Lauren Ackerman, Digital Strategist
What’s worth more than topline sales? Ask J.Crew, who just killed two of its fashion brands and accepted the resignation of a CEO who was successfully turning around a sales slump.
What the heck? Why let someone who was successfully driving the biggest sales increase in 5 years go?
To understand, first you need to understand the backstory.
J.Crew’s long-time CEO, Mickey Drexler, stepped down in mid-2017. J.Crew brought-in former West Elm President, James Brett to turn things around. A 25-year retail veteran whose resume also includes stints at Anthropologie, JC Penney, Urban Outfitters and others, Brett made strategic marketing shifts to combat the perception that J.Crew was too expensive for everyday wear. He made the fashion brand more accessible (read: cheaper) by launching a budget line, Mercantile, on Amazon – something former CEO Drexler swore would never happen. To make it more modern, he also launched a trend line: Nevereven.
Never heard of Nevereven? You’re not alone. That’s because it only took 16-days between the fashion brand’s launch and a leaked memo revealing the board’s plans to kill it. What?!? There are snow banks that have existed longer than this brand. Your average air-freshener will be freshening much longer than this brand. Most dragonflies live longer than this brand.
Photo caption: J.Crew’s Trend Line Launched on November 13, and a leaked memo to the Washington Post revealed plans to kill the sub-brand 16 days later.
Why?
Only the board knows for sure, but the rumors say that Mickey Drexler, former CEO and current Chairman of the board, couldn’t stomach the change in strategic direction. And so Brett stepped down, and the board immediately announced plans to wind-down both Nevereven and Mercantile.
Ultimately, the board chose to overlook the 4-8% third quarter gains – which must have taken some STRONG opinions, considering they had seen 10 previous quarters of loss.
However, they haven’t abandoned all the changes that Brett instigated in his 17-month tenure; they’ve committed to investing more in digital marketing, especially with the diverse “New Crew” campaign. But, with the closure of these apparel brands, they have drawn a line in the sand. The budget Mercantile and trendy Neveven line represent a 180 degree pivot away from the core values that the fashion brand was founded on: well-made, preppy classic apparel. The way forward for J.Crew will be to grow and evolve with the times while hewing closer to their roots, carefully avoiding brand-cheapening territory, which we at J.Schmid support wholeheartedly.
Sometimes it’s equally important to understand what your brand is NOT. And J.Crew is not “fast fashion.” Branding is a long game. And just because something worked for one brand, doesn’t make it a one-size-fits all solution.
So…to return to the question: what’s more important than topline sales? Presumably, J.Crew’s board has answered: a brand’s core values and reputation. Are they right? Is this decision a refusal to change with the times, or a prescient strategy to maintain a key part of their identity? Shoot me your thoughts at laurena@jschmid.com.
Tags: apparel brand, branding, core values, fashion brand, J.Crew, Lauren Ackerman