RH CEO explains why his company doesn’t have a social media presence

RH CEO Gary Friedman told CNBC's Jim Cramer on Friday why the upscale home furnishing retailer doesn't have any official social media accounts, saying paid promotions by online influencers aren't authentic.
"The great brands that stand the test of time, they earn it, right," Friedman said. "They tell the truth. And, you know, having fake fans and people you pay talk about you on Instagram or TikTok or whatnot, it's not the truth."

RH CEO Gary Friedman told CNBC's Jim Cramer on Friday why the upscale home furnishing retailer doesn't have any official social media accounts, saying paid promotions by online influencers aren't authentic.

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"The great brands that stand the test of time, they earn it, right," Friedman said. "They tell the truth. And, you know, having fake fans and people you pay talk about you on Instagram or TikTok or whatnot, it's not the truth."

Friedman conceded that social media has exploded, and "the digital visualization and connectivity is real." However, he said that if consumers aren't interested in our showing enthusiasm for the brand, RH should do better work, not pay others to talk about the company. He claimed that RH still has a solid presence online, but not because of paid influencing or social media marketing on the company's part.

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RH reported an earnings beat earlier this month, and its stock is up a little over 18% year-to-date. Formerly known as Restoration Hardware, the luxury retailer is expanding its national and global presence, with plans to open locations in London, Paris, Milan and Madrid. Friedman projected confidence about the future of his company and the housing market in general, noting that RH has bought back $3.7 billion in shares over the past several years.

He also discussed how higher tariffs could affect business, but suggested it may not be an obstacle particularly difficult to overcome. He said "supply chases demand," and that RH is good at creating demand. Friedman noted that when tariffs increased in the past, the company moved a significant part of its upholstery business back to the U.S., adding that it has a sofa factory in North Carolina.

"You have to be flexible, you have to be fast," Friedman said. "There's always going to be obstacles like that."