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The secret behind Jessica Simpson’s billion-dollar brand

Singer helms billion-dollar fashion and lifestyle empire spanning 31 product categories

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Jessica Simpson’s booming retail empire is changing hands.

Jessica Simpson has come a long way from her Chicken of the Sea flub on the MTV reality show “Newlyweds.”

Ten years after launching a footwear line with the Camuto Group, the singer-turned-mogul is at the helm of a billion-dollar fashion and lifestyle empire spanning 31 product categories. The Jessica Simpson Collection, which includes shoes, clothing, handbags, jewelry, fragrances and a home line, appears in hundreds of department stores across the U.S., including Macy’s, Dillard’s, Belks and Nordstrom, and last year it pulled in $1 billion in retail sales.

While other celebrity fashion brands have fizzled out, Simpson’s has managed to stay on top, and one branding expert says her ability to connect with consumers on a human level has much to do with her success. “A lot of celebrities endorse things, but it doesn’t make them a brand,” said Robert Passikoff, founder and president of marketing consultant Brand Keys Inc. in New York. “It makes them a business person.”

Sequential Brands Group is looking to triple the net worth of the Jessica Simpson Collection by expanding overseas.

Passikoff said Simpson’s down-to-earth, girl-next-door persona and her ability to emotionally engage with everyday people and meet their expectations is helping her to become even more successful.

“People want to feel better about themselves and who they are,” Passikoff said. “And Simpson has this rare quality where she can do that.”

Simpson’s likability resonates across all age groups, Jack Gross, CEO of Jeanswear for the Jones Group, license holder to her jeans collection, told WWD in 2010. She is “very communicative with her fans. Fifteen-, 16-year-olds and 40-year-olds like her. Sometimes she has missteps, and they identify with her.”

New York–based Sequential Brands Group is now hoping to cash in on Simpson’s star power. The company signed an agreement to acquire a majority stake in the Jessica Simpson Collection for an undisclosed amount of cash and stock. The stake was sold by the Camuto Group, which is giving up the master license for the line but staying on to produce footwear.

Sequential, which also owns Justin Timberlake’s William Rast clothing brand, is looking to triple the net worth of the Jessica Simpson Collection by expanding overseas. Wunderlich Securities on Thursday affirmed its buy rating on Sequential, citing Simpson’s impressive reach and potential to expand internationally and get to that “next billion.”

Simpson has often positioned herself as a women’s advocate, saying at the Forbes Power Women Summit last year that her goal as an entrepreneur was to make women feel confident in what they wear and to create clothes that fit different body types.

“I’ve been every size on the planet, and I feel like I understand women and how to dress them,” she said. “There’s life in the whole world beyond L.A. and New York. I understand Middle America and their mindset.”

Simpson attributes her success to knowing her market, listening to the consumer and designing clothes and shoes that are comfortable and flattering and not necessarily trendy. “I try to focus on what makes a woman feel beautiful,” she said.

The fashion icon has long been looking beyond the current standard of beauty. In a 2009 VH1 documentary series, “The Price of Beauty,” she traveled the globe to examine how beauty was perceived in different cultures.

“I got so much scrutiny for putting on extra pounds,” she said. “The decision to not make myself anorexic was great for branding because when you’re really skinny, not everybody can relate to you.”

Teri Agins, who developed the fashion beat at the Wall Street Journal, told Elle magazine in October that the celebrity brand that’s impressed her the most has been Jessica Simpson’s.

“[Simpson’s brand] has really transcended,” Agins told Elle. “It’s no longer just a celebrity brand, it’s a brand. A lot of kids who buy those shoes were probably toddlers when ‘Newlyweds’ first aired in 2003. A lot of teenagers who are wearing those shoes have no idea about the show.”

http://www.marketwatch.com/story/the-secret-behind-jessica-s...