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Reinvest in the brand.
Once the recession ends, top apparel executives believe re-invigorating their brands will be their main priority, whether it be through more aggressive marketing, investing in e-commerce, opening stores or remodeling showrooms to create more pizzazz to lure still-nervous retailers.
After nearly a year of stringent management of working capital, maintaining low inventories and serious cost reductions, fashion firms are finished with battening down the hatches and are now beginning to devise strategies for better times.
While no one can predict when the recovery will begin, there have been signs, albeit tentative, that there may be light at the end of the tunnel. “Although we expect that real consumption will resume its contraction in the second and third quarters of this year before posting growth again the fourth quarter, the worst seems to be over for consumer spending,” said Paul L. Kasriel, chief economist at Northern Trust, in a research note.
So WWD allowed executives to engage in a little wishful thinking and asked them: “What’s the first thing you’ll do at your company once the recession ends?”
William McComb, chief executive officer, Liz Claiborne Inc.
“I could name many things that will begin to happen when we return to ‘normal.’ The one that really stands out — which will begin to unlock greater prosperity in our company — is the recalibration of our marketing investment to levels that will drive even greater interest and engagement in the brands. Unlike some of our competitors, our brands are generally early in their life cycle, and will see tremendous upside from marketing. Our strategy is really about creating demand via great product merchandising and brand marketing. More Web, more print, more in store and more novel media are essential components of our growth plan.”
Mark Weber, ceo, Donna Karan International
“Congratulate the people for their hard work and managing through this tough period.”
Susan Sokol, president and chief operating officer, J.Mendel
“Naturally, there are many things we’d like to do, but at the top of the list would be the chance to remodel our showroom. As our geographical reach expands, we have more accounts coming in to see the collections, and we feel that having the right showroom environment is critical. We have already planned and designed the showroom space with our architect, David Mann, and we can’t wait to get the ball rolling. We definitely need more room for the sales markets, and are looking forward to having a beautiful new showroom to present the collection.”
Glenn McMahon, ceo, St. John
“We haven’t stopped doing anything we’ve planned as part of our strategies. Initiatives such as product expansion to nonapparel categories and international, we’ll probably accelerate that.”
Haresh Tharani, ceo, Tharanco Group
“Quite candidly, the last year and a half we’ve been running our business pretty much the same, and really focusing on design. We’re really focusing on making sure our marketing, sales and design work collectively to understand the consumer. It’s working quite well for us. We don’t expect to change that. We’re looking at what Twitter can do at the company, and how can social networking sites helps sales. Poleci is using Twitter. We’re putting more money in sales, in both people and resources.”
Robert Siegel, ceo, Lacoste USA
“My first act will be to gather our teams in our headquarters and celebrate with one of France’s best Champagnes. Like many other companies we have learned to live with less, so we will continue to operate as we have been doing. Despite some positive moves in the stock market, we are all waiting for the consumer to have confidence to go out and shop again. The retail game has changed, as has the consumer’s appetite, so we are going to carefully monitor our customers’ shopping patterns. We are all hopeful that price promoting will become less of a factor in customers’ decisions, but my hunch is the consumer is not going to say, ‘OK, the recession is over, no more bargain hunting for me.’ This market has conditioned the shopper to wait for sales and it will take a well-disciplined brand/store to structure a well-balanced mix of full price and sale price.”
Jill Granoff, ceo, Kenneth Cole Productions
“We look forward to doing many things once the recession is over, but one of the top priorities is to thank our team for their incredibly hard work during this challenging time. We are in the process of launching a pay-for-performance program and intend to restore merit increases and the 401K match when the economy picks up and we meet our financial targets. At the end of the day, it’s about the people.”
Michael Kramer, president and ceo, Kellwood Co.
“Over the last 12 months… we’ve shifted operations to our City of Industry [Calif.] facility and built an in-house design studio to manage all digital initiatives in-house that were previously managed externally. We will capitalize on this by launching e-commerce sites for brands such as David Meister, XOXO and Jolt. Once the recession is over, Kellwood will take advantage of those cost-saving investments and continue to build our brands and a business that provides the company with significant levels of financial upside without incurring the fixed costs associated with growth. For example, Vince will be opening nine additional retail stores domestically in the coming months and will look towards international expansion in 2010.”
Topher Gaylord, president, Seven For All Mankind
“We have become laser focused on product innovation, our key initiatives and carefully managing our expenses through this challenging recessionary period. We are going to continue to execute against our initiatives [and] maintain an open-minded, collaborative and entrepreneurial company culture now and as market conditions improve. We don’t see the recession being a big bang event that suddenly ends and therefore dramatically changes how we are doing business. We look at these times as a way to build long-term efficiency into our business and get closer to our customers and end consumers.”
Mark Mendelson, president and ceo, Ellen Tracy
“Throughout our past year here, regardless of macroeconomics, we have focused all energy on reinvigorating our brand. That way, we would be best prepared for upside when things turned around. As things open up, I believe we would push for more growth everywhere. Not only with our existing accounts, who have partnered with us through this, but also new international business and e-commerce.”
Laura O’Connor, president, Zac Posen
“Everybody is dealing with budget constraints in this difficult time. We’re working so hard and we’re rethinking and have remanaged our calendar and all of our long-term projects. We haven’t stopped any of them, we’ve really changed the calendar. We’re working twice as hard to better our business and manage our operating expenses. It’s never easy to economize, and we’ve done a lot of things. Some have been really positive, and simply made the business more efficient. We were never big spenders. [Once the recession is over] I’d love to open stores and do more capital improvements, but the first thing I want to do is to celebrate our team. It’s a tremendous group of people who work here and they are dedicated to making our team stronger.”
Beth Bugdaycay, ceo, Rebecca Taylor
“The very first thing I would do would be to give every one of our staff [members] a big fat raise. I can’t wait for that day, since they are all so valuable to us.”
Michael Wallace, president of Adam
“We look forward to opening more Adam stores. Our freestanding retail has performed well despite the recession, and with the arrival of warm weather, business has really been exciting. L.A., Miami, Atlanta and Chicago are all on our list. We are also exploring new categories, including shoes and accessories, and will grow our brand through these avenues as the economy picks up.”
Heather Pech, ceo of Nanette Lepore
“Throw a huge party! After that, I believe we will continue to operate in much the same manner as we have over the last nine to 12 months. We are much smarter, more disciplined and aligned as an organization than we were a year ago. This is the new reality, and while we are more cautious, we are opening new stores, expanding into new product categories, launching a new fragrance and broadening international distribution.”
Jane Schoenborn, design director of Lilly Pulitzer
“Bring back our favorite company tradition at Lilly Pulitzer…the annual Lilly Prom [which was canceled this spring]. Each spring, Lilly Pulitzer throws a company party, affectionately known as the Lilly Prom. The evening is always perfect, set in an outdoor tent, candles glimmering. Everyone wears their Lilly brights and has cocktails. The band starts and it is like someone lit a match on the dance floor. There is a blur of twirling, laughter and excitement. Lilly herself was always known for throwing fabulous parties that lasted long into the night — and early mornings — in Palm Beach. Therefore, in true Lilly tradition, as the sun sets on prom night, the music only gets louder — everyone is clamoring to dance with the cute boys in the IT department, shoes are kicked off, hair is pulled back and the fun continues.”
Stacey Bendet, co-owner, Alice + Olivia
“Go on vacation.”