Elle Macpherson: super business model

By Ian Rose
BBC Money Programme

"The Body" quickly understood that there was money to be made

Elle Macpherson stands out in our celebrity-obsessed culture.

She is a model who has established a successful long-standing brand that transcends her fame.

Her signature lingerie range has gone global, generating £40m a year.

Now Ms Macpherson is setting her sights on even bigger projects that could make her a corporate power player.

Ms Macpherson found out early that modelling could be a money spinner.

At 17, she starred in an advertisement for Tab - a low calorie cola drink, walking along a beach in a red swimsuit.

"That's when I understood the power of the commercial side of the modelling industry," she says.

"It was distributed for years and I received residuals."

New campaign

Soon Ms Macpherson was an internationally famous face, thanks to four cover appearances on the famous Sports Illustrated Swimsuit Edition in the space of five years.

Ms Macpherson earned the nickname "The Body", a tag that has become both her signature and her brand.

She showed early business savvy by sacking her modelling agency and setting up Elle Macpherson Incorporated, which produced big-selling calendars and videos starring herself.

But her real business empire was being built back home.

The New Zealand-based lingerie firm Bendon was looking for a way to break into the Australian market.

They came to Ms Macpherson with the idea of using her to front their new campaign.

Market leader

But Ms Macpherson had a more ambitious plan.

Elle's journey from fame to fortune has been well documented In pictures

I said, 'well I don't actually think you could afford for me to be the face of your company. However, if you're willing to put together a collection, I will lend you my name and likeness for a period of time in exchange for a royalty fee'," she says.

A self-confessed lingerie junkie, Ms Macpherson turned up to the first product meeting with a suitcase of samples from around the world and quickly became a hands-on partner in the design team.

A profitable partnership was born.

Elle Macpherson Intimates was unveiled to the Australian public in 1990 and quickly became the market leader.

But soon commercial disaster struck.

Ms Macpherson signed up with other big name models to launch a chain of themed restaurants: Fashion Cafe.

But they soon went bust and Ms Macpherson lost all her investment.

New markets

Intimates was still growing, though.

In 2001, after a decade on top down under, the brand was brought to Britain where it enjoyed huge success having quickly establishing itself in a market dominated by home grown retailers such as Marks & Spencer.

Some question whether business wants Ms Macpherson for her mind

Elle Macpherson Intimates is now available in Australia, New Zealand, the United Kingdom, elsewhere in Europe and in the Middle East.

In 2006, it enjoyed a successful launch in key markets in the United States.

Early this year, Ms Macpherson took Intimates up a gear by launching "Boudoir"; a more expensive black-label collection.

In its first month on sale it sold £100,000 worth of stock.

Not the face

While Elle calls the lingerie brand "her baby" she has other business interests and plans to expand her portfolio further.

A recent development is the allegation of defamation through the photograph of a lookalike Open University: when your face is your fortune

In 2005, she launched a range of beauty products in Boots, which carry her appearance and nickname The Body.

Another departure is her appointment to the board of surf-wear company "Hot Tuna".

Ms Macpherson received no upfront payment, but instead was paid in shares and options.

Her role is restricted to the boardroom.

She is not the public face of the company.

But Hilary Alexander, the fashion director of The Daily Telegraph doubts whether this is the whole truth.

"I think I'm fairly cynical," she says.

"I cannot believe that Hot Tuna has enlisted her services purely just to use her brain in the boardroom.

"It would just seem to be totally ridiculous business sense.

"If they want that brand to take off, put her in a pair of board shorts, stick her on a beach and then just watch the sales rise."

Lasting brands

Despite such suspicion, Hot Tuna's chairman, Ranjit Murugason, insists "Elle Macpherson's involvement with Hot Tuna is not a celebrity endorsement".

"It's about bringing her tremendous skills as a business woman, as a brand manager who's built an amazing fashion brand."

For Ms Macpherson, the experience of working behind the scenes at Hot Tuna is another step to fulfilling her long-term ambition.

"I would like to end up with a globally successful brand that I own a big chunk of and that is not just licensed out to other companies," she says.

She would like a stake in a company "that my children can decide to work in if they wish", she says.

"Because I've been working for 25 years and it would be a shame to throw away the ground work that's being done now."

With 20% of all advertising in the UK now using celebrities, Ms Macpherson has been one of the most successful in using her fame to sell products.

Unlike many others she has created brands that appear to have staying power.

The Money Programme: Elle Macpherson: super business model, Friday 23 March at 1900 on BBC Two.