By  on May 5, 2009

What do the retailers say? In the final installment of this two-part report on good news (see Part One here) they told WWD: The customer is still engaged. Hard times lead to creative explosions. You can’t win playing defense. And much more. Here are their answers:

Karen Katz, president and chief executive officer, Neiman Marcus Stores: “The customer is still engaged. When we present her with the right trends, she is responding. For our storewide focus on a color, we settled on the color pink. Our customers are feminine. Pink has been perfect for her; she has definitely embraced pink. She’s also been buying anything with a feminine detail.

“Our customers like to be modern. We’re starting to sell leggings; we know that’s going to be very important for fall already. Statement shoes, anything with the right platform, the right embellishments, those have done well. So have flats. Anything that’s new — she is still buying fashion.

“The other thing that she is responding to is intimate, focused events, sometimes for as few as 20 people. It [gives her] a different reason to come in. We had an extraordinary event with Victoria Beckham. She was very engaged in helping them shop. We have been doing lots of these events. Ken [Downing] will go, or Burt [Tansky] or I will go, sometimes a lunch or a dinner. It’s a treat for all of us to talk one-on-one with the customer, even about the recession. They want to talk about it. We want to hear from them. We had started [this approach] about a year ago and ramped it up this season.

“There’s no question. Customers are very selective in what they’re buying, but they still want to look good, to be fashionable, and they’re loyal to Neiman Marcus. They want to do their part.”

Pete Nordstrom, president of merchandising, Nordstrom Inc.: “When business gets difficult, it helps heighten your focus. Even though we always have a prioritized focus on the customer, it feels as though that’s been heightened even more. It’s something that helps differentiate ourselves from others, but it’s also something we can do that’s within our control. We talk about that a lot, trying to focus on the things within our control. Nothing lends itself better to that subject than customer service.

“We’ve taken a look at everything we were doing that seemed tactical and defensive. We’ve talked about how we can take advantage of the things going on out there that put us on the offensive. There are pockets of businesses, whether it’s just an item, a fashion trend or a theme, that we can really get behind and exploit. When you can find a way to leverage the stuff that’s working best for you, it is always a key ingredient in success. That seems obvious, but when business is bad, it really forces you to look at it that way.

“The other thing is that we’ve opened a handful of stores in the last seven to eight months, and most of it’s been pretty darn successful. For the most part, our openings have met, if not exceeded, expectations. We build a lot of hype and anticipation around that opening weekend, and not through promotions or giveaways. Just the excitement of something new creates a lot of interest and buzz. Every store’s a little bit different, but it’s mostly been a positive story.

“We’re talking about how to become better sellers and how to better connect with customers. It extends all the way to salespeople, making sure they’re getting better product knowledge and really understanding the things that we’re selling. Good relationships are what we’re really focused on.”


Millard “Mickey” Drexler, chairman and ceo, J. Crew Group:
“The good news, and this is number one: It’s about time there’s an environment where it’s not going to be so easy to get by. Why do I think that? It means that product becomes more important. Quality of the merchandising becomes more important and the customer becomes more important. It’s not just, ‘Put the goods out and they’ll sell.’ I’ve used the term ‘reset button.’ It’s not going to be that easy to just get by anymore, and I think that’s great news.

“Customers are more discerning. Customers are not going to pay prices that they were paying before unless it’s worth it from a quality, design, style, fit, etc., point of view. There’s a new value system in place in the world. Customers are shopping much more acutely for what I call ‘value at any price.’ The luxury business is not going away, it’s just being redefined. It’s no longer defined as, ‘I’m going to pay a lot of money for something.’ Now it’s, ‘I’m going to pay what I think something’s worth for something I love, something that I will cherish or something that might be scarce.’ It might be a perfect old vintage piece. It might be something they do not see coming and going around America or around the world.

“From my perspective, that’s all good news because it puts a premium on performance again, and on connecting to customers emotionally, connecting personally and forcing each and every one of us to think differently about how we’re going to manage our companies and our businesses. This is all good news for the industry, and particularly for our customers.”

Brendan Hoffman, president and ceo, Lord & Taylor: “We’ve had great success with this new ‘Shop Smart’ campaign that we’ve been running. The challenge was to follow up on the branding campaign that we had been running for the last year or two, which we couldn’t sustain and which I’m not sure was the right direction for now anyway.…Working with his team and my team, David Lipman came up with the ‘Shop Smart’ campaign, where he decided to focus in on some terrific price-pointed items in a campaign that could be more whimsical — and not shy away from what we’re all dealing with in terms of the economy and people’s reluctance to shop. It’s more whimsical; it’s slightly more risqué — things like the Ellen Tracy [ad] with two ladies wearing this great pink trench, one of them flashing a passerby walking his dog, and the tag line is, ‘There’s nothing naughty about buying this trench…Wearing it, however, is another story’ and leads into ‘Ellen Tracy Trench, Only $150. Shop Smart at Lord & Taylor.’ We had a 23 percent sell-through the week we ran it. The following week, we ran a Love 80 jersey jumpsuit. The sell-through on that was 40 percent the week we ran the ad. We’ve gotten similar results throughout, and [the campaign] also did a great job helping to brand us as a place for great values, as a store for all shoppers, regardless of your age or your wallet.”

Sir Philip Green, owner, Arcadia Group, parent company of Topshop/Topman: “This is week five in New York. I think everybody was pleased that something fresh was coming to the city, which was the feedback we got when we arrived. The reaction to the merchandise has been really excellent. Certain core categories started a little slower, but everybody’s buying the fashion. We delivered new product Thursday night and sold half the new delivery by Sunday night. The business is probably running 30 to 40 percent better than we thought it would. But [it’s the] early days. We’re still learning. We’re quietly looking at one or two other locations.

“On a global basis, our U.K. business remains very resilient. We’ve had a good quarter. Everybody got spooked and scared in November-December, but since we’ve turned the year, it’s a little calmer, and certainly here we’ve had slightly better weather and different timing. We’ll reap [benefits from] that. In the round, we think we’ve got good product, good offer, and not just across the Topshop/Topman business, but generally our businesses have been fairly robust. In our marketplace, where there’s an average ticket of $50 to $60, it’s disposable income. People want to feel good, want to feel better. They wake up, open the door in the morning — it’s 70 degrees. They want to buy a new dress, a new skirt, a new T-shirt. I said when we opened this store that people are going to buy clothes. They’ve been buying clothes forever. People like shopping as a hobby.”

Jim Gold, president and ceo, Bergdorf Goodman: “The good news is that the great product is selling extremely well. The best-selling products fall into one of three categories: Either they’re spot-on from a trend standpoint, they have an investment quality to them or they are very authentic. The designers that are coveted from a trend standpoint [include] Balenciaga, Lanvin, Narciso Rodriguez, Marc Jacobs, Roland Mouret and Alexander McQueen. From an investment-dressing standpoint, Chanel handbags are flying. Verdura jewelry. Monica Rich Kosann — her vintage-inspired frames and charm bracelets. From a ready-to-wear standpoint, brands like Akris and Loro Piana, where it’s not going out of style, [are selling]. It depends on [the customer’s] mind-set. Either they’ve got to have it because it’s on-trend, or they’re going to feel comfortable buying it if they feel they can pull it out of their closet for years to come.”

Simon Doonan, creative director, Barneys New York: “Having been through a number of depressed periods, most notably the Seventies, I find a lot of explosive creativity comes out of these periods. The punk movement in England came out of the terrible, terrible economic depression that hit England in the early Seventies. A creative rage can come out of [hard times], which is an immensely productive thing and has a huge impact on fashion design and marketing.

“There’s something incredibly liberating about having the kind of economic enema that we’re having right now, where everything is being reevaluated. It’s not just about money; it’s about our relationship with material goods. It leaves everyone with fresh perspectives and encourages creativity and new approaches. That boom where women were buying 15 handbags every week and 2,000 pairs of Louboutin or Blahnik shoes [couldn’t continue]. The obsessive-compulsive focus on designer accessories — ‘It’ bags, ‘It’ shoes — has been fantastic for business, but there was a time in the Eighties when handbags didn’t matter that much. Handbags were for Margaret Thatcher and the Queen. A lot of people who are in the creative end of fashion see this as an opportunity to just look at the future with no preconceived ideas about what fashion means, what it means to be a fashion designer.

“It’s painful and some people don’t make it through, but ultimately it can be enormously creative. Think of everything that came out of punk, from Stephen Sprouse to Body Map to [John] Galliano. All of those people were by-products of punk.”


Michael Gould, chairman and ceo, Bloomingdale’s:
“Our dot-com business is terrific. For the first time, our cosmetics are online and it’s really exciting to see what’s happening with that and the big brands that are in the store. Theory, Quotation and DVF are all doing extremely well online. We really feel good about that. In the four-wall business — the accessory area — charms and initials are doing extremely well. In the handbag area, there is certainly a big return to the classics. The leggings — this whole season it’s about leggings. Tights are a hot trend. Leggings are terrific. The open-toe shoes have been very good. It’s all about the sandals. We really have had great sandals.

“Cosmetics are a microcosm of one thing in the store that I really want to point out: events have been phenomenal. We have Bobbi Brown, Nicky Kinnaird in the store doing p.a.’s. Wherever we’ve had energy on the floor, that’s where we’ve really been doing extremely well. One of the things that we’re seeing in this new environment — and it is a new environment — is how you create energy on the floor. What’s the buzz on the floor? What’s the energy level on the floor?

“We’re excited about redoing the Roosevelt Field store with the cosmetics and fashion accessories. We’re about two-thirds of the way done with the men’s store on 59th Street. If you walked in the store today, almost half of the first floor is blocked off. We moved fashion accessories to their new home on Sunday. Now, if you walk down Broadway from Lexington Avenue, the entire fashion accessory-jewelry area is all boarded up under construction because that’s the first phase of our cosmetic move. We’re very excited about that. We’re excited by the Flip restaurant that we put down in the men’s store, the gourmet hamburger place. We’re excited by the men’s store that’s opening in another two weeks. The Ralph Lauren shop will open, and then basically the lower level, with the exception of the current Ralph shop, will have been done. There’s a new Polo shop, a new Black Label [shop]. We feel good about that. Again, it’s about the energy and the activity in the store. We’re not standing still. There’s a Chinese proverb that says that even if you’re on the right track, you’re going to get run over if you just sit there. I use that all the time. I have a passionate belief that the only way we’re going to come out of this is by driving the quality of our people, which I think is one of the strengths of Bloomingdale’s, and being on offense. You can’t win the game by playing defense. Yes, times are difficult. But I think this is a time that gives Bloomingdale’s a greater opportunity than ever before to distance ourselves from the competition. I really passionately believe that.”

Humberto Leon, co-owner, Opening Ceremony:
“We just launched our Opening Ceremony Web site, openingceremony.us. It officially launched two weeks ago, and we had our millionth hit [last] Monday. Our stores are still slammed on the weekends. We feel the energy in both cities — L.A. and New York. We’re working on our Japan store, which is beyond exciting for us. [The economy] has given us a great opportunity to relook at our concept, make it into something bigger and partner with superexciting people.

“For spring-summer, we got Rodarte to make a short version of those gowns at the end of their runway show, and they just came in. They’re custom for us, they’re superexclusive, and we got all the leather leggings in. So it’s a look that we imagined and now it’s come to life.”

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