The state of high-end retail
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The state of high-end retail
Kai Ryssdal: Let’s take a step back from the sheer holiday-ness of retail right now and talk about shopping for things a bit more work-a-day. A pair of jeans, just for instance.
There are a whole lot of options out there. Me: I like Levi 501s. But it gets fancier — a lot fancier.
Joe’s Jeans fit into a category you could call high-end denim — $150 and up at your typical department store, women’s and men’s jeans at the price, I should say.
Marc Crossman is the CEO. Welcome to the program.
Marc Crossman: Thank you for having us.
Ryssdal: OK, first of all: You’re wearing your own company’s jeans? Just checking.
Crossman: Of course I’m wearing my own jeans.
Ryssdal: You paid $150 for a pair of jeans?
Crossman: Yeah, actually, you know what: I bought these last night at our own store and I paid $174 for them.
Ryssdal: All right. So let me take that price point and look around here. This is obviously an outlet mall where bargains are the name of the game. But consumers everywhere want better prices today. How do you position yourself to make that work?
Crossman: We have to do the same thing, whether it’s at Guess or Tommy Hilfiger or Macy’s — if they’re offering discounts, we have to be competitive, and we too offer discounts.
Ryssdal: Would you go to the 70 percent thing like a lot of people here do?
Crossman: You know, we do what a lot of them do: If you look over at the Guess store, it’s 50 percent off, but it says ‘Select styles.’ So we do the same thing. You put the banner in the window, it says ’70 percent off’ and it’s select styles.
Ryssdal: Yeah, you couldn’t hear Jennifer’s piece because you don’t have the headphones on, but that’s what she was all about. That’s the secret price, that’s the thing that nobody knows about.
Crossman: It’s always at the back of the store so we get you in and we try to get you at the front of the store where the discounts aren’t quite as heavy, and some people make it past our sales force to the back of the store.
Ryssdal: Tough couple of quarters for you guys. How’s the economy — if it doesn’t get better soon, how are you going to be doing?
Crossman: You know it’s funny you ask that because I was pulling our numbers from Black Friday and then so far through December, and we actually comped up. Our full-price stores comped up 60 percent, believe it or not.
Ryssdal: What does that mean, ‘comped up’?
Crossman: We did 60 percent more business this year than we did last year.
Ryssdal: Wow.
Crossman: At our full-price, and our off price was — in the outlet malls that we’re in — we’re up 33 percent.
Ryssdal: So what does that tell you? Top end of the market’s doing better.
Crossman: It’s funny, I think the top end of the market is coming back. It’s hard to say because there’s not a huge crossover between the outlet shopper and the full-price shopper. So you really have to tailor your offerings to reach those customers. But not a huge overlap.
Ryssdal: What about online? You guys doing all right online?
Crossman: Yeah, online is doing very well for us. Doing very well for us.
Ryssdal: I asked around the office whether people would buy jeans online, and you will not surprised to know that the men said sure, the women said forget about it.
Crossman: That’s usually the way it is. And men, once they find a jean, they’ll just keep going back and back to that jean. So yeah, it’s a different shopper for sure.
Ryssdal: You guys went into Europe last year? How is that going for you with the mess over there?
Crossman: You know, Europe’s a little bit difficult. Everybody still wants to buy product, it’s just getting paid for that product that’s difficult.
Ryssdal: So that is a little bit difficult, right?
Crossman: Yeah, especially in Italy. I mean, Italy, you can sell product all day long, but in terms of getting paid for it, it’s very difficult.
Ryssdal: Have you come to the point yet where you’ll say, ‘All right we’re not going to fill this invoice because we’re just not getting the money for it’?
Crossman: We’re doing it a little differently. We’re changing our strategy and instead of not selling, what we’re doing is finding distributors, middlemen, and having them buy the product and let them deal with actually collecting.
Ryssdal: The headache and hassle, if you will.
Crossman: Exactly.
Ryssdal: Marc Crossman, the CEO of Joe’s Jeans, here at the Citadel with us, live. Marc, thanks a lot, really appreciate it.
Crossman: It’s my pleasure, thank you.
Ryssdal: Take it easy.
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