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If you were one of the 111.5 million people watching the Super Bowl earlier this month, you might have noticed a commercial spot from jewelry company Alex and Ani.
While the Super Bowl might seem like a funny place for a jewelry company to be advertising—amidst all the beer, soda, technology, and cars—the move was just another one of Alex and Ani's unconventional business strides.
The Rhode Island company was started by jewelry maker Carolyn Rafaelian in 2004. Over the last ten years, the company has grown 365 percent in revenue from $2 million to $230 million, according to Privco Media, which follows Alex and Ani. With 41 retail stores around the country, and 24 more expected to open this year, the only other company that competes with Alex and Ani's selling rate per square foot is Apple.
Alex and Ani has obtained a cult-like following, especially on the East Coast. But while other jewelry brands like Dannijo and Pamela Love gain status through the interest and support of the fashion industry, Alex and Ani has bypassed the world of fashion, pursing their own channels for success.
"I will readily admit my ignorance on the fashion industry, but that is an asset," CEO Giovanni Feroce, a former American military officer who joined the company in 2010, told Racked. "I wasn't hampered by perceived rules and conditions of the fashion industry. We are able to operate based on our standards and not anyone else's."
"There are many ways for a brand to make it big: being popular with fashion insiders is only one," said Jaqui Lividini, a fashion brand expert at Lividini & Co. "[Alex and Ani] are a company that the consumer found first and once they became a mega brand, they didn't need the fashion world to get big. They aren't in the fashion jewelry arena because they don't belong there."
Feroce shared some insight into the company's success, and pointed to some explicit and "unusual steps" that helped fuel the company's growth.
Keeping Production Local (While Keeping Costs Down)
Alex and Ani jewelry is made from recycled parts and scraps. The brand is best known for their charm bangles, with prices ranging from $28 to $78.
"[The company works with] local mills and refineries to allow for limitless options," Rafaelian told Racked. "All items are manufactured in America from sustainable materials derived from eco-friendly processes."
"As a business model, it's successful because the company cuts costs by using recycled materials but at the same time they demand a premium," said Adriana S. de Lozado, a senior analyst at Privco Media.
As Alex and Ani began to expand, the company created something of a boom in the domestic jewelry market. While the number of employees working in the domestic jewelry industry decreased 43 percent from 1998 to 2008 according to the Bureau of Labor Statistics, Alex and Ani's expansion caused the company's staff to multiply from 23 employees (in 2009) to a current roster of 1,024.
A Precise Branding Angle
Building off its business model of made local (all jewelry is produced in the greater Providence, Rhode Island area), Alex and Ani incorporated a "Main Street" approach in its branding models. The company purposely places Alex and Ani stores on town streets, as opposed to inside shopping malls, so the products feel like "a part of a lifestyle, not just a retailer complex," according to Feroce. That "Main Street" angle is a major marketing push, as demonstrated in Alex and Ani's Super Bowl ad.
"The Main Street aspect is important to us as a business. Everything has been exported to Asia over the years, and you really don't get to resurrect that. It's going to take a little bit for us to undo that as a country," Feroce said. "By using a main street approach, we prove that we aren't just a company that is selling jewelry."
Alex and Ani jewelry is also sold at stores like Nordstrom, Bloomingdale's, and Saks, which Privco Media believes is a branding move in and of itself; while the products are in the price range to be sold at stores like JCPenney or Macy's, they purposely are not retailed there in order to maintain a certain image.
Lividini noted the company's branding targets a concerned consumer who is interested in a "give back" mentality. She compared them to TOMS shoes in that they've made a cause-related, sustainable product fashionable.
Feroce's fanciful idea of the ideal Alex and Ani customer (described as, "a person who has hope, despite their situation, positive or negative, who takes on the day in a positive way") is also right on brand, Lividini said. The company targets a different kind of consumer, one who is interested in a different way to shop.
Advertising in the Most Unexpected Places
While other jewelry companies look to reel in customers from the fashion magazine audience, Alex and Ani finds devoted shoppers in other places. The brand focuses much of its advertising in the sports world, with billboards and commercials in sports arenas like New York City's Madison Square Garden, Boston's TD Gardens, and at this year's Super Bowl.
"No other fashion brand targets sports, but we see it making sense for revenue generation," Feroce said. "45 percent of NFL fans are women, so we are very conscientious about where we position ourselves there." While Alex and Ani does place ads in fashion magazines like Vogue, Harper's Bazaar, and Elle several times a year, "that world is not our primary means," he said.
Perhaps one of the biggest milestones in Alex and Ani's business venture was a series of major partnerships with companies like the United States Army, the NFL, the MLB, the NHL, the Olympics, and 62 different colleges. Alex and Ani makes all the official jewelry for numerous sports teams, and universities. It's also behind the jewelry products sold through Walt Disney. The company first starting selling at six Disney locations in 2010 and expanded to 34 locations at Disney parks in California and Florida. As of 2013, Alex and Ani's Disney swag is also sold on Disney's website and on Disney cruises.
"We moved to create an agreement to become one of the first company in history to co-brand with Disney. The first was George Lucas with Star Wars," Feroce said. "From there, we created standards. We partner and do business but we don't peddle goods. We got equal status with major companies and gained a large presence, moving our brand inside their location."
Partnering with large companies is an extremely effective way to invest in marketing without spending too much, noted de Lozado. Companies like MLB clearly invest in marketing ventures and Alex and Ani benefits from this influence. "By partnering with established brands, you reach an intensity of people. It's a way of cost cutting by leaning on someone who has already put all that money into marketing," de Lozado said.
Alex and Ani: the Next Tory Burch?
Alex and Ani recently released a line of candles and will soon start to work on a line of beauty products, bags, and eventually, apparel. Feroce said he expects the company will eventually turn into a "lifestyle brand that can soon compete with brands like Tory Burch and Calvin Klein." But can impressive sales growth and strong store representation compete with the fashion brand cachet Calvin Klein and Tory Burch have?
While de Lozado said the company is far too young to be categorized next to such competitors, she said she is optimistic about the brand's future. In 2012, JH Partners, a private investment firm previously involved with beauty brand Bare Escentuals and lingerie company La Perla, invested in Alex and Ani. According to a release, "the investment is believed to be one of the largest in its category [that] year."
"The company's proven to be strategic with marketing, and a minority acquisition proves they have financial backing," de Lozado said. "[In regards to companies such as Tory Burch or Calvin Klein], the brand has yet to reach those levels but there is a demand for other brands to jump into the lifestyle market so it's quite possible. But they are not there yet."