Drexler Hits the Nail on the Head Again

The Robin Report - Mickey DrexlerHey folks, I hate to suck up to Mickey Drexler, and I assure you I am not, because he has once again nailed a major and very dangerous value shift taking place in this industry. He’s said it before in different ways, as have I. And, I’m going to follow him this time, essentially “doubling down” on his points.

I’ve called what’s going on with discounting, which is now on the steroids of the e-commerce “deal machine,” the “lowering of all ships,” “the race to the bottom,” and, I’ve even speculated, and actually built a pretty good case, for predicting our economy drifting into a deflationary cycle.

But, let’s stick with Mickey’s diatribe on CNBC and quoted in WWD the other day. In his own words: “There are too many retailers. There are too many brands. There are too many designers. There’s too many discount stores and the predator online companies are selling discount like crazy. At some point, people are going to stop paying as much money as they’re paying for logos (brands). At some point, people are going to go online for every product in the world and say, ‘what’s the best price out there?’… the more there is of anything the less desirable it becomes. And, the world today – the standards have been lowered and more people are wearing more products from every designer and the dilution of designer names is extraordinarily fast because they’re selling all discount stores with products and with deals.”

He also takes a shot at social media, with which I totally concur: says he, “I have yet to see a correlation in my industry between great social media and great numbers. You’ve got to be there, but on the other hand, it’s a very hyped-up thing right now.”

Amen – Mickey!!

Since I got worked up again by this tirade of his, I can’t help myself for adding another little corner of darkness. It’s like what Charles Prince, former CEO of Citibank said during the great “bubble” creation of mortgage-back securities and derivatives of all types: “…while the music’s playing, you’ve got to dance,” meaning if his competitors are all in making billions of dollars, regardless of a bubble forming, how would he justify to his board and shareholders that he was going to sit it out because of a bubble risk?

Likewise, look what’s happened to JC Penney, so far, (note the “so far”), as they decide to opt out of the “race to the bottom” pricing.

My point is, the cynical side of me says that wherever this massive sucking whirlpool started, it’s a game that every retailer feels they must play. Therefore, as Drexler points out, and as I have, value could descend to its lowest common denominator, wiping out the quality and aesthetics of a finer lifestyle.

Sadly, this sounds like what our culture has become and it continues: quantity over quality and for the lowest price, and I want it now.

Robin Lewis About Robin Lewis

Robin Lewis has over forty years of strategic operating and consulting experience in the retail and related consumer products industries. He has held executive positions at DuPont, VF Corporation, Women’s Wear Daily (WWD), and Goldman Sachs, among others, and has consulted for dozens of retail, consumer products and other companies. In addition to his role as CEO and Editorial Director of The Robin Report, he is a professor at the Graduate School of Professional Studies at The Fashion Institute of Technology.