Bum’s the Word: If You Want To See Kathleen Staples’ Business Plan, Look Under Her Skirt

Blitz Magazine, November 1999


In the minds of many, the idea of an entrepreneur constantly pushing a product is considered ‘shameful self-promotion’. (Somehow, constantly running television or radio commercials is not.) However, the success of BC entrepreneur Kathleen Staples shows how self-promotion, without benefit of paid advertising or PR services, can build a booming business.

Staples’ entrepreneurial flair first exhibited itself in high school, during the course of which she designed, sewed and sold 5,000 bathing suits. While she had great swimwear, she never wore any underwear because she couldn’t find any that were comfortable. She hated the feeling of exposed elastic and inside seams. She wanted the luxury and comfort of silk, but silk was too expensive, too fussy and too hard to care for.

In 1992, following a stint at Sotheby’s, Staples found herself with her own Vancouver antiques store, selling beautiful things to people who didn’t need them. She decided that she’d rather sell something that people needed.

Then, light bulb. Product: Underwear. Name: Staples—You Need Them Every Day. Concept: High-quality, silk knit underwear which is attractive, comfortable, affordable and easy to care for.

In 1994, after designing her patterns and arranging financing, Staples arrived in Hong Kong with no contacts, no industry experience and no idea of how to find a manufacturer. When she went into a government building to pick up her travel documents, she saw a notice saying that the Chinese Silk Industry Trade Show was taking place at that moment, in that building. Within hours, she’d given a pattern to two dozen manufacturers; a few months later, her chosen manufacturer—a mill near Shanghai—shipped her first order of 1,500 white briefs. Staples contracted a local woman to hand-dye them; she made her own tags, improvised a corded package and began to sell them.

How, you might wonder, does one sell underwear? In Staples’ case, she cold-called lingerie shops, then sent retailers pairs for their own use. Nine out of ten calls resulted in purchases, then repeat orders. She dropped into stores and showed her product to owners or sales managers. Who bought them. And quickly sold them. She also leased a small space near the cash register at The Bay in downtown Vancouver, and laid her panties across people’s hands as they waited to pay. It worked like a charm. Because, in the case of Staples lingerie, once people feel it, they buy it. All Kathleen Staples had to do is get it into people’s hands.

In 1994, Staples sold $1000 (CAD) worth of lingerie. In 1995, sales were $10,000. In 1996, $100,000. In 1997, $500,000. In 1998, $1 million. She projects sales of $10 million for the next fiscal year. In 1998, she shipped 150,000 garments; over the last year, business has increased by 1000%. She now has 20,000 customers.

According to Statistics Canada, in 1996, Canadians spent $2 billion (CAD) on lingerie. In 1997, sales of lingerie giant Warner’s were $4 billion (US), while the popular Joe Boxer line takes in $40 million (US) a year. Many credit Calvin Klein’s ground-breaking PR and marketing work for the fact that, in the last decade, the foundation garments market has grown by double digits every year. It’s now a no-lose business. If you have a quality product and can get it to market, it will sell.

staples1“If you think about it, it’s so simple,” says Staples. “Everybody needs underwear every day. So the biggest problem is meeting demand, which is unending. You can’t niche-market because everybody wants it. Consumers want extra-large sizes, they want it for grandmothers, teens, children. Women are screaming for bras; body shapers account for almost half of the market. You find a cost-effective way of manufacturing it, you put it out there, it flies away. The secret to success, though, is being able to deliver—getting those orders to customers and giving them 100% attention, time and service.”

A 1998 Style Magazine survey found that what women want from underwear is minimalist purity of colour and fabric. They want fine materials which hug the body and won’t interfere with movement or clothing. Price was most important for 69% of respondents; 57% stock up on lingerie twice a year. Only 29% preferred silk over cotton (69%). But there is very little brand loyalty in lingerie purchases, and that’s where Staples has been able to squeeze in and flourish—once people start wearing her underwear, they rarely wear anything else.

The first attraction is the feel and concept of silk. Staples looked at samples from Vietnam, India, Africa, Italy, France and Japan—the Chinese was the best. Silk keeps you cool in the summer and warm in the winter. It lifts moisture off the skin. Clothes won’t stick to it and, contrary to popular belief, it does not need dry-cleaning. From the ethical perspective, Staples’ manufacturer is not a sweatshop, nor does it use child labour. Unlike cotton, the production of silk requires no pesticides—it is a protein fibre spun from the heads of well-fed caterpillars. Staples uses silk stitching and natural, cold water-and-vinegar dyes.

The second attraction is in construction. The knit allows for a 75% stretch. It washes quickly, dries quickly. Front seams mean that panties won’t ride up. The elastic is concealed and the underwear fits like a glove—no added bulk, no panty lines.

The other big selling point—for men as well as women, is functionality. Staples sells 20 items: for women, there are three panty styles, for men there are fitted boxers and Speedo-like ‘Cary Grants’. For men and women there are undershirts, biking shorts and leggings. Colour names have personality—Go Fly A Kite Blue, Sugar Petal Pink, I Love Lilac. Her biggest seller remains the ladies French Cut, size medium, in Jet Set Black. Prices range from $20 (for panties) to $100 (for sleep shirts). And, if they’re hand washed and hung to dry, they last for three years.

So Staples has a unique product. But, she says, she’s been “panty-rich and penny-poor”. At the beginning, without funds to hire an advertising agency, conduct consumer advertising or pay for public relations campaigns, she took the pragmatic approach and is now well-known for her attention-getting promotions.

She mailed panties to professional women golfers, telling them that Staples will allow them to think about their back swings as opposed to their back sides. She has appeared at Christmas parties as Panty Claus. She has sponsored golf tournaments where the hole flags were replaced with pairs of underwear. She has carried a Staples-clad Barbie doll to parties. She has stuffed underwear into popcorn boxes and sent them to guests of the Vancouver International Film Festival. To Staples customers, she handed out t-shirts reading ‘Ask Me About My Underwear’, knowing that people couldn’t resist asking. After addressing a meeting of a women’s business association, she dropped her pants.

She is also a master at media relations. Her press releases are short, to the point, and iconographically intense. Her copy is irreverent and witty, e.g. ‘I Am Woman, Hear Me Snore’. Her press kits always include lavender-scented samples. A consummate schmoozer, she hosts four parties a year, and calls media members regularly.

“I tell them what I’m doing, and I always put a spin on it so it’s news. Or I give them a photo to op, like the Panty Claus thing. Journalists need stuff to write about. If you give them light news, make it funny and don’t send them a pile of stuff to read, you’ll get coverage. Reporters like stories about women, about entrepreneurs and about underwear. Plus I’m a good talking head; I give good interview.”

Staples has been interviewed on CBC Radio and cable television, and is a favourite with the fashion press. She got a lot of ink in 1997, when she launched a lingerie vending machine. It was fully-computerized, with instant credit card verification and interactive directions in 10 languages. At the time, there were only three such machines in North America (also tested by Ralph Lauren and Joe Boxer). Although the machine would have been perfect for an airport, train station, bus station etc., Staples couldn’t find a permanent location for it. But she hasn’t dropped the idea—before returning the machine, she placed it in the Vancouver office of a large corporation for two weeks and had to re-stock it daily. It also earned her spots on V.TV and the CTV National News.

Back in 1996, Staples hosted a Gaunch Launch at a restaurant—your drinks were free if you danced in your underwear. BCTV’s Pamela Martin came, then ran an eight-minute piece on the BCTV Newshour. This was 10 days before Christmas; for the next month, retailers’ racks were picked clean of Staples items.

That led to a feature story on Venture. At the time, Staples was supplying all Bay stores. For publicity for all involved, she set up her own ‘trading post’ in front of The Bay at Toronto’s busy Yonge/Bloor intersection. Venture ran an ad in the Financial Post reading: ‘Woman With Knickers in a Knot at Yonge & Bloor’. On the day of the promotion, she told passers-by that she’d trade anything for a pair of silk panties—she received stock tips, jokes, a thermos, an emergency bee sting kit. Meanwhile, models walked around inside the store wearing her pieces. The Venture piece ran; The Bay promptly sold $30,000 worth of Staples’ pieces.

Then The Bay changed buyers and Staples’ deal with the chain ended (she’s now back in seven Bay stores). By that time though, many people knew about her products and started e-mailing orders. Staples realized that she had to move from guerrilla marketing to electronic marketing.

Staples first had a web site designed in 1995 but, in 1997, she partnered with BC Tel to offer the first Christmas of secure shopping, becoming the third pilot site in BC Tel Interactive’s E-Commerce credit card encryption project. Now, sales on the site (www.staplesonline.com) account for half of her company’s revenue. Most orders come from the US and Canada, but she has loyal customers from Sweden to Brazil to Hong Kong, and she recently arranged for her site to accept JCB, Japan’s largest credit card.

Like all of Staples promotional materials, the site is not fancy. Staples prefers to use lots of white space, no more copy than is absolutely necessary, and line drawings and cartoons instead of photographs. This bare-bones approach is probably why the site has worked so well; shopping on it is easy. The site contains testimonials from satisfied customers, a Q & A section, sizing charts, store listings and a ‘Katalog’ with drawings and descriptions of each product. Staples has removed the password system; now shoppers need only register and click their purchases into personalized shopping carts.

“We’ve seen a huge increase in sales due to the Internet,” says Staples. “New customers are coming in more rapidly, existing customers are shopping more often and buying more.”

Staples is an avid pamphleteer and promotes the site at every opportunity. She will give anyone a $10 gift certificate toward a web-site purchase. Or a fridge magnet bearing the site’s address. She has sent out coupons with orders of Chinese food, she donates to countless charity events and tries to give away 10% of her stock. Every garment tag bears the web site address, as well as her 800 number.

“The 800 number has at least doubled sales,” says Staples. “The web site gets about 2500 hits a month, which is not a lot, but 10% of those visitors make a purchase—many sites get millions of hits but make no sales. The 800 number is used by people who are calling specifically to make a purchase, and we get about 40 calls a day.”

Callers to the number (800-397-7228) speak directly to Staples’ shipping manager, who works out of her home. There is no Staples office. Kathleen Staples’ fax machine and files are in her parents’ home. She carries out her business with only a lap-top computer, a 3-watt cell phone and a canary-yellow VW bus. Two other assistants handle database and paper work; she has eight agents acting on her behalf in the US and Canada.

Staples is now in 24 US stores (60 in Canada), but sales in the US have been thwarted by American quotas on the importation of Chinese silk; a labeling law ditched a deal with Nordstrom. She has, however, been approached by several catalogues and is looking at the lucrative practice of private labeling. She recently signed her first deal: Staples lingerie will soon be found in 900 US Harley Davidson locations, bearing that company’s logo.

Incongruous, perhaps, but Staples isn’t worried about projecting any particular product image. This is, after all, underwear. And, as she says; “The medium is the message—or maybe it’s the large…”