Mike Gould on Leadership

MIke-Gould-FINAL-IMAGEWhat makes a great leader? The topic, by all accounts is very close to Mike Gould’s heart, “It is the single most important thing any of us do, regardless of what we do.”

Mike Gould, one of the most accomplished leaders in all of retail, recently retired as CEO from Bloomingdale’s after a 23-year career. He spoke to a group of industry executives, FIT students and faculty on April 8th at a meeting of the Retail Marketing Society in NYC.

During his wide-ranging talk, he emphasized, “At the end of the day, what people remember are the opportunities you gave them to grow and to become more than they thought they could be; not the numbers that mesmerize our daily lives.”

How does Mike lead? He stressed that people come first; nurturing their growth and providing opportunities are the mark of a good leader. [Read more...]

Women’s Underwear is Difficult

Playtex_graphic-01A Brief History and Consumer Perspective

Women’s underwear, its euphemistic pseudonym ‘intimate apparel,’ or its more sophisticated sister, ‘lingerie,’ is difficult in so many ways. For all of us women consumers, it is a necessity; a purchase that must be made and replenished regularly. And, trust me, as a consumer who has been buying her own underwear for more years than I’d like to count, it is not always an easy, satisfying, fun, or self validating purchase.

Underwear is a category of apparel that gets us down to the bare bones of ourselves. Our bodies. Our comfort. Our sense of self. Our sex appeal. Our underpinning. The foundation for all of our clothes. Women’s underwear has been marketed to us for generations reflecting deep-seated emotions and attitudes about ourselves, our roles, and our history as women. From long before the time women discarded their bras in the late 1960s as a symbol of second-wave feminism, bras have had a history of women’s emancipation and independence. In 1873, writer and activist, Elizabeth Stuart Phelps, wrote: “Burn up the corsets! … No, nor do you save the whalebones; you will never need whalebones again. Make a bonfire of the cruel steels that have lorded it over your thorax and abdomens for so many years and heave a sigh of relief, for your emancipation I assure you, from this moment has begun…” [Read more...]

Three Dirty Little Secrets

Alexander Mcqueen London, Old Bond Street, London, W1, United Kingdom Architect:  Pentagram Alexander Mcqueen, Showroom, Pentagram, London, 2002, Overall View Of ShowroomGlobalShop, the retail design expo, had its three-day extravaganza in Las Vegas the middle of March. Like Euroshop, its continental counterpart, it is a gathering of brick-and-mortar assets: flooring and mannequin companies; fixture and signage manufacturers; point-of-purchase display companies … and more. There are receptions, cocktail parties and lunches, and lots of meetings to imbibe in adult beverages. VMSD and Design:Retail, the two trade magazines covering the industry, put aside their differences and celebrated the occasion enthusiastically. Still, however happy the gathering was, it is hard to avoid the dark clouds looming on the horizon. [Read more...]

Water Sales Swirl Brands Down the Drain

waterbottleIs water washing full-price mega brands down the drain? Well, maybe so, given that major bottlers have lost consumer credibility to the degree that they can’t market product under their own brand names.

But let’s start at the beginning. As has been postulated in the Robin Report lately, harbingers of the “death of mega brands” are on the horizon. Chief among them is the slippage of Tide laundry detergent at the previously unassailable “high performance, high price” end of the category.

How so? Procter & Gamble is poised to introduce “Tide Simply Clear” detergent. Simply put, it’s a Tide entry into the lower-price end of the market. It’s reminiscent of P&G’s introduction of Charmin Basics and Bounty Basics a few years ago as an off-price version of its high-end paper products.

These price moves are intended to fend off the increasing popularity of off-price products that consumers perceive as performing just as well, or well enough, in product categories that aren’t edible. Increasingly, many consumers now see no reason to pay full price. [Read more...]

Growth by Foreign Expansion

dm_hebLittle-Known H-E-B Shows the Way

As the post-recession era drags on, the dynamics of retailing are changing, adjusting to the new normal.

As we’ve seen lately in the pages of the Robin Report, some retailers that didn’t fare any too well in the recession are circling the wagons and shedding retail units. Opportunistically, those sites are being picked up by resiient retailers that survived the recession. What we’re seeing is the classic case of the big getting bigger and stronger, and the weak continuing on a downward trajectory. Is it simply survival of the fittest? Or poor strategic planning?

There’s another path to growth that’s increasingly being considered by clever American retailers, namely international expansion. Some retailers have long had a presence beyond America’s borders; McDonalds and Starbucks have led the way. Others are making the leap for the first time or expanding into more countries, including Bloomingdale’s, Urban Outfitters, J. Crew, Ralph Lauren, and Gap.

Yet, one strange anomaly persists in the world of retailing — and stranger still, it concerns the largest and most widespread retailing of all — food retailing, or, to be more precise, conventional supermarkets. [Read more...]

The Meaning of Time

SONY DSCAll of us move through our lives with a clock ticking inside our heads. Even in troubled economic situations, time, rather than money, is our most important commodity. That clock tends to tick at relative degrees of loudness. You can meet a friend at Garden State Plaza Mall for the afternoon, and the clock ticks softly, a kind of shopping therapy. At the same mall another time, you want to get in and out as fast as you can. In other words, the meaning of time can change.

My mother was relieved when a 7-Eleven opened a location close to our suburban home in the 1950s. The idea of buying milk for a young family any time of day was a godsend, even if she did have reservations about both the price and quality. Ask a Millennial today where they buy milk, and you get an eclectic list; the drug store, the grocery store, the convenience store, the mass merchant, even the office product superstore sometimes stocks milk. In parts of Europe, you can even buy milk at roadside vending machines. [Read more...]

Made in USA: Myth or Reality?

American FlagOn a recent afternoon I was stopped in the mall by a foreign tourist looking for American gifts to take back home. All the clothing and accessories in the stores were made elsewhere, she said, so they weren’t really American.

U.S. consumers are starting to feel the same way. Groups with names like Made in the USA Foundation and Buy American are launching advertising and social media initiatives to encourage Americans to buy domestically made goods. They’re reacting to a groundswell of sentiment that blames the sluggish job market on imported consumer products. Large companies are reportedly looking at their product lines to see whether even a little domestic sourcing is feasible. Several fashion startups are touting the fact that their stuff is made in the USA, and in some cases even successfully using crowdfunding to get their businesses off the ground. [Read more...]

Does History Have a Future?

Galleries_Lafayette_Dome‘Fortnum & Mason opens second UK store in 307 years,’ was the title of the recent press release in my inbox. Opening two stores in your home market in the time it took the pilgrims to establish Plymouth and America to become what it is today seems a tad under-ambitious; but perhaps they were just trying to get it right. Nonetheless it got me thinking about whether the rich history and legacy of department stores still matters today.

Selfridges, Harrods, Le Bon Marché, Macy’s New York; visiting these stalwarts of the category, many housed in buildings designed when the consideration of grandeur was still part of inspiring product purchases, masks the diminishing reality of the segment: shrinking share of the consumer’s wallet and the inability to rely on economies of scale to be price competitive. So that leaves them in an operational pickle: after they’ve reduced their footprint, cut costs and, with it, service — what’s next?

Department stores once made retail interesting, and were, as Dr. Robert Tamilia at the University of Quebec put it, “marketing’s answer to the industrial revolution.” He’s not far off when you consider the impact they’ve had across many aspects of society and retail we take for granted today. Their sheer size changed building technology and architecture, and were precursors for skyscrapers and shopping malls; they democ- ratized consumption and furthered gender equality by providing jobs for women; they fueled the develop-ment of mass-production technologies; and hosted some of the world’s first radio broadcasts. This was the forum that introduced the very notion of customer service: gift-wrapping, restaurants, home delivery, even funeral services.

Harry Gordon Selfridge once said, “entertainment, customer service, and value for money: the first will get them in, while the second and third will keep them there.” How many department store executives still think this way? Not many, and it shows. In an interview with an HR executive at UK retailer House of Fraser it was explained that 20 years ago the gap between the floor staff and the customer was much narrower. That was a time when staff could relate more and better understand the products they were selling. Today, in many cases, salespeople can’t afford the products they sell and their attitudes towards a career in retail has changed, and I’d dare say the real attitude of many retail executives is that sales employees are expendable; they’re going to leave anyway so why bother investing?

Fortnum_&_Mason_Tea_SalonDepartment stores used to stand for something. They used to dream big dreams and do big things. Macy’s introduced the department-store Santa in the 1860s that led to generations of children’s sentimental memories. When Harrods introduced the ‘moving staircase’ in 1898, they needed to provide cognac and smelling salts for those who found the experience too moving (sorry!).

Not Losing Sight of the Past

Well it seems this notion isn’t entirely dead, and if you’re seeking inspiration, look no further than the modern owner of Selfridges. To quote Alannah Weston, scion of the Weston family that owns it and the store’s Creative Director, “It takes confidence to think of the store as a dwelling space and not a shed full of product that people are forced through. To thrive, stores need to be much more than simply a space to buy stuff. They need to tap customers at a deeper level — the level of ideas and dreams.”

I can’t recall a memorable online purchase experience, but I’ll never forget the first time I visited Alannah’s store. Selfridges is located in London’s retail heart on Oxford Street. Opened in 1909 by American Harry Gordon Selfridge, it attracted 90,000 people its first day. I was there one morning before the store opened and the visual spectacle was like a magical kingdom of retail. The department heads came onto the floor in a phalanx, then split apart to begin tweaking their environments. They obsessed over the detail. These were people who clearly saw the store as a stage; who understood that to lose the illusion is to lose the audience.

Harrods_Food_HallWhat they get better than most is that as a retailer, retailing should be a major part of the appeal. That getting shoppers off the couch means delivering value through the creation of a live experience — that thing online can’t compete with. And it’s working; in the last four years they’ve set new records for sales and profitability despite being based in a country that continues to lurch from one near-recession to the next. And they are enjoying their second year rated as the number-one department store in the world by the Intercontinental Group of Department stores. Interestingly when you research their history, you see their founder set out to make this a reality and the new owners are merely carrying on the tradition.

Sometimes What’s Old is New Again

Another example of history informing the way forward is reflected in the strug-gling department store Marks & Spencer, a chain that’s been acutely attuned to its role within wider British society with a legacy for supporting small producers, and being committed to shopper satisfaction with core principles expressed simply as ‘Quality, Value, Service, Innovation and Trust.’

Despite a challenging economic climate that’s contributed to eight straight quarters of decline in the fashion categories of its business and overall declines in profitability, the retailer is committed to sticking with what they refer to as Plan A, a CSR platform considered to be the most comprehensive of any major retailer anywhere in the world.

The program was created in 2007 after then -chief executive Sir Stuart Rose decided his business should re-think its leadership position around social responsibility, believing a sustainable business could be a profitable one, and also because “there’s no Plan B for our planet.”

Starting with a 100-point, five-year plan, estimated at the time to cost $350 million to implement, Plan A has since expanded to include programs that cover everything from the working conditions of factories that supply the company through to emissions, recycling, facilities management, and even a program called Schwop that encourages customers to donate used clothing to benefit local charities.

While the company is clearly hitting high notes in performance and accolades — it’s delivered on 139 of its now 180 commitments and earned more than 150 sustainability awards — a compelling aspect of Marks & Spencer’s strategy comes from the fact that Plan A isn’t just about delivering value through its own operations, but instead looks to deliver results by recruiting the help of everyone connected to the business, both customers and suppliers alike. And it’s working: the net benefit of Plan A to the business is up 29% year on year and is credited with adding almost $210 million for reinvestment in the last 12-months alone.

The Secret Weapon Can’t Be Found on a Spreadsheet

There’s a point in business when you can’t cut any more, where there’s no silver bullet to devastate the competition, when acquisitions are about buying revenue and profit rather than creating it. I’d argue the time to revisit history matters more now than it ever has. Using history as part of your strategy is a common practice in the branding game, but it’s not just about creating the ingredients for an ad agency brief. In the storied history of department stores, we find what is the soul of retailing — the excitement of acquiring new things; offering authentic service; developing meaningful customer relationships; creating spectacle and memorable experiences — and customer loyalty along with all of it.

Would Rowland Macy, Harry Selfridge, or Richard Warren Sears recognize the stores they created today? They set out with courage, vision, and endeavor to create the retail foundations that informed the industry. As I take my family to see the Christmas windows at Harrods, and wait in line to visit Santa at Selfridges, I’ll be reminded again that I never rush to do the same at my local shopping mall or when I’m shopping on Amazon. Consumer desires haven’t really changed, so perhaps it’s time to get back to the values that started it all.

FOMO & the Retail Experience

iStock_000018141330SmallA Nation of Smartphone Junkies

It’s a truism that an overwhelming number of people today are addicted to their electronic devices. According to Pew Research, the cell phone has been the most quickly adopted consumer technology in the history of the world. Over 90% of American adults (97% of the under-35 crowd) own them. It is estimated that by the end of this decade, all but the oldest, youngest, poorest and most technophobic among us will own smart phones.

We use our phones as camera, alarm clock, board game, metronome, magazine, map, bank, GPS tracking device, bank, TV, and more. Mostly, though, we use them for their original purpose: to stay connected. We can reach out to friends and family members instantaneously, and know where our kids are at every moment of the day or night. We can keep up on breaking news while hiking in the Adirondacks. We can watch a revolution unfolding in the city center of a Middle Eastern country thousands of miles away. Increasingly, we can do more than one of these things at a time. [Read more...]

Suitsupply Has Its Customers’ Needs Covered, Today and Tomorrow

suit-supplyBrand-loyalty bonds made today among young HENRYs will keep the male fashion customer coming back as their careers lead them into Ultra-Affluence

Sometimes, but all too rarely, you happen upon a new retailing concept that grabs you. It is the perfect combination of the right product at the right price for the right customer — delivered with the right shopping experience. That is how international men’s retailer Suitsupply got my attention. With six US stores and seven more slated to open soon to make 46 stores worldwide, Suitsupply sells high-quality, well-designed men’s suits at affordable, even reasonable prices, with off-the-rack suits starting under $500 and made-to-measure up to $2,000.

Besides the great clothes, Suitsupply provides exceptional service, which includes highly-trained sales associates that take the guesswork out of the equation by fitting a customer into the suit that works best for him; and on-site tailors who do basic alterations while you wait — all for the thrill of immediate gratification.

But it’s not just the clothes and shopping experience that sets Suitsupply apart. Suitsupply’s marketing strategy makes it an important retailer; everyone needs to take notice, and not just those in the fashion business. Suitsupply is a retailing concept that is designed to grow and evolve with its core customer base. Suitsupply knows its customer – young, ambitious professional men – and his needs today, but is positioned to meet those needs in the future, as he advances in his profession and his ability to trade up. It’s the affordable front door to a bespoke haberdashery experience that today’s young and less affluent HENRY (high-earners-not-rich-yet) customers will ultimately grow into. [Read more...]

Field Notes on the New Face of Affluence, the Migration of Wealth and Changing Cityscapes

Paco-Final-imageThe most frightening story of 2013 that reverberated across the retail world was the terrorist assault on the Westgate Mall in Nairobi, Kenya. More than 70 people were killed. One of the key premises that have driven the expansion of shopping malls and the growth of organized retail across the world has been safety. Malls provide a secure, climate-controlled and clean environment, and for both old and new money consumers. In emerging markets like Kenya, it is a leap from the 19th to the 21st Century in one self-contained property. The mall has a suite of interchangeable parts, from brands to food courts, which makes it as close to a global vocabulary as you get. Where it gets different is security.

In Brazil, some mall security services are linked to boxing schools. The guards are well dressed, but have scar tissue around their eyes. In malls in India, your trunk is inspected and the undercarriage examined with a mirror. In Israel and Turkey you pass through a metal detector, like Checkpoint Charlie at the airport. By comparison, North America mall security is window dressing. [Read more...]

Ralph is the Greatest!

ralph_lauren_store_frontOk, I confess, I am in love with Ralph Lauren. Not the man, whom I’ve seen up close only once, but the brand, which I think is by far the greatest and most iconic American brand in the both the retail and apparel space and beyond. Ralph Lauren has created a world in which his brand lives. The brand is referred to as “The World of Ralph Lauren.” This is how the company refers to it, and, this is how we, as consumers, have been educated, by Ralph to think about and experience the brand. The World of Ralph Lauren is a place of elegance and luxury, of classic and rugged American style. The World of Ralph Lauren has its roots in a rich and glamorous American past. In an old world “WASP” lifestyle with touches of the American West; of polo players and yachts; of country houses, of Palm Beach, Nantucket, Southampton and the Maine coast; of old-school Boston and the New York establishment; of the Virginia hunt country and the ski slopes of Colorado, Utah and Idaho.  The World of Ralph Lauren presents very specific images of effortless and timeless style and taste. It is not pure fantasy. The images are rooted in an other-worldly reality that some people have actually lived. Picture the extended Kennedy family tossing a football in Hyannis on a fall afternoon, and then dressing for dinner at Downton Abbey. [Read more...]