NEW YORK - When Russell Simmons or Sean Combs makes public appearances, it's almost a given that they'll be wearing their own fashion apparel lines, generating free publicity for the brand and boosting sales as fans rush to wear what they see their idols wearing. But what happens when the celebrity has been dead for 25 years?
Ask Elvis Presley Enterprises. The for-profit business came out with its first fashion line in February, the same month that the King's daughter Lisa Marie Presley sold a majority interest in the company to CKX . The clothing line flopped.
"Consumers and buyers have preconceived notions of what Elvis was," says Carol Butler, director of worldwide licensing for EPE, "The vision we have of him is he was hip, a leader. He changed style, music and dance. When we shop that, it's a hard sell."
But EPE isn't giving up. It's incorporating the changes that retail buyers suggested--such as different pant-leg styles and logo sizes--and plans to relaunch the brand in August with an upscale line and a department store line. Consumers won't find it in Wal-Mart.
The designer behind the original and new line is Paul Guez, the founder of Sasson Jeans. When Guez came on board, he became a master licensee for EPE and has invested millions in what he's named Elvis Presley Clothing, Butler says.
There are currently 150 Elvis licensees, but EPE is moving away from the smaller licensees to build consistency into the brand.
The licensing is where the big money lies. Last year, EPE pulled in $40 million in sales. In a recent U.S. Securities and Exchange Commission filing, CKX said that for the quarter ended March 31, revenue for the Presley business totaled $5.8 million, with $2.5 million coming from royalties and licensing and the rest from the Graceland operations. Its operating profit totaled $962,000, which included a $323,000 loss on the Graceland operations. However, winter isn't the peak tourist season for Elvis' former home.
Lisa Marie retained sole ownership of Graceland and her father's personal effects, but sold 85% of the business which controls the commercial use of the name, image and likeness of Elvis Presley, the operation of Graceland and related attractions and revenue derived from Elvis' music, films and television specials. The trust she formed to run the operations got $50.1 million in cash, convertible preferred and common stock and the repayment of $25.1 million in debt.
Fashion is only one of a number of ventures to keep Elvis' name in the spotlight. There's also a radio station on Sirius Satellite Radio, a film festival, a Broadway musical, a television special that ran on Viacom's CBS network last year and a new advertising campaign, "Elvis Lives."
The apparel line still has a long road ahead of it. It all depends on what image of Elvis prevails. Will it be the overweight Vegas Elvis; the hip-gyrating 1950s young Elvis; or the playboy in such movies as Spinout, Blue Hawaii and Viva Las Vegas?
Butler admits that the new line with its subdued fashions and fitted clothing doesn't sit well with the traditional fan base. "The older audience doesn't like that. They want something boxy, something with his image on it, so they can sleep with Elvis."
To help with that, EPE has brought in some interesting bedfellows: Jay Z and Russell and Kimora Lee Simmons. EPE recently signed e-Fashion Solutions to run its e-tail operations. The company founded by former Calvin Klein executives Edward Foy, Jr. and Jennifer Silano-Foy, also operates the Web stores for the above-mentioned celebrities.
From shipping to design to customer service, they run all the brands' Web stores out of their New Jersey warehouse, making it more cost-efficient for brands to outsource instead of hiring in-house staff to run their online operations.
But the bonus for EPE could be if they can cross promote with the hip-hop brands and get some street cred for the King. Could Phat King Clothes be next?