The 2018 WWD Apparel and Retail CEO Summit came to a close Tuesday in front of a sold-out audience in downtown Manhattan. The day’s speakers touched on key facets of customer retention, the evolution of content and the utilization of data.
Rice on Building Loyalty
For Julie Rice, partner in WeWork and cofounder of SoulCycle, innovation is an overused word. “We spend so much time as business leaders talking about innovation. What does it mean to us? Some people might say it’s about setting the trends, being first, creating the next big thing. There are a million different definitions and to be honest with you, the word is overused and it can mean anything,” Rice said during her presentation.
“Eight years ago, innovation was social. Five years ago, innovation was content. Three years ago, innovation was data and ironically each of these things is just about knowing and communicating with our customers…There is no doubt that we need to continue to create new things. The world is moving faster than ever and digital and physical progress are imperative. Customers have evolved and here is the thing: With all of us spending hours of the day on our phones and computers and not even looking up, the real innovation is training our employees to make human contact. A personal touch. Truly knowing and hearing someone. Real personal human connection is actually innovation of today. Are we doing that?”
At SoulCycle, Rice said, “By delivering a consistent experience that made people feel amazing, we built loyal customers who grew into a strong supportive community. We built a brand…While I was passionate about SoulCycle it wasn’t necessarily the fitness that inspired me. It was the incredibly powerful community that formed around every single SoulCycle studio.” At WeWork, it feels different than a typical office setting, she said. “There is an energy, a warmth and there is collaboration. Just like SoulCycle isn’t really about fitness, WeWork isn’t about selling desks.” —David Moin
Rousteing Talks Couture
Balmain’s plan to return to couture in January in Paris was the big takeaway from Olivier Rousteing’s Q&A with Bridget Foley Tuesday morning.
With ready-to-wear accounting for more than 80 percent of the house’s sales, the creative director has a sturdy base to build from. “When I started at Balmain at 24, I wished that the kids of tomorrow would know Balmain. Thanks to singers and the collaborations [with H&M, among others], people know about Balmain,” he said. “Now my goal is to make Balmain bigger, of course with accessories, and to do that we need to present the DNA of the house. This took seven years.”
His couture debut will coincide with the opening of a Balmain flagship. It has been more than 16 years since Balmain last did couture, when Oscar de la Renta served as creative director. Opening a flagship in mid-January, Rousteing said he “wants to go back to basics,” the creative director added that making haute couture doesn’t mean old. “The reality is that I want to bring back that luxury factor to Balmain even more because my customers love the luxury factor. They love to feel special and unique.” Rousteing said. “It is a house that dates back to 1945. Pierre Balmain was doing couture. I want to bring back the Parisian DNA.”
Staying connected to retailers and commercial directors via text, e-mail and talking is essential to his success. “I’m really connected to the total commercial system of Balmain as much as I am connected to my studio. For me, it’s really important. I don’t believe that you can be a creative director, unless you talk about business or know about business. I’m obsessed with numbers because the only way that you can see if a collection is a success is if you sell it,” he said. —Rosemary Feitelberg
Hasker on the Media Revolution
The amount of time Americans spend consuming media continues to increase and is now at nearly 80 hours a week, up from 64 hours a week just five years ago.
And the channels through which they get their news and entertainment is dramatically different today, said Steve Hasker, chief executive officer of Creative Artists Agency Global, with mobile and social media taking the place of print and traditional broadcast television, particularly among young people.
But the biggest gainer is video, with consumers showing an insatiable appetite for professionally produced media.
As a result, Hasker said that the most popular media channels such as Netflix, Apple and Amazon are investing billions into creating their own sophisticated programs to better address this new consumer demand.
Hasker also cautioned those who discount the Millennials as unimportant to take another look. They represent the largest consumer group, with 1.8 billion people globally, and are also set to inherit $7 trillion over the next four years, making them a prime candidate for marketers. —Jean E. Palmieri
Horowitz Listening and Learning
Fran Horowitz, ceo of Abercrombie & Fitch Co., spoke about listening and learning, as well as how to use those tools to change the company’s culture.
One key point was to remember to “send the elevator back down.” She said a big part of her job is “walking the walk,” noting that one shouldn’t keep one’s self secluded from the staff. She explained that learnings can come from anywhere, noting that even a trip to the cafeteria could garner feedback through a comment someone made while on line.
Horowitz joined the company in 2014 as brand president of the Hollister brand. A year later she became president and chief merchandising officer of Abercrombie & Fitch Co., and in February 2017 ascended to the ceo post. Along the way, the key to repositioning the two brands has been a focus on “keeping the customer at the center of what we do.” That’s a cultural change from before, where the decisions were made by one person and store merchandising was based on visuals — essentially “what it looked liked.”
These days, the listening goes even further and now includes customer feedback on product, whether it’s through focus groups, comments online or in the stores, or through the firm’s two new “learning labs” located near college campuses. — Vicki M. Young
Li & Fung Quickens the Pace
Spencer Fung, chief executive officer of Li & Fung, is thinking about how to be both big and fast while also keeping an eye out for new competitors as he steers the sourcing and logistics giant toward the “supply chain of the future.”
“I’m always trying to look out and say, ‘OK, who are my future competitors,” he said. “Who are the next Amazons and Alibabas of our industry?”
To stay ahead, Li & Fung is working on getting faster. “The rest of the industry is actually waking up to the fact that the Zara model is not a bad model,” Fung said. “Everybody knows the Zara [fast-fashion] model, but it’s not easy to do.”
Part of being quicker today means becoming more digital.
Fung pointed to the company’s 3-D virtual design capability, which can save up to three months of product development time. Designers can mix and match fabrics and colors, check fit digitally and see new looks on a virtual runway within 24 hours, dramatically speeding up the whole process.
But it’s a complicated world and speed is just part of the equation.
Fung also noted, “Today the hot topic is the trade war,” but said that his company has a broad base and is prepared to adjust if necessary.
“My recommendation to my customer is to be prepared, get ready, but don’t panic yet,” he said. “You never know what the president is going to tweet tomorrow.” — EVAN CLARK
Building a Data Culture
SSENSE views data as its secret advantage. According to Krishna Nikhil, chief merchandising officer at SSENSE, a fashion retailer based in Montreal that was founded by engineers, they’ve used data to improve and optimize existing processes.
This translates to ensuring that customers receive orders in a speedy manner and experimenting with a retail concept that’s based on their own selections. At SSENSE’s 10,000-square-foot flagship, customers are able to select the items they want online and try them on in store with a stylist. Data has also informed content. For one of its most trafficked stories, SSENSE tracked what people were searching for online and used that to create a video showcasing trending sneakers in an unconventional way. They are also interested in sharing the data they receive with their partners such as Stefano Pilati, who will launch his new line, Random Identities, with the retailer.
Jennifer Schmidt, senior partner at McKinsey and Company, said SSENSE is an anomaly in the apparel world, which lags behind most industries with data — only 4 percent of clothing brands are applying data to their processes. Her advice for companies wanting to build a data culture is to stay true to a business problem; reward output over process; hire people from outside of the company; look at small data to unlock different opportunities and spend to scale its applications. —Aria Hughes
A Hands-On Hearst
When WWD met with Gabriela Hearst three and a half years ago to see her first collection, the designer presented a full ready-to-wear lineup with beautiful fabrics, shoes, bags and a logo designed by Peter Miles. There was no question that this woman was serious.
“I wanted to bring back what I learned in Uruguay, having inherited my father’s ranch,” said Hearst. “All I knew growing up was being in nature, outnumbered by animals.” Hearst learned about quality, and the leathers and saddles are made by hand and they’re made to last: “You can’t do quality fast. It takes time.” She said she uses wool from her family’s farm. “Life was very simple,” said Hearst, joking that if the end of the world comes, move to Uruguay because things happen there 15 years later.
“I grew up in a sustainable environment, grass-fed, organic. For me luxury is sustainable. It shouldn’t be two competing concepts. Something that is crafted by hand, it needs to have a human aspect and not based on over-consumption,” said Hearst. The designer said she will be taking plastics out of her line by April 2019 and uses Tipa biodegradable plastics for all its packaging. She also stays away from synthetics in her designs. —Lisa Lockwood
Madewell Keen on Men’s
“Expect much more from Madewell men’s,” said Libby Wadle, president, during her presentation, where she outlined strategies to sustain the steady growth the brand has seen for years since its debut in 2006.
Aside from Madewell men’s, introduced earlier this year with denim, Wadle cited several growth tactics going forward, including opening additional Madewell Commons experiential stores for events, workshops and performances, as well as for selling product; attracting more third party creatives to complement the assortment, and growing the wholesale part of the business. Wadle also stressed the importance of continuing to build the Madewell “community” of followers and shoppers.
“Shoppers will always want to feel like they are inspired and part of something bigger than themselves. We are committed to creating a sense of community in everything that we do, from product that is inclusive to a store experience, so if you are a customer you feel like you have a friend waiting for you outside of the fitting room,” helping with the selection and styling. “At our core, Madewell is a denim brand; we are also a place for discovery for our customers. They come to us not only for great product but for artful styling and meaningful community initiatives. These are the things that we stand for.” — David Moin