“We have more to do in fashion,” Chief Executive Officer Mika Ihamuotila, who is also the biggest shareholder in the Helsinki-based company, said in an interview. “In the 1960s, we were a legendary fashion house.”
Marimekko propelled to fame in the U.S. when Jackie Kennedy posed in a red dress on the cover of Sports Illustrated in 1960. The retailer, these days better known for its interior decoration products than its clothing, is now reviving designs to make its apparel appeal to a global crowd.
Marimekko hired a new creative director, Anna Teurnell, who joins the company from fast-fashion retailer Hennes & Mauritz AB July 15. Teurnell is the head of design for H&M’s accessories-focused & Other Stories chain. The Finnish retailer also teamed up with Banana Republic, a unit of Gap Inc., for a collection last month. Clothes brought in 41 percent of revenue in the first quarter, bags 20 percent and interior decoration 39 percent.
“There seems to be a very strong demand for Marimekko’s prints, colors and brand,” said Ihamuotila, a former banker who became the company’s first male CEO when he started in February 2008. “We also see a lot of potential for our fashion items, but we still need to develop the line,” he said, citing improvements in materials and cuts.
“Our aim in the next five years is not to make the company a luxury brand,” he said. “The price point is going to be between mid-market and affordable luxury.”
Marimekko must appeal to a global consumer, having reduced its home market’s share of total sales to about 50 percent from about 75 percent before Ihamuotila took the reins. While the CEO said he still sees possibilities for growth in Finland, the biggest potential for expansion in the next five years is in markets outside its home. “At this moment it looks obvious that most rapid growth will happen in Asia,” he said.
Marimekko’s quirky designs have become a hit in Japan, where it has 27 stores. The company targets 10 new stores in China by the end of 2016 in addition to the five it has on the mainland and in Hong Kong.
Marimekko’s shares rose 0.2 percent to 9.58 euros at 12:29 p.m. in Helsinki, paring the stock’s loss this year to 2.7 percent this year after a 31 percent decline in 2013, valuing the company at 77.5 million euros ($106 million).
For the next three years, it’s “highly likely” the company will focus on existing markets, Ihamuotila said. Marimekko said yesterday it is opening eight stores in the Middle East by the end of 2019 in partnership with BinHendi Enterprises, the first of them in Dubai in September.
While the business climate remains challenging for retailers in Europe and U.S., Ihamuotila said the shift away from fast-fashion brands and high-luxury toward “interesting brands with strong values” may benefit the company even in weaker markets. It’s a boon to Marimekko that its name, print and colors attract consumers in the fastest-growing consumer markets such as Korea and China, he said.
Catering to global tastes means the company must strike a “fragile balance” so that it doesn’t “lose its Finnish and Scandinavian identity,” Ihamuotila said.
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