The creator of a $150 purse beloved by AOC and Oprah is revolutionizing “it bags” by making them accessible to everyone. Against all odds, it’s working.

Telfar

Tianni Graham, 27, remembers the “before times” – that is, the harrowing months before Telfar introduced its Bag Security Program.

It was early last summer and she, along with thousands of others, was stuck testing their luck each day trying to buy the wildly popular Telfar handbag whose celeb fans include Oprah, Selena Gomez, Alexandria Ocasio-Cortez, and Solange. But they often sold out before anyone could click ‘check out.’

It turns out, robots and resellers were buying products in bulk, making it harder for real customers to purchase them. So, last summer, Telfar introduced its Bag Security Program, in hopes of giving customers better access to its bags by allowing patrons 24 hours to pre-order any bag on the site, with no limits on how many can be purchased. The bag is then made to order, and shipped directly to the customer.

Its first drop, which happened last August, brought in about $20 million – about 10x what Telfar made in all of 2019.

Suddenly, Graham, who is also a fashion archivist and consultant, had her green Telfar bag. It arrived right before Christmas and was a “present to myself,’ she told Insider, adding that other brands could benefit from implementing a similar program. “It would make things so much easier and make the customer feel like you care.”

The program’s success shows how a luxury brand can create accessibility without losing the allure of exclusivity. The old-school model for luxury brands states the product should be scarce and elite, but the next generation of high-end consumers and entrepreneurs are taking a different route.

Teflar is rewriting the rules of luxury, and this time, it’s not too hard for other brands to follow suit.

Telfar ‘white glove treatment’ is what next-gen luxury shoppers crave

Young consumers look less at price tags and more at brand values when determining where to spend their money; these next-gen consumers want sustainability, inclusivity, and a sense of community. The new “white glove treatment” when it comes to luxury shopping is a speedy online checkout from a brand that cares.

For Telfar’s latest drop this week, customers had the option to use the payment installment plan Klarna, making it even easier for those looking to obtain a bag. While customers will have to wait a few months before receiving the bag, people often spend years on a Birkin bag “waiting list” and most will probably never get one.

Shortly before Telfar’s program ended this week, a spokesperson for the brand told Insider it was, already, “going very well.”

Telfar started with an aim of inclusive luxury

Telfar was founded in 2005 by its eponymous founder Telfar Clemens and has dedicated the past two decades to building an inclusive business model.

In 2014, it released its now-iconic vegan leather handbag, which takes inspiration from a Bloomingdale’s shopping bag. The bags became widely available around 2018 after Telfar won $400,000 from the CFDA/Vogue Fashion Fund, allowing the company to expand production.

Clemens described his brand to The Cut as being “genderless, democratic, and transformative,” purposely seeking to challenge the notion that high fashion is only for a certain group of people, with the brand motto being “Not For You – For Everyone.”

Telfar

Now, Telfar bags come in three sizes, with prices ranging from $150 to $257. (For comparison, Birkin bags go for at least $12,000 while Black-owned luxury brands such as Brother Veilles go for at least $1,295.)

As reported by FT, handbag sales in the US declined 18% between 2016 and 2019. Yet, Telfar stood out – in 2016, the brand earned $102,000, growing to earn $2 million in 2019. Last year, New York Magazine deemed its bag the “Bushwick Birkin” and the brand was on pace to earn eight figures, even as the fashion industry was expected to take a 90% loss in profits due to the pandemic.

Boston Consulting Group’s Head of Luxury Sarah Willersdorf told Insider that Telfar has checked all the boxes on what it takes to connect with next-gen luxury shoppers. She said the brand has a narrative that “evokes emotion” and properly intertwines timelessness, creative partnerships, and culturally relevant authorities. GQ pointed out Telfar’s customer base was built, not through influencers, but through “customer aspiration alone.”

Telfar
Telfar Clemens.

Raising the bar for next-gen luxury

Brands like Telfar are important in proving accessible business models can be just as lucrative. Willersdorf expects other brands to follow similar strategies in a post-pandemic world, as shopping continues to pivot online.

In the old days – a pre-millennial world, perhaps – having too much of a product is thought to dilute its value. The Bag Security program defies that. But even the most tech-savvy luxury brand is often behind the curve, as Insider has previously reported.

“Luxury brands are always nervous,” Joseph Yakuel, CEO and founder of consulting firm Within, told Insider last year. “There’s so much risk to them tarnishing their brand reputation because luxury brand price points are only supported by their perception, and if their brand perception goes down market, their price point gets eroded very quickly.”

Clemens and his artistic director, Babak Radboy, said they aren’t worried about oversaturation. It’s about community, now. The new “white glove treatment” is making sure everybody gets a pair that fits perfectly.

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Pajama sets are the new 2-piece suit. A millennial brand explains the wild pandemic year when sales spiked 400% .

Desmond & Dempsey
Joel Jeffery (L) and Molly Goddard (

There are two types of people in the world: those who wear old T-shirts to bed, and those who don’t.

Joel Jeffery, 33, and Molly Goddard, 29, the millennial duo behind the London-based luxury pajama brand Desmond & Dempsey, don’t mind if you’re part of the former.

Eventually, Jeffery said, people come around. Some of the investors they first pitched claimed to not wear two-piece pajamas, forcing the duo to revise their presentation, calling pajamas “something you wear to the breakfast table.”

Goddard’s old boss also wasn’t a believer. Then, they gave him a pair. “Now he’s on our VIP customer list,” she said.

Desmond & Dempsey, which sells pajama sets for about $150, saw sales skyrocket during the pandemic. It sits in a privileged position at the intersection of two multi-billion-dollar industries. First, the $10 billion self care industry. Second, high-end sleepwear, or as Brandi Neal wrote for Bustle the “fancy pajamas you usually only see in movies.” This category also encompasses nightgowns, robes, and slippers, and market researcher Technavio expects the market to grow by $19.5 billion between 2020 and 2024.

And Jeffrey doesn’t expect the momentum to stop anytime soon.

The brand was in the right place, at the right time

It’s hard to pinpoint how many people actually sleep in pajamas.

A 2017 survey in the UK found about 40% of people sleep in pajamas, while another one found 90% of people wear them to lounge around the house.

In the United States, meanwhile, a 2018 report stated nearly 69% of people sleep partially clothed, while 31% sleep fully clothed. Then there are those, of course, who sleep naked. What is known, however, is that luxury sleep and loungewear are associated with comfort. And the idea of comfort (including meditation apps, organic diets, and face masks) is especially popular among millennials.

Desmond & Dempsey

It’s this comfort, Jeffrey says, that people sought during the pandemic as the world fell into precariousness. Last year, the Washington Post, citing the Adobe Digital Economy Index, reported pajama sales increased over 140% in April 2020, compared to the month prior.

Last March and April, Desmond & Dempsey saw a 400% increase in sales. Its best-selling items were the two-piece pajama set. The company was able to deal with an increase in consumer demand because it decided to still place the orders that wholesalers canceled, restocking its top items and then selling direct-to-consumer.

Launched in 2014, the brand was named after Jeffery’s and Goddard’s grandparents, respectively. In its early days, Goddard used to personally email each customer asking for feedback, then send a code that would give them free monogramming if they told their friends about the company.

That referral program helped generate interest in the company at the start, and a similar strategy helped it get through the pandemic. It started an initiative that allowed people to nominate a friend to receive a pair of Desmond & Dempsey pajamas. All the person had to do was explain why their friend deserved it.

“People needed comfort and that’s what those pajamas provided,” Goddard said. “People were vulnerable and really suffering, and it gave them something to make them feel a little more creative.”

The market is expected to grow, Desmond & Dempsey is ready

The pandemic, in a sense, has helped accelerate the normalization of self-care and comfort.

Andreas Lenzhofer, cofounder of the Zurich-based sleepwear company Dagsmejan, told Insider he expects interest in the category to rise, and the focuses on personal health, wellness, and comfort are here to stay.

Desmond & Dempsey

Adobe Analytics found that November pajama sales were up 200% compared to the year prior. NPD Group told Insider last year’s sales for pajamas costing $50 or more increased 3 times faster than average-priced pajamas, accounting for 17% of the pajama market.

Meanwhile, social media is helping these niche brands build an audience. Desmond & Dempsey has over 80,000 followers on Instagram alone. Other luxury sleepwear brands such as Lunya (whose sleep set goes for $232) and Olivia Von Halle (whose pajamas can cost nearly $600) have over 233,000 and 102,000 followers on the platform, respectively.

Dagsmejan told Insider it also ended 2020 with massive sales growth, seeing over three-times what it saw in 2019.

“People realized there was life to have,” he said. “[They] readjusted their spending patterns, and focused on where they could make a positive impact on their personal wellbeing.”

Now, with an influx of customers, Desmond & Dempsey’s next mission is now fighting out how to make the consumer demand stay, Goddard said.

But that might not be too hard. As the remote work trend continues, rumors have been swirling that office life will never be the same. Even designer Misha Nonoo previously told Insider she was preparing to make comfort dressing the new power dressing, as Zoom meetings slowly becoming part of everyday life.

Already, Desmond & Dempsey has collaborated with H&M and has expanded into slippers, nightgowns, robes, eye masks, and even diapers. To date, it has partnered with over 30 wholesale retailers, including Bergdorf Goodman, Selfridges, and online retailer FarFetched, and in October it will officially launch a kids collection.

Jeffrey and Goddard even want to open a store one day, and further expand their presence into the United States. The market might be crowded but if anything, but they are ready.

“We just have to change the spelling of pyjamas,” Goddard said.

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Swarovski crystal heiress Marina Rapahel explains how she achieved record-breaking sales by selling smaller handbags, donating to charity, and using snail mail to reach customers

Marina Raphael
Marina Raphael with her SS21 collection(1)

  • Marina Raphael, 22, launched her brand of luxe handbags in 2019.
  • Despite the pandemic, she said she saw an increase in sales in 2020.
  • To Insider, she reveals how she got her company through the past year.
  • See more stories on Insider’s business page.

When Insider first spoke to Marina Raphael in July 2020, she was in the midst of leading her luxury handbag brand of the same name through the pandemic.

A member of the famed Swarovski crystal family, Raphael launched her eponymous line the year before. It was being sold in high-end retailers such as Moda Operandi; it also captured the attention of Maxima, Queen of the Netherlands.

But now, the pandemic had disrupted in-person shopping, supply chains, and manufacturing. Halfway through the year, it was too soon to have confidence in what the rest of the year would bring.

“As a young entrepreneur, everything was just moving so quickly,” Raphael, 22, told Insider in a recent interview. “But a good entrepreneur has to adapt to any situation and find quick and flexible solutions.”

Now, a few months into 2021, she reflects on her company’s record growth. It turns out, luxury consumers never actually stopped splurging on high-priced goods during the pandemic. Wealthy patrons put their money into handbags, artwork, and fine jewelry – investment categories believed to be less volatile than the stock market.

Raphael, whose bags range from 500 to 1,500 euros ($600 to $1,800), said sales skyrocketed last year, though she declined to share exact revenue figures. The team re-vamped their social media strategy, added charity initiatives to purchases, and even reduced the physical size of its products by 50% to adjust to, what she described as, the new reality of customers’ needs: “carrying less.”

The brand launched collaborations and partnerships, including one with French skincare line Vichy, and expanded its own line to create cosmetic pouches and keychains.

It also released a sustainable collaboration, using upcycled leather and cruelty-free leathers with luxury retailer Luisaviaroma and another line with art director Evangelie Smyrniotaki, which sold out in its first two weeks. Next, the company is about to launch a line with Swarovski Creative Director Giovanna Battaglia. She’s projecting a 420% increase in sales this year.

The luxury brand stayed grounded through hard times by donating 20% of sales

Raphael’s company is headquartered in Greece, but its operations are spread throughout the world. Public relations for the brand is in London, while the sales agent is in New York; quality control is in Australia, and bag production is in Florence.

Marina Raphael with her SS21 collection(3)
Marina Raphael with her SS21 collection(3)

In March 2020, the brand received its spring-summer collection, which gave it stock until August. It combined that with leftovers from the previous collection, but still sold everything by June, she said.

Having a diversified supply chain helped, however. When factories in Italy closed, quality-control in Australia was able to pick up production. The team’s small size of 14 (six of whom joined during the pandemic) made it easy to communicate, despite the time differences. And because retailers were closed, the company didn’t have to worry about shipping out the fall-winter collection.

Another challenge for Raphael was communicating via WhatsApp and Zoom, especially since she had to design handbags without ever touching the fabrics or physically seeing the final product.

At the same time, the brand had to figure out how to sell a luxury product during an ongoing global health and financial crisis. The company couldn’t just stop selling or making the bags, Raphael said. “Then our suppliers would have a problem, our production team would have a problem,” she continued. “They would lose their jobs.”

Marina Raphael with her FW19 collection
Marina Raphael with her FW19 collection

To great success, the company decided to donate 20% of all sales to charities such as Black Jaguar White Tiger Foundation and The Hellenic Pasteur Institute. Luxury retailer Moda Operandi implemented a similar strategy last year to huge success, reporting that if an item was attached to a charitable cause, shoppers were willing to spend full-price on it, even if another promotional sale was happening at the same time.

“I think that’s why we didn’t feel guilty about promoting the product, because with every sale we were helping in some way,” Raphael said.

To promote the collections, Raphael’s company began mailing puzzles and other “interactive fun stuff” to patrons. That was very successful too, she said.

“Getting something delivered to your house makes it feel more personal than at a fashion week where you are running to 15 different showrooms,” she said. “That was too much, too fast.”

In the early months, the team was in a state of panic

Raphael credits the success of this time to her team. In the early months of the pandemic, she recalled, everyone was in a state of panic. So she took it to herself to see how she could motivate her employees during this time, listening to their feedback in order to adopt new business strategies.

Smyrniotaki, the content creator and art director, told Insider that Raphael’s “strong personality” and keen leadership skills are what helped get their collaboration off the ground during this time, even with the disruptions. Her bag with Raphael was made with 5,000 Swarovski crystals to represent brighter days ahead. “It is the perfect allegory for the brighter future we see ahead,” Smyrniotaki continued.

Designing the Marina Raphael X Evangelie Smyrniotaki collaboration
Designing the Marina Raphael X Evangelie Smyrniotaki collaboration

Sometimes, Raphael still thinks about those early months of the pandemic. Customers from the United States, especially, were contacting the company in haste, trying to figure out how soon their products would arrive.

“Customers were saying, ‘we want our orders sooner – can you send us the tracking number?’ We have never experienced that before,” she said. “We were questioning, where are they going with the bags?”

Maybe it was to buy themselves gifts to make themselves feel better, she ponders; maybe they wanted to invest in nice things or were just bored at home. It’s more likely a mixture of all of the above, Insider previously reported.

That, or maybe people just really wanted another tote bag.

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SIGN UP HERE FOR OUR LIVE EVENT ON THURSDAY: Next-Gen founders on racial equity and inclusion in tech

insider events racial equity in tech 2x1
(L-R) Urenna Okonkwo, Jordan Walker, Vernon Coleman

The Black Lives Matter protests last summer helped fuel a new drive for diversity and inclusion in the workplace. But how far have we come since then? And how much farther do we have to go? 

Every industry in Corporate America has its own issues to grapple with. Insider is taking a deep dive into tech to talk to Next-Gen founders about racial equity and inclusion in this industry. 

On Thursday, February 25th at 12 PM ET, Insider’s entrepreneur reporter Dominic-Madori Davis will moderate a panel featuring Vernon Coleman, CEO and cofounder of the video networking app Realtime, Jordan Walker cofounder of the audio messaging app Yac, and Urenna Okonkwo, founder of the finance app Cashmere.

They’ll talk about their journeys in Silicon Valley and tech, the importance of mentorship, access to capital, and opportunities for Black founders looking to launch businesses.

They will also take questions from the audience. 

You can sign up here to watch. 

Read the original article on Business Insider

SIGN UP HERE FOR OUR LIVE EVENT ON FEB. 25: Next-Gen founders on racial equity and inclusion in tech

insider events racial equity in tech 2x1
(L-R) Urenna Okonkwo, Jordan Walker, Vernon Coleman

The Black Lives Matter protests last summer helped fuel a new drive for diversity and inclusion in the workplace. But how far have we come since then? And how much farther do we have to go? 

Every industry in Corporate America has its own issues to grapple with. Insider is taking a deep dive into tech to talk to Next-Gen founders about racial equity and inclusion in this industry. 

On Thursday, February 25th at 12 PM ET, Insider’s entrepreneur reporter Dominic-Madori Davis will moderate a panel featuring Vernon Coleman, CEO and cofounder of the video networking app Realtime, Jordan Walker cofounder of the audio messaging app Yac, and Urenna Okonkwo, founder of the finance app Cashmere.

They’ll talk about their journeys in Silicon Valley and tech, the importance of mentorship, access to capital, and opportunities for Black founders looking to launch businesses.

They will also take questions from the audience. 

You can sign up here to watch. 

Read the original article on Business Insider

YIMBY with a conscience: Meet the 26-year-old real-estate heir who wants to make affordable housing a reality in the Biden era

Donahue Peebles III
Donahue Peebles III.

  • Donahue Peebles III has worked for his father’s real-estate firm, Peebles Corporation, since high school.
  • He’s passionate about gentrification, telling Insider that lack of affordable housing is “a failure of American society.”
  • Peebles talked to Insider about affordable housing, gentrification, and what he expects under a Biden presidency.
  • Visit Business Insider’s homepage for more stories.

In real estate, there are NIMBYs and YIMBYs, and Donahue Peebles III knows where he stands.

For decades, “NIMBY,” which stands for “not in my backyard,” referred to homeowners who oppose nearby development. The “YIMBY,” naturally, says yes to the same proposition. To hear Donahue Peebles III tell it, more development won’t just be good for his family’s company – he’s a real-estate development heir – but also a key to civil-rights progress in the Biden era.

“As developers, we have such an outsized effect on the world in which everyday folks live, far more than an options trader would or your Wall Street executive,” Peebles told Insider. “Everybody, every day, interfaces with real estate, multiple times a day.”

Peebles works at Peebles Corporation, which was founded by his father, Donald Peebles II, in 1983 and has grown into of the nation’s largest real-estate investing and developing firms, with a portfolio topping $8 billion. The company made his father one of the richest Black real estate developers in the US, with a net worth estimated at over $700 million.

The Peebles Corporation utilizes public-private partnerships to develop properties with civic interests in mind, focused primarily on the New York, Washington DC, Miami, and Los Angeles markets. It specializes in residential, hospitality, retail, and mixed-use commercial properties. 

Peebles is his father’s chief of staff, a position he has held since early last year. He said he has no interest in separating himself from his father’s legacy, saying there is “so much value” in being allowed to help build on that. 

In an interview with Insider, Peebles spoke about the affordable housing crisis, how his company is trying to help curb the effects of gentrification, and what he’s expecting under a Biden presidency. 

Donahue Peebles III
Donahue Peebles III (L) alongside his father (R).

Peebles calls the affordable housing crisis ‘a failure of American society’

Peebles has been working for his father’s firm since his senior summer in high school. Born in Washington, DC, Peebles spent his childhood in South Florida and attended high school in New York before matriculating to Columbia University to study economics.  

“My real-estate education happened simultaneously with my regular education,” he said. “As a little kid, you always want to go to McDonald’s and get a McFlurry or go to your friends’ house early on a Saturday before basketball practice. My father would say, ‘Sure, but I need you to learn the value of this building first.'” 

To Peebles, housing affordability is one of the most pressing issues facing the US right now. “There’s no reason that somebody gainfully employed should have to be housing insecure, or struggle with finding an apartment they can comfortably afford on their full-time salary,” he said. “That’s a failure of American society.”

Read more: How full Democratic control of Washington DC could transform real estate

Part of the problem, he said, is that developers are being restricted in terms of when and where they can build new housing. He cited historic preservation in the West Village, for example, which prevents developers from knocking down existing brownstones to create more housing. 

These restrictions exist “even though they were constructed to satisfy the housing needs of a New York that’s about one stitch the size of New York City is today,” he said. “Instead of treating the symptoms, we need to begin to treat the underlying cause of the disease, which in my mind is a consequence of artificial supply constraints.” 

Andrew Berman, executive director of the Greenwich Village Society for Historic Preservation, told Insider that, for the most part, the organization was all for more affordable units in landmarked areas.”That can be achieved through adaptive reuse and new construction,” Berman told Insider.

But there is often a catch: “What is often proposed however is large new entirely or predominantly luxury developments which do little or nothing to address affordability issues and actually often make the situation worse, not better,” he continued. 

Meanwhile, Simeon Bankoff, executive director of NYC’s Historic Districts Council, an organization that advocates for the city’s historic and cultural neighborhoods, noted that as a developer, Peebles has a vested interest in more laxity on development. “If people who are in the business of doing real estate development didn’t have to deal with regulations, they wouldn’t.” 

Bankoff said the number of landmark properties in New York City overall is very small, the city has one of the most complex building ecosystems and construction ecosystems in America, and finally, it has a “limited amount of land. If someone wants to come in and build a high-density, residential development in a low-density zone, it’s difficult.” Doing that has nothing to do with landmark designation, Bankoff added.

Peebles Corporation is raising money for a fund to help minority entrepreneurs

Peebles, along with the corporation, has also been working to assist minority and women entrepreneurs as it seeks to help close the racial wealth gap and curb gentrification. 

He called the racial wealth gap a social failure of capitalism. Talent, he said, is thought to be distributed equally, but without opportunities, underrepresented and underutilized business owners, entrepreneurs, and firms will still struggle to grow. 

Read more: Meet one of the youngest Black entrepreneurs in tech, who just raised a seed round topping $4 million that included Alexis Ohanian

“It seems as though people who have a fair amount of economic privilege already are those who have been encouraged to become entrepreneurs and become owners,” Peebles said, adding that consumers and society will benefit more if more people with talent are provided with opportunities.

A development project isn’t like an options trade, he said, and there are so many different economic tributaries that flow from it – from the developer making money to the bank getting the land and the equity partner getting deployed capital.

The goal is to find a way to democratize access to capital and involve local businesses and long-term residents of particular neighborhoods in that neighborhood’s economic growth, he said, rather than a third party coming in from outside, attracting all the capital and renovation work. Right now, he said, the Peebles Corporation is raising an emerging developers fund that will help provide capital to women and other developers of color who seek to develop in the communities in which they live. 

And this, Peebles said, will hopefully guard, in some ways, against more gentrification. 

 “I like to say the struggle of the 19th century was emancipation,” Peebles said. “The struggle of the 20th century was enfranchisement. And the struggle with the 21st is without a doubt, economics. If we can help bridge the racial wealth gap by whatever means, I think we’re doing our society a service.”

Corporations need to give employees better safety nets, Peebles says

Peebles expressed optimism about the future of affordable housing with Joe Biden in the White House and congress under unified Democratic control.

He praised the section of the $900 billion in COVID-19 relief and $1.4 trillion stimulus package passed in December that assisted renters and made 4% the permanent minimum rate for low-income housing tax credit bonds. Peebles predicts this will help create a boom in affordable housing.

democrats win house
House Speaker Nancy Pelosi

Read more: How Democratic control of Washington could threaten real-estate investing

He’s also expecting a revision of a few tax policies that could have large-scale economic consequences, such as the 1031 exchange. He also hopes to see a revision in the structure of opportunity zones – designated geographic areas that have been identified as low-income subdivisions. 

Opportunity zones, he said, are like “government-funded gentrification” and they need to be structured so they can help create jobs and economic opportunities within the communities they target, rather than creating economic hubs that are pushing out existing communities. “You want a rising tide that lifts all boats,” he said. “Not a new dock.” 

The situation might be different for individual citizens, however, and Peebles said the pandemic has the potential to spark conversations around entrepreneurship as a whole. Many people realized that the job security and safety nets they had are not as secure as they once thought. 

If corporations, he said, could find ways to provide a more robust social safety net for people, it could boost innovation as it would give more people freedom to fail, which “would encourage more entrepreneurial risk-taking, which in turn would hopefully help bridge the racial wealth gap.”

He called real estate “such a challenging, creative industry,” but said he wouldn’t rather be doing anything else. “The problems we solve are at times both very immediate and practical, but also indelibly complex. It’s one of the best intellectual and social challenges.” 

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