\u201cMy change and keys fall out sitting,\u201d posted<\/a> Robert C. about his Dockers Men\u2019s Classic Fit khakis. \u201cExcellent with major exception of front pocket depth,\u201d wrote Disappointed Loyalist, who posted a one-star review of a pair of pebble-brown Signature Classic Fit trousers. \u201cThese are actually 4-star pants,\u201d clarified IWearPants in an online review thread<\/a>. \u201cUnfortunately, they\u2019ve committed the ultimate atrocity in fashion; they made the pockets too shallow.\u201d<\/p>\n By IwearPants\u2019 measurement, the pockets on his new Dockers are 1.5 inches less deep than his old pair. And he made a plea: \u201cIf Dockers (or parent Levi Strauss) needs to raise the price by a couple of bucks per pair, so be it. Just give me back deep pants pockets on my Dockers.\u201d<\/p>\n Levi Strauss is actually no longer the parent company of Dockers; in May it sold<\/a> the label to brand ownership giant<\/a> Authentic Brands Group (ABG) for an initial value of $311 million, with the potential to reach $391 million based on performance under Authentic\u2019s ownership. (ABG declined to comment on the Dockers brand or its pocket measurements.) \u00a0<\/p>\n The Dockers pocket predicament\u2014which some dismiss as an imagined problem\u2014predates ABG\u2019s ownership. But it shows the peril of a 1.5-inch difference\u2014that razor\u2019s edge between a loyal customer and one who abandons a product or company. Even the most beloved brands can become vulnerable following perceived changes or quality erosion that upset passionate consumers\u2014and when heritage brands are purchased by holding companies like ABG, which seek to optimize and grow the brands globally, that passion can be a double-edged sword.<\/p>\n Justin Sullivan\/Getty Images<\/p>\n<\/figure>\n Dockers followed a well-trodden path, and one that many iconic brands have taken in recent years. Brand management companies including ABG, WHP Global, and Marquee Brands have assembled portfolios that include dozens of household-name brands. These companies have emerged as the new power brokers in fashion and retail, raking in some $50 billion in sales globally each year.<\/p>\n The cherished American retail names now owned by these companies make a long list: WHP owns Toys \u201cR\u201d Us and Babies \u201cR\u201d Us, Anne Klein, Express, Bonobos, and Rag & Bone. Marquee owns the revamped Martha Stewart brand, BCBG, Laura Ashley, and Isotoner. ABG, the largest player in this space, owns a vast empire of more than 50 brands, including Eddie Bauer, Champion, and Reebok.<\/p>\n Also under the ABG umbrella are investments in the name, image, and likeness rights of various boldface names, including soccer superstar David Beckham and basketball great Shaquille O\u2019Neal. ABG also owns the names and likenesses of long-deceased icons including Elvis Presley, Marilyn Monroe, and Muhammad Ali.<\/p>\n A $1.4 billion deal<\/a> for ABG to own a controlling interest<\/a> in the Guess? brand is expected to close in 2026 after a bidding war<\/a>. If that deal goes through, Guess? will be among the largest brands in the ABG portfolio, and is expected to bring its annual retail sales to $38 billion each year. WHP\u2019s annual retail sales are $7 billion, and Marquee\u2019s are $3 billion and climbing.\u00a0<\/p>\n Globally, the broader brand licensing industry is growing<\/a> rapidly\u2014from $295 billion in 2024 to an expected almost $400 billion in 2029. That includes\u00a0the brand-licensing arms within blockbuster\u00a0companies\u00a0such as Disney,\u00a0which\u00a0licenses its characters for toys and other merch, and the NFL, which licenses team jerseys. Rising consumer demand, star-powered celebrity endorsements, and the growth of virtual branding, in which a brand exists and sells to customers entirely online with no physical retail stores, have fueled this growth.<\/p>\n Each brand management company operates differently and there is no unified approach, but generally, these firms will purchase a brand\u2019s intellectual property (IP), often during financial distress or bankruptcy. That generally means the brand management companies own trademarks, logos, copyrights, and creative content, and control the rights to license the brands to third parties. The brand managers then enter into lucrative licensing deals with a network of third-party partners that handle manufacturing, shipment to retailers, marketing and advertising, as well as store displays and sales, in various parts of the world.<\/p>\n The question at the heart of this thriving industry, which often includes private equity backers, is whether the second life these brands get after being rescued from the brink of oblivion can be profitable without sacrificing quality. In some cases the born-again versions of these once iconic brands are smashing successes. In others, they can turn into zombie brands, churning out inferior products that leave consumers feeling confused and even betrayed.<\/p>\n \u201cLicensing can genuinely keep a brand alive when it\u2019s losing momentum,\u201d said Armando Zuccali, CEO at private financial services firm Gag London Equity Capital which partners with businesses and operating partners. \u201cThe risk is when it becomes the whole strategy and everyone starts chasing royalties and door count to hit numbers. That\u2019s usually when the products being to slip, quietly at first.\u201d<\/p>\n The core of this business is a volume play: The brand management companies buy IP that they believe could be bringing in more revenue, with the right push. Buyers often pay lip service to their responsible guardianship of beloved brands, but there\u2019s an inherent tension in the proposition: If the strategy is to re-popularize and optimize a brand, the pressure to produce quickly, cheaply, and at huge scale to maximize licensing revenue can lead to what critics call \u201censhittification<\/a>\u201d\u2014the gradual decline of quality as brands chase volume over value.<\/p>\n Instead of manufacturing stuff itself, the industry relies upon a vast network of \u201coperating partners\u201d\u2014companies that license the brand and do the heavy lifting of producing and selling products. The brand management companies typically inspect and approve the products for sale, but the design, craftsmanship, and manufacturing are all handled by the operating partners, explained Sonia Lapinksy, managing director in fashion retail at the consulting firm AlixPartners.<\/p>\n Critics claim some brand management companies offer little oversight while allowing operating partners to slap logos on a vast array of subpar products. Sometimes, the operating partners hire the same designers and suppliers that worked with a brand prior to its purchase to maintain continuity, said Lapinsky, but problems can creep in when operating partners\u2019 practices are unscrupulous, or they cut corners.<\/p>\n Zuccali of Gag London Equity Capital, who has overseen retail facilities projects in Europe, the Middle East, and Africa, said brand DNA usually only survives a licensing sale if the original product teams maintain authority by approving fabrics, checking construction, visiting factories, and pushing back when someone suggests a shortcut. \u201cIf that stops happening, the brand becomes a logo anyone can rent,\u201d he added.<\/p>\n Erik McGregor\/LightRocket via Getty Images<\/p>\n<\/figure>\n The step that often generates skepticism is when brand management companies remove creatives and founders who previously maintained strict control in all aspects of production\u2014walking production lines around the world to check the stitches per inch on a pair of pants, for instance, or the inclusion of real buttonholes on a suit versus decorative buttons.\u00a0\u00a0<\/p>\n \u201cIn theory, there should be some standards with these arrangements that maintain a level of quality,\u201d said Lapinsky. \u201cOr else eventually the products won\u2019t sell, and the brand managers won\u2019t be able to collect the royalties.\u201d<\/p>\n It\u2019s a matter of balancing quality with quantity, explained Aaron Duncan<\/a>, a former creative director for global licensing at Playboy Enterprises and an associate professor and chair of global fashion management at Fashion Institute of Technology. But when the operating partners have bet on the brand by guaranteeing a fee to the IP owners, they sometimes \u00a0\u201cgo rogue\u201d to ensure their return on investment, he said.<\/p>\n Duncan, who has led global strategy and business development for brands including Barbie and Hot Wheels, recalled one licensee who opened a shop-in-shop in Seoul for a different brand he can\u2019t name due to a confidentiality agreement. He had not approved the shop, and it wasn\u2019t the right aesthetic for the brand, said Duncan. While most partners are honest in their business dealings, he said, he also has had apparel manufacturers that secretly sub-licensed a brand to other manufacturers. By the time it was discovered, the unauthorized products were already for sale. \u201cMost of the time, you\u2019re not even finding out about it until someone goes shopping in a mall in the middle of nowhere and sees it,\u201d said Duncan. \u201cThat\u2019s the danger.\u201d<\/p>\n Those revenue-generating measures can dilute the brand, Duncan added. And if a partner has damaged the brand, it can be difficult to recover its shine.<\/p>\n What\u2019s driving consumers back to beloved brands of the past in the first place? According to brand strategist<\/a> Jean-Pierre Lacroix, nostalgia plays a big role, and that nostalgia is rooted in three impulses, particularly in younger consumers: Anxiety, and need for mental escape; the search for non-mainstream brands; and the power of influencers.<\/p>\n \u201cThe undercurrent is there\u2019s a lot of anxiety in the marketplace right now, and people are looking for a way of escaping this anxiety,\u201d said Lacroix. \u201cThe wars, the tariffs, the instability of the marketplace, the lost jobs, AI\u2014all these things are unsettling for people.\u201d\u00a0<\/p>\n Brands from the past can soothe, he said, allowing anxious consumers \u201cto live in the past where it was a great life.\u201d For Gen Z, who wasn\u2019t even born when many of these brands were in their heyday, the appeal is complex: Influencers seeking to be unique are using unboxing videos on YouTube and TikTok to showcase products beloved by their parents\u2019 generation.<\/p>\n Clay Routledge, a social psychologist who specializes in nostalgia, wrote in the New York Times<\/em> that some 60% of Gen Z wish they could teleport to those pre-iPhone days\u2014which could explain why they\u2019re chasing tangible offline experiences like vinyl records, photo albums, and board games.<\/p>\n For instance, Champion-branded running shoes are back after they nearly disappeared. They\u2019re popular because they tick some of those key boxes, said Lacroix\u2014a brand without the ubiquity of Nike, a uniqueness that makes the wearer stand out, and the nostalgia factor that evokes better quality.<\/p>\n Champion invented the hoodie in the 1930s, and engineered it for pro-athletes to stand up to repeated wear and tear, weather, and travel. Under ABG\u2019s stewardship, Champion is on its front foot again, with a new partnership to sell at Target and a fashion-forward focus. Its products are being marketed<\/a> as high-quality and substantial\u2014with a trademarked reverse weave to resist shrinking.<\/p>\n Martha Stewart\u2014a brand that encompasses home and garden products, content, and its eponymous founder\u2019s likeness\u2014is now part of the Marquee Brands portfolio, and it exemplifies the nostalgia phenomenon. It also demonstrates how a brand management company can leverage and optimize a cherished brand by bringing it new fans and customers. The company relaunched<\/a> Stewart\u2019s seminal 1982 book Entertaining<\/em> in November after noticing that it was selling for hundreds of dollars on eBay, said Marquee CEO Heath Golden.<\/p>\n In a marketing blitz, Stewart\u2014America\u2019s first self-made female billionaire and a pop culture figure whose appeal has endured for decades\u2014has made the media rounds this fall, appearing on the Today<\/em> show to discuss her book while cooking mushroom and Tuscan tomato soups for sweater-weather season. There are also collaborations: Fans can buy seven of the desserts from Stewart\u2019s book at Crumbl Cookies stores.<\/p>\n \u201cMartha Stewart is having a moment,\u201d said Mark Weber, a podcaster and former CEO of Calvin Klein, The Donna Karan Company, PVH Corp, and LVMH. \u201cShe looks great, and she\u2019s out there in front of the public and creating demand.\u201d<\/p>\n But the guru of domesticity\u2019s brand also offers an illustration of what can go wrong when a brand is sold to new owners bent on rapid optimization. Martha Stewart Living Omnimedia went public in 1999, valued at $2 billion, and raked in nearly $1 billion in annual retail sales in the late 1990s and early 2000\u2014then changed hands multiple times following that peak. In 2004, following Stewart\u2019s five-month prison sentence related to insider trading charges, the stock cratered<\/a>, eventually losing 70% of its value. In 2015, brand management company Sequential Brands Group acquired<\/a> Martha Stewart Living Omnimedia for $353 million\u2014a bargain at less than a fifth of its peak valuation.<\/p>\n Under Sequential\u2019s stewardship, the brand failed recover its previous cachet. Sequential went out of business after bankruptcy proceedings ended in 2022, but a former executive who spoke anonymously because they still work in the industry said the company made the mistake of attempting to saturating the retail market with Stewart\u2019s brand. \u201cThe company wanted Martha Stewart\u2019s name on every single product category from picture frames to sneakers to face cream,\u201d the executive said. With a lifestyle brand meant to evoke aspirational entertaining, that indiscriminate strategy undermined the narrative of curated or special products, the veteran exec added.<\/p>\n In 2019, Marquee Brands acquired Martha Stewart from Sequential at an even lower price, $215 million. But under Marquee, Stewart\u2019s brand appears to have thrived. By 2021, Stewart\u2019s products were raking in roughly $900 million<\/a> in combined retail sales annually, and were in 70 million households. Forbes<\/em>estimated<\/a> Martha Stewart Kitchen, a cabinetry, countertops, and shelving line, could hit $1 billion in retail sales this year.<\/p>\n Golden told Fortune<\/em> that the company mines nostalgia, but it also invests heavily in consumer data and updates products and marketing for more modern tastes. \u201cWe love our 19 brands like we love our children,\u201d said Golden. Along with nostalgia, consumers crave authenticity, and Martha Stewart has it in spades, he said.<\/p>\n Plus, Stewart has a strong social game, including almost 3 million followers on Instagram, where Stewart posts what followers affectionately call \u201cthirst trap\u201d pics of herself, d\u00e9cor, and images from around her estate, including of garden-grown garlic and chrysanthemums.<\/p>\n Social media has completely changed the way companies create interest and demand. \u201cWe\u2019re in the want business,\u201d said Weber. \u201cWe\u2019re in the business of creating a craziness in you to go out and buy something new.\u201d<\/p>\n Neil Saunders, a retail analyst and consultant, said it\u2019s not just in the immediate aftermath of an acquisition that matters, but how the brand value grows over its lifetime. Saunders pointed to Brooks Brothers, which was owned by ABG and is now under an ABG-backed joint venture with J.C. Penney called Catalyst Brands<\/a>, as a brand that has dealt with some early stumbles it is working to overcome. Catalyst is the brand licensee for Brooks Brothers in the U.S. and operates design, sourcing, e-commerce, and stores domestically.<\/p>\n Under ABG, Brooks Brothers launched some secondary, lower-priced clothing ranges called \u201cdiffusion\u201d lines, Saunders said, but the clothes were \u201ca little bit shabby.\u201d For the nostalgia play to work, the products still have to be good and the price has to be right, said Saunders. \u201cNo one will buy into a brand or buy products from a brand just because there\u2019s an element of nostalgia,\u201d he said. (Catalyst has not responded on the record to a request for comment.)<\/p>\n The mechanisms of decline are subtle but cumulative, and customers usually feel it before anyone inside a company will admit it, said Zuccali. \u201cThe leather seems thinner; a zipper catches; buttons look fine in photos but feel cheap in the hand,\u201d he said. \u201cOnce trust breaks there, it\u2019s really hard to get back.\u201d<\/p>\n Any kind of quality degradation can alienate a brand\u2019s most valuable customers, said Gabriella Santaniello, founder of brand consultancy A Line Partners. And some\u2014especially the wealthier older customers who have personal allegiance to particular brands\u2014are difficult to win back. \u201cGen X is the most likely to be disappointed in you if you\u2019re a brand,\u201d said Santaniello. \u201cAnd they\u2019ll hold a grudge\u2014it\u2019s harder for them to move on.\u201d<\/p>\nThe brand management playbook<\/strong><\/h2>\n
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The nostalgia paradox<\/h2>\n
The Martha Stewart moment<\/h2>\n
The quality risk<\/h2>\n
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