When Ivanka Trump’s products were dumped by – firstly Nordstrom and then – a number of retailers, the reason given was “falling sales”. What wasn’t clarified was that the falling sales had been brought about by a social media campaign that called on consumers to stop buying not only the specifically Trump branded products but also the department store itself if it continued to stock the Trump products. This tactic has now been labelled ‘Buycotting’.
In The Age Of Science Are You Driven By The Dogma Of ‘Ancient’ Words Or The Beauty Of Experimentation & Observation?
t’s a great quote and one I borrow unashamedly from Richard Dawkins. While he was using it to express why science explains and celebrates the joy of nature and our place in it, it could just as easily be applied to the contemporary malaise in retail – not just domestically but globally. For in retail we have reached a cross roads where old thinking is seeing the demise of once successful businesses and celebrated business models.
Without wishing to sound too much like a bad spy novel, I had a coffee with a secret leasing agent James Blond# (not his real name) the other day and the subject turned to the competitive context posed by international fashion brands. While we worked our way through the extensive list of issues that many domestic fashion brands find it hard to compete against, the big one that came out of the conversation was rents and rental differentials.
The recent announcement that the M.Webster Holdings businesses have been placed into voluntary administration and are looking for a buyer or bailout has received mixed responses. But has this outcome really surprised people who know retail? This isn’t the first nor will it be the last Australian fashion brand who succumbs to the pressures of contemporary retail so it shouldn’t come as a surprise at all.
Retail has been a calendar-based business for all of its 3,500 year-old history. Seasonal promotions have always served an important part of the retail calendar, connecting into the human emotions of customers and driving peak spending patterns. But in the last twenty years something quite dramatic has emerged in the engineering of those promotional periods that has caused them to be stretched over much longer timeframes – some up to 20 weeks now.
Last year during a high profile legal process, the former Chairman of a publicly listed retailer openly confessed that the company had pushed out supplier payments as an embedded pillar of ‘business as usual’. Not only was he not contrite nor apologetic about the practice, he extolled the virtues of such an approach as a sound and operationally legitimate way of reducing capital tied up in inventory to be deployed elsewhere for aggressive growth.