Features, Strategy & Operations

Find Your Soul, The Ashley Stewart Way

There’s a great irony in the kind of cold, technology-driven world we are evolving through: and at the same time, tech’s ability to provide retailers and brands the tools to personalize products, services and experiences.  That’s awesome. The use of data and predictive analytics to get to one-on-one personalization (with Amazon leading the pack) is currently the Holy Grail.  Indeed, I believe personalization is the single most important success factor for winning in the future.

However, simply using data and analytics to understand the persona — or the soul of each of your customers — to determine how to personalize their shopping journey, will fall short by at least half of the potential power of personalization. The other half is actually finding and understanding the persona or the soul of your business. The business as a person, a human being, can then better connect with your human customers.  You become soulmates, and more importantly, you can then co-create the entire journey together. And just like best friends, you will stick together and be loyal forever. Without a soul, the personalized product or service, however good it may be, it is emitting from a brand name, a nameplate, a store or just a business. There is no human touch, no compatibility, warmth or intimacy.

James Rhee Divines Ashley Stewart’s Soul

James Rhee, CEO of Ashley Stewart, put forth this visionary concept of humanizing commerce at the recent NRF Big Show. Full disclosure, I had not thought about this concept quite the way he described it. Ashley Stewart, a once failing plus-size apparel brand, was rescued from bankruptcy for the second time in 2013 by Rhee who retired from his Board seat to take the helm.

Perhaps James was able to view the business from a totally different perspective because he had absolutely no retail or apparel brand experience. By his own admission, on his first day of taking over as CEO with the intent to save the business from bankruptcy, he confessed to his entire management ranks that he was the least qualified person to run the business, much less save it.  Indeed, his background was brand and retail “lite” to say the least.  He was a private equity investor and former high school teacher.

He began his turnaround plan by finding the “soul” of Ashley Stewart. He listened to customers in its boutique-like settings in urban neighborhoods throughout the country. He learned that the brand stood for more than the product or the experience.  He wrote in a Harvard Business Review article that the brand stood for “…values like respect, empowerment and joy.” He explained that in tightly knit communities, shopping routines are interwoven amongst generations of women, often times around important moments for them like church, family reunions, or a new job interview. On the plus side, store employees were already loyal to customers, many of whom were friends, he said, noting that loyalty and friendship cannot be bought. The store culture was about respect and stores had deep ties to their local communities. In short, he discovered that customers believed that “Ashley Stewart stood for kindness and embodied community.”

But let’s take a step back. How could the brand have found itself in bankruptcy for the second time?  Surely poor management, strategy and execution played a major role in its decline, but Rhee uncovered a greater problem in his search for the brand’s human persona. He said, “… decades of operating losses and rampant turnover in both the employee base and ownership group had cemented a fearful culture.” There was a “darkness” and kind of a crumbling infrastructure. A nascent e-commerce effort operated independently on an antiquated platform.  The store culture didn’t match the customer’s belief in the brand.

So it had to be an incredible jolt when Rhee concluded his first town hall meeting by stating, “Kindness, as the bedrock of innovation and consumer engagement, is a go-forward core strategic pillar.” Whoa!! Talk about pursuing a strategy of compassion and soulmate positioning.  This had to be a big wake-up call for many employees.

Rhee then created an internal culture that aligned with their customers’ belief in the brand. It also operated as a community, radiating kindness first and foremost, with product almost a secondary consideration. Of course he implemented all of the operational downsizing, cost-cutting and turnaround tactics to right the ship.  But all of it was shaped by “a mission-driven dedication to (their) core customer, transparent communication, lean processes and — yes — kindness.”

All of the operations were focused on, and driven by their core consumers.  Rhee’s team studied both their customers’ psychological and emotional tendencies and their shopping behaviors. Rhee built a framework for transparent communications, both internally and with their customers. He said, “We outlined in advance each and every step, and we took great care to explain why our decisions were best for Ashley Stewart and her customers. We used SMS, email, and social media to engage directly with our customer, and we had very direct conversations with our field associates. By broadcasting our operational changes this way, we helped engender trust and build a foundation for the open door policy of our new social-first, mobile-delivered customer engagement strategy.”

And adhering to the attributes of Ashley Stewart’s soul, its kindness and community, Rhee wrote: “Despite our financial plight, we reintroduced a generous local charitable giving program during the 2013 holiday season. We were penniless, frightened, and exhausted, but we knew that our philanthropic efforts were the right thing to do on multiple levels. A picture from our YWCA event in Brooklyn still hangs next to my desk to this day. It reminds me daily of the importance of staying true to core values, a commitment I made to my father, who dedicated his life to the well-being of children.”

He went on to write: “Today, Ashley Stewart is thriving. Operating profits are at unprecedented levels, organic sales growth is north of 25% and our asset productivity, through the implementation of lean processes, has shot up. Our digital business is booming. Our e-commerce business accounts for roughly one-third of total net sales and it is growing at over an 80% clip. Our mobile metrics are particularly encouraging, with demand growth at 200%+ and demand penetration at well north of 30% of total e-commerce demand. We’re also seeing some of the highest levels of social media engagement amongst all brands. We are one of the largest, most profitable and fastest growing plus-size fashion brands in the world.”

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At the end of the day, he said, “… I still believe that the single biggest contributor to our success has been the fostering of a teaching culture with deep roots in kindness. Kindness enables innovation by creating a safe work environment and it serves as the foundation for our meritocratic, performance-based culture. Kindness also supports our fiduciary-type sensibility towards our customer. We are a mission-driven business — we believe in advocating for a woman who could sometimes use more advocacy. Everything we do is to serve her. Period.”

Amen.  Soulmates: Ashley Stewart and customer are a win, win.

Find your soul and you, too, may win.

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