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Excerpt from Oral History Interview with Robert Sidney Smith, January 25, 1999. Interview I-0081. Southern Oral History Program Collection (#4007) See Entire Interview >>

Hosiery marketing innovations

Smith offers more key examples of hosiery innovation—Hanes Hosiery's development of the L'eggs brand, which appeared in stores in an egg-shaped package, and the decision to market hosiery in grocery stores.

Citing this Excerpt

Oral History Interview with Robert Sidney Smith, January 25, 1999. Interview I-0081. Southern Oral History Program Collection (#4007) in the Southern Oral History Program Collection, Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill.

Full Text of the Excerpt

SS: To reiterate, the amount of sheer hosiery sales through discount is thirty-three, thirty-five percent. Whereas in the sock category, it's sixty, sixty-five percent. In both cases, it is still the largest channel of distribution. That is a tremendous shift from when the majority of all sock sales and the largest channel of distribution, even of ladies’ goods, was through other channels -- either department stores or for ladies' hosiery, grocery stores. So, that's been a big change. JM: I imagine that translated into downward price pressure at the wholesale level. SS: Yes. This country is going through deflation, as most economists have pointed out. The consumer price index increases have been very low. We have not had inflation for quite a few years. Bill Clinton gets no credit for it. It's the discounters. They are driving the retail economy. They are the market force to deal with. They deal in volume and they deal in price. At the same time, they demand quality too. So, the manufacturers are squeezed to produce high quality on one side, but do it fast, do it quick and do it at a very competitive price. There are a couple of other things probably that we ought to talk about in historical developments. They relate to pantyhose only and not the whole hosiery industry. With pantyhose being a very large product category, [one development] is the advent of the shift of selling pantyhose in the grocery store from the department stores. In '65, when Twiggy stepped out on that runway, most hosiery -- including this new product “pantyhose” -- was sold in the department store. That's where women went to buy their goods. One of the biggest manufacturers at that time, if not the biggest, was Hanes hosiery, family owned out of Winston-Salem. Gordon Hanes was running the company at that period of time. They were making this new product, pantyhose. One of the things that he did was he came up with a new innovative packaging and a marketing play off of the word legs and eggs and came up with L'eggs and started packaging pantyhose in a little plastic shaped egg. It was very unique packaging. It got a lot of consumer attention. They [the Hanes compay] backed it with a lot of advertising and turned L'eggs into a national brand, just like they'd always done with their Hanes brand product. But, he also looked at the channels of distribution and said, “Well, where do women -- in 1968, '69, 70, '71, '72 -- where do they do most of their shopping?” Well, it was the grocery store. He said, “Well, I'm going to put this product where they are.” He went to the grocery stores and said, “Let me sell those L'eggs here.” They said, “You've got to be kidding? Why are we going to put these in with canned goods?” He said, “Listen, I've got a freestanding module. It's very attractive. I'd like to put them right at the checkout counter. It's the last thing they see as they go through there. I'll put them in here at no cost to you. You'll only pay me when they sell. I'll take care of stocking. What do you have to lose?” They said, “Oh, okay.” So, they tried it. It went great guns. That was kind of the story of the development of L'eggs. Other hosiery manufacturers came in with similar marketing techniques. No Nonsense [pantyhose] is another example. Grocery stores became the largest channel of distribution for ladies' pantyhose. It was purely through innovative marketing and merchandising. Instead of producing a product and putting it out there and saying, “Gee, I hope you like it and I hope you come to the store to buy it,” we're going to track you down and grab your attention with our packaging. Really, that was the beginning of that shift over to grocery stores. Now we're seeing the shift to department stores, excuse me, discount stores. JM: Discount stores. SS: We're seeing that shift over to discount stores. Just in the last year or two, discount has taken the final one or two percentage points it needed to get higher than groceries. It has done that.