Recently, J.Crew chairman Mickey Drexler (who previously served as the company's chief executive) revealed why he thought the retailer seems to be in the midst of an internal crisis. For him, it all boils down to one thing: “Clothes are just not that important or as important as they were,” he said during during a conversation at The New York Times DealBook Conference. That, and we all seem to be glued to our phones. “[People are] not really hanging around in shopping centers," he added. "[Cell phones] are local villages, and you don’t have to go to the villages to see people.”
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Despite J.Crew's best efforts with frequent discounts, its sales are dwindling — and that might have something to do with how infrequently people are shopping in-store. Regardless, we knew something had to be done, and it turns out J.Crew’s new CEO, Jim Brett, has a plan.
According to Fashionista, during a conference call on Tuesday, the brand announced plans to close even more of its stores. Instead of the planned 20 (which was announced in June after reports the Q1 revenue had fallen six percent), J.Crew will shut the doors of 50 locations before the year ends. “In order to drive top-line growth, we must evolve our business model from a traditional brick-and-mortar specialty retailer to a digital-first omnichannel business,” said president, COO, and CFO Mike Nicholson. “We are committed to driving outsize growth with strong e-commerce capabilities complemented with a more appropriately sized real estate footprint.”
When you consider the company has had a revolving door of executives lately, with one major name leaving after the next, a serious transformation seems necessary in order to bolster and maintain its position in the retail space. And with other brands exploring alternate shopping routes, investing in interactive experiences, and attempting to disrupt the traditional purchasing model, J.Crew's move to stray away from traditional stores could be just what it needs.
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