23 Responses to Is This CEO a Jerk or a Genius?

  1. Rob Hird says:

    You have to respect that the CEO / CBO made a brand decision (however controversial it might be portrayed) and stuck with it. It was a brave decision to narrow their customer focus but at the same time, when people know that your attention is focused on a niche that you will be more adaptable to changes to that market. Trying to be all things to everyone takes money, market strength and a commitment to something many companies cannot foresee in their long term vision. Take for example WalMart expanding to handle grocery. They are trying to be more things to a larger market segment as well as providing additional services under one roof – customer convenience. That might work for a general retail, but it doesn’t fit and won’t fit in the boutique fashion industry.

    A niche brand is a genius idea and I think that Mike Jeffries is a fantastic CBO.

    • Jen Lomax says:

      Thanks, Rob.
      That is an excellent point!
      Walmart is a fantastic example of how different verticals (even within retail) face different marketing opportunities and challenges.
      Certainly, A&F is not for everyone – but in sharp contrast, its niche, premium positioning allowed it to ride out the 2008 economic downturn without taking the heavy discounts offered by competitors.

    • Andris Pone says:

      Thanks Rob –
      I’ve sometimes said that branding is about adopting a single position and forgoing all others. It’s a point you’ve made well above – that you “can’t be all things to all people.” Yet we often forget the more positive side of the argument: that when “your attention is focused on a niche…you will be more adaptable to changes to that market.” This should be excellent encouragement for brands worried too much about what they will lose by focusing, rather than what they will gain.

      Andris.

  2. Jen says:

    Great Blog, I’m pretty familiar with the comments and the fallout noted. I do think that his comments were unnecessary, over the top, and bad press as he took aim at homeless/poor, which funnily enough can become young, cool, hip, good-looking and wealthy (yes wealthy) people. You know most “Streetkids” become regular people who have jobs, homes and buy stuff. I get the need to stay with your brand, but used clothes for unfortunate people is not something to take aim at and is a very sensitive social issue. That to me has nothing to do with brand, and everything to do with ignorance.

    I know I will never buy their products again and neither will many of my friends just because of a few senseless comments.

    Best,
    Jen

    • Jen Lomax says:

      Your point is very interesting, Jen.
      I don’t disagree.
      When you consider that he is supposedly targeting highschool students (Hollister) and college kids (Abercrombie), I have to wonder if this group is not a) completely oblivious to social issues his comments stir, or b) if his ignorant comments actually reinforce his consumers’ sense of ‘entitlement, exclusivity and superiority’?
      In either case, he has denied his use of press and controversy to drive the brand

    • Andris Pone says:

      Hi Jen – thanks for your comment. What I find utterly fascinating about Jeffries’ putdowns is his own very odd appearance. It does not take a board-certified psychiatrist to wonder how much of Jeffries’ obsession with perfection has to do with his own deep-seated flaws and insecurities. Again, fascinating. And I think that any well-adjusted person should recognize how frankly mean Jeffries’ comments are. While I respect A&F on a number of levels, it is nonetheless what I call an “asshole brand.”

      Andris.

  3. Janis says:

    Scandalous, yes. But the only difference between Mike Jeffries and all the other CBOs of the world is that he tells the press the uncensored truth behind the boardroom conversations. There isn’t an aspirational brand in the world that doesn’t exclude customers based on income, age, appearance, size, taste, etc.
    He’s got a bit of Rob Ford in him and perhaps could use a bit of media sensitivity training, but this is the absolute truth of what A&F and hundreds of other brands are chatting about behind the office door. So bravo for telling us the truth, but may we suggest a slightly softer tone next time?

    • Jen Lomax says:

      Thanks for this comment!
      Yes, the tone is a little scandalous – but, as intended, it has people talking.
      To be clear, my personal values don’t align with his apparent narrow view of beauty, perhaps misguided moral compass and public insensitivity; however, I do have tremendous respect for his resilience in the line of fire.
      Regardless of whether we are offended by Jeffries’ decisions and choice of public statements, parents continue to shop at A&F for Christmas gifts and school-age kids line up outside A&F stores each boxing day to scoop up discounted goods.
      Pretty remark-able!

    • Andris Pone says:

      Hi Janis – thank you for your comments. You have deep experience in the fashion industry and I am sure you have this one right. Your note about a softer tone is especially interesting to me. As a CEO, Jeffries has a solemn responsibility to shareholders, yet his comments border on reckless and there is no reason to be sure they’ll result in a higher, rather than lower, stock price. He should have his knuckles seriously rapped by the board; there are time-tested methods of growing shareholder value other than blurting out insensitive remarks.

      See you soon?
      Andris.

  4. Arijit Banik says:

    1. “We want to market to cool, good-looking people.”
    Evidently, A&F was not targeting Mike Jeffries then?
    2. “A&F is an aspirational brand that, like most specialty apparel brands, targets its marketing at a particular segment of customers.”
    On the surface, this appears true but the success in numbers doesn’t add up. Surely Jeffries is being disingenuous –he understands fully that there are a lot of people in the world who are neither cool, nor good looking by society’s narrow standards, and are a few notches beneath his target market on the social ladder—yet those are also the people who will drive the extra revenue and profitability in A&F’s bottom line that have enabled him to afford his awful adventures in plastic surgery.
    If our economy was just about the supply side then every brand out there could be successful. As you are well aware, the differentiation and market power stems from the consumption and that is demand driven. As such, many of the end consumers are really proxies for their parents (the bill payers). All of the tweens, and teens wanted to epitomize A&F –they could be cool and good-looking by association—but lest we forget that while parents may not have a say in their children’s brand of choice during good times, they do have a veto if they think something has gone too far and doesn’t conform to their personal values during trying periods. Jeffries played with this notion on a razor’s edge. If the brand is indeed what people think of you then he miscalculated and suffered the rightful blow back. Rather than answering the binary nature of the question posed, I would argue that his hubris got the better of him. CEOs need to stop believing that they are as smart as they think they are. He managed and led well and made a mistake for which he had to pay. He is neither a genius, nor a jerk.

    • Jen Lomax says:

      Appreciate the non-binary point of view.
      In the same vein, could Jeffries not be considered both a genius AND a jerk?

      Regarding point #1, I am sure there is a meme out there online which says exactly that!
      Your second point covers a lot of ground. I imagine most parents would be comfortable with their son/ daughter polo shirt and jeans (I may be wrong), but it would be interesting to know who is buying the ‘questionable’ slogan Ts and super short-shorts.
      To what extent might parents buy into the brand because they want their tweens and teens to fit into the societal norms and ideals as depicted by A&F? What proportion of purchases are made by end consumers with dollars they have earned at a part time job?

      So many questions…

    • Andris Pone says:

      Thanks Arijit –
      I like your response. JFK was once asked: “Would you rather be dead or Red?” His reply was something like: “I would rather be both alive and free.” It is an excellent reminder that in the name of making our point, we need not answer the question we are asked.

      Andris.

  5. Robert Gillelan says:

    IMO, Mike Jeffries is a passionate CBO with laser focus on the brand and on the bottom line. He differentiates a mass-market product using calculated exclusivity to exploit society’s obsession with youth, beauty and aspiration for status. Kind of Machiavellian but kudos to him for making money by taking a position, even though some feel it is being shallow.

    A key component of brand marketing is knowing your ideal customer. Is Lululemon Athletica heinous because they target wealthy, healthy females who practice Yoga? I’ve experienced their brand of ‘exclusion’ when shopping for my wife and yes it is annoying.

    A & F has a branding strategy that is spot on. Teens, tweens and people outside the target age (and within the clothing`s sizes)are crazy about wearing the logo, even if they`re overspending on a tee-shirt – and they know it.

    Mike Jeffries gaffe was talking to the media about the A & F branding strategy. It’s foolish to give the competition an opportunity to turn A & F`s strengths into weaknesses.

    • Jen Lomax says:

      Thanks, Robert.

      Call me guilty.
      There was a time when I begged my parents and scrimped and saved for that A&F logo.
      Now, over a decade later, my closet (and my identity) is long clear of the brand.
      Feels like laser focus to me. I’m certainly not his target customer anymore.

    • Andris Pone says:

      Thanks Robert,
      I made a point above, to Janis’s comment, that Jeffries’ ultimate responsibility is to the shareholders, and that his behaviour is reckless in that context – because there is certainly no reason to be confident that saying insensitive things will boost share price. I appreciate that you’ve fleshed out the argument against blurting out rude things: it gives the competition a glorious opportunity to reposition, or run a campaign or two, that trades on the brand’s insensitivity.

      Thanks again –
      Andris.

  6. Angela says:

    If we all agreed and we lacked passion would it not be boring…? Certainly Opinions stir the pot…

    I like the way Jeffries has successfullly created a brand and has been relentless in his commitment in doing so for A&F.
    No matter how one goes to market, often there will be a group that is or can be offended. Business is business and Jeffries has taken emotion out of the equation while building a strong brand.
    His strategic thinking and determination to lead in his market has enabled him to be an iconic CBO. I believe he is equally a strong leader with his team whom admire and support his vision.

    In fact, I would go as far to say, likely he was not the “cool, good looking consumer” he is after today.
    Perhaps, it is for this reason he recognizes that that is the very customer he wants to target, one who wants to look young and hip, sexy and fashionable….helping to build his brand, all the while he is relentless in his path to build A&F.

    So many brands and Luxury brands, do the same, targetting specific markets or market segments – be it Apple, Starbucks and many more.
    Hats off to Jeffries…

    Best,

    Angela

    • Andris Pone says:

      Thanks Angela –
      Your point about Jeffries’ not being the “cool, good looking consumer” he seeks is very well made. One might even say, with the tortured face he has created, that he’s the antithesis of his target market. And that’s what I find most interesting about this story. Here you have a CEO who looks quite odd – presumably because he has been chasing the American beauty ideal – telling people that he wants to market only to the good-looking. One need not be a practicing shrink to conjecture that Jeffries’ drive for selling to beautiful people comes from his own deep-seated need for acceptance.

      Perhaps a tad philosophical for a Monday morning…

      Andris.

  7. Jen Lomax says:

    Thanks, Angela.
    It can certainly be scary to take emotion out of the equation for fear of offending!

  8. Ted Matthews says:

    He’s two, he’s two, two people in one- Brand genius & social ass.

    • Andris Pone says:

      Hey Ted – thanks. A&F, due to Jeffries’ remarks, is what I call an “asshole brand.” So I don’t feel too badly about dishing out a bit of Jeffries’ own vitriol in saying that your “two people in one” analysis makes me think of two characters from literature with faces as remark-able as Jeffries: The Phantom of the Opera and Jekyll and Hyde.

      Andris.

  9. Michael Cappuccitti says:

    The guy’s face is priceless for starters. And yes his comments are those of a complete dick, but I believe they come in the same vein as Vince McMahon’s comments would. That is to say they’re not from a dark place of discrimination, but rather a ball-busting place of a) getting people talking about them and, b) truly railroading A&F in a particular direction that actually does strengthen sales and brand toward a specific demographic; one that’s big enough numbers-wise to deliver growing sales in the billions year over year. So true that if you try to be all things to all people you’ll be really boring really fast. This guy has people talking and truly created a sense of urgency and status that said-demographic is eating right up.

  10. Coin says:

    This fellow is emblematic of what I have come to think of as an “asshole brand.” I think of American Apparel as being in this category, as well as Lululemon at the end of Chip Wilson’s era. Thanks Arijit for the update – Andris.

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