eyed Peas and Kelly Rowland wearing Marlies
lingerie, “We just haven’t capitalised enough on that up to now.”
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Riding the Crest of Change
As the company is consistently gearing up to remain adaptive to the new business
environment and customer needs, Dekkers, reminiscent of some of the challenges in
the earlier periods, wonders whether they have all the steps in place, which can help
them retain a strong market position. “Are we still as relevant and appealing as a
feminine feminist brand to the current generation of women? Have we adapted well
in the new digital environment as well?”
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mother; and a fashionista. The age group spans from 17 to 80, with the demographic
in-between being the largest. A recent trend is the growth of the younger segment:
“It makes me happy that my design isn’t growing old with me. It’s a vital brand.” (see
Appendix 3 and 4 for more details).
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Redressed: Marlies Dekkers' Recovery and Regrowth
Assignment Questions
2. Evaluate the company’s positioning, just after restarting from the bankruptcy.
What are the critical success factors in the fashion industry nowadays and is
Marlies Dekkers’ strategy in line with them?
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3. What are important core activities and adjacencies that Marlies needs to
consider now in order to re-establish and position herself for a sustained
competitive advantage on the market? How would you evaluate the
company’s current approach to online sales in this respect?
4. Discuss the new leadership structure of the company after the bankruptcy –
what are some of the challenges that you may anticipate and how could those
be addressed?
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1. Analyse some of the primary challenges that Marlies Dekkers had faced when
scaling up, which ultimately led to her bankruptcy in 2013. What were some of
the core issues you can identify and why? Analyse and discuss both the internal
and external factors that could have contributed.
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Redressed: Marlies Dekkers' Recovery and Regrowth
Appendix 1: Unlock Your Potential
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“Can you see YOU in your reflection? Or
are you too fixated on the things you
don’t like?” For Dekkers, her label’s
original name Undressed had embodied
her mission:
“If you're standing in front of a mirror and
love what you see, then the promise of
the brand has been met … I design to
please women. Working from the
assumption that there is beauty and
power in every woman, with this threeyear journal I have created a beautiful and
powerful way to structure a process of
self-realisation the way a top performer
would.”
Like her calendars or guest speaker appearances at conferences, Dekkers does not
consider these additional activities as revenue channels but ways to strengthen her
message and brand.
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To mark her 25th anniversary in 2018,
Dekkers published Unlock Your Potential,
a three-year step-by-step journal to
enable women to design their own future.
It starts by asking the reader what they see
when they look in the mirror.
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Redressed: Marlies Dekkers' Recovery and Regrowth
“When my company went bankrupt I really had to go into myself. I felt that death was
very close to me at that moment. For 20 years I had been CEO and Creative Director.
And I thought, what if I were really dying? What would I want on my headstone when
I’m lying in the grave? I really don’t want ‘Here Lies a Very Good CEO’. That’s not my
purpose. The purpose of my life is to make the difference for women. I got a second
chance, and got the company back … and I really want to spend more time getting
women to hear my voice, to understand my message, and to inspire them.”
For Dekkers, having a sense of purpose is her life and business compass. It’s a purpose
that comes from the inside, “a kind of fire” that feeds resilience during difficult periods.
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To keep her brand philosophy alive, Dekkers ships roughly 40,000 glossy magazines,
which she edits herself, as complimentary gifts to her online customer base each year.
Her philosophy about women's empowerment, embodied in her 'Feminine Feminist'
campaign, has always been about the power within – true empowerment – a power
deeper than skin.
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Appendix 2: Mirror, mirror... Reflecting Purposefulness
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Source: Marlies Dekkers
Source: Marlies Dekkers
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Appendix 3: New Brand Positioning and Product Architecture
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Source: Marlies Dekkers
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Appendix 4: Facts and Figures or Marlies Dekkers (2019)
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