Patagonia's sales rise, thanks to buyers it doesn't design for

Outdoor gear maker Patagonia will likely see annual sales double their revenues of five years ago, thanks to chic consumers that the company didn't intend to seduce. What's their success formula?
Written by Reena Jana, Contributor

How is it that even with the recent economic hurdle of the Great Recession, and despite never styling itself intentionally as a luxury label, outdoor-gear maker Patagonia will see a near doubling of revenues over the last five years? In fact, one of its most recent, thought-provoking marketing campaigns (as we've covered on SmartPlanet) has been a general plea to consumers to buy less.

All of this seems paradoxical. But there are savvy design-meets-business lessons to be learned from Patagonia's tale.

"For nearly 40 years, Patagonia has prided itself on selling high-quality, high-performance outdoor apparel to dirt bags," wrote John Swansburg in his Culturebox column on Slate (on March 15), referring to the mountain-climbing jocks that the company originally--and continues--to design for primarily. As Swansburg noted, non-jock celebrities such as Will Ferrell (okay, so maybe he plays bumbling jocks on-screen) and fashion icons such as designer spouses Ruben and Isabel Toledo have been photographed wearing their parkas and fleece jackets. And the Patagonia label is becoming such a status symbol that it's being called "Patagucci" by some.


Swansburg wrote that Patagonia will likely see $500 million in annual sales this year--that's way up from a reported $270 million in annual sales five years ago (as referenced in a 2010 U.S. News and World Report article.) Yet the company's founder, Yvon Chouinard, has long made it clear that he never intended to expand by becoming a fashionable label; it just happened.

“We outgrew our loyal customer base and increasingly were selling to yuppies, posers, and wanna-bes,” he told Inc. back in 1992, as Swansburg quoted in his Slate column. “These people don’t need this...to get in their Jeep Cherokees and drive to Connecticut for the weekend.”

Today, Patagonia is clearly striving to make its gear good-looking--and even subtly market it as such, beyond its athletic functionality. In recent years, as sales have been growing, the spectrum of colors Patagonia offers has expanded to include eye-catching hues such as cool metallics, bright fuschias, and electric blues, although one could make the argument that these are safety-conscious colors, as they're easy to spot on a mountain if you're in need of a rescue in an avalanche. And offerings are even described on Patagonia's own site with language pointing to style, such as this sales copy describing a women's parka: "As much a work of art as a down coat...shimmering...adorned with elegant, cable-style side panels and cuffs."

Then again, its description also includes technical details, such as "a quilted lining insulated with ultrawarm, 600-fill-power goose down," reiterating the coat's performance. And here lies the real secret to Patagonia's success: it stays true to its legacy of technological innovation, packaged within jackets and other apparel and accessories with beautiful physical forms. And their products are marketed masterfully, by a rebellious and charismatic founder.


A label that implies "status" -- because of its design and innovation legacy

In a way, Patagonia is the Apple of outdoor clothing. It has fan boys and girls. And that fan base is spreading, because people want coats and bags that improve their lives and are easy on the eyes. Like their iPhones and Macs are. And they don't mind paying more for products that have a decades-long history of pushing forward new technologies with design in mind. Patagonia, for instance, pioneered the concept of layering light, fitted clothing to stay warm and dry when active, way back in 1980. That's when they came up with their first insulating long underwear made of polypropylene, a synthetic fiber which doesn't absorb water and is also lightweight. Just as Apple products--always pricier than other PCs, smart phones, or tablets-- were once favored only by serious tech geeks and chic designers but now have caught on with the masses, so too have Patagonia's high-quality, lovely clothing among "dog walkers," as Swansburg referred to their non-jock customers in Slate. Those dog walkers, however, also need to battle the elements, often while running the streets and climbing the stairs of New York City.

(Okay, full disclosure: I am a dog-walking Manhattanite who just recently invested in a Patagonia Fiona parka.)


But it should be noted that the Patagonia success story also echoes that of its competitor, The North Face. It has a similar innovation strategy of working with athletes who test out new materials out in extreme natural conditions. Then, Patagonia and North Face create and market body-conscious, high-performance wear based on their field research. North Face products obviously tend to catch on with "dog walker" and celebrity types--and have been featured in rap lyrics. Earlier in March, the North Face's parent company stated that the brand saw sales grow 24 percent in the Americas in the fourth quarter of fiscal 2012, reported the Outdoor Industry Association.

That both Patagonia and The North Face have seen rising sales shows that their parallel strategies of staying true to their roots is working. Both continue to research and design for jocks and innovate with weather-resistant, durable yet light materials, all packaged in the body-conscious styles that serious athletes need to wear when in action. The success formula they share is that neither company consciously tries too hard to be a fashion label--even if they both are.

Related on SmartPlanet:

Patagonia Pleads: Buy only what you need

Q&A: Philip Hamilton, director of product, The North Face

At The North Face, a new sustainability mantra

Will benefiting society benefit your company's profit?

Images: Mr. Beattie/Flickr

[Via Slate, Patagonia, Outdoor Industry Association]

This post was originally published on Smartplanet.com

Editorial standards