J.Crew's Jenna Lyons on Creating J.Crew's Look

"Thanks!" to many of you, including Molly K., as well as Suzy and GigisGoneShopping (in this post), who let us know that J.Crew's Jenna Lyons was featured on CBS's This Morning last week.

To read the transcript in its entirety, as well as videos, click here.

J.Crew creative director's secret to fashion
CBS News
November 19, 2014

Jenna Lyons is one of the most influential women in fashion. As creative director at J.Crew, she is credited with giving the brand its unique style, catering to everyone from celebrities to students. But as the company struggles with falling profits and tries to expand abroad, Lyons has her work cut out for her.

She's more than game for a challenge, reports "CBS This Morning" co-host Norah O'Donnell. Walking around with Lyons at the J.Crew office, you might notice one thing about her: she wears five-inch heels.

"I feel like I can see everything better," she said. "I can see over all the aisles, I feel a little bit more glamorous, especially on those days when, you know, I have a lot going on." But at six feet tall, she doesn't have a height complex.

And if Lyons has no aversion to heights, it's because she's scaled a lot of them. As president and creative director at J.Crew, Lyons helped transform a once-homespun mail-order brand into a multi-billion dollar retail powerhouse.

"I always liked being surrounded by pretty things, and sometimes those pretty things looked beautiful next to each other, and sometimes they actually created a strange magic. Those things happen when you come home after a night and you throw off your blazer and all of a sudden it's landing on top of your necklace and it's landing on top of a blouse that you wore the day before. Clearly, I'm very neat," Lyons said, laughing. "And all of a sudden they form something different that you might not have thought about."

Lyons has no problem admitting to the inspiration for her genius; she gets her ideas from the pile of clothes on the floor.

"I'm not gonna lie, I do," she said. "There you go, that's the secret."

Lyons grew up in California, sewing her own clothes and dog-earing catalogs from her future employer. She moved to New York to attend Parsons School of Design and, after interning at Donna Karan, joined J.Crew in 1990.

She described her role there as an assistant to an assistant to somebody else's assistant.

"Yeah, it was like that," she said. "I think I sat in a hallway with my computer sort of with an extension cord plugged in."

But she felt much more at home at J.Crew than she did at Donna Karan.

"Having not been sort of like the cool kid in school, and being a little bit of the outcast when I was younger, I remember one of the first couple of times when I felt attractive or beautiful," she recalled. "And I realized that that was important to me, to be able to do that for everyone, not just people who had the ability to write a $2,000 check for a jacket."

She insisted she wasn't the popular kid growing up. "Oh God, not by a long shot," she said. "No, I was unfortunately incredibly tall, oddly skinny."

She also dealt with a personal issue that had other students making fun of her. "I have a genetic disorder called incontinentia pigmenti," she said, "and the result of that means that I had bald spots on my head, which I didn't even know I had until the girls were talking about me behind my back in school."

Lyons faced bullying. "I got beaten up quite a bit... on the way home from school, yes," she admitted. "It's traumatic, but it also, I think, is an opportunity to decide what you wanna do with that. Like, you have two ways to go. You can crawl under a rock, or you can actually decide to do something with it."

Lyons didn't seek out a rock, though she did endure some hard places. Her early career survived a decade of turmoil as J.Crew shuffled its looks and its leadership. It took Mickey Drexler, the so-called "king of retail," named CEO in 2003, to finally define J.Crew's aesthetic and five years later, to charge Lyons with curating it.

People have said that she and Mickey have a very special relationship, drawing comparisons to the relationship between Steve Jobs and Jonathan Ive at Apple.

"I was going with Sonny and Cher, but okay," she said. "There is no question I think he is an inspiration. He gets excited to the same level of excitement he did the first day he walked in here."

In a few seasons, J.Crew clothing went from cloistered and collegiate, to laid-back, grown-up, big-city cool. Its stock surged when first lady Michelle Obama and her daughters wore J.Crew outfits at the 2009 inauguration.

"I do a hula dance when I'm in the airport and someone walks by in a coat, you know?" she said. "When Michelle Obama came out in our outfit, I think the hula dance turned up a notch. And to have the First Lady feel accessible for America? That's really never happened before."

For some, it still hasn't. J.Crew prices do start in the single digits, but can reach well into the hundreds of dollars. There are some sweaters that sell for $98, but others are priced at $800 -- not necessarily the most accessible price.

"We had some of the more expensive pieces in the catalog, that was something that we got feedback on and we have changed," she said. We still have that product, but it's certainly not for everyone."

They've also received feedback on a recent addition to their clothing line. In July, J.Crew suffered criticism for introducing a 000 size. "Interestingly enough, part of that was driven by the fact that we launched a store in Asia, so we opened our first store in Hong Kong, and some of the people that were living there had tried on our double zero and said, 'it's actually not small enough,'" she explained.

They were shocked, and knew they had to change to fit their new customer base. "I think there was some idea that maybe we were doing it for, you know, vanity sizing, which, I mean, absolutely was not the case," Lyon said. "We got a lot of negative feedback; we also got a lot of positive feedback from people who are like, 'No, no, no. It's for me, it's for me. Don't take it away.'"

Beyond Hong Kong, J.Crew also opened in London and, come Spring, will be in Paris. The expansion comes despite a bruising year, in which second-quarter profits fell almost 40 percent.

"I've been incredibly fortunate, I have to say, oddly enough, to have been through this before -- we've had tough quarters before," she said. "We've had tough moments. As much as it's hard to go through, I'm not worried," said Lyon, adding, "We have not peaked."

There is another video about the behind the "behind the scenes" interview:

This is a great segment showcasing Jenna Lyons and her passion for J.Crew.

What are your thoughts on the article and video? Any points that you found very interesting? Please share! :)

J.Crew Struggles {Mickey Drexler Definitely Does Not!}

"Thanks!" to Stapelia N. who shared the following article from the Bloomberg (click here to read in its entirety & to watch a video).

CEO Drexler Amasses $350 Million as J.Crew Struggles
By Lindsey Rupp, Carol Hymowitz and David Carey
June 13, 2014

Mickey Drexler has amassed more than $350 million from the leveraged buyout of J.Crew Group Inc. even as he struggles to revive sales and restore the apparel chain’s fashion cachet. Three years after taking the retailer private with private-equity firms TPG Capital and Leonard Green & Partners LP, J.Crew’s chief executive officer is battling slowing sales as shoppers decamp to more affordable, trendier rivals. The challenges reduce the likelihood of an initial public offering this year and make J.Crew less appealing to a potential strategic buyer such as Japan’s Fast Retailing Co.

“Mickey has done very well for himself,” said Eric Beder, the managing director of equity research at Brean Capital LLC. “But J.Crew has to reinvent itself given the prevalence of fast fashion and a customer who isn’t paying up that much for basics, which is a large part of the brand.”

Drexler invested $11 million of his own money when he was named CEO in 2003. In the 2011 buyout, his stake was worth about $301 million -- he pocketed $202 million of that and rolled the rest into an 8 percent stake, according to company filings. He also got $55 million in dividends as part of the $681.5 million J. Crew has paid the owners since going private.

In all, Drexler, 69, has accrued about $380 million since becoming CEO, including options awards, salary and bonus, according to company filings and a Bloomberg News analysis. He and his private-equity partners have recouped over half their $1.23 billion investment.

Possible Sale
In February, two people with knowledge of the matter said J.Crew was in talks about a possible sale to Fast Retailing, which owns Uniqlo. Last month, Drexler said there were no immediate plans for an IPO or sale. The bonds J.Crew sold last year to finance the dividend are indicating diminished odds that the retailer will explore a stock sale anytime soon.

...Initially, Drexler was just what J.Crew needed. After the former Gap Inc. CEO joined in 2003, the chain quickly morphed into the go-to place for younger shoppers looking for stylish T-shirts and making investment purchases of cashmere sweaters; career women couldn’t seem to get enough of the pencil skirts and oversized blazers.

When First Lady Michelle Obama wore a J.Crew cardigan while gabbing on Jay Leno’s couch in 2008 and the first daughters donned Crewcuts, the children’s line, for President Barack Obama’s inauguration, J.Crew reaped fashion status comparable to superstars such as Ralph Lauren and Donna Karan.

Key Rationale
But by the time Drexler took the New York-based company private, it was starting to flag. A key rationale for the $3 billion buyout was giving Drexler an opportunity to work his magic again without Wall Street watching his every move.

It hasn’t happened. Though store mannequins are skillfully designed to prod shoppers into buying outfits for day and evening, there’s a sameness to the fashions, said Shaz Kahng, who advises private-equity and hedge-fund firms about retail and luxury goods. As prices have crept up, younger shoppers, once a mainstay, have fled to Uniqlo, H&M and Zara, she said.

Elleree Erdos, a 24-year-old associate at Craig F. Starr Gallery in New York, no longer gets her basics at J.Crew, as she did in college. “Their basics are a little pricey,” she said. “And their statement pieces are just so branded that if I got a dress at J.Crew five of my friends would say, ‘So-and-so has that dress,’ and that’s not what I want in clothes.”

HBO Hit
Creative director Jenna Lyons, a style icon who appeared on the hit HBO show “Girls” and is a walking advertisement for J.Crew, is under pressure to recapture her fashion mojo. She may be counting on the fall collection, which includes slim-fitted coats in an array of hues and wide cropped pants.

The company reported a first-quarter net loss of $30.1 million, compared with income of $29.3 million a year earlier. Revenue rose 4.9 percent to $592 million as gross margin slipped to 38.7 percent from 44.7 percent. J.Crew incurred a one-time refinancing loss of $36 million in the quarter.

Citigroup Inc. credit analyst Jenna Giannelli projects earnings before interest, taxes, depreciation and amortization of $294 million for the current fiscal year, down 21 percent from last year. If operating results continue to decline, the company said this month that it may write down the value of the business.

Boosted Debt
While J.Crew funded the first dividend with cash on hand, it boosted debt by half a billion dollars to $2.05 billion to pay the second one. Cash generation has shrunk, with free cash flow after interest falling to about $40 million in the 12 months ended May 3. The company had $128 million of working capital at the end of the first quarter and a $250 million credit line.

Like many U.S. apparel chains, J.Crew is looking abroad for growth. The company operates three stores in London, two in Hong Kong that opened in May, and 12 in Canada. In an interview in Hong Kong last month, Drexler said he’s targeting capital cities, including Paris, where the chain plans to open one or two locations by the end of 2015.

“The ambition is to go slow and do it well with great integrity, and not do it quickly and lose the quality control,” he said. “When we see the right location, we will take a shop. We’re not looking everywhere and anywhere.”

Beder said Drexler is smart to do the international push while the company is private because of the ramp-up costs. Capital spending has surged 35 percent since fiscal 2011. Still, because J.Crew is a “uniquely driven American product, we’ll have to wait and see if it resonates with Europeans and Asians,” Beder said.

New Markets
In a statement today, a J.Crew representative said: “We are very pleased with the performance of our initial stores in both the U.K. and Hong Kong which are exceeding expectations and rivaling some of our best stores here in the U.S. We’re also excited to explore new markets in both Europe and Asia to open additional stores where we find great locations.”

On a recent Saturday afternoon, J.Crew’s store on London’s fashionable Regent Street was a quiet oasis after the crowded street; none of the checkouts was permanently staffed.

David Anthony, a 46-year-old display manager at a chain of coffee shops, was among the handful of customers browsing the store. He found a cardigan he liked but wasn’t prepared to drop 248 pounds ($420). “Why should I pay that kind of money if I can get something not dissimilar at Zara or H&M?” he said.

This article and the article discussed in last week's "J.Crew's Got an Inventory Problem {no, really?}" post, showcase a store that is struggling to stay on top of their game. J.Crew is still doing well compared to other retailers- as the industry is struggling in general.

My unsolicited advice for J.Crew, to turn things around, has not changed:

1. Offer kill prices for sale items that are a year old. Seeing those items in the sale section, with the same high price point season after season, impacts how customers see the rest of the sale section. (For example, many of us don't bother checking the sale section because we are tired of seeing the same things.)
2. J.Crew needs to offer "classic with a twist" offerings again. For example, more perfect shirts with Liberty for London prints. ...And Summer maxi dresses that are fitted, as oppose to shapeless sacks. ...And bring back custom-prints like the one on the Veruschka Dress.
3. Hire a really good stylist. Treat the catalog, er style guide, like the store mannequins and make customers want to buy the whole outfit.

Trust when I say that I still buy my fair share at J.Crew because they still offer pieces I love. (Right now, it is the only store I buy clothes et al from.) My suggestions just come from a place where I want to see J.Crew back on top. :)

Other tidbits:

1. I thought it was interesting the article & the video associated with the article stated younger shoppers (those in their 20s) are turning away from J.Crew.
2. I am super excited about the Fall Collection. Slim fitting coats? Array of hues? I am in!
3. Dayum! Mickey got a great return on investment turning $11 million into $300 million in less than 10 years. If only I could get such a return on my savings... ;)

What are your thoughts on the article ? Do you think J.Crew will continue to perform well under Mickey Drexler? Any points caught your interest? :)

Another Interview with J.Crew's Jenna Lyons

"Thanks!" to many of you, including Peggy, who let us know about the following article from Forbes. (Click here to read in its entirety.)

J.Crew's Jenna Lyons On Fashion, Lena Dunham And Why She's Not Posting On Instagram
By Blue Carreon
May 21, 2014

Jenna Lyons and the J.Crew design team and CEO Mickey Drexler are in Hong Kong to celebrate the opening of their expansion in Hong Kong, the first in Asia to have free-standing J.Crew stores. Below, I talk to Jenna about J.Crew and fashion, ...and why she refuses to join the social media craze. ...

Speaking of day jobs, congratulations on the stores. Two stores in Hong Kong. Last year when we met you were just exploring the idea of expansion.
I didn’t think a year ago that it would be happening now. It’s exciting. Designing a store internationally — it’s been easier than I’ve expected as we’ve had that experience with our London store. It’s gone pretty seamlessly. I am so happy with the stores.

Why do a separate store for men and women?
When we do combined stores they are larger and there aren’t really a lot of large footprints here and also what we’ve been gravitating to are smaller and more specialized experiences. We’ve seen men respond well to having an environment specifically geared towards them, with a staff focus on their needs. And that’s been a successful model for us. That doesn’t mean we won’t do a combined store it’s just that the real estate is not available and it’s all about location.

You’ve had a couple of seasons at Lane Crawford, what did you learn from that?
What it gave us was an understanding of the market. We weren’t sure if people would respond to the product. We had no idea. But we’ve had a tremendous response from the Lane Crawford team and their customers and that was very encouraging and it made us feel confident.

We also thought that potentially the style here would be different, that they would dress differently but the fact of the matter is is that style isn’t necessarily attached to a zip code.

How are you addressing concerns over slightly higher prices here compared to the US?
We’ve done everything we possibly can to address that. We’ve gone back and forth with Lane Crawford a lot to make sure that things are adjusted. We face import duties and taxes. We are doing our best to keep it as tight as possible but there are operating costs with doing business in a country that you are not based in. Unfortunately this is something we have to contend with but we’ve put a lot of attention on the pricing.

Where do you think women’s wear is heading?
I love seeing all the shifts in fashion and I see them in the office. It’s fun to watch. What is refreshing is that there is a degree of freedom on the girl’s side. Although the rules have been broken many times before, for some reason the rules are opening up a little bit more. The sense of being yourself and looking less like a cookie cutter is more accepted now than ever before. I appreciate that.

Do you think fashion is moving too fast?
Everything is moving too fast. It’s one of the reasons I am not on social media.  I do find it hard when you’re at an event and people are trying to record the event instead of experiencing it. People aren’t enjoying the moment. And they aren’t connecting with the people they meet. I have a busy life and I want to talk the person I am talking to and not be taking a picture with them. And to have access to everything all the time is exhausting.

How do you do it all at work? Be creative and do management responsibilities at the same time?
All the people I work with for the most part have been there for over 10 years. We’ve developed a set of understanding of what’s inside and what’s outside. So much of what I do is finding the best things that are happening in the building and connecting them to the other best things in the building. At the same time the bar is high and I want everything to be beautiful from the price tags to the labels to the way something smells, the way something is photographed. All these decisions, it’s not always easy. ...

My thoughts on this interview, in no particular order:

• Jenna always does a great job with her interviews. She keeps it classy.
• I appreciate the question/answer about the price discrepancies with international orders. I think transparency about the additional costs incurred helps customers understand why something is priced differently.
• I could not agree more about styling not attached to a zip code. It use to be that certain cities (like Paris) would be a year ahead of trends. Thanks to fashion blogging, I find that the same trends are popping up everywhere at the same time, regardless of location. 

What are your thoughts on the article? Agree or disagree with any points made? Please share! :)

J.Crew in London {the info!}

"Thanks!" to so many of you, including Teri Lynn, as well as Knit Yarns (in this post), for letting us know about the following news about our favorite retailer.

The following are excerpts of an article from Business Week (there is a lot of good stuff, click here to read in its entirety):

The J.Crew Invasion
By Emma Rosenblum
November 27, 2013

Dozens of shivering British fashion bloggers, TV personalities, and socialites snake down London’s Regent Street, waiting patiently to get into the Nov. 6 opening night party for the J.Crew flagship store. ...

...Lyons says there was talk of tweaking the collection to be more British “for maybe five seconds,” but “we have a point of view. We felt good about exporting what we were currently doing.” That includes everything from hair elastics to hand-knit Fair Isle sweaters to $1,800 embellished jackets. The vibe is casually stylish, cool yet cheerful. Perfectly American. ...

Back in the store the next day, Drexler, sitting on a couch in the women’s shoe area, is thrilled to talk about the transformation of his company from sweater catalog to the kind of international brand that draws A-listers on a chilly London night. “The party was below-the-radar cool,” says Drexler. “They all looked good. Oh my God, if we could look like that!”
Drexler, 69 ... is constantly doing his own market research and pauses to greet some VIP shoppers. “How do you like the new store?” he asks. (Everyone loves everything, which seems to disappoint him.) “The interesting thing about apparel and clothes is that it’s emotional,” he continues. “People’s emotions can change quickly. And the advantage we have in coming to London now is that it’s not J.Crew how it used to be. It’s J.Crew. It’s brand new. Oh my God!”

...With prices hovering above fast-fashion chains such as Zara (ITX:SM) and H&M (HMB:SS) but below designer lines such as Alexander Wang and Thom Browne, J.Crew has found a lucrative niche as an aspirational destination for younger shoppers and the go-to store for wealthy customers seeking wardrobe staples. “I don’t want to risk being arrogant, but I think a lot of what we’ve done has connected emotionally with America,” says Drexler.

...The words that Drexler and the president of the J.Crew brand, Libby Wadle (who heads merchandising and buying), use to describe the company’s international strategy are “thoughtful” and “careful.”

J.Crew rolled out shipping for online purchases in more than 100 countries last year, but the U.K. stores are its first physical outlets overseas under Drexler. He’s planning two stores in Hong Kong next spring. In addition to the Regent Street flagship, there’s a women’s boutique in the upscale shopping area of Brompton Cross, selling the higher-priced J.Crew Collection, and a men’s shop on Lambs Conduit Street that specializes in suiting. “We’re not flooding the markets. We’re not out to become a mass brand,” says Wadle, 40, who worked with Drexler at Gap and has been at J.Crew since 2004. “And so we’re putting a lot of pressure on the stores we are doing to succeed.”

...Lyons has made it less so. “Style is for everyone,” she says. “We don’t talk down to our customers.” The ethos of J.Crew is design plus value; the cashmere is made in Italian mills, but costs less than at Bloomingdale’s. Nothing falls apart. (If it does, the salespeople will happily replace it.) The post-2008 demand for value coincided with a resurgence in buying made-in-the-USA products and supporting local manufacturing. J.Crew smartly began beefing up its In Good Company offerings, which include American heritage brands ...

...Lyons’s influence is everywhere. Sitting at a large table in her office, which is white and airy and piled with sketches, she talks about her role at the company. “At the end of the day, all I really want is for people to be excited about clothes,” she says. ... Lyons is J.Crew the way Diane von Furstenberg is DVF; her own image is so intertwined with the clothes she creates that it’s hard to separate the two. Yet she says she’s not necessarily designing for herself. “You want to love what you make,” she says. “I don’t wear shorts, but we design lots of shorts. I can have a really robust dialogue about shorts!”

...“This is not a store for college kids anymore. That woman over there—look,” Drexler says, pointing at a middle-aged shopper in the shoe section of the Regent Street flagship. “She’s buying three pairs of £375 leather ankle boots. They’re made in Italy, and designed by us. We take it from our costs directly, so there isn’t a double markup. These would be twice as much at a department store,” he says. The gray boots, with their sleek shape and pointed toe, do look a lot like a Manolo Blahnik version that sells at Barneys New York for $1,055. But to buy the same J.Crew shoes in America, customers pay only $375. Many items in the Regent store and on the U.K. website are priced the same in pounds as in U.S. dollars. With the exchange rate at $1.60 to the pound, cute ballet flats cost 40 percent more in the U.K.

Drexler has gotten some flak for the jacked-up British prices: “Shoppers shocked as Michelle Obama’s favourite brand J.Crew lands in UK … at double the price!” read a Nov. 8 headline in the Daily Mail. “Prices are different from country to country. I’ve been coming to Europe for decades, and it’s always been that way,” says Drexler. The bad press doesn’t bother him. “Opening international stores enormously helps your domestic business. Because then customers will buy even more when they come to America, because it’s cheaper,” he says.

...J.Crew is deep into its leasing negotiations for the two planned Hong Kong stores. The brand has some experience in the city—last year, it began a collaboration with upscale department store Lane Crawford, displaying J.Crew merchandise in a store-within-a-store format. Drexler says that venture “did really well, though I can’t tell you the numbers, ’cause then you’d have to report them.” His executives, however, seem more measured about J.Crew’s move into Asia.

I thought this article covered a lot of great topics. Some that made the top of my list: (1) That J.Crew stands by its product and nothing falls apart. HA! Yet, in the same breath they will gladly replace items that do. HA! HA! (2) Jenna does not design for herself. I respectfully disagree with that one. Did they forget the Jenna-clones for the models used at Fashion Week (and even the MasterCard commercial)?

(3) J.Crew has moved away from college students: I could not agree more. They do offer a student discount, but I don't know too many college students who can afford J.Crew today. In all fairness, they have done a great job differentiating themselves in terms of offering "classics with a twist". Yeah, they stray away with some questionable pieces, or some head-scratching company moves, but for the most part they offer styles I am interested in.

(4) I am glad they addressed the international price mark ups. It is amazing to see such an increase in prices, but offering an explanation (the reasoning behind it) helps a bit. Plus, I could not agree more that it helps domestic sales.

What are your thoughts? Do you agree or disagree with any of the points made in this article?

J.Crew Debuts on Lane Crawford

The following is from Jing Daily about J.Crew's expansion into the Hong Kong market (click here to read in its entirety):

J.Crew’s China Adventure Set To Kick Off In Hong Kong
By Jing Daily
September 25, 2012

After months of planning and anticipation, American retailer J. Crew’s long-awaited Autumn/Winter 2012 expansion in partnership with Hong Kong’s Lane Crawford is finally set to launch. Appearing first at Lane Crawford Canton Road and online at lanecrawford.com on September 26, followed by Lane Crawford ifc mall on September 28, J.Crew will offer customers in Asia special access to curated women’s and men’s ready-to-wear collections, including shoes and accessories. This two-pronged on- and offline approach will give customers throughout Hong Kong and mainland China the ability to shop in-person at J.Crew outside of North America for the first time.

J.Crew’s partnership with Lane Crawford is unfolding in real-time this week as an instructive — and likely promising — case study of how some Western brands are entering, or perhaps should enter, the Chinese market. By starting with an online-heavy strategy and partnering with a department store, J.Crew is able to bypass many of the headaches that accompany the construction of a full-blown store. As Divia Harilela recently wrote for Jing Daily, “tread[ing] lightly by creating an online presence first” instead of diving head-first by establishing a physical presence is the wiser road to take, particularly for a brand that’s well-established at home but untested in Asia.

J.Crew began its Greater China expansion late last year, starting by offering flat-rate shipping to Hong Kong (HK$150) and mainland China (US$30). Within six months, Hong Kong quickly became one of J.Crew’s top five biggest markets. The company seems confident that finding and partnering with a credible retailer (or e-tailer) before going solo is an effective way to tackle the very different animal that is the Chinese market now that it’s set for a physical appearance. Only after a strong online presence is established under the wing of Lane Crawford will J.Crew likely find the idea of opening an independent brick-and-mortar store in Hong Kong less daunting and more economically viable.

But what’s a grand opening without a party? To celebrate the collaboration, a cocktail event will be held on October 11, 2012 at Lane Crawford ifc mall, attended by leading members of the J. Crew team, among them creative director Jenna Lyons, womenswear head designer Tom Mora and menswear head designer Frank Muytjens.

Some JCAs may have already noticed over at lanecrawford.com, that it already features J.Crew's merchandise. (Make sure you change which country you are in.) I also love that I have another source to see how the clothes actually look on a model. Very cool!

Also, the party that J.Crew will be throwing next week sounds amazing. If any JCAs are attending, please share about the details!!!

What are your thoughts on J.Crew's entrance to the Hong Kong market? Do you think Lane Crawford is a good match for the retailer?

J.Crew Announces Latest Quarter Results {making money!}

"Thanks!" to Kat (in this post), who shared the following from WWD (click here for the article in its entirety):

J.Crew Profit Vaults Ahead
By David Moin
August 29, 2012

J.Crew Group Inc. is running strong and bringing its business to new markets.

“It’s been a nice year so far,” Millard “Mickey” Drexler, chairman and chief executive officer, told WWD. “Every day we get a bit smarter about our business, but you can never let your guard down.”

On Wednesday, the company reported a robust second quarter, marked by a return to the black and strong sales and full-price selling across several categories. Executives also cited plans to add more men’s wear stores this year, and divulged the time frame for opening the first J.Crew stores in Europe and Asia, meaning the company is getting close to signing leases. A London store is seen opening in the second half of 2013, and a store in Hong Kong is seen opening in the first half of 2014.

...J.Crew reported net income of $22 million for the second quarter ended July 28, compared with a $10.5 million loss in the year-ago period. Last year’s loss was due to nonrecurring inventory and litigation costs associated with its acquisition by TPG Capital L.P. and Leonard Green & Partners L.P. in March 2011. In the 2011 period, the amortization of inventory from purchase accounting cost the company $22 million, and litigation costs reached $6.5 million.

Total revenues in the latest quarter rose 21 percent to $525.5 million, while comparable company sales increased 14 percent. Gross margin increased to 45.1 percent from 36.5 percent, reflecting healthy full-price selling.

Operating income increased to $62.1 million, compared with $12.3 million in the second quarter of 2011.

Men’s wear, according to the company, increased at a higher rate than women’s last quarter, and executives cited plans to open two more units this year, including a Ludlow shop in Copley Place in Boston on Sept. 18, and a J.Crew men’s shop in The Grove in Los Angeles on Nov. 21, bringing the total to nine men’s units. J.Crew men’s wear, Drexler said, has become “quite well known as a strong franchise. Our Ludlow suit business is a business unto itself, as is our shirt business.” Ludlow is a J.Crew label.

With the rollout of men’s stores, “We are ramping up, only selectively,” Drexler said. “We are not running fast. We are running strategically and appropriately….I don’t think men have had a great choice in the last number of years to buy high quality at prices that are reasonable.”

Overall at the company, “We intensified our product offerings from a creative point of view,” Drexler said. “I would characterize the J.Crew product and merchandising as standing out in the marketplace. People voted with their pocketbooks, but we worked hard at it, and we continue to innovate and create every day….A lot of designers sell primarily accessories. We are in the apparel and accessory business.”

Drexler said that the brand’s pricing below designer and the fact that J.Crew is not sold at discount in channels other than its own “long-term builds loyalty into the customer base.” He also said not being a business that designs products flaunting the logo enhances the appeal. “We maintain the friendliness of the brand.”

Drexler also said that certain categories were identified for intensification this year, though he declined to specify, and also stressed the marketing efforts, including reformulating the catalogue, were intensified as well.

Regarding the Madewell brand, Drexler said, “We are expanding it both storewise and onlinewise. We’re very excited. We’re launching our fourth catalogue in September.”

Great news for our favorite retailer! I have to say, I am surprised menswear increased at a higher rate than women. (Although I bet, the actual figure still shows women outspending men at J.Crew.) ;)

I also have to agree with Mickey about not flaunting the label. When I was younger I did not mind having the label of the clothing company visible. However, not so much anymore.

Lastly, I am not sure why Madewell does not keep up with a catalog. Seems like they could at least be rolling one out every season. Just a thought...

What are your thoughts on this latest news? Any points you found interesting?

J.Crew Expanding in Hong Kong

Last year we heard about J.Crew's expansion plans to open in Hong Kong (refer to the "J.Crew Enters the Asian Fashion Market" and "J. Crew to Open Store in Hong Kong {oh yeah!}" posts).

"Thanks!" to Sabrina & Get Fresh who shared the following article from the Wall Street Journal (click here to read in its entirety) about J.Crew's overseas move:

J.Crew Plans to Expand in China, Hong Kong
By Jeffry Ng, Yun-Hee Kim, & Mariko Sanchanta
July 31, 2012

After withdrawing from Japan four years ago following a botched expansion, J.Crew Group Inc. now is wooing someone new in the region: the sophisticated Chinese consumer.

The U.S. clothing retailer, ...will dip its toe into Hong Kong and Beijing this autumn when it debuts its clothes at Lane Crawford—Asia's version of Barney's New York.

J.Crew is scouting stand-alone retail space in an upmarket Hong Kong mall, with plans to open next year and is looking at opening stores in mainland China, according to Chief Executive Mickey Drexler. The company, which is based in New York, also is looking at a possible return to Japan. Mr. Drexler was to fly to Tokyo on Tuesday for meetings and to scout out real estate.

J.Crew's move comes, however, when the once torrid China luxury market is starting to show signs of a slowdown.

It isn't clear whether the U.S. line will be well-received in China, where consumers favor luxury European brands and logos. The late entrance of U.S. retailers into China means they have to try harder to build brand recognition and loyalty.

"It is easy for a Chinese consumer to understand Gucci, 'It is expensive, so it must be good, and you must be someone if you have it.' How does a Chinese consumer understand the history and lifestyle that [a particular U.S. brand] represents?" said Franklin Yao, chief executive of consulting firm SmithStreetSolutions.

J.Crew this year started shipping online orders to more than a hundred countries as a way to test the markets. Hong Kong, Japan and Australia are now among J.Crew's top five international e-commerce markets.

Mr. Drexler, who ran Gap Inc. for much of the 1980s and '90s, said J.Crew is in no hurry to expand internationally and that he would wait to see its stores open in Hong Kong and London next year before considering his next steps. "We don't have a grand plan for opening X%," he said.

Building brand recognition in Asia, particularly in China, will be a challenge. J.Crew will have to compete with the dozens of midtier international clothing names already in the market. Pricing is an issue for new brands entering China, Mr. Yao said, especially with the advent of international shipping from e-commerce sites and the growth of Chinese travelers shopping abroad.

"You need a more sophisticated consumer, someone who can make the distinction between spending $150 for a pair of pants compared with $80," said Torsten Stocker, the head of the consumer group at consulting firm Monitor Group. "These consumers are emerging in China, but it's not as obvious as it is in markets like Hong Kong or Singapore."

To address the challenge, J.Crew recently hired a head of international marketing from handbag maker Coach Inc., one of the most successful U.S. fashion names in Asia. ...

Mr. Drexler said he believes customers in Asia will be attracted to J.Crew's unique, high-quality apparel. "We offer an alternative that's not being offered in the marketplace today," Mr. Drexler said.

Unlike other U.S. retailers seeking international exposure to mitigate slowing growth at home, J.Crew has been expanding steadily. It plans to open 42 stores in North America this year, bringing its store count to around 400. "We're not here because we are running out of places to go in America. We have so much organic growth there," Mr. Drexler said.

...It was Mr. Drexler's decision to pull its shops out of Japan, at the time J.Crew's only market outside North America. "Tokyo reflected the same issues we had in America but trying to do something in America and fixing Tokyo at the same time was impossible," he said.

What J.Crew won't repeat is expanding abroad with local partners, a strategy that was unsuccessful in Japan. "We like control.…We have the capital to do it, and I don't want to visit a store where I have to discuss with…my partner what I like or don't like about my store." "I don't consider this a huge risk at all and if, in fact, we didn't succeed in Hong Kong, life goes on. We'll figure out alternatives," Mr. Drexler said.

It will be interesting to see how J.Crew translates its brand to a consumer base who may not be that familiar with the company. The other thing is what kind of prices will J.Crew be charging. (As international JCAs already know with J.Crew's current international e-commerce site, the initial price points are much higher than the counterpart in dollars.)

I am also interested in seeing what types of marketing their new head of international marketing (formerly from Coach) will pursue. I am guessing the Hello World is just the start (refer to the "J.Crew Styled around the World" post for more).

Lastly, I did not know that Hong Kong, Japan and Australia were part of J.Crew's top 5 international e-commerce markets. I am guessing Canada fills one of the two other slots. Maybe the U.K. is the other one?

Are you excited about J.Crew's move to Hong Kong? Do you think J.Crew can build & translate its brand in the international retail market?

J.Crew Enters the Asian Fashion Market

The following article is from Fashionista (click here to read in its entirety):

J.Crew To Make Its First Appearance In Asia, Continues Plan for World Domination
By Hayley Phelan
June 11, 2012

J.Crew is on a roll. After reporting a strong sales lift two weeks ago (profits nearly doubled over the last year), the retailer has another exciting announcement: Their wares will now be available in Hong Kong and China, thanks to a new collaboration with luxury retailer Lane Crawford.

According to a press release, a curated selection of J.Crew’s women’s and men’s ready-to-wear collection, as well as shoes, will be available at select Lane Crawford stores and online starting in October 2012.

“We are thrilled to be collaborating with J.Crew on this first-ever, unique multi-channel project,” Lane Crawford’s president Andrew Keith said.

The partnership is also a first for J.Crew. While the American brand has a similar relationship with Net-a-Porter, the collaboration with Lane Crawford marks the first time J.Crew’s clothes will be sold at brick-and-mortar stores outside North America. And J.Crew couldn’t be happier about it.

“We always want to work with the ‘best of the best,’ and Lane Crawford was at the top of our fantasy list,” J.Crew’s CEO Mickey Drexler said. “When it comes to editing and presenting collections with a creative and elevated point of view, no one does it better. We are beyond excited to partner with Lane Crawford to help introduce J.Crew to Asia.”

Of course, the collaboration with Lane Crawford is only the beginning. J.Crew has set its sights on becoming a household name all around the world. “One of the big priorities is building the global brand, in a disciplined, deliberate manner,” Stuart Haselden, J.Crew’s chief financial officer, told WWD. And with retail stores in Canada, an online store that distributes to 106 countries, and brick-and-mortar locations in the U.K. and Hong Kong expected to open soon, it’s safe to say the American retailer is well on its way to world domination.

Pretty exciting international expansion! (They are definitely moving quickly abroad in the past few years.) Curious if they will slow down a bit and concentrate in the international markets they have just entered, or move forward to include additional locations...

What are your thoughts on J.Crew's entrance to the Hong Kong market? What market should they pursue next?

J. Crew to Open Store in Hong Kong {oh yeah!}

A big "thanks!" to Channing, who shared the following news from ButterBoom (click here to read in its entirety):

J. Crew to Open Store in Hong Kong
The US retailer continues to launch large-scale assault on HK.
Butterboom Buzz
November 25, 2011

Popular US brand J.Crew is rumored to be heading to Hong Kong in summer 2012 according to our sources. They will be targeting Central for their first store, and will look to expand almost immediately to tackle the huge mid-tier fashion market that’s growing here like wildfire.

J.Crew is a huge brand that all of our American readers will know well. In fact, it doesn’t end there as they have around 250 retail stores and 76 locations in Japan alone! You can see their current collections at Jcrew.com and expect a formal announcement in December. As always, watch this space for the latest!

That is exciting news! I am happy for all our Hong Kong JCAs who will be able to shop at a J.Crew store.

I am also happy to see J.Crew's recent moves to expand into other countries. (J.Crew has always been very cautious about setting up stores and selling online in international markets. Now they are selling online to Canada, France, Germany, Italy, Japan, & United Kingdom, in addition to the United States.)

Are you excited about J.Crew's move to Hong Kong? Do you think J.Crew is moving too slow or too fast in the international retail market?