Radical Retail Therapy: 10 Ideas for Struggling Multi-Brand Retailers

TAKING STOCK: Multi-brand retailers have tough decisions ahead, including having to consider disrupting their very business models to prepare for the new reality, while impatient Street and equity investors give them a tight financial leash. There is some hope and inspiration in foreign and smaller retailers…and Uniqlo.

Business news and fashion press readers know that 2020 has been, by and large, a disaster for apparel retailers. Without question, COVID-19’s human and economic toll has been a significant factor, but truth be told, the industry’s “cruisin’ for a bruisin’” was years, if not decades in the making. Between the twin stars (or more aptly, ‘comets’) of ecommerce and social media, competition intensified amidst stalwart and newer ‘part-wholesale’ brands and their ostensible “partners”, multi-brand apparel retailers and platforms. Amidst some winners (luxury brands adept at continual newness [Europe] and Fast Retailing [Japan]) and the hobbled (mid-tier brands and fast fashion retailers adapting to new realities), the bottom of the pile would seem to be US multi-brand apparel retail with significant bricks and mortar presence, especially those termed “department stores.”

FAST RETAILING’S UNIQLO SOHO: One of the more successful apparel retailers with significant bricks and mortar ‘exposure’

Who are we talking about? (NOTE: Below I compare some historical stock highs to current post-COVID lows, but in nearly every case, stocks were significantly down even before COVID when looking at 5 year historical charts)

Macy’s: Stock down approx 80% since 2015
Bloomingdale’s: Owned by Macy’s, seemingly not exciting investors as a spin-off or contributing to a higher stock price
Kohl’s: Stock down about ⅓ since November 2019
Neiman Marcus: Recently emerging from bankruptcy
Nordstrom: Stock down about ¾ since December 2019
Lord & Taylor: Parent company has filed Chapter 11
Barney’s: Bankrupt, purchased by Authentic Brands, unclear future
Urban Outfitters: Stock down about 30% since Nov. 2019; down over 50% since Aug. 2018
JC Penney: Bankrupt, potential buyer Simon Malls, to do what with besides pay rent, uncertain
Totokaelo: Purchased by Need Supply, entire enterprise recently shuttered

PLEASE NOTE: I focus here on US-based multi-brand retailers. I recognize there are purported successes overseas (Selfridges, Harvey Nichols, etc.), but I opted against including them given my relative lack of familiarity and their unclear finances (many are private and don’t disclose revenue and profitability).

Numerous industry experts have pointed to the US being “over-stored” relative to European and Asian countries, while others, like “Merchant Prince” Alex Mill owner Mickey Drexler, have said there are too many brands. I can’t argue against either observation, but wanted to offer some ideas to give these companies a fighting chance.

The overarching theme is easier said than done, particularly with antsy investors eager for quick ROI and exits:

Multi-brand apparel retailers need to risk cannibalizing and ultimately destroying a lot of what they currently do to make way for the mere possibility of future success. Ultimately, these companies will need to create or buy exclusive, desirable brands by hot creatives and become vertically integrated to the greatest extent possible, coming closer to an upscale Uniqlo-like model

In this way, the industry bears remarkable resemblance to tech companies such as Netflix, Microsoft, and Adobe who risked killing their ‘golden goose’, yet waning business models to preemptively align with technology advances, consumer preferences, and new competitors. In hindsight, such moves were applauded as genius game changers, but before and during their implementation, not everyone — including investors and customers-was quite so effusive.

These suggestions differ from how business is currently conducted and, frankly, assume that the existing business models will simply NOT work regardless of funding, operational skill, with high-priced consulting firms running financial forecasts and probability scenarios. Without question, they require a strong stomach and perhaps a reality-distortion field. Scott Galloway would likely argue them futile in light of the industry’s downward trajectory and COVID’s radical acceleration of that trajectory, alongside monopolistic digital competitors. Nevertheless, I think they offer the best chances for these companies to align with how young consumers are shopping and what they expect from brands and experiences.

  1. FOCUS ON [WAY] FEWER CATEGORIES: Target and Walmart are superstores, built on offering an extraordinarily wide array of categories at great prices, and in years past, Target leaned quite heavily into design, partnering with famed industrial designers (and a few apparel collaborations). For a mid-market multi-brand retailer like Macy’s, it would be huge lift just to win in apparel, accessories, and beauty; the competition in this price tier is fierce. Yet, it continues to offer home, kitchen, furniture, mattresses, patio furniture, and the list goes on. Kohl’s offers a wide range of categories, including electronics. I am trying to imagine who would buy furniture at Macy’s over West Elm and Crate & Barrel (I’ll leave out higher priced Restoration Hardware), and who would buy a Sony Playstation at Kohl’s. Similarly, Neiman’s should probably exit Home. In all cases, it might be revenue now, but shows a lack of focus likely impeding competing in more winnable categories. Similarly, Urban Outfitters, though not a department store, could be better served focusing on the most important categories and getting out of the tchotchke and rando hipster product business.
BEAUTY & FLOOR CARE?!: Kohl’s seemed to be making strides in more aspirational style, but is fighting a tough battle against superstores like Target, Walmart, and Amazon (which offer food) by spreading itself so thin.
RESTORING FAITH IN RETAIL: Though I think it’s stock is, like, way over-valued, Restoration Hardware offers a range of goods focused around the home. Though presumably it could offer more apparel and electronics, it seems to recognize that successful retail requires a sharp POV and not trying to boil the ocean.
COLETTE PARIS’ (now closed) SARAH ANDELMAN: She offered a new, potentially too radical vision of retail. If given the right role with skin in the game, she would be an incredible asset to one of the ailing multi-brand retailers — in credibility, vision, ideas, and marketing value.

2. EMPOWER A VISIONARY CREATIVE DIRECTOR TO DEVELOP A SHARP, DIFFERENTIATED POV: These are large companies with numerous stores across the US, and it’s not easy for one individual to envision the entire retail experience, especially with the seasonal (and more frequent) turnover in product and display. Yet, when you walk into many of these stores, they often suffer from multiple personality disorder as you move within and through departments. Even worse, these store experiences are nearly interchangeable in most markets. Regardless, consumers don’t care, are confused, and prefer simpler, elevated experiences. They’ve seen better at Apple, Uniqlo, Target, West Elm, and in countless other retail spaces, and expect the same everywhere. Macy’s acqui-hired Story for Rachel Shechtman, but she unfortunately left the company in June. Imagine the creative energy Sarah Andelman (founder of Colette) would bring to a Bloomingdale’s if given a meaningful, named role; people would take note, and the press/media/influencer attention would fan the flames. What about Marc Jacobs (if he’d ever!) rethinking Neiman’s from top to bottom? For a time, his West Village archipelago of stores showed incredible imagination about what retail could be. The entire industry needs this type of visionary thinking and sharp POV, so these retailers can differentiate from each other.

MARC BY MARC PRODUCED BY MARC: Marc Jacobs was/is a brand and retail visionary. Critics will point out his business’ decline (perhaps spread too thin across so many diffusion brands and at one point LV), but he would bring new energy and ideas to re-energize a multi-brand retailer. If he’d ever do it.
Nordstrom’s New Logo: Logos are hot-button topics, especially after Gap’s misstep. They are also subjective, yet…I don’t think this was an upgrade its past incarnation. It actually feels less aspirational.

3. ELEVATE BRANDING & DESIGN: Who thinks Macy’s or Bloomies’ brands feel modern? And who finds Kohl’s to feel aspirational? Target feels more current, and most of its design could be created in PowerPoint with various Helvetica weights. Consumers, especially younger ones, are seeing the best in branding and design in social media, on the streaming services, and in culture at large. They also seem quite open to continually evolving branding, where logos and colors evolve and morph— throwing out the trad ‘brand book’ ideas of yore. Newness is prized. The “influencers” and celebrities they admire are often showcasing their own sense of elevated taste in branding. It matters a ton, and Gens Y & Z can sense intuitively when something feels dusty or diffuse.

BLOOMIES’ BRAND TREASURE TROVE: Opportunities abound for retailers like Bloomingdale’s to re-think and play with their branding and identity systems, taking pages from luxury brands like LV, Dior and Chanel that alternately lean into and mine traditional codes and/or upend them.
THE TENOR OF SAKS: Compared to competitors, Saks’ brand identity system seems fresh and modern, playing with its classic codes, like a luxury brand.
‘HONESTLY GENUINE’ GENERICS AT JC PENNEY: Competitors have private labels, but very few have name, respected creative directors to give them vision, a filter, and credibility. If offered at competitive prices, it could help differentiate and elevate. Uniqlo offers a successful template for this model.

4. CREATE EXCLUSIVE DESIGNER-LED PRIVATE LABEL BRANDS: Which principle has Netflix, Amazon, HBO and more recently Spotify proven over the past 5–10 years? You can’t differentiate from competitors when you offer the same content, because that leads to commoditization. In an age when consumers can purchase nearly anything from anywhere, this becomes a pricing firefight. You have to have true exclusivity, and that ‘content’ — or apparel — has to be differentiated and compelling (not a colorway of shirt to satisfy a buyer’s need for ‘exclusivity’.). If the product has star-power provenance, all the better. Consumers can buy Levi’s and Ralph Lauren numerous places, including the brands’ own stores, and younger consumers are not excited by generic apparel brands, especially at higher price points. Target might be able to succeed with a private label strategy because it’s a superstore, but JC Penney’s? Highly unlikely. Consumers don’t covet JCP’s private labels Arizona and St. John’s Bay when there are cooler brands and styles available elsewhere at competitive prices. Additionally, Target built its style credibility — and did a great throwback collection last year — on an array of celebrity designer collaborations in fashion and product design: Phillip Lim, Proenza Schouler, Rodarte, Phillipe Starck, etc. (Incidentally, Mr. Porter’s private label ‘Mr. P’ lacks a name designer, which seems like a missed opportunity to build credibility.) Finally, I think such brands should be led by experienced designers with established reputations, not stylish influencers (unless they have actually run a successful brand).

TOO BIG, TOO HIGH, NOW CLOSED: Neiman’s at Hudson Yards, now closed post-bankruptcy, but struggling from the outset — who knew that this sign placement indicated the location of store’s first floor — 5 floors up from ground level.

5. SHRINK STORE FOOTPRINTS: Neiman Marcus and Nordstrom opened large New York flagships in the past 2 years (Neiman’s Hudson Yards location is closed). For higher priced “department stores”, they feel too big and impersonal, especially when their consumers are shopping luxury, single brand stores, which even when ‘maison’-sized, feel like well-merchandised jewel boxes. I recognize the grandeur and allure of multi-level stores, but these days, consumers are bummed out when they have to travel up and down 4 or more stories to buy something, especially when they could purchase it from their mobile phones. The juice isn’t worth the squeeze, ergo Barney’s Madison Avenue store, which had its charm, but often felt like the Winchester Mystery House. Neiman’s Hudson Yards store had its first level on the fifth story of the building. (NOTE: Saks Fifth Avenue’s recent redesign is terrific, and is in a great, high traffic location, yet the endless escalators and elevators detract from the experience in any time other than the holidays. I have heard that size of store hasn’t impacted Liberty or Selfridges, but they are markedly smaller entities with less competition; plus, they take great pains to differentiate themselves in tone, branding, and assortments, and their store design is top notch. [ex. Selfridges has worked with architectural genius David Chipperfield]

RACKED WITH UNSOLD MERCH: Saks’ beautiful ‘new’ shoe emporium marred by racks of unsold, often luxury brand goods on sale. (Photo: Dec. 2018)

6. STOP OVER-MAKING & BUYING: Companies need to make their numbers and grow revenue and profits, and there is a pipeline that must be filled to accomplish this, etc., etc. Yet, for multi-brand apparel retailers, is it better to buy and manufacture based on ambitious sales projections based on a workback sales goal when you have to put everything on sale to clear inventory, or rather, be more conservative and, worse case scenario, not have enough inventory to meet demand? Expert analysts will correctly point out that retail has been built on this model, accounting for its inefficiencies. Nevertheless, it hurts business if when consumers visit your stores, they see racks of poorly merchandised, name brand product that’s heavily discounted. In a post-re-design visit to Saks last year, after taking the escalator up 7 flights, I toured the new women’s shoe floor, which was marred by racks of picked-over sale shoes, including several luxury brands. This spoonful of arsenic spoiled the large pot of delicious soup. What’s worse is that many choice remainders likely end up at the stores’ lower priced outlets, further diminishing brand integrity and aspiration.

7. IMPROVE SUPPLY & DISTRIBUTION CHAIN EFFICIENCY: When Steve Jobs returned to Apple, he noticed the terrible impact that 6+ month long production-to-distribution timeline was having on its business. In a famed speech to employees, he mused that he and “even Einstein” couldn’t predict what consumers would want over such a long time period (he didn’t mention that Dell was employing this on-demand/low inventory supply chain to win the PC war). We’ve all read stories about Inditex, H&M, Boohoo, etc. being able to move from idea to in-store in under a month, yet the majority of the multi-brand store industry still moves much slower. I’m sure I’ll hear critiques that such speed requires a specific business model and tremendous volumes to achieve such efficiencies, but I struggle to imagine that in 2020, if multi-brand apparel retailers invest in the right type of private label brands (Point 4) and become vertically integrated, they can’t vastly reduce their timelines, inventories, and consequently improve their forecasting capabilities. Are clothes more complicated to manufacture than cutting edge computers where purchasers can customize their machines? It just can’t be in a vertically integrated model.

DEMANDING SUPPLY CHAIN-DISTRIBUTION EFFICIENCY: In his return to Apple, Jobs recognized the incredible challenges that long supply chain-distribution timelines created for the company. They could not forecast demand — in terms of volume AND what the consumers might want.
COACH AT MACY’S HERALD SQUARE: While the structural design of this ‘installment’ is alluring, the density of choice is overwhelming, and makes an aspirational luxury brand seem ‘un-exclusive’.

8. GIVE ITEMS BREATHING ROOM: Analysts love to look at revenue per square foot figures and swoon when they write about Apple’s retail success (which took cues from luxury, with high prices, requiring fewer sales to achieve good yields). Some multi-brand retailers are better than others, but many cram their floors with a dizzying density of products, with often high numbers of the same items, price tags hanging out. These moments remind me of web design’s early days when companies would try to jam as many windows and buttons “above the fold” to ensure visibility, but realized that choice density caused users to search (if lucky) or bounce from choice architecture confusion. If you think Coach bags are amazing, it’s not appealing to see so many of the same ones packed together. Coach and other brands that operate their own stores know this and operate accordingly. That’s why consumers prefer to buy from those stores rather than the multi-brand retailers. (I think this is especially the case with luxury brands where in their store environments, purchases feel like souvenirs of a high end experience.)

SEEN IN THE RIGHT LIGHT: Bergdorf Goodman (and cool, smaller apparel stores) avoid harsh lights from high above and balance such needs by lighting merchandise at eye level (through artificial or natural light), enhancing the appeal of items and the most important ‘asset’: the shoppers who buy them. Additionally, items are not packed tightly on shelves.

9. FIX THE LIGHTING: If you walk into most multi-brand retailers (in my experience), everything is lit full blast from the ceiling. Ostensibly, for a consumer entering the store, this raises energy levels and is great for wayfinding, because they can eye-sweep the entire floor and hopefully find where they want to go. And I think this light blast approach is great for…Ikea, Walmart, Home Depot, and Target. For multi-brand apparel retail, this lighting is not flattering for the most important store asset: the consumers who buy the product while looking at themselves and others. It makes them look like ghosts with circles under their eyes, reinforced by innumerable mirrors. Better restaurateurs know that to create ambiance, you light closer to eye level, not from above, in both banquettes and bathrooms. It makes people look better, which makes them feel better and maybe food taste better. It also hides flaws, wear, and tear on the establishment…and its patrons.

10. EMBRACE STORES AS “SHOWROOMS”: “Showrooming” has been a dirty word, referring to consumers’ ability to price shop the same goods via mobile retailers. Yet, if they are to survive, multi-brand retailers need to ensure this isn’t the case by offering truly exclusive, covetable brands (Point 4, again). We live in an on-demand world, and delivery times continue to decrease, yet more consumers, especially younger ones, seem remarkably patient to receive goods. Streetwear and sportswear fans will wait a week or more for deliveries from their favorite brands. Warby Parker’s showroom model (Point 8) means that eyewear delivery take a week or so (based on my recent experience). Shein’s ultra-low priced merch, apparently drop-shipped from China, takes about two weeks. Of course, there is competitive advantage to offering faster delivery, but I’m not convinced it’s the be-all-end-all if the “value” is there, meaning the goods are desirable, exclusive, and/or the price is right. Given that apparel and accessories have an emotional appeal — that say, pencil sharpeners and microwaves don’t — the waiting might NOT be the hardest part. Finally, if items sell out, that could mean temporary pain for long term gain: consumer disappointment that they can’t have it, but greater desire for the next time (again, this assumes that the brand and item are not considered easily replaceable commodities). This approach also means smaller stores (5), better merchandising (8)…and lower expenses.


In the US, multi-brand retailers are clearly in trouble, yet investors (i.e., primarily private equity and banks) seem willing to give them another shot…and many consumers still love the experience of shopping in-stores. I wish I could finish more positively, but I feel when private equity or big-shot investors give “lifelines,” there’s an expectation of immediate returns, stripping of costs, and selling off of assets more immediately valuable than the business itself (i.e., wunderkind Eddie Lampert’s Sears, which seemed to have no winners). What the category needs, in my opinion, is not only cash and loan forgiveness, but a fundamental re-think about how the entire business operates and a move away from larger box apparel wholesale towards a more Uniqlo-esque vertically integrated model with exclusive designer sub-brands (Uniqlo’s U with Christophe Lemaire, and J+ now back with Jil Sander, are examples). This involves significant risk in a highly volatile time, but I think the rewards could be outsized for those who are FIRST willing to undergo an honest assessment and some ‘radical’ rethinking.

Marketing and Brand Consulting for Lifestyle, Fashion & Luxury. Father of tween daughters. Music Passionate. Mediocre Guitarist. Brooklyn, NY / Los Altos, CA.

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