Thursday, June 4, 2009

Will J.Crew Attract "The New Consumer" {of course!}

A big "thanks!" to Tweedybird, who not only let us know that J.Crew was mentioned in a Barron's article (click here to read it in its entirety), but also scanned the cover of the magazine as well. :)

The New Consumer
By Kopin Tan
June 1, 2009

As the economy improves, consumers will pay a little more to get a little more, including some brands favored by Michelle Obama. Ten stocks that could benefit.


AMERICA'S FLING WITH BLING MAY BE OVER, but the shift to thrift -- brought on by a sagging economy and stock market, and heralded on the cover of Time -- also has gone too far. According to Gallup, the polling organization, Americans cut their daily expenditures by more than 40% in the past year. That's not just fewer lattes; it's muscle and bone.


As savings rise and the market rallies, however, a new consumer is emerging, seeking a sensible middle ground between the gross excesses of the mid-2000s and the privations of the past year. He -- and more often, she -- is likely to find it in companies that offer great products, excellent service and outstanding value, which, by the way, doesn't always mean the lowest price.


Barron's has identified 10 companies that occupy this coveted territory and that stand to prosper as consumers trade up again after a protracted period of trading down: Amazon.com , Apple , Bed Bath & Beyond , Chipotle Mexican Grill , J.Crew Group , Nike , Safeway , Target , Toyota and Urban Outfitters . Not all boast cheap stocks at the moment, but each looks like a long-term winner.


We call this group of 10 the Michelle Index in a nod to America's First Lady, Michelle Obama, whose championing of brands that offer good value reflects a nationwide trend. The honor shouldn't be construed as an endorsement of her politics or her husband's, and we don't even know whether she favors all these concerns. But we do know she's famously fond of J.Crew separates, loads her iPod with Mariah Carey and Stevie Wonder, and has been photographed traipsing across the White House lawn in black-and-pink Nike sneakers. ...


J.Crew Group

J.Crew imposes a modern sensibility on American classics -- like twin sets for women and plaid shorts for men. The result is designer-quality fashion at mid-range prices that has found fans far from preppie redoubts like Nantucket and New Canaan. Is it any wonder that Michelle Obama chose to wear J.Crew on the Jay Leno Show -- the better to press her point about affordable fashion -- after the hubbub over Sarah Palin's whirlwind shopping spree?


Rival Gap (GPS) is cheaper at 14 times this year's expected earnings, and its troubled child, Old Navy, finally looks to be on the mend. But New York-based J.Crew delivers a better retail experience, complete with well-lit stores and impeccable service. And its Website draws 80 million visitors a year.


J.Crew shares shot up 26% Friday, to 26, after the company beat fiscal first-quarter guidance and forecast operating earnings of eight to 12 cents a share, also better than expected. As CEO Millard "Mickey" Drexler said in the earnings release, "there is no choice in this environment than to continue to be creative and figure out where the customer is going, not to respond to where he or she has been."


We couldn't have said it better. ...


Yey for J.Crew! I am thrilled to hear that J.Crew was selected by Barron's as a firm that will perform well during these times. (I am especially happy since I own some stock- which has taken quite a dive since last year!)

What are your thoughts on the article? Disagree or agree on any of the points made? Where there any points that you found particularly interesting?

22 comments:

  1. Mickey must have announced his excitement on the loudspeaker and then bicycled around to further spread the news. I imagine they can't get too excited, but basically they're in like flynn for the next 3.5 years if M.O. continues to wear J Crew. Just last year a couple women could not understand what I saw in J Crew and have now admitted to stalking the website...

    Mmm hmmmm

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  3. Be honest, don't you think Michelle Obama can pick a cardigan from any store including target to make her look as good as she was in this jcrew cardigan. I don't understand why suddenly she became a jcrew fan. I don't remember she wore any jcrew during the compaign. I think by then she was already named a fashion icon by a magazine and I think she was aware of jcrew.

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  4. Thanks for sharing the article Tweedybird and Alexis. Nice to read some positive news about J.Crew and retail trends.

    For me, J.Crew has always been about the style. They have some really cute clothes that suit my lifestyle and I have a lot of "go-to" pieces from J.Crew. The quality used to be top notch and seems they are moving back in that direction, thankfully.

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  5. Anonymous - I believe that MO's appearance on Jay Leno was during the campaign. She wore a J.Crew skirt, cami and sweater, I believe. The items then sold out quickly. That is the first recollection I have of MO wearing J.Crew and the buzz around it.

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  6. Looks like our favorite place to shop is in good shape and will be around for a long time. Thanks so much for the great article. Confirms what all of us already knew or felt.

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  7. I do think that consumers are looking for value and long term use out of items instead of the super-expensive or the super-cheap (which incidently falls apart...)

    I'm glad to hear J.Crew is on the rise :)

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  8. OT:
    I was on Ebay and I spotted a Rose Tee in L for a buy it now price of$69.99. There is a tiny small hole that may or may not be repairable- I don't know much about sewing. Tought I would mention it for the ladies who are still on the hunt for that tee.

    http://cgi.ebay.com/j-crew-rose-tissue-shirt-Sz-Large-Slight-Damage-NWDST_W0QQitemZ220425685240QQcmdZViewItemQQptZUS_CSA_WC_Shirts_Tops?hash=item33526508f8&_trksid=p3286.c0.m14&_trkparms=65%3A12%7C66%3A4%7C39%3A1%7C72%3A1205%7C240%3A1318%7C301%3A0%7C293%3A1%7C294%3A200

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  9. Off topic, but does anyone know what Mickey's email is? I had a wonderful experience with my personal shopper (he really went above and beyond, and was supposed to be leaving on vacation that morning but stayed late to help me), and I wanted to let the company know. If you don't want to post it here, please email me at kate_osullivan78@hotmail.com
    Thanks!

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  10. OT: is there a difference between the embossed beach dresses from last year and the lorelei dresses from the most recent rollout?


    thanks!

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  11. To stacey,

    The embossed beach dress from last year has a wide A-line skirt without any pleats. I think lorelei dress's skirt has pleats.

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  12. XOXO, That was the first I saw MO wearing jcrew's too. The event was late during the compaign. I meant she didn't seem to be a fan of jcrew before. Why did she suddenly become a fan?

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  13. I def. agree that the B&Ms are one of the most attractive stores. Right now the storefront has a cute ice cream cone motif that my daughter stood stock still and giggled for a full minute before begging for an ice cream! I just wish the store was easier to navigate with a stroller, they don't do any better than the Gap on that issue (not that I'll be able to use one for much longer.)

    I'm glad that JC is doing well. It just irks me that Mickey is everywhere proclaiming quality and great service, when I just got an order that had one shirt with a big hole on it, and mislabelled to boot, one sweater with an uneven seam, and one of the pairs of shoes I got was obviously a return- WORN! Scraped bottom, and a couple of what look like water spots on the left shoe. I'm not surprised about the hole in the shirt, it was a popback tee, but the shoes are this spring. Unfortunately, they are sick cute and are now out of my size in the color I ordered (grey peeptoe slingbacks) so I am almost tempted to keep them.

    You don't have to be a psychic to figure out where this shopper is going: straight to my local JC to return this order!!!

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  15. Crazy PDA is acting up! I am glad to hear JCrew is doing ok in these trying times. They have always had nice basics and more. I do not know and never heard anything mentioned about where MO shopped prior to the road to the White House. She was not in the spotlight prior so I do not think assumptions on when she became a JCrew fan is appropriate or makes a difference. JCrew is not exclusive or considered high end. They have always been a great place to shop and have decent prices for regular people.

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  16. CheesyGoodness,
    I agree that there is lots of talk from Mickey and no action on quality issues. I have received a full price new cashmere sweater with a crooked seam and a red sweater with black threads sewn into it. JCrew has cute clothes but the quality and durability of its clothes compares to ______(fill in name of favorite discount store...i.e. Kmart!)

    Sorry you got a poor quality order too!

    I hope people keep posting about their order problems and poor quality issues so JCrew takes notice since they do read this blog!

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  17. I recently received a pitiful order and returned most of it including a ecole jacket - the SA at my B&M said the problem was that "I should have called CS" prior to ordering the jacket. My complaint was that the Tall should have been labeled a petite because the body was so short waisted. SA went on to say that it was stlyed that way on purpose and was actually empire waisted......she said the CS would have steered me away. (No way I would go to all that trouble besides, in the time it takes to call the CS all of my cart will be soldout.) So, a tall woman should not expect a jacket labeled T to fit?

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  18. OT: I decided to sell my Hayworth giraffe cami which is a size 10.

    Before listing it on ebay, I thought I would offer it to you ladies first.

    If interested e-mail me @ musthavejcrew@yahoo.com

    Have a great night!

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  19. sorry forgot to add it is New with Tags and I am asking what I paid...$120

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  20. Genny, thanks for commiserating! If you can stand it, after all that, I looked at the bottoms of the shoes to see how worn they are, and one is labelled 9, the other 9 1/2!!! I hate to get all acronym-y, but WTF?!? Whoever speculated a few months ago that there might be some funny things being smoked in the JC warehouse was on to something. As opposed to the workers, who may just be ON something. (Buh dum, ching!)

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  21. OT: New Arrivals are due to arrive in stores next Tuesday, and possibly even Monday afternoon at some stores (like mine)...more details on my blog. :)

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Dear J.Crew Aficionadas & Aficionados: Please feel free (and encouraged) to share your thoughts and opinions. :) However, please note that this is still a personal blog. So comments that are considered inappropriate (e.g. obscene, racist, homophobic, personal attacks, rude, and just plain mean) will be removed.

And now back to J.Crew! :)