Lifestyles From the Rich and Famous

RR_Lifestyles From the Rich and Famous_mcAh, Robin Leach, you won’t believe what they’re doing now.

Back in the heyday of your incredibly ridiculous – and every bit as addictive – breakthrough TV series, you gave us a measured and breathless peek into how the superstars of the entertainment world actually lived. OK, so maybe it wasn’t so actual, but that wasn’t the point: aspirational voyeurism was.

Well, now we don’t need Robin (Leach, not Lewis) to enlighten us. The rich and famous are doing it themselves…and trying to make a few bucks in the process.

Over the past year or three, a whole slew of TV, movie and ersatz celebrities have launched businesses selling us the products they themselves actually use…once again with the proviso that this is much more about perception than reality. [Read more…]

Staying Hot (AKA The Other Kind of Sustainability): Can Frédéric Fekkai Get His Mojo Back?

lead_frederic_bioIf you’re older than a minute, and in the beauty biz in any way, shape or form, you will remember the epic hotness of one Frédéric Fekkai.

There was another guy named Oribe who was equally epically hot at the same time, circa 1995, and we’ll circle back to him later. But in the spirit of serving short Internet attention spans, our task today will be to focus on Monsieur Fekkai, and how his once ground-breaking product and salon business has changed hands more times than a blackjack whale on a bender in Vegas.

While much has been made of Fekkai’s swarthy good looks and devastating French accent over the years – and there is zero question that both factored mightily into his early success – the fact of the matter is that the guy is really smart and incredibly driven. You don’t get from Aix en Provence with a pair of scissors in your hand to acquisition by P&G for north of $400 million simply by trading on your own charm and pulchritude. The beauty industry isn’t Hollywood. (But then again, judging by all the A-list actresses launching lifestyle brands, Hollywood isn’t even Hollywood anymore…) [Read more…]

Cotton Incorporated

Cotton Incorporated, funded by U.S. growers of upland cotton and importers of cotton and cotton textile products, is the research and marketing company representing upland cotton. The Program is designed and operated to improve the demand for and profitability of cotton.

Company History

In 1960, cotton apparel and home fabrics accounted for about 78% of all textile products sold at retail. By 1975, that share had plummeted to an all-time low of 34%, due to the successful incursion of synthetic fibers in the marketplace, threatening the extinction of cotton as a viable commercial commodity.

Reacting to the serious erosion in cotton’s consumer market share, producers in the High Plains of Texas called for a collective national marketing and research effort. With support from regional producer organizations, the cotton growers were successful in petitioning Congress into passing the Cotton Research and Promotion Act of 1966. The act established a funding mechanism, which ultimately led to the creation of Cotton Incorporated in 1970.

From the beginning, Cotton Incorporated adopted a “push/pull” marketing strategy. The objective was to “push” cotton textile innovations into the market through product and process development, while building consumer demand, or a “pull,” through advertising and promotion.

By 1983, Cotton Incorporated succeeded in curtailing share decline, and a long steady period of increasing consumer popularity and share growth resulted. Today, cotton can be found on store shelves everywhere in most product categories, and cotton share is more than 60% of the marketplace.

Overfranchising: When Category-Killers Just Can’t Stop Cannibalizing

overfranchisingMaybe you’re Maybelline.

And maybe, because you’re Maybelline, you produce one of the most beloved mascaras of all time. Yes, Great Lash is one for the ages, a perennial box-office champ for the last 44 years. In this era of here-today, gone-tomorrow product launches, that preppy pink and green tube of makeup magic is in a class by itself.

In the prestige arena, Lancôme has enjoyed a similarly mammoth success story. Though its Définicils High Definition Mascara is 20 years younger than Great Lash, urban legend has it that one is sold – somewhere, globally, from Boston to Beijing — every three minutes.

Clearly, these two brands have carved-out massive slices of the brutally competitive mascara pie, proffering products women the world over genuinely adore. [Read more…]

Making Athletes Better, Socially

under_armour_newOn the heels of a strong close to 2014 and annual sales and profits growth of 32% and 28% respectively, Under Armour hosted a meeting with the investment community, addressing its recent acquisitions that, when combined, create the world’s largest digital health and fitness community. Aptly named Connected Fitness, CEO Kevin Plank, along with the leaders of the newly assembled Under Armour digital team and CFO Brad Dickerson, spoke to rationale, strategy, and opportunities.

In true entrepreneurial fashion, Plank started Under Armour as a football player who couldn’t understand why there wasn’t a T-shirt on the market that was light and wicked sweat, which would improve his (and athletes generally) performance. The rest, as they say, is history. The guiding principle from his inspiration 19 years ago, to the more than $3 billion in annual sales just reported, is the goal to make the athlete perform better. This remains the goal with the MapMyFitness acquisition (in 2013), Endomondo (acquired January 2015), and the MyFitnessPal purchase (closing in the current quarter). In the digital world, Under Armour now has more than 120 million unique registered users in its online community. [Read more…]

The Power Of John Fairchild

fairchild_newJohn Burr Fairchild, who turned a family owned bread and butter garment center trade publication, Women’s Wear Daily, into a fashion powerhouse, passed away last week at 87 years of age.

John completely understood the business of publishing. His father, Lewis Fairchild, drummed circulation, advertising and administration into him. His father had no need to school John in journalism; he had spawned an editorial genius.

Rarely has a man’s talents and interests been so perfectly synchronized with John’s innate journalistic abilities, his love for fashion and those who practiced it, as well as his incredible fashion instincts, all married to pitch perfect taste. He was, without question, simply the best fashion editor there ever was in the time, of his time, and maybe for all time. No one even came close during his reign at Women’s Wear Daily and W. And no one has come close since. Legendary Vogue Editor, Diana Vreeland, walked in the same rarified atmosphere, but lacked all of those other skills that John possessed combined with the right vehicle to exploit them.

[Read more…]

12 Symptoms of a Dying Retailer

12symptomsWe all know when a retailer is in trouble financially. If public, their quarterly results invite critical comments by analysts. Their financial disclosures begin to make reference to problems with loan covenants. Their underlying liquidity and solvency comes under fire from suppliers and factors alike. Often these symptoms are noted too late for any effective remediation to take place. The deathwatch is on.

But are there warning signs that can be spotted before it’s too late?

I would suggest that, in fact, there are 12 symptoms of a dying retailer:

  1. Reductions in selling space. Stores that close off selling space abruptly are often signaling a crisis in lost productivity. Beware the department store that suddenly shutters its upper or lower floors.
  2. Reductions in inventory. Stores that begin to exhibit chronic stock outages, either empty shelves or lack of continuity in colors and sizes of ongoing merchandise, are often signaling a liquidity problem. A mass merchant, big box specialist or grocery chain that can’t adequately stock its shelves is sliding down a slippery slope that can be hard to escape.
  3. Unexplained elimination of classifications. This sometimes foretells a retailer that is beginning to lose its way. A healthy retailer finds ways to make difficult merchandise categories viable rather than eliminate them. The decision most department stores made in the 1990s to trim consumer electronics and housewares in favor of apparel and accessories — because those categories didn’t have enough margin or exhibit enough turnover — was a bad decision that is now coming home to roost.
  4. Reduction/elimination of amenities and services. A retailer that stops offering free or inexpensive gift wrap, and adequate boxes and bags for customer purchases, is also exhibiting worrisome behavior. Reductions in selling hours that don’t conform to competitors’ policies is another red flag.
  5. Wholesale changes in return policies. Returns are a never-ending challenge for all retailers. Appropriate changes that reign in aberrant customer behavior, without undue effect on customers at large, are a sign of a healthy retailer. But when changes take place that are completely inconsistent with past company policies and competitive practices, it is often a sign of inner turmoil.
  6. Deterioration in merchandise quality. Taking quality features and benefits out of merchandise and services is always an all-too-available stratagem for retailers looking to improve their gross margins. But it is almost always a fool’s errand. Customers notice when apparel doesn’t fit or wear well; when features and benefits have been withdrawn or made available at higher prices than in the past; and when packaging begins to look cheap and cheesy. Merchants under pressure, without adequate leadership, will often see this as path of least resistance. Once set in motion, however, this course usually becomes irreversible. Customers rarely give retailers who exhibit this behavior a second chance.
  7. Reduction in marketing spending. Stores that are having trouble paying their bills often begin to reduce their marketing spend disproportionately. Cheaper paper and fewer pages in newspaper inserts, less attention to quality of artwork, smaller media distribution, and failure to repeat historically successful fashion and promotional events are all harbingers of trouble. Hand in hand with this is the imposition of unreasonable and unwarranted demands on vendor partners for increases in advertising allowances.
  8. Loss of price competitiveness. All retailers are sensitive to competitive price issues. When a retailer suddenly begins to be less focused on this they are definitely heading for trouble. Failure to set prices properly, and then adjust prices, as necessary, is a symptom of a loss of integrity in customers’ eyes.
  9. Reductions in customer service. Unwarranted reductions in selling expenses by understaffing departments; cutting back sales support; providing fewer cash wraps, check out stations, and pick-up desks; and cutting back on customer service are all early warnings that something is going awry. If you are a customer and can’t get a sales representative to talk to you in a store or on the phone, you need to take your business elsewhere. If you are a vendor and you can’t reasonably correspond with your retail client, then you, too, need to think about taking your business elsewhere.
  10. Reductions in lighting. Does a store start to look dark and dim? Has the store actually begun to turn its lighting down by removing bulbs, or is it merely failing to replace the bulbs that have burned out? Hand in hand with this is inappropriate heating and air conditioning.
  11. Deterioration in housekeeping. Stores require constant attention to housekeeping. This includes everything from neat, properly presented merchandise to clean selling floors, wrap stands, and rest rooms. Dirty, disheveled stores are accidents waiting to happen.
  12. Deterioration in physical plant. Stores whose buildings and property are in disrepair are signaling larger troubles. Leaking roofs, unlit external signs, poorly maintained parking lots, entrances and docks are all signs of an organization that is coming off its rails.

[Read more…]

Beyond Criticism

criticismWhat’s the role of the fashion journalist today? As a veteran of the industry, that’s something people ask me all the time. They’re always trying to bait me to say the obvious. I might be old school, but I certainly don’t think that school is as relevant as it once was. The role of criticism is changing as we speak, and the sooner the better, as this state of flux does not serve this industry well. We need voices that reflect both the new role of the critics and the new role of the brands themselves.

So what actually has changed? There has been a time shift, of course. Thanks to the flow of social technology, everything is immediate. No one waits to hear a description of a collection. But the other thing that’s shifted, the much more significant shift, is that anyone with a smartphone and a love of shopping is now also a critic. And while everyone thought that this would make for new important voices and fresh faces, really, all it’s done is force everyone to write in the first person. [Read more…]

Shoppable’s “Distributed Commerce”

young woman texting in a bus stationThe Ultimate In Preemptive Distribution

In my co-authored book, The New Rules of Retail, one of the new rules is preemptive distribution. Simply stated, it is defined as distributing a product to reach consumers first, faster and more often than all of one’s competitors, thus, preempting the fierce and excessive number of competitors. And today, this strategy is further enabled by technology and the Internet, including the unprecedented impact of smartphones. There’s a whole chapter devoted to this new rule and it offers deep perspective on how to implement this strategy.

In this warp speed world where new technologies and millions of new apps appear each day, there’s a preemptive distribution technology that is turning science fiction into reality. It’s called “distributed commerce.”

Think about how many times your brand is mentioned or appears online, in print, social media, advertising, on TV, in conversation, and on merchandise. Now imagine every time consumers engaged with your brand or product, wherever it may be, were automatically connected to a “buy button” that allows them to complete a purchase from any of these locations in under 60 seconds. This may sound like something impossible or out of a futuristic film, but technology companies have been working on this accelerated access for years, and according to better tech minds than mine, it will be everywhere within the next five years. [Read more…]

Price Chopper’s Name Game

PriceChopperAlthough it doesn’t happen often, one of the most momentous decisions a company’s board and top executives can make is to change the customer-facing name of the company.

Sometimes, such a change can go well, for example when Macy’s changed the disparate department-store banners it had acquired over time to the Macy’s name itself. Now only Bloomingdale’s remains as a separate banner. There was some initial consumer pushback, especially concerning changing the name of Marshall Field’s in Chicago, but that settled down and now Macy’s enjoys the benefit of being able to stage company-wide, national promotions and advertising campaigns.

In the supermarket space, several companies have changed store banners for various reasons; some went well, some didn’t. Years ago, Food Town changed to Food Lion, which went well. The name change of Lucky supermarkets to Albertson’s went less well.

After 40 years, there’s a name change in the offing for Price Chopper supermarkets in upstate New York and New England that seems to be premised on some especially dubious reasoning. [Read more…]

The Magic of Christmas Should Just Be the Beginning

happy woman in a Christmas cap opens the magic box giftIf the only effort you make with those you love were once a year, you’d likely be left alone at Christmas. So why do brands and retailers show the love disproportionately at Christmas and then revert to the same-old, same-old throughout the rest of the year?

The simple response is because you follow the money and the holidays are when shoppers are spending. So you make hay. But this strategy, one that’s all too common, points at a serious problem.

Right now in the UK, retailers are in the middle of their annual advertising war. This tradition involves trying to top one another through 60+ second TV ads designed to make you to cry. But strangely, I’d even say stupidly, if you’re so moved by these ads to actually leave your sofa and go to the store, all you’ll find is crowds, a bit of tinsel, steep discounts, and the same old store you likely opted out of the rest of the year. What moved you to tears, exactly? Perhaps this is why the growth of online shopping climbs on its relentless ascent.

I recently hosted a panel discussion with a group of retail executives from Disney, Selfridges, Google, and Intel, among others. A key point they made was the crucial need for clarity of meaningful shopper purpose if retailers are to succeed in today’s market. This purpose recognizes that the limited wallet we all chase for our success has a myriad of choices for what to buy, where, and at what price. Providing only one shopping solution won’t produce success.

While there is greater pressure to spend at this time of year, the fact is people love discovery and the seduction of new things at any time. There’s no seasonality to desire. And this offers retail’s great opportunity: the ability to tap into an always-on emotional state to entice people to come into the store and then keep coming back.

A perfect example of a retailer that does this exceptionally well, a personal favourite of mine, is Selfridges. They make it their business to constantly innovate, to make their store a destination not just a shop all year long. Their view is that the store is a theater of dreams, requiring constant care and attention to capture peoples’ imaginations. For Selfridges, Christmas is just an excuse to add another level of experience to customers. This strategy has made shopping at Selfridges an incredibly special experience. In return, they are rewarded with an abundance of new shoppers added to their loyal customers who have a deep emotional engagement to the Selfridges unique brand of retail. The in-store experience is so powerful that shopping online at Selfridges.com defeats their true purpose and value.

Which brings me back to Christmas. The mythical magic of this holiday showcases stores at their best. It is our retail stores that create the stage set for creative, sentimental, joyous, dreamy holiday memories. Who can forget the childhood memory of sitting on Santa’s lap? And it isn’t just about the stuff. It is the power of creating a meaningful experience.

My challenge is: Why isn’t it Christmas year-round? Shoppers expect it. And in the competitive environment in which we now operate, we are being asked to create something special all year long. If we can do it once a year, we can sustain it for 12 months.

MAC: All Things to All People…Even If That Maybe Isn’t The Best Idea Right Now

MACUpfront disclaimer #1: MAC is one of the best beauty brands of all time.

Now that that’s firmly out of the way, let’s commit a little heresy and posit that maybe, just maybe – and this is solely one industry-watcher’s opinion, Makeup Artist Cosmetics, founded in Toronto in 1984 by two guys both named Frank (Toskan and Angelo), snatched up by the Estée Lauder Companies in 1998 for a cool $60 million, has lost sight of its North Star.

How do you know a colossal cosmetics company, one that cut its teeth with professional makeup artists and deployed 6’7” drag superstar RuPaul as its very first spokesperson, may be veering off track? When it announces its hot new collaboration with…Brooke Shields.

Upfront disclaimer #2. Brooke Shields is incredibly beautiful and an American institution. [Read more…]