Mickey Drexler, the former CEO of the Gap and J. Crew, and the man once dubbed the “Merchant Prince,” and frankly one of my iconic heroes back “in the day,” recently made some really Mickey Mouse statements. Back in May, Drexler admitted to the Wall Street Journal that he underestimated the impact technology was going to have on retail. Mickey then doubled down on these sentiments in an interview with Adam Ross Sorkin, at the New York Times DealBook Conference in November.
Drexler, the man who brought the Gap to its crowning heights in the 1990s, the man who had the guts to disrupt himself by building Old Navy soon after, and the man who later turned around a struggling J. Crew, somehow, again, tells Sorkin early in his interview, “I wasn’t prepared for the speed with which it (technology) happened.”
You (and others) didn’t see it coming, Mickey? With all due respect, why didn’t you? Wasn’t it your job to see it coming? And then to add even more insult to injury, near the end of the interview, Drexler drops an even bigger doozy on us when he remarks, “It is still about the product.” More on this last line later – it is a whopper.
I admit that Mickey has been my hero, but even heroes have their weaker human moments. I am taking him to task because he is an archetype of a certain breed of retailer that hasn’t kept up with the digital times. As ridiculous as Drexler’s comments might be (and I realize hindsight is always 20/20), he still deserves a slight reprieve. Mickey didn’t see the changes coming for one big reason — he, like so many others, suffers from the biggest problem in retail right now — the Product Problem. This is the mistaken belief that the ability to see trends and to design individual products for the tastes of the consumer is all that matters in the retail business.
Mickey may not have come to terms with the fact that retailing is no longer a merchant-driven business. He received the moniker the “Merchant Prince” because he was one of the best intuitive merchants the world has ever seen. Howard Davidowitz of the retail consulting and investment firm, Davidowitz & Associates, once called Mickey, “the greatest re-inventor I ever saw.”
I too worked under Mickey and would second Davidowitz’s statement (and when I say, “under him,” I really mean I was a 24-year-old entry-level inventory analyst and he was CEO). Mickey was and still is a genius. He was willing to listen to anyone (“You are 10,000 people,” he would say), and his intellect moved faster than anything I have ever seen. Watching Mickey conduct a line review was like watching Wayne Gretzky skate or Michael Jordan glide through the air. He could spot the trends others couldn’t see and was never afraid to go after the big ideas in which he believed – he had a natural instinct when it came to product, especially for men’s and women’s apparel.
Mickey also taught me the importance of knowing every detail in my business. Each week he would walk the floor and ask us pointed questions about our jobs. You either had the facts or you didn’t. There was nowhere to hide. You couldn’t bullsh*t him either, and if you tried, he would see right through it. When I was about 24-years-old, I once had a quick two-minute one-on-one meeting with him. His assistant called me directly on the phone and said, “Can you come to Mickey’s office? He wants to hear about an idea you have.”
So, I went, and my Right Guard also suddenly decided to stop working that same second. It was like the Hoover Dam broke in my armpits. It was the most out-of-my-mind nervous and exhilarated I have ever been at the same time. Within seconds, Mickey listened to, dissected, and supported the idea of a wet-behind-the-ears 24-year-old kid based on the instinct he had honed over decades in the business.
But sadly, like a fullback in today’s pro-style NFL offenses, Mickey’s product instinct is no longer as valuable as it once was. Why? Because e-commerce and our now “socially-networked” lives have changed the game. Product has become too commoditized, available, and customizable to anyone at the push of the button. As a result, the products that retailers and the “tastemakers” choose to put on their stores’ shelves do not matter as much they once did. And this is the cruel Achilles’ Heel of old-world merchants.
We don’t need Mickey or other “merchants” to tell us what is hot anymore – we can see it quickly for ourselves within our social feeds, or better yet we can even design it for ourselves or be fooled into thinking that we can. We can see all the world has to offer across thousands of websites, in a matter of minutes, meaning product alone is no longer a big enough hook to get our asses off the couch. As a result, the epicenter of retail is no longer the merchant prince.
The princes are beginning to abdicate their thrones, and their scepters are slowly being passed to the new Kings of Retail – the Product Managers — the people trained in the art and discipline of Product Management, where the word “Product” is capitalized with a big “P,” and who understand that the future of retail is really the intersections among user experience, business and tech.
The product inside retailers’ walls or on their websites does not matter anymore — the Product (big “P”) that matters is the result of the collective experiences, feelings, and emotions that a retailer’s brand connotes, with a brand’s stores and digital efforts simply two of the many tools within a brand’s toolkit to elicit emotions in its customers.
Walmart, for example, did not buy Bonobos for their chinos. Walmart bought Bonobos because it was the first penguin in the water in the guideshop experiment — an experiment in a new branded product experience for consumers. Thinking otherwise only perpetuates the Product Problem. Thinking otherwise only keeps our industry thinking with a small “p” mindset rather than the big “P” mindset it needs. It is the Product experiences, whether physical, digital, or omnichannel that that will separate the haves from the have-nots in retail’s future — not the trendy crewneck sweaters nor the skinny jeans.
We can determine for ourselves the must-have colors of the season, but where we desire to touch these products, in what channels we desire to purchase them, how we desire to bring them into our homes, and what memories we desire to build and store away along the journey are the real canvases upon which the brilliant product mangers to come in our industry will paint the future of retail.
It’s time we get with the program. It’s time we celebrate Jeff Bezos for what he is — not a merchant but possibly the best product manager the world has ever seen. It’s time for all the chief merchants out there to step up and either become more interdisciplinary in their approaches and educations or to begin abdicating their thrones to the next generation of retail leaders who understand the punchline to the joke.
While, like Mickey, many legacy retail leaders may not yet hear the sound of change in the distance, but they soon will. It is the sound of the bell and it tolls for thee.
Our princes’ castles are beginning to crumble.