Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly from Bloomberg Radio. Hi, I'm Jason Kelly, and welcome
Speaker 1: to the Bloomberg Business Week Extra. It's our weekly podcast
Speaker 1: bringing you a full conversation one of our favorites from
Speaker 1: the week. Well, this week Alex Steele and I were
Speaker 1: hosting the show together. Carol Master was off and Alex
Speaker 1: and I caught up with Jerome Griffith. He's the CEO
Speaker 1: over at Land's End. He's got a long history in
Speaker 1: the world of retail and fashion and he is pulling
Speaker 1: out every lesson he's learned to deal with this pandemic
Speaker 1: and the new world order. When it comes to the
Speaker 1: consumer check it out. I think what we've seen so
Speaker 1: far is well, I think everybody's been hearing about over
Speaker 1: the last several months, is demand online UH continues to grow. UH.
Speaker 1: It's been a big plus for consumers who are working
Speaker 1: from home to be able to water products in as
Speaker 1: opposed to going out. We see slow traffic and stores.
Speaker 1: We've reopened the few stores that we have over the
Speaker 1: last couple of months. UH, and we think that going
Speaker 1: into the back part of the year, online business should
Speaker 1: still stay strong. Yet we have a business to business
Speaker 1: UH uniform business that we have called Leo Lands and Outsiders,
Speaker 1: which I think is going to continue to be somewhat
Speaker 1: challenged over the quastion next few months. A lot of
Speaker 1: our customers are travel related and most of course you
Speaker 1: know that that's been a tough business. But there has
Speaker 1: been a run up in the stock obviously over the
Speaker 1: last few days, with people expecting us to have a
Speaker 1: decent results for the quarter. I'm glad to get a
Speaker 1: chance to talk to you again because we can delve
Speaker 1: into a lot more over the next two segments. And
Speaker 1: I guess just to take a step back for a second,
Speaker 1: like how has your world changed in the last six
Speaker 1: months and sort of how do you view it over
Speaker 1: the next six to eighteen months, sort of as we
Speaker 1: move towards a vaccine and some kind of normal. I
Speaker 1: think that the where our world has changed has been
Speaker 1: a little bit topsy turvy from you know, we had
Speaker 1: said earlier in March when demand really shrunk, to April
Speaker 1: recovery and then May June and through the rest of
Speaker 1: the summer being relatively strong. So we've had to go
Speaker 1: back and relok at projections for a lot of our
Speaker 1: items and and increase UH quantities that we were ordering
Speaker 1: because we think that the holiday seasons every big and
Speaker 1: what we thought it was. I think one of the
Speaker 1: things which is a concern for us is that all
Speaker 1: of the carriers that are carrying packages today to homes,
Speaker 1: they're really stretched. So if you look at the big
Speaker 1: three of USPS and fed X and UPS, UH, you know,
Speaker 1: every day is like Christmas for them. So we're doing
Speaker 1: a lot of work with our partners to plan for
Speaker 1: what the holiday season is going to look like, which
Speaker 1: is something that does have us, UH, you know, a
Speaker 1: little concerned, and they're going into next year. One of
Speaker 1: the things that we've seen over the course of the
Speaker 1: last couple of years is our product people who have
Speaker 1: continued to refine and improve what the quality and the
Speaker 1: look of the products that we're selling, and we see
Speaker 1: a lot of increase demand. I think he Goes probably
Speaker 1: saw the UH numbers that we're seeing with new customer acquisition,
Speaker 1: which was up about thirty percent last quarter, and then
Speaker 1: the large rebuy rates that we're having from our customers.
Speaker 1: Are active customers tend to be around New customers are
Speaker 1: around thirty which are pretty great numbers for the industry. Uh,
Speaker 1: and we see that continuing. Yeah, it's interesting, you know,
Speaker 1: Jerome to think about buying patterns and and even for
Speaker 1: lack of better terms, sort of wearing patterns. And I've
Speaker 1: joked on this show before that when I wear a
Speaker 1: colored shirt these days, my two year old sort of
Speaker 1: looks at me funny, like, what are you doing? Like
Speaker 1: you're a T shirt guy now. I mean, the last
Speaker 1: time I put on a dress shirt, I have a
Speaker 1: hard time remembering. I mean, are you seeing you know,
Speaker 1: sort of a real change in the way people dress
Speaker 1: that seems to be, at least for a certain category,
Speaker 1: just a market change here. Absolutely, people are looking for comfort.
Speaker 1: They're working from their homes. Not everyone's home was actually
Speaker 1: shet up to be comfortable for them. So you see
Speaker 1: people ordering comfy clothes, something that looks good on top,
Speaker 1: but it's a little bit more casual on the bottom. Uh.
Speaker 1: You see people ordering lots of stuff for the home
Speaker 1: as well. Our home business has been extremely strong because
Speaker 1: kids have been coming home tore loosed with mom and
Speaker 1: dad and people are getting together, so people are retooling
Speaker 1: what their lives are. Our dress shirt business and we
Speaker 1: sell a lot of dress shirts with monograms on them.
Speaker 1: That's been a little depressed for us the last several months,
Speaker 1: as has uh some of our dressed pant business. But
Speaker 1: when you look at the lion's share of our selection,
Speaker 1: it's really casual clothing. And when you get to knit
Speaker 1: tops and loungeware and pull on pants and sleepware, it's
Speaker 1: it's really bit of being dress. I should point out
Speaker 1: as a Jason is home, he's showing off his super
Speaker 1: cool black T shirt. Are you wearing shorts? Is that
Speaker 1: with that? Jeans every day? Jeans and T shirt every day,
Speaker 1: like every single form day, that's the uniform. So in
Speaker 1: this environment, UM, I'm curious as to how you plan
Speaker 1: because there's a bit of confusion as too. If you know,
Speaker 1: Jason's going to wear dress shirts and dress pants again
Speaker 1: in the next two years, you know, and even if
Speaker 1: things open up, if you still will, how do you
Speaker 1: plan for that? Um. We spend a lot of time
Speaker 1: looking at trends and analyzing trends. We also use artificial
Speaker 1: intelligence for a lot of our basics in order to
Speaker 1: make smarter decision because how much you're going to be
Speaker 1: purchasing and you know, inevitably you run out of stuff
Speaker 1: or you have some overstops and the two things. But
Speaker 1: I have to say that the guys have done a
Speaker 1: pretty good job making it through spring and summer, and
Speaker 1: we've relooked at what we think Fallen Winner is going
Speaker 1: to be. But things that will screw up I think
Speaker 1: that you just didn't think of or can't plan for,
Speaker 1: Like you know, if if we have seen this when
Speaker 1: certain states have spikes and COVID demand goes down. So
Speaker 1: over the summer, when you saw the southern states Florida, Texas,
Speaker 1: California have spikes, you saw the demand go down. As
Speaker 1: you see the spikes start to recede, demand goes back
Speaker 1: up and supply chain issues. Anything that you've run into
Speaker 1: in a meaningful way up to this point, and what's
Speaker 1: the status now. We knew several months ago that we
Speaker 1: were going to have some of our full deliveries a
Speaker 1: couple of weeks later, of which we were prepared for
Speaker 1: and I've dealt with. But generally we've divested ourselves of
Speaker 1: being reliable upon anyone country or anyone factory. So what
Speaker 1: we've seen is pretty good deliveries and expect that into
Speaker 1: the back part of the year. UM but again, you know,
Speaker 1: I can't stress enough. It's not really the supply chain
Speaker 1: coming in. It's going to be deliveries on the other
Speaker 1: on the other side. Yeah, it's gonna be on the
Speaker 1: other side, right right, all right, Jerome, I gotta bring
Speaker 1: something up. Alex Steel and I we're just talking about
Speaker 1: it in our chat. You were the president of J
Speaker 1: Peterman and I just think that is the coolest thing
Speaker 1: ever as a longtime Seinfeld fan, Like, did you really
Speaker 1: dine out on that at cocktail parties? That must have
Speaker 1: been amazing. It was kind of amazing. I've been living
Speaker 1: in London for several years prior to that, and to
Speaker 1: be honest with you, I did not know the Sidebell connection.
Speaker 1: And when they recruited me to come to Kentucky, it
Speaker 1: was just the coolest thing. Human was an awesome person,
Speaker 1: an awesome guy. Yeah, loves him a lot, But unfortunately
Speaker 1: the business model was not really set up for success
Speaker 1: and it was a short lived stint for me, right, Yeah, No,
Speaker 1: I mean the whole backstory. I mean, as I was
Speaker 1: researching you, like, I went down a whole rabbit hole
Speaker 1: of like everything that happened with J. Peterman. It was
Speaker 1: really interesting. All right, So with that is a side note.
Speaker 1: You have had a really interesting career working for a Spree,
Speaker 1: working for The Gap, working for Too me Um and
Speaker 1: Tommy Hill figure. I mean, you've seen sort of retail
Speaker 1: and fashion in a number of different iterations, and I
Speaker 1: wonder what you make of this moment. I mean, we
Speaker 1: were talking about sort of the lifestyle changes that were undergoing.
Speaker 1: But when you think about the disruption in retail and
Speaker 1: travel and hospital all those things that that you've had
Speaker 1: as touch points throughout your career, how do you sort
Speaker 1: of sent this is at all right now in this
Speaker 1: kind of amazing time. It's very serendipitous. I started retail
Speaker 1: when I got graduated college in seventy nine. I went
Speaker 1: to work for Lord and Taylor and work their ten years.
Speaker 1: Lord and Taylor famously did not use computers. We handwrote
Speaker 1: every sales check. So that was the eighties for us.
Speaker 1: Now take take it from there to today. AI is
Speaker 1: a big part of our business. So I've seen a
Speaker 1: lot of change over the years. And my advice to
Speaker 1: anybody coming into the industry or working in the industry
Speaker 1: and working their way up is do not get stuck
Speaker 1: on any one thing. You always have to be looking
Speaker 1: for the next thing that's coming out there, or you
Speaker 1: will get left behind. Yeah, I that you're still a retailer.
Speaker 1: Are you ai technology company? Uh? You know, I don't
Speaker 1: know if you call it retail anymore. I tend to
Speaker 1: look at us more as a tech company because of
Speaker 1: the amount of money that we put into tech, the
Speaker 1: type of people that we hire, the emphasis that we
Speaker 1: put on technology and the evolution of technology. Um. Whereas
Speaker 1: you know others might look and stay able to your retailer,
Speaker 1: how am I retailer? We only have one stores of
Speaker 1: all my businesses, I want to click. And so when
Speaker 1: you look at the carnage that we have seen in
Speaker 1: more traditional retail, you know the idea that Gap is
Speaker 1: closing its flagship store in San Francisco, and at the
Speaker 1: same time you see another well known name and retail
Speaker 1: We were talking with one of our internal experts about
Speaker 1: this earlier. You look at the success of a Lulu
Speaker 1: Lemon on the other hand, which obviously has a retail
Speaker 1: footprint and has really ramped up e commerce as well
Speaker 1: and leaned into a lot of the trends that that
Speaker 1: we've been talking about. What's the winning formula at this point,
Speaker 1: there's still much opportunity out there. I think you have
Speaker 1: to look at where the customer is going. The customer
Speaker 1: is in charge of their future. They have so much
Speaker 1: information at their fingertips, they have so much choice. The
Speaker 1: customer really decides what it is that you're going to
Speaker 1: be doing. And when we talk about being a customer
Speaker 1: center company, we think of everything from what's the customer
Speaker 1: going to want? What's the customer to like from this?
Speaker 1: And I know a lot of companies talk about doing that,
Speaker 1: but not a lot of companies actually do it. I
Speaker 1: think there's a ton of opportunity out there right now.
Speaker 1: There's so much disruption in the marketplace that there is
Speaker 1: a lot of opportunity for the people that think right
Speaker 1: and are bold. Does that mean you're gonna buy some stuff?
Speaker 1: I didn't say that one way or the other. Then, Uh,
Speaker 1: we need to hint that there's you know, there's some
Speaker 1: opportunity out there, etcetera. Not something that necessarily here right
Speaker 1: now in the retail quote tech retail landscape. UM, walk
Speaker 1: me forward in a few years, like what do you
Speaker 1: think your business looks like? Uh? You know, I think
Speaker 1: we continue to evolve. UM, I might have mentioned earlier,
Speaker 1: just a year ago, you can only buy land things
Speaker 1: on Landing dot com and in a few of our
Speaker 1: Landing stores. Today you can get it on Amazon, you
Speaker 1: can you'll be able to get it on Coals and
Speaker 1: we'll look to do a couple of things. We'll look
Speaker 1: to expand in the third party marketplaces. H Coles is
Speaker 1: a great example, but there's lots more out there, and
Speaker 1: we're doing that domestically and internationally. And we're trying something
Speaker 1: which is a little bit different as well, with the
Speaker 1: investment in our enterprise order management system. We have the
Speaker 1: ability to bring other people's products under our website. So
Speaker 1: last year we tested at a Christmas time with one company.
Speaker 1: This year will have about twenty different companies selling their
Speaker 1: products on our website. And it's all stuff which is
Speaker 1: complimentary toil My. Nothing that's a head a head to
Speaker 1: head competitor. And I think from the research that we've seen,
Speaker 1: you know, our customers looking for ease and simplicity, So
Speaker 1: they're happy with our website because we convert extremely well
Speaker 1: and they're excited to see other products on the website
Speaker 1: to add to the basket. Jo I'm just the last
Speaker 1: question for you only about a minute left. What role
Speaker 1: are you seeing in terms of social media? I mean,
Speaker 1: I think about I have sort of sold myself out
Speaker 1: as an avid T shirt buyer, Like the amount of
Speaker 1: T shirts I buy through like Instagram and things like
Speaker 1: that is embarrassing to a met But I do wonder.
Speaker 1: And I'm an old guy, you know, I I have
Speaker 1: to think that for a younger generation, there's a whole
Speaker 1: lot of that that's driven on the social side. We
Speaker 1: were late to social media, you know. I I would
Speaker 1: fault us for that. Having said that, though you know,
Speaker 1: a lot of our new customer acquisition comes from earned
Speaker 1: search and paid word search. Um, we we see huge
Speaker 1: increases today in social media where we are, and we
Speaker 1: think that we can lean into it a lot more.
Speaker 1: I think it is more important than what people continue
Speaker 1: to think. I would say a year ago, he would
Speaker 1: say how much bigger is the Internet actually going to get? Well,
Speaker 1: right now with covid, you can see how much figger
Speaker 1: it's going to get. And I think you have the
Speaker 1: same opportunity with social media. You think it's it's very
Speaker 1: prolific as an now that I think there's a lot
Speaker 1: of ways for it to grow and that's lands End
Speaker 1: CEO Jerome Griffiths talking with me and Alex Steel this week.
Speaker 1: It coincided with their earnings report, but he took it
Speaker 1: much wider. Talked a lot about his own history and
Speaker 1: how he's applying those lessons to man. This time it
Speaker 1: continues to be, I'll say it, unprecedented. Well, you've been
Speaker 1: listening to Bloomberg Business Week Extra, be sure to tune
Speaker 1: into Bloomberg Business Week Radio Live Money through Friday at
Speaker 1: two pm Wall Street Time on Bloomberg Radio. I'm Jason Kelly,
Speaker 1: and this is Bloomberg