Yes, it's the Technology
Every week in my professional practice, and throughout the research I do for this blog, I find myself returning again and again to the disruptive, seismic influence tech is having on all aspects of our lives, our brands, our businesses. As quoted in an article in the WSJ (May 25, by Khadeeja Safdar), even CEOs are found saying, "I Underestimated How Tech Would Upend Retail."
Case in point: Mickey Drexler, lauded as a fashion genius responsible for reshaping how Americans dress (pictured above, center). The paragraphs intended below are quoted from the WSJ article, and used to illustrate urgency – the proverbial writing is on the wall, and yet brands are still hesitating to re-think their business models and embrace technology.
“I’ve never seen the speed of change as it is today,” the 72-year-old chairman and chief executive of J.Crew Group Inc. said.
The retail veteran, who redefined Gap Inc. in the 1990s and then transformed J.Crew into a household name, is now scrambling to keep the company he took private in a leveraged buyout from ending up in bankruptcy. (Note, on June 5 Mr. Drexler stepped own as CEO.)
Many visionaries focus on doing what they do best, even when the ground shifts beneath them. From newspapers to television, successful companies have been upended by disruptive technologies. Facebook Inc. is now the world’s largest publisher; Netflix Inc. is worth twice as much as CBS Corp.
“The incumbent leaders never see it coming,” said Clayton Christensen, the Harvard Business School professor who introduced the theory of disruptive innovation 20 years ago.
Drexler bet on design and quality over technology – an "honest mistake" given that design and quality is what made The Gap a success. But in the words of a brilliant management book, "What Got You Here Won't Get You There" (Marshall Goldsmith).
Today, with nearly two billion people using Facebook every month, he feels differently: “You cannot be successful without being obsessed with the product, obsessed with social media, and obsessed with digital,” he said. “Retail is now about all that.”
One of the investment bankers involved with the brand also acknowledges that J.Crew and its peers are struggling with declining mall traffic and the shift to online shopping. “The internet has proven much more resilient and much more important than most of us thought a decade ago,” he said at a conference earlier this month.
Appeared in the May 25, 2017, print edition as 'J.Crew’s Slip: Trusting in Design Over Tech.'