Archive for September, 2009

Donald Fisher’s legacy at The Gap

While it’s apparent that Mickey Drexler took The Gap to a new level, Donald Fisher deserves an enormous amount of credit for having the vision in the first place. He saw an opportunity to develop a business model tailored to fit the rapid expansion of regional malls during the ’70s and ’80s. He created one of the first specialty retailers filling a niche (or “gap”) that was being neglected by traditional department stores; in a very real way, The Gap was one of the earliest “power retailers” although not in a big-box format. And, finally, he understood the strength of branding: Even though The Gap began as a Levi’s “headquarters,” eventually the brand image of the store became bigger than the sum of its parts.

British designer uses “real” models, causes scandal

We live in a topsy-turvy world when fashion designers use size 8-10 models (still well below the US average) and are considered avant-garde for doing so! Designer Mark Fast should be congratulated for making a statement about the unhealthy size of typical runway models; perhaps he is doing his sales a favor, too, by trying to appeal to “real” customers.

JCPenney tries text-message coupons

To some extent, texting coupons to customers is a smart move by JCPenney because it reaches customers through “new media” that probably don’t pay much attention to “old media” anyway. Newspaper readership is falling fast, especially among the generation of consumers being targeted for a more interactive sales promotion like this one. Coupons by phone, text messages about sales events…all the wave of the future provided that the customer doesn’t view it as a disruption or invasion of privacy.

My only caveat to JCP is the overuse of coupons in the first place. Running sale events with a constant overlay of coupons on top of sale prices that might not be so compelling in the first place is not getting Penney the type of comp sales increases it is looking for.

No dogs allowed: Smart retailing?

Sorry, fellow dog-lovers but I agree that laws keeping dogs and other animals out of food stores and restaurants are there for a reason: public health. (And I agree that service dogs ought to be the exception to the rule.) The trend toward “humanizing” dogs and treating them like members of the family is real, and it’s also a business driver for retailers from big-box pet supply stores to boutiques. But public health concerns ought to trump “customer-friendly” policies for food resellers — at least as long as science dictates that these laws should be on the books.

Baby Boomers to retailers: Ignore us at your peril

Following are comments from a recent Retail Wire discussion about baby boomers’ shopping habits as they age. Kimberly Clark is collaborating with some of its big retail customers (like Walgreens) to pay closer attention to signing, accessbility and other mobility-related issues. My argument is that marketers and retailers need to pay attention to the Baby Boomer mindset, not just physical issues:

As a certified Baby Boomer (born 1954), I have always wondered why CPG companies and retailers have seemingly been more focused on a twentysomething target customer, at least in terms of their sales pitch and merchandise content. (But I may be just a typical self-absorbed Boomer.) I think there are a couple of issues worth focusing on: First, the very real physical changes that will affect the health and mobility of our biggest and most affluent population bubble. In this regard, Kimberly Clark and its retail partners are conducting a valid experiment.

But just as important is the psychographic makeup of the Baby Boomers, if it’s even possible to classify their mindset. There is likely to be a “forever young” mindset (just as there has always been with this age demographic) that runs somewhat contrary to the physical reality of aging discussed above. It’s hard to picture Baby Boomers suddenly turning into their parents or grandparents — attitudinally — no matter how much trouble they may have reading the labels or reaching the top shelf.

Zara on the Web: Will it succeed?

Because of Zara’s “fast fashion” approach to the apparel business, managing inventories online in a nimble fashion will be a key to the website. Forecasting demand — and, more importantly, running out of product “just in time” instead of too early or too late — will go a long way toward a profitable business model for Zara. But if H&M can figure this out, so should Zara, especially with its more limited footprint in big markets like the U.S. A viable website gives Zara a lot of cross-marketing opportunity as it works toward higher brand recognition in new markets.

Designer goods, mass appeal

A recent New York Times column about “Fashion Week” focuses on Tory Burch, who is succeeding not only on the strength of her design but also based on well-positioned price points…moderate by the standards of the runway industry. There is no doubt that the economic slowdown over the last year has had a devastating effect on the sales of high-end goods, and luxury retail is the toughest segment of the industry. The question is whether we are looking at a sea-change or merely a dip in the demand for high-end goods. My guess is the latter, and several luxury retailers are reacting accordingly.At the same time, “design for the masses” continues to push aspirational goods down the distribution channel. Norma Kamali for Walmart is one example…Vera Wang at Kohl’s is another. Some of these (like the Ralph Lauren “American Living” initiative at JCPenney) preceded the recession but the timing was right: The volume base for most designers is shrinking too rapidly for them to depend only on the growth of high-end retail.