Marigay McKee’s Revolution?
First of all, along with many industry luminaries, I extend a warm welcome to Marigay McKee to this side of the pond, and especially to New York City: the most intensely competitive city in the most ferociously competitive country on the planet; massively over-stored; stuffed and web-sited; and with the most complex distribution and marketing infrastructure in the world. And I’m sorry to start off with such a negative tidbit, but as people get to know me they understand I tend to remind them of the darker side of things. Usually my observations are followed by: “so good luck!.” And in Ms. McKee’s case, it’s augmented by: “particularly since she is coming from the role of chief merchant of one privately-owned store to president of 41 publicly-owned stores, with a lot of underperforming doors.”
Also, I’m not Paul Revere, but I am wondering if I should be taking a midnight ride to shout out to the world that a revolution is about to start. I’m just raising the question, because after reading through the cascading number of articles trumpeting Ms. McKee’s whirlwind arrival in New York as the brand new, energy-powered President of Saks Fifth Avenue, one could believe another “shot heard round the world” is about to be fired. “Breathtaking, awesome, a force of nature, cool.” Whew!! Those were just a few of the descriptions I read, or read into, scattered throughout the many pages of fashion business reports. In fact, Beauty Inc. saw fit to headline their article: “Talkin’ About a Revolution.”
Interestingly, I have a history of shouting out retail revolutions; one that ended spectacularly, and one that failed miserably. The winning one was on McKee’s side of the pond: Vittorio Radice’s revolutionary re-positioning of Selfridge’s in the early 90s. And another revolution for which I drank the “kool aid” and later “ate crow:” Ron Johnson’s “shot heard round the world” to totally transform JC Penney.
So revolutions are not only hard to call, I learned that they can be dangerous to call. They are even harder to win for their leaders, particularly after they have shouted out (on big public stages) their revolutionary ideas, a la JC Penney.
I hasten to add that I am not suggesting that Ms. McKee declared a “revolutionary” re-positioning of Saks, although the optics, tone and style portrayed in some of those articles could sound like it.
On the other hand, I do know how the media is in this city, especially the fashion media of which she seems to be their new “darling,” taking New York and one of its luxury crown jewels by storm, along with the support all of the city’s social circles. Indeed, their hyperbole over her is almost indigestible. I’ve always maintained that under the radar rather than under the lights is many times more palatable.
So I was somewhat relieved to read some of her responses to Drapers, as well as the Wall Street Journal. One comment: “There are quick wins and longer-term wins that will be evolutionary, not revolutionary.” Another response: “However fashionable the brand, we always start and finish with the numbers—the sell-throughs, the margins, the returns, the contributions—and then we talk about the pleasantries.”
Other sensible points made by McKee in the business coverage were about contemporizing the brand without losing existing customers; localizing assortments for different areas of the country and varying sizing for foreign luxury shoppers; and the ‘wow’ factor and exceeding customer expectations. She also spoke on maintaining the iconic brand position but ‘future-proofing’ it; differentiation; understanding omnichannel integration and interchangeability; and the role of technology. She is all for revolutionizing the shopping experience.
These were all great strategic insights and observations from McKee — of course, as we all know, strategy is one thing, execution another. And the $200 million she will have to do a “fixer-upper,” as she humorously called it, to the Fifth Avenue store, will probably have wonderful results. However, I got a little bit concerned about the fact that she was quoted: “My life for the next five years will be spent with architects…” and then went on to say 50% of her time will be with architects and the other 50% with brands. Oh my! I hope it’s just a slip of the tongue. I also got a little nervous reading her interview in Beauty Inc. likening her job to being let loose in a candy store – or ‘sweet shop’ as she calls it – and getting to sample all the chocolates to taste every filling. “It’s just fun, really,” she says.
Sweet shop? This is multi-billion dollar, seriously complex business.
And what about the organization? I’m told 10 of the 13 senior level operating executives under McKee’s predecessor are gone. She said somewhere that HBC has been working on the organization for some time, and that she was “happy I can hit the ground running.” Okay, but I’ve learned by observing newly hired CEOs that they don’t immediately shut down systems, processes and get rid of the people running them until they’ve clearly defined their new positioning and strategies, and then developed the organization to make it all happen. In other words, maintaining some continuity while evolving the business plan. It’s hard to hit the ground running if there is no ground there.
And about the $1 billion in capital for spiffing up the other 40 stores or converting some into Lord&Taylor nameplates (which leaves me scratching my head anyway – does not compute); and/or the near-term expansion of Saks into Canada — is a billion really enough? And where will it come from, in this slow-to-no growth economy of ours? I guess her boss, Richard Baker, has all of that figured out. As I’ve said before, he is brilliant, albeit most prominently displayed in the real estate business.
Not to leave this dispatch on a sour note, I do honestly welcome Marigay McKee, and do wish her nothing but the very best. And if her more strategic thoughts are methodically and sensibly enacted, she will have achieved great success without having to rely on good luck.
But I wish her good luck anyway. And I look forward to meeting her in the very near future to continue the conversation.