(Bloomberg) -- In the mid-2000s, J. Crew introduced a generation of young adults to preppy fashion, the edgier alternative to stodgy labels such as Tommy Hilfiger and Lacoste that had dominated for decades.
It worked, for a time. Sales soared and the label became a chic powerhouse of cardigans and chinos. First Lady Michelle Obama wore a J. Crew cardigan on Jay Leno's couch in 2008, and her daughters wore Crewcuts, the label's children's line, for President Barack Obama's inauguration. Much of the brand's success was credited to Mickey Drexler, the famed retail merchant who was brought in as chief executive officer in 2003, and to his top designer Jenna Lyons.
Then J. Crew got boring. What was once a go-to stop for younger, fashionable types looking for stylish T-shirts or cashmere sweaters faced an identity crisis. The label no longer feels as if it has "any sense of styling and style," said Wendy Liebmann, CEO of consulting firm WSL Strategic Retail. "It doesn't feel like it has a lifestyle point-of-view."
This week marks the end of an era for the troubled fashion brand. Drexler has stepped down as chief executive officer of J. Crew Group Inc. as it struggles to attract shoppers. With Drexler and Lyons, the pair who defined the company for over a decade, both gone, the label—and its clothes—may never be the same again.
Preppy labels have been jostled by fashion trends in recent years, but most have stayed true to the country club esthetic that defines them. L.L. Bean Inc. embodies the New England countryside; Sperry Top-Sider Inc. owns the yacht club. Vineyard Vines LLC, the fast-rising Connecticut-based retailer, sells vibrant, simple clothes that belong on a tennis court or aboard a yacht. The style is nostalgic by design, but even classics need a reboot sometimes.
When Drexler started at the company, the plan was to raise prices and sell a more colorful and pricier array of products, returning the label to its preppy mid-'90s heyday. Lyons was tasked with carrying out Drexler's vision. She infused J. Crew with what's now her signature style, marrying classic preppiness with a refreshingly androgynous edge.
By 2015, J. Crew was in the midst of an identity crisis. Was it classic prep or fancy couture? Shoppers weren't willing to pay the higher prices the label's high fashion flirtation demanded, and losses mounted as the merchandising missteps piled up. Realizing the mistake, the company abandoned high fashion, jettisoned its bridal collection and laid off hundreds of workers. It even launched a down-market line, Mercantile, in an attempt to lure more frugal customers. In February 2014 the label was in talks with Fast Retailing Co. Ltd., which owns Uniqlo, about a possible sale, two people with knowledge of the matter said. The deal never materialized.
The company's future now rests with new CEO Jim Brett, the former president of furniture seller West Elm, and design head Somsack Sikhounmuong, who is credited with developing the styles that have made J. Crew's more casual sister brand Madewell such a success.
What will the clothes look like now? Last fall, Sikhounmuong's second collection for J. Crew's namesake brand flashed a few highly saturated hues and plenty of flair. Yes, there was still gingham and denim, but most looks cranked up the drama with rumples, tulle or the sequins that his predecessor loved so much.
"They've got to get the product back on track," said Michael Appel, founder of consulting firm Appel Associates. "That's the number one thing."
To contact the authors of this story: Kim Bhasin in New York at kbhasin4@bloomberg.net, Lindsey Rupp in New York at lrupp2@bloomberg.net.
To contact the editor responsible for this story: Josh Petri at jpetri4@bloomberg.net.
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