Mickey Drexler's Outdated Playbook

Having been a retailing industry analyst on the equity side, I came across Mickey Drexler many times in my travels.  I know that I have visited many hundreds of stores all round the United States, looking at my companies, their competitors and emerging concepts.  I had a passion for what these businesses were doing, and the best place to learn is on the ground.  As Sam Zemerray's motto goes in "The Fish that Ate the Whale,"  "Go See for Yourself."

In Drexler's old modus operandi he and his family traveled on road trips during which he visited every store under his management umbrella, talking to store managers, coaching employees on how to restock the floor and keep displays clean, and generally introducing them to what otherwise is the remote, hierarchical, hands off management style of the typical chain.  I can speak to this from experience.

In fact, the Wall Street Journal's story on Mr. Drexler from 2010 calls him a "retail therapist," which is a clever moniker for the grinding, time intensive, heavy personal engagement style described above.  Of course, this style can't be sustained for many, many years and ultimately employees become inured to repeated CEO visits.

Subsequent to the huge success of the GAP, Mr. Drexler as CEO began a series of discussions with investors about taking the company private.  His behavior as CEO wouldn't win any corporate governance awards, to say the least.

Many fast growing retail concepts from the bygone era of the nineties floundered as their concepts stagnated, as they failed to stay ahead of emerging competition and changes in consumer demographics, income and tastes.  Abercrombie & Fitch, The Gap, and J. Crew are among the big ones.  The trends which launched these companies continued and even drew more customers into their ambits, e.g. adventure travel, classic but functional clothing and accessories, crossover between outdoor suppliers like REI and fashion, and completely new purveyors of fashion and function, like Nike and Under Armour.

All of these concepts missed the boat completely, and now Mr. Drexler has his hands all over every aspect of retail operations, including merchandising, which is where he started his career at low end department store Abraham and Strauss.  Making the success of J. Crew rely on one executive, no matter how much pixie dust he spread in the past, is foolish.

Apparel production, sales and merchandising are both commoditizing and breaking into finer and finer niches, in store and online, all the time. The field isn't just shifting, it's like trying to have an office on a water bed.

Even hot teen chains emerge and burn out faster than ever before.  I fear this playbook is badly outdated.