Branding

Gwyneth Paltrow, Business Mogul?


“Gwyneth Paltrow represents rarefied nuts and specialty kale”

Photograph by Carter Smith/Art and Commerce

“Gwyneth Paltrow represents rarefied nuts and specialty kale”

Sure, a wise person steers away from politics and religion in conversation, but only a real idiot mentions Gwyneth Paltrow. When her name comes up, otherwise happy, well-adjusted women put down their wine, take a deep breath, and lose their minds. Everyone loathes Paltrow. Or loves her. She’s so divisive that in one week in May she was People’s World’s Most Beautiful Woman and Star’s most-hated celebrity. She’s been called a “smug unbearable scold”—and that was by the New York Times. New York magazine has described her as “terrifically funny and chatty.” Time said, “If there’s an opposite of America’s Sweetheart, she’s it.”

So it’s surprising that Paltrow, who declined to comment for this article, is so successful as a lifestyle guru. She sells everything from clothes to recipes to gym memberships, all helping women construct an entire Gwynnie-approved existence. Paltrow’s many businesses are based around a character she’s carefully built. She’s an Everywoman—a working mom who takes her two kids to school, cooks them dinner, and holds down a day job—who just happens to be in movies that have grossed more than $3.9 billion. And she’s married to the lead singer of Coldplay. She’s 40 and yet boasts that her butt isn’t “so bad for a 22-year-old stripper.” She eats a lot of tofu but smokes one cigarette every Saturday night. It’s difficult to make those contrasts feel authentic. For some, as Slate put it, Paltrow “sits at the intersection of populist rage and the outsize expectations placed on working parents.” But there are many who buy it: Her new cookbook, It’s All Good, made its debut at No. 1 on the New York Times Best Seller List, and her website, Goop, has more than 150,000 subscribers.

Courtesy Goop

Paltrow is just one of a number of female celebrities building namesake brands. “They want to be great artists, but they’re realizing their social media footprint is so massive they can get in other businesses like the spirits industry, the fashion industry, and the movie industry,” says Cory Isaacson, a partner at the marketing agency Walton Isaacson. “Now they all want to be CEOs.” Isaacson helped market Real Housewife of New York Bethenny Frankel’s Skinnygirl cocktails, which sold 1 million cases in the first 18 months; it took Maker’s Mark 50 years to sell that much. “If they can use their celebrity when it’s hot, they can create an annuity so that they’ll make money when they’re sleeping,” he says. Last year, Jessica Alba launched The Honest Co., an organic baby product line. Jessica Simpson, who sells shoes, fragrance, clothes, and handbags through the Jessica Simpson Collection, is worth about $100 million, according to Forbes. Dualstar Entertainment, the Olsen twins’ clothing business, has annual sales of more than $1 billion, the magazine calculated. What Paltrow’s hawking is different, though—she’s not focusing on what to buy, but on how to live.

Once, people didn’t have such strong feelings about Gwyneth Paltrow. In 1998 she was just that tall, beautiful woman who won an Oscar for Shakespeare in Love. Then, in 2004, she mildly annoyed people by flaunting a Madonna-like, put-upon British accent and naming her child Apple. Gwynnie-hating really began as a sport in September 2008, when she launched Goop.com, an online newsletter that turns her exclusive existence into a how-to for readers by sharing vacation destinations, workout tips, and recipes for the best corn vichyssoise. Goop was endlessly mocked—goopyou.com nails her pretentious use of parentheses to casually tell readers her connection to every fabulous location and celebrity. But according to Alexa, a company that provides Web traffic data, the site draws hundreds of thousands of well-educated women, most of whom make more than $60,000 a year.

Courtesy Goop

Goop teams up with brands for limited-edition collections such as a Kings of Cole $290 sweat suit that is “great for lazy days” and a $950 sterling silver shot glass from Foundwell that’s “a fun conversation piece.” While the prices may seem exorbitant and the descriptions eye-roll-worthy, spend some time on the site, and its appeal begins to wash over you like the warm ocean off Santa Barbara—Paltrow recommends staying at the San Ysidro Ranch near there; rooms start at $695 a night. She has an expert eye for luxurious curation, and after a while you stop laughing at those $935 leather-and-gunmetal pants from Rag & Bone—instead, you want to own them. (Too bad you can’t: They’re already sold out.)

Courtesy Goop

Paltrow’s reach is growing rapidly. She’s written three best-selling cookbooks that advocate various forms of gluten-free, dairy-free, low-carb, vegan, and macrobiotic diets. (In It’s All Good she tells the story of a near-death scare caused by French fries, after which she gave up coffee, alcohol, dairy, chicken, eggs, sugar, shellfish, deepwater fish, potatoes, tomatoes, eggplant, corn, wheat, meat, soy, and all processed foods.) In May she signed a $2 million deal to model in ads for Hugo Boss’s new perfume and also launched Goop’s city guide travel apps at the SoHo Apple Store. She’s teamed up with her trainer, Tracy Anderson, to open gyms in Manhattan, the Hamptons, London, and two in Los Angeles, and to start a food delivery program that sells fare such as cheesy kale chips seasoned with nutritional yeast. The two also have a forthcoming workout-clothing line ($125 leggings promise “absolutely no muffin top”), and Paltrow is opening an L.A. blow-dry salon with her celebrity hairdresser, David Babaii, where you can get a close approximation of Paltrow’s signature tresses. She and Anderson are set to co-host an AOL (AOL) Web series produced by Ryan Seacrest called Second Chances. It’s about inspiring women.

At the Licensing Expo 2013 at the Mandalay Bay in Las Vegas on June 18, Paltrow and Anderson gave the keynote speech, “Brands on the Brink of Global Expansion.” Tony Lisanti, the editor of License! Global magazine, which sponsors the expo, says Paltrow has the ability to do what modelpreneur Kathy Ireland has done with her company, which sells more than $2 billion in sales of just about everything. “Gwyneth Paltrow seems to have a strategy that’s well thought out. It could have widespread appeal very quickly,” he says. Nick Nanton, an international branding agent who’s worked with Jack Canfield to sell his Chicken Soup for the Soul brand, says, “She’s connecting to her audience. There are people who want to gripe and complain that she has a great life, but it has to be a small portion of the world that would take the time to bash her.”

Those haters focus mostly on her privileged background. Paltrow was born to a famous director, Bruce Paltrow, and actress, Blythe Danner, and went to Manhattan’s Spence, one of the best private schools in the country. She’s the godchild of someone even more famous than her parents—Steven Spielberg. This is not the kind of person you’d turn to for advice on how to get through your day. And yet, by casually talking about her besties Jay-Z and Beyoncé, or a recent miscarriage, or the style of her bikini wax (often done alongside BFF Cameron Diaz), she starts to feel like a confidante.

“Gwyneth Paltrow represents rarefied nuts and specialty kale and personal training,” says Anne Helen Petersen, who teaches classes in feminist media studies at Whitman College and wrote Scandals of Classic Hollywood, due out in 2014. “She’s doing exactly what Kim Kardashian is doing, except it’s ostensibly classy. That’s part of her appeal, how unabashedly upper-class she is. It doesn’t seem like she’s performing.” Paltrow’s is both a truthful and infuriating stance. “I am who I am. I can’t pretend to be someone who makes $25,000 a year,” she told Elle UK in 2009. That honesty is a powerful part of her brand. “More and more celebrities are trying to be relatable—being relatable is a sales pitch. But Gwyneth doesn’t bother pretending that she could be your next-door neighbor,” says Lainey Lui, who runs the celebrity gossip website LaineyGossip.com. “That’s why I love her.”

Stein is a Bloomberg Businessweek contributor.

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