WEBVTT - Catalyst Brands CEO Marc Rosen Talks Holiday Shopping 

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>The US consumer remains resilient. Data from MasterCard showing retail

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<v Speaker 2>sales rose four point one percent on Black Friday. That

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<v Speaker 2>surpasses last year's three point four percent growth, So better

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<v Speaker 2>than last year and better growth as well for our

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<v Speaker 2>boots on the ground. Look at the consumer. We welcome

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<v Speaker 2>Mark Rosen, Catalyst Brands CEO. Catalyst is a parent company

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<v Speaker 2>of retailers like jcpenny, Brooks Brothers, Eddie Bauer, Aeropostyle, Lucky Brand, Nautica,

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<v Speaker 2>you know all the names. Mark, Welcome to the program.

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<v Speaker 2>Thanks for joining us here in studio. How is how

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<v Speaker 2>was Black Friday?

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<v Speaker 3>And how is Cyber Monday shaping up?

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<v Speaker 1>Thank you for having me so. Black Friday was as

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<v Speaker 1>it always is. I think it just a super exciting

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<v Speaker 1>day for all of us in the retail business. I

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<v Speaker 1>was out in stores that morning and we had lines

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<v Speaker 1>around the store at our jcpenny stores that morning of

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<v Speaker 1>customers coming in for our five deals. They were waiting

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<v Speaker 1>to get a snow globe, which is one of our

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<v Speaker 1>historic nostalgic giveaways, but also a coupon book. I think

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<v Speaker 1>consumers were really focused on value and deals this holiday.

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<v Speaker 1>I will say the other big thing that we noted

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<v Speaker 1>on on Black Friday was gen Z was fully in

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<v Speaker 1>on Black Friday this year, and it was really exciting

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<v Speaker 1>to see gen Z shoppers out in the malls. Our

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<v Speaker 1>Aeropostyle brand did really, really well with strong sales and

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<v Speaker 1>you know, a really strong presence of gen Z coming

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<v Speaker 1>out here.

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<v Speaker 2>It does feel like there's like a nineties comeback somehow.

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<v Speaker 2>I don't know when aeropostyle really hit the first time,

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<v Speaker 2>but there's definitely a second wave for these kind of brands.

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<v Speaker 3>And you own a lot of them. How is that

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<v Speaker 3>shaping up and what's driving it?

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<v Speaker 1>It's you know across the portfolio, right. I think the

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<v Speaker 1>thing that brings our brands together is, you know, we

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<v Speaker 1>have historic brands that the consumer knows and loves, and

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<v Speaker 1>the thing that brings them together is it's also incredible

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<v Speaker 1>fashion at a really affordable price.

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<v Speaker 2>I think.

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<v Speaker 1>So if you look at Aeropostol for the team customer,

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<v Speaker 1>all the trends, Y two K is actually the trend

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<v Speaker 1>right now. Right it's the wide leg, the baggy, the

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<v Speaker 1>low rise denim, and that's doing really well, and so

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<v Speaker 1>we're seeing consumers really come in for that Brooks Brothers,

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<v Speaker 1>which I know.

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<v Speaker 3>You're a show near and dear to my heart.

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<v Speaker 1>Exactly right. So Brooks Brothers also had a great Black Friday,

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<v Speaker 1>and we're moving into Cyber Monday. But there it was

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<v Speaker 1>all about sweaters, so Marino wool sweaters, Cashmere sweaters, and

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<v Speaker 1>the quarter zip is actually we have a quilted quarter

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<v Speaker 1>zip that was our number one selling item on Black Fridays.

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<v Speaker 1>Consumers are coming in for that.

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<v Speaker 3>What are the common themes among the brands.

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<v Speaker 2>You've had significant growth over the past few years, and

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<v Speaker 2>you've developed a great portfolio of brands. What are the

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<v Speaker 2>common threads behind all of these businesses that you've put together.

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<v Speaker 1>I think the common theme, if you put it all together,

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<v Speaker 1>is really accessible for the American consumer with brands that

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<v Speaker 1>they know and love. And that's really the thing is

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<v Speaker 1>we've been able as we put the whole portfolio together.

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<v Speaker 1>If you think across JC Penny, if you think about

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<v Speaker 1>Lucky Brand, and if you think about Aeropostyle just as

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<v Speaker 1>the primary brands for denim, and you think about the

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<v Speaker 1>amount of denim that we source and buy for consumers

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<v Speaker 1>across all of those brands. With a combination which was

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<v Speaker 1>just formed in January. Has allowed us to do is

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<v Speaker 1>put together all of that sourcing and really make sure

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<v Speaker 1>that we're bringing the best value for the consumer by

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<v Speaker 1>finding the best prices on denim and really giving that

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<v Speaker 1>to the consumer on days like Black Friday, and in

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<v Speaker 1>this time where the consumers really value focus. That is

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<v Speaker 1>what's making the difference right now.

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<v Speaker 2>So how have you navigated what's been of all lit

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<v Speaker 2>all year in terms of policy? Right, Tariffs I imagine

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<v Speaker 2>must have a huge effect on the amount you pay

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<v Speaker 2>for textiles. How do you equal the hit of that margins?

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<v Speaker 1>We work closely with our suppliers. Again, I think the

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<v Speaker 1>combination this year was probably really well timed with tariffs

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<v Speaker 1>to give us the combined volume of things like denim,

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<v Speaker 1>like fleece and looking at that combined by across the

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<v Speaker 1>total total portfolio, and then working with our suppliers to

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<v Speaker 1>get the lowest possible cost for consumers. And we've been

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<v Speaker 1>committed to that throughout the year. Back to school season,

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<v Speaker 1>we talked about it. But again at Black Friday, if

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<v Speaker 1>you look at J C. Penny for example, a well

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<v Speaker 1>over half of the items that we offered at Black

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<v Speaker 1>Friday Deals matched the pricing of last year, because that's

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<v Speaker 1>really the job of our merchants is to make sure

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<v Speaker 1>that they can deliver that pricing for the consumer. At Aeropostal,

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<v Speaker 1>we delivered the same promotion that we had last year,

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<v Speaker 1>which was buy one, get one free denim, and again

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<v Speaker 1>that's our merchant teams working with our suppliers to make

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<v Speaker 1>sure that we can bring that to them. And at

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<v Speaker 1>Brooks Brothers it was the Cashmere and the Marino wol

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<v Speaker 1>sweaters the same pricing as last year.

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<v Speaker 2>So I mean, good deals for Black Friday and for

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<v Speaker 2>Cyber Monday is great for the consumer, but you must

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<v Speaker 2>have to take price somewhere, right, So what's what's it

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<v Speaker 2>look like over the totality of twenty five and going

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<v Speaker 2>into twenty six.

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<v Speaker 1>As we look across the total portfolio, Again, it is

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<v Speaker 1>the job of our merchants to make sure that they

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<v Speaker 1>are working to get the best costing from our suppliers

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<v Speaker 1>and deliver that in value to the consumers, and we

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<v Speaker 1>mix that out across the total portfolio. And so we

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<v Speaker 1>are really focused on making sure that the key items

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<v Speaker 1>that our customers are looking for at the big moments

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<v Speaker 1>like Black Friday and throughout the year. Back to school

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<v Speaker 1>that we are delivering like item at like value.

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<v Speaker 2>In terms of twenty six What do you expect for

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<v Speaker 2>next year? Because the consumer has been resilient. The US

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<v Speaker 2>consumer is always resilient, right, don't count out the US consumer.

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<v Speaker 3>But consumer confidence numbers were low.

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<v Speaker 2>There's real worry about the labor market, and I was

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<v Speaker 2>surprised to see such growth in this season.

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<v Speaker 3>So what do you expect for next year?

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<v Speaker 1>I think the interesting thing about the consumer is we

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<v Speaker 1>definitely see that the consumer has stretched wallets right now,

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<v Speaker 1>but we also know that the consumer is going to

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<v Speaker 1>make sure that those moments that matter for the family,

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<v Speaker 1>their family and the ones that they care about, that

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<v Speaker 1>they are going to make the most for those moments.

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<v Speaker 1>And so the consumer is going to have Holiday and

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<v Speaker 1>Christmas this year. What they're searching for is really more

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<v Speaker 1>for value, and that's where we really win at j C. Penny.

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<v Speaker 1>For example, this was the fourth year that wallet hub

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<v Speaker 1>named us as the best place to find Black Friday deals.

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<v Speaker 1>So we're making sure that we have the deals that

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<v Speaker 1>we're showing the value, and that is what's really important

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<v Speaker 1>to the consumer, because although the wallet's stretched, they're also

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<v Speaker 1>committed to taking care of their families all right.

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<v Speaker 3>Mark, great having you here in studio. Thanks so much.

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<v Speaker 2>Thanks for joining us on this cyber Monday. Mark rosen

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<v Speaker 2>there of Catalyst Brand