Leverage a Well-Known Name
(Business 2.0) – OK, follow along: In 1995, Seinfeld introduced a character named J. Peterman, who ran a catalog company called J. Peterman. J. Peterman was already a real catalog company, founded in 1987 by a real man named John Peterman. Though the real J. Peterman's sales reached $75 million in 1998, the real John Peterman couldn't capitalize on the publicity, and in March 1999, the real J. Peterman--after a failed attempt to build 70 retail outlets nationwide--was sold out of bankruptcy for $10 million. Then the company that bought the real J. Peterman went out of business, and in 2001 the real John Peterman bought back the name "J. Peterman" for $1 million. Where did he get the money? In part from the actor who played the TV Peterman. So the TV Peterman now sits on the board of the real J. Peterman. But this time, the real John Peterman explains, things will be different.-- Interview by Andy Raskin
Name recognition is not the same thing as brand recognition. According to research we commissioned, 40 million people know the name "J. Peterman." Yet 70 percent of Seinfeld viewers thought it was a fictional brand. It's my job to introduce them to J. Peterman products.
I'm keeping the catalog small, though. At the old company's peak, we were printing 18 catalogs annually with an average 115 items each, but you had blouses and pants that were not "Peterman." They were just included because they looked nice. Now we do eight catalogs a year with an average of 50 items, all with the Peterman provenance in another time and place. ["One fine day in 2640 B.C., a Chinese princess was relaxing under a mulberry tree," begins the caption on the Shang Dynasty Caftan.]
Rather than opening stores, I'm leveraging the brand's potential through licensing. But I'll only license the name where we control product and write marketing copy. For example, I signed with Jeffco, which introduced J. Peterman-branded furniture in October. ["It's 1 a.m. in the dining-room kitchen of the old farmhouse in Provence," reads the tag on a wood table.] We're currently in 75 furniture stores and expect that number to grow throughout 2004, which means our brand reach will be three to four times larger than last year.
Yet I'm not in a rush to grow. Before, I got into venture capital deals, which are about building up the business, whether you make money or not. But I decided that a better way to run the business would be to make money every month. We did just under $10 million in sales last year, with a bottom line far in excess of the 5 percent of sales that is the catalog-industry average.
I met John O'Hurley, the actor who played Peterman on Seinfeld, on the set of a talk show, and now he's an investor in the company. We just filmed a TV pilot called Peterman's Eye, which is Peterman's quest for some item around the world, and all the funny, interesting things that happen. O'Hurley hosts the show, as O'Hurley. But when people see him, they think about Peterman anyway.
The biggest thing I learned is where my passion lies. I don't want 600 people working for me again, because you wind up spending your time as psychologist, arbitrator, whatever. Now I have 23 employees, and I'm about to set off for Spain and France. I'll go to the small towns, talk to people, visit antiques shops, junk shops, any kind of shop. Except department stores. The real John Peterman doesn't shop at department stores.