Has Ted Baker Lost Its Way?

The British label brandished its logo as if it was as aspirational as Louis Vuitton — no wonder it’s all gone wrong.

Visit the Ted Baker website and the first image you see is of three female and two male models dressed in the brand’s current spring collection. Not that you can discern what they are wearing that clearly, because they’re standing in a maze, their clothing partially obscured by hedging.

As metaphors go, there could be no more apposite one for the troubles engulfing Ted Baker. The 36-year-old British brand is currently trapped in a maze of its own making, thanks to a series of convoluted twists and turns. Last month, the chain was put into administration. Authentic Brands Group, its US-based owner since 2022, cited “damage done” during a tie-up with another firm as being “too much to overcome”. On Monday, administrators announced that 15 stores would be closing, leading to 245 job losses.

The announcement is the latest in a series of wrong turns for the once-popular brand that has since lost its way. Its woes started in earnest in 2019, after former chief executive and founder Ray Kelvin left amid allegations of misconduct that included ear kissing and “forced hugs”.

More than 300 former and current staff signed a petition complaining about his behaviour, leading Kelvin to relinquish his role while consistently denying all claims. “Difficult though this decision is, given that Ted Baker has been my life and soul for over 30 years, I’ve decided that the right thing to do is to step away and allow the business to focus on being the outstanding brand it is,” he said in a statement at the time.

Kelvin still owns almost 12 per cent of the company and his resignation precipitated a tumultuous time for Ted Baker, which has suffered from a series of profit warnings and accounting mishaps in the intervening years. In December 2019, shortly after Kelvin’s resignation, it announced its accounts had been overstated by up to NZ$52 million, leading to a $121m balance-sheet deficit. This led to the brand entering lockdown in already straitened circumstances. As the pandemic hit in March 2020, it installed its third chief executive in just over a year. The following month, it furloughed 75 per cent of its workforce — about 2000 employees — in a bid to replenish its balance sheet. In June 2021, it revealed losses of $209m.

While its fortunes recovered from their pandemic nadir, by April 2022 it had put itself up for sale, rejecting three takeover bids from US-based Sycamore Holdings in a move that saw shares fall by 19 per cent. Current owner Authentic Brands announced its acquisition in August that year, in a deal worth about $442m.

So far, so labyrinthine. But while many of Ted Baker’s issues are business-related, as with any fashion business there are also creative issues at play. Many would opine that the brand that listed itself in 1997 as “No Ordinary Designer Label” has become just that — ordinary, with not enough distinguishing features to drive that all-important consumer lust. Others would opine that it was never a designer label at all but merely fancied itself as one. While Ted Baker never had the high price points of a luxury label, it certainly tried to present itself as a smart, sophisticated alternative that shared the same attention to detail and craftsmanship as its more expensive rivals.

Its positioning on the high street was also carefully thought out. Of the 86 stores listed in its portfolio, 29 are standalone, situated in desirable streets in wealthy locations such as Oxford, Cambridge, Bath and York. Its flagship store on London’s Regent St occupies a corner site, to ensure maximum footfall and, of its 35 concessions, 25 are in the upmarket John Lewis department store.

But if Ted Baker was in all the right places, its product was considerably less well thought-out. It failed to adapt to changing consumer tastes, buying heavily into the rose gold trend, for example, but being slow to move on when that became passé. It seemed equally wedded to blousy floral prints, a trend still very much in evidence in its new spring collection.

Ted Baker is hardly alone in presenting “florals for spring”, but nor is there anything else that’s “groundbreaking” in its current collection. Of the 413 items of womenswear listed on its UK website, more than a quarter — 108 — are dresses, an anomaly in a season focused on trousers, of which there are only 40 pairs.

According to Fflur Roberts, head of luxury at Euromonitor, Ted Baker is far from alone in struggling in a post-pandemic landscape. “The pandemic, cost-of-living crisis and inflation hikes continue to have an unprecedented impact on wealth and on spending habits on clothing and footwear,” she notes.

“In key European luxury markets such the UK, where Ted Baker has a large presence, total disposable income levels were down by 2 per cent in real terms in 2023. Spending on non-essential items such as formal apparel and suiting, key focal areas for Ted Baker, have been down. Despite social events returning, dress codes have remained more casual, as consumers have become used to dressing for comfort. While this has benefited sports-inspired apparel and footwear, it has been detrimental to Ted Baker and other brands associated with more formal clothing.”

The problem is further compounded by Ted Baker’s price points placing it in what is arguably the most competitive sector of fashion retail — the cut-throat “middle market”. Everyone’s trying to do “affordable luxury” these days, from established British brands such as All Saints, Hobbs, LK Bennett and Whistles to newer niche brands such as Kitri, Cefinn and Mint Velvet.

These latter three — to which you could add Me + Em, Rixo and The Fold — are all founded and owned by women and enjoy a more direct and intimate knowledge of their customers, nurtured by the pandemic, as well as business models that allow them to be more nimble in responding to demand.

Popular as these female-owned brands are, their popularity has been achieved by other, more creative means than touting their logos. By contrast, Ted Baker has always featured its logo prominently, emblazoning it in a repeat pattern on bag straps as though it were as aspirational as Louis Vuitton. A more useful analogy would be Burberry, which in the 1990s saturated the market with its classic house check to the point that it became devalued. Ted Baker was never a luxury brand but, now that its popularity has waned, its logo-centric strategy seems particularly misguided.

While it may have fallen out of fashion in the UK, Ted Baker seems to enjoy a higher standing in the United States and Canada. In 2021, costume designers on the hit TV show Succession confounded the British public by dressing Shiv Roy in a Ted Baker dress for her mother’s wedding. “What have they done to Shiv?” was the common consensus, given that her character had previously always favoured expensive designer clothes.

At the King’s Coronation last May, Sophie Trudeau, the now-estranged wife of the Canadian prime minister, surprised British guests by wearing a blush pink Ted Baker dress whose quiet elegance was perfectly pitched for the occasion.

But two high-profile fans — one fictional — do not a success story make. In the meantime, Ted Baker will continue to trade, with Authentic Brands, which also owns Reebok, Forever 21 and Juicy Couture, claiming to be in “advanced discussions” with several potential buyers.

Whatever strategy its new owner takes, it would be advised to prioritise shifting focus from the logo to the product itself, modernising its offer and capitulating more rapidly to current trends. Until it finds a new direction, it will continue to be lost in its own maze.

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